GASTAT Reports 3.2% Growth in Non-Oil Activities for February

Saudi Arabia’s General Authority for Statistics (GASTAT) has released its Industrial Production Index (IPI) statistics for February 2025, showing a slight year-on-year decline of 0.2%, even as non-oil activities surged by 3.2%. The monthly report, published via the Saudi Press Agency (SPA), highlights the Kingdom’s ongoing economic diversification, with manufacturing, utilities, and waste management sectors all posting gains. The IPI, a key indicator of industrial output, offers insights into the performance of mining, manufacturing, and utilities, and is closely watched by economists and investors tracking Saudi Arabia’s Vision 2030 progress.

The February data reveals a mixed picture: while overall industrial production dipped marginally due to a 0.7% decrease in mining and quarrying, the non-oil sector continued its upward trajectory, reinforcing the Kingdom’s efforts to reduce dependence on hydrocarbon revenues. The manufacturing sub-index rose by 0.2%, and the electricity, gas, steam, and air conditioning supply activity increased by 1.1%. Most notably, water supply, sewerage, waste management, and remediation activities jumped by 13.1%, signaling robust activity in environmental infrastructure. These figures underscore the resilience of Saudi Arabia’s non-oil economy amid global market fluctuations. As the Kingdom advances its ambitious economic transformation, how do these numbers reflect the broader strategic shift? The IPI serves as a vital tool for policymakers, businesses, and international observers assessing the pace of industrial growth and diversification.

Context and Background

What does the Industrial Production Index reveal about Saudi Arabia’s economic journey? The IPI is a monthly economic indicator compiled by GASTAT that measures changes in the volume of industrial output across mining and quarrying, manufacturing, and electricity, gas, steam, and air conditioning supply, as well as water supply, sewerage, waste management, and remediation activities. It is based on the industrial production survey, which collects data from a sample of industrial establishments across the Kingdom. The index is a crucial gauge of economic health, providing timely insights into the performance of key sectors and helping to inform policy decisions.

Saudi Arabia has long been a dominant player in global energy markets, but under Vision 2030, the Kingdom is actively diversifying its industrial base. The IPI’s breakdown into oil and non-oil activities is particularly telling: while oil activities decreased by 1.6% in February 2025, non-oil activities grew by 3.2%. This divergence reflects the strategic push to expand sectors such as manufacturing, renewable energy, and environmental services. The slight overall decline of 0.2% is largely attributed to the mining and quarrying subindex, which is heavily influenced by crude oil production levels. In contrast, the growth in manufacturing and utilities signals that downstream and support industries are gaining momentum.

GASTAT’s role in publishing these statistics is central to transparency and data-driven governance. The authority operates under the Ministry of Economy and Planning and adheres to international standards, ensuring that the data is reliable and comparable. For international investors and analysts, the IPI provides a window into the effectiveness of Vision 2030 initiatives, such as the National Industrial Development and Logistics Program (NIDLP), which aims to boost manufacturing, mining, and logistics. The February figures suggest that while oil production may fluctuate, the non-oil engine is accelerating, aligning with the Kingdom’s long-term goals.

Key Details

What specific trends emerge from the February 2025 IPI data? The report shows that the mining and quarrying subindex fell by 0.7% year-on-year, reflecting adjustments in oil output in line with OPEC+ agreements and market conditions. However, the manufacturing subindex edged up by 0.2%, indicating steady demand for Saudi-made goods, from petrochemicals to construction materials. The electricity, gas, steam, and air conditioning supply activity rose by 1.1%, supported by rising industrial and residential demand as the Kingdom’s population and economic activity grow.

The most striking increase came from water supply, sewerage, waste management, and remediation activities, which surged by 13.1%. This spike highlights significant investments in environmental infrastructure and utilities, essential for sustainable urban development and public health. It also reflects the expansion of services tied to mega-projects like NEOM and the Red Sea Project, which require advanced waste and water management systems. Meanwhile, the split between oil and non-oil activities underscores the diversification narrative: oil activities declined by 1.6%, but non-oil activities rose by 3.2%, continuing a multi-year trend of non-oil growth outpacing the hydrocarbon sector.

GASTAT publishes the IPI monthly, calculated from the industrial production survey, which covers establishments with 10 or more employees. The index is a Laspeyres-type volume index, meaning it measures changes in the volume of output relative to a base year (currently 2010). This methodology ensures that the data accurately reflects real growth rather than price fluctuations. For February 2025, the overall IPI stood at a level consistent with recent months, showing that the industrial sector remains stable despite global economic headwinds. The data is disseminated through official channels, including the SPA and GASTAT’s website, ensuring wide accessibility for stakeholders.

International and Regional Impact

How do Saudi Arabia’s industrial production trends resonate beyond its borders? As the world’s largest oil exporter, the Kingdom’s production levels influence global energy markets. The 1.6% decrease in oil activities in February 2025 may contribute to supply adjustments that affect oil prices, though OPEC+ production cuts are a deliberate strategy to stabilize markets. For international investors, the 3.2% growth in non-oil activities is a positive signal that Saudi Arabia is successfully broadening its economic base, offering opportunities in manufacturing, logistics, and green technologies. Regional peers in the Gulf Cooperation Council (GCC) often look to Saudi Arabia’s data as a bellwether for their own diversification efforts.

The surge in water and waste management activities (13.1%) also has regional implications, as it demonstrates Saudi Arabia’s commitment to environmental sustainability, a priority for the Middle East as it grapples with water scarcity and climate change. This growth could spur cross-border collaborations in technology and infrastructure. Moreover, the steady manufacturing growth (0.2%) supports the Kingdom’s ambition to become a global logistics hub under Vision 2030, enhancing trade links with Asia, Europe, and Africa. For multinational corporations, the data reinforces the attractiveness of Saudi Arabia as a destination for industrial investment, particularly in non-oil sectors.

Economic and Strategic Significance

Why does the IPI matter for Saudi Arabia’s economic strategy? The index is more than a statistical snapshot; it is a tool for measuring the effectiveness of Vision 2030’s economic diversification. The 3.2% increase in non-oil activities is particularly significant because it shows that sectors such as manufacturing, utilities, and environmental services are expanding, creating jobs and reducing reliance on oil revenues. This aligns with the goals of the Public Investment Fund (PIF) and the National Industrial Development and Logistics Program (NIDLP), which aim to grow the industrial sector’s contribution to GDP.

The 0.2% overall decline is a minor blip, largely driven by oil production adjustments, and does not detract from the positive non-oil performance. In fact, the stability of the overall index suggests that the non-oil sectors are offsetting oil volatility, a key objective of economic reform. The 13.1% jump in water and waste management highlights the growing importance of environmental infrastructure as a strategic sector, supporting sustainable development and quality of life. For businesses, these trends indicate a maturing industrial ecosystem with opportunities in supply chains, technology, and services. The data also provides confidence to international lenders and investors, demonstrating that Saudi Arabia’s reform agenda is yielding tangible results.

Vision 2030 Alignment

How does the February 2025 IPI data reflect the aspirations of Vision 2030? The report underscores the Kingdom’s progress in diversifying its economy away from oil, a core pillar of Vision 2030. The 3.2% growth in non-oil activities is a direct outcome of initiatives to boost manufacturing, mining, and logistics, as well as investments in renewable energy and environmental services. The 13.1% increase in water and waste management activities, in particular, supports the Vision’s focus on sustainability and smart cities, ensuring that urban development keeps pace with environmental standards.

As Saudi Arabia continues its transformation, the IPI will remain a vital indicator of success. The slight decline in oil activities is expected as the Kingdom manages production in line with global agreements, while the non-oil surge demonstrates resilience and strategic foresight. GASTAT’s monthly publication of the IPI reinforces transparency and data-driven policymaking, essential for achieving Vision 2030 targets. Looking ahead, sustained growth in non-oil sectors will be key to creating jobs, attracting foreign investment, and enhancing the Kingdom’s global competitiveness. The February data is a reassuring sign that the diversification engine is running strong, paving the way for a prosperous and sustainable future.

20 Questions

Q1. What is the Industrial Production Index (IPI)?

A1. The IPI is a monthly economic indicator published by GASTAT that measures changes in the volume of industrial output across mining, manufacturing, and utilities, based on the industrial production survey.

Q2. Which authority released the February 2025 IPI statistics?

A2. The General Authority for Statistics (GASTAT) released the IPI statistics for February 2025 via the Saudi Press Agency (SPA) on April 10, 2025.

Q3. What was the overall change in the IPI for February 2025?

A3. The overall IPI decreased by 0.2% compared to February 2024, influenced by a decline in mining and quarrying activity.

Q4. How did the mining and quarrying subindex perform?

A4. The mining and quarrying subindex decreased by 0.7% year-on-year, largely reflecting adjustments in oil production.

Q5. What was the change in the manufacturing subindex?

A5. The manufacturing subindex increased by 0.2%, indicating steady growth in the production of manufactured goods.

Q6. How did the electricity, gas, steam, and air conditioning supply activity change?

A6. This subindex rose by 1.1%, supported by rising demand for utilities from industrial and residential consumers.

Q7. What was the performance of water supply, sewerage, waste management, and remediation activities?

A7. This subindex recorded a significant increase of 13.1%, highlighting robust activity in environmental infrastructure and services.

Q8. How did oil activities change in February 2025?

A8. Oil activities decreased by 1.6% compared to the previous year, in line with production adjustments and market conditions.

Q9. What was the growth rate of non-oil activities?

A9. Non-oil activities increased by 3.2%, demonstrating the ongoing diversification of Saudi Arabia’s economy.

Q10. Why is the IPI important for Saudi Arabia’s economy?

A10. The IPI provides timely insights into industrial performance, helping policymakers, investors, and businesses assess economic trends and the effectiveness of Vision 2030 initiatives.

Q11. How often does GASTAT publish the IPI?

A11. GASTAT publishes the IPI monthly, ensuring regular updates on industrial output trends.

Q12. What is the base year for the IPI calculation?

A12. The IPI is calculated using a Laspeyres-type volume index with 2010 as the base year, measuring real output changes.

Q13. Which sectors are covered in the IPI?

A13. The IPI covers mining and quarrying, manufacturing, electricity, gas, steam, and air conditioning supply, and water supply, sewerage, waste management, and remediation activities.

Q14. How does the IPI reflect Vision 2030 goals?

A14. The IPI’s breakdown into oil and non-oil activities shows progress in diversifying the economy, a core Vision 2030 objective.

Q15. What does the 13.1% increase in water and waste management indicate?

A15. It signals significant investment in environmental infrastructure, supporting sustainable development and smart city projects.

Q16. How does the IPI data benefit international investors?

A16. It offers reliable, timely information on industrial trends, helping investors identify opportunities in Saudi Arabia’s growing non-oil sectors.

Q17. What is the source of the IPI data?

A17. The data is collected through GASTAT’s industrial production survey, which samples industrial establishments across the Kingdom.

Q18. Why did oil activities decline in February 2025?

A18. The decline reflects production adjustments in line with OPEC+ agreements and global market dynamics, not a structural weakness.

Q19. How does the IPI support economic policymaking?

A19. It provides empirical evidence on industrial performance, enabling policymakers to fine-tune strategies for growth and diversification.

Q20. What is the outlook for Saudi Arabia’s industrial sector?

A20. With non-oil activities growing steadily, the sector is well-positioned for continued expansion, supporting Vision 2030’s economic diversification goals.

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