Manufacturing activity in Saudi Arabia climbed 10.1 percent in June, compared to the same month last year, the official data showed.
According to the latest report by the General Authority for Statistics, the Kingdom’s overall industrial production index increased by 0.5 percent in June from the previous month in 2023, despite a slight fall of 1.6 percent when compared to the same month last year.
“The decline in the mining and quarrying activity during June 2023 led to the decrease in the general index, given its high weight in the index,” GASTAT stated.
Meanwhile, electricity and gas supplies surged 25 percent in June 2023.
In the IPI, the mining and quarrying, manufacturing, and electricity and gas supply sectors have relative weights of 74.5 percent, 22.6 percent, and 2.9 percent, respectively.
Therefore, IPI trends were significantly reliant on mining activities, according to the report.
Mining and quarrying declined by 6.5 percent in June 2023 compared to the same month 2022, as Saudi Arabia reduced its oil output to 9.9 million barrels per day.
The mining and quarrying industry maintained the same level as May 2023, while the manufacturing sector had a 0.2 percent decline while electricity and gas supply saw a 22 percent gain.
“At a negative growth rate of 1.6 percent in June 2023, the industrial production index continued its downward movement of previous months,” GASTAT stated in the report.
It also added that “the index had peaked in early 2022, supported by growth rates of mining and quarrying activities, and manufacturing activities during that year.”
However, the growth rates have dropped in 2023, mainly due to mining and quarrying.
This comes as Saudi Arabia’s real gross domestic product increased by 1.1 percent in the second quarter of this year compared to the same period of 2022, reflecting the Kingdom’s progress in its economic diversification efforts, according to GASTAT’s report in July.
Strengthening the non-oil industry is a critical element of Saudi Arabia’s Vision 2030, as the Kingdom works to diversify its economy, which has been reliant on oil for decades.—AN
