2025 in Review (KSA) | RESILIENCE IN A TRANSFORMING ECONOMY
Saudi Arabia’s economy in 2025 is demonstrating renewed momentum, with growth projections strengthening as both oil and non-oil sectors expand under the Vision 2030 diversification agenda. Real GDP grew by approximately 5.0% year-on-year in the third quarter of 2025, up from prior estimates for Q2, according to official flash estimates by the General Authority for Statistics (GASTAT).
The oil sector posted robust growth of 8.2% in Q3 2025, while non-oil activities grew by 4.5%, and government activities by 1.8%. Seasonally adjusted growth from Q2 to Q3 was around 1.4%, with oil activities up 3.1% and non-oil up 0.6% in that period.
The Kingdom’s GDP per capita is estimated at approximately US $35,230, reflecting continued improvements in productivity and private-sector participation. Inflation has remained contained at roughly 2.1% (forecast level)2, maintaining price stability despite global supply fluctuations.
In the labor market, the latest available data for Q2 2025 show the unemployment rate among Saudi nationals at 6.8%, with male unemployment at 4.3% and female unemployment at 11.3%. The female labor force participation rate among Saudi nationals was 34.5% in Q2.
Fiscal performance, however, continues to face headwinds: in Q3 2025 the budget posted a SAR 88.5 billion deficit, with revenues of SAR 269.9 billion and expenditures of SAR 358.4 billion. Within that, non-oil revenues rose by only 1% year-on-year to SAR 119.1 billion, while oil revenues declined by 21% to SAR 150.8 billion in Q3.
Overall, the Kingdom’s economic performance in 2025 highlights both resilience and transition. The government’s diversification policies are strengthening the non-oil base, private investment is accelerating, and fiscal consolidation efforts are balancing growth ambitions with sustainability. With inflation stable, employment rising and non-oil activity accelerating, Saudi Arabia enters 2026 on a trajectory of stable expansion and greater economic maturity supported by continued reforms.
1. CULTURE & TOURISM
The Culture & Tourism sector in Saudi Arabia is exhibiting strong momentum as part of the broader economic diversification agenda. According to the World Travel & Tourism Council (WTTC), the Travel & Tourism sector is expected in 2025 to contribute SAR 447.2 billion to the economy—crossing the 10% of GDP threshold—and support approximately 2.7 million jobs.
In the first quarter of 2025 alone: international visitor spending hit SAR 49.4 billion (USD 13.2 billion), up nearly 10% year-on-year4. Tourist arrivals increased by around 102% in Q1 2025 compared to Q1 20195, placing Saudi Arabia first in global growth rate for that period. The hospitality market reflects this surge: in Q1 2025 hotel-room occupancy reached 63% (up 2.1 percentage points from Q1 2024) and the number of licensed tourism/hospitality facilities reached 4,988 (including 2,414 hotels), an increase of 67.5% (hotels) compared with the prior year. Additionally, official statements project the tourism sector to grow by 8% in 2025 (direct spending basis) following a 14% rise in 2024 (from SAR 256 billion in 2023).