Saudi Arabia’s economy grew 3% year-on-year in the first quarter of 2026, with both the oil and non-oil sectors contributing to expansion, as the Kingdom’s Vision 2030 diversification strategy continues to deliver results and equity investors responded with a strong June 10 session on the Tadawul.
The General Authority for Statistics (GASTAT) reported that real GDP rose 3% in Q1 2026 versus the same quarter last year. Oil and gas activities grew 2.9% year-on-year, while non-oil private sector activities also advanced 2.9% — a result that demonstrates the economy is expanding on a broad front rather than driven solely by hydrocarbon performance. Government activities grew at a more measured 1.5%.
Financial Services Lead All Sectors at 5.4%
Financial services, insurance and business services recorded the highest growth of any sector at 5.4% year-on-year in Q1 2026. The figure reflects the rapid expansion of Saudi Arabia’s banking sector, growing penetration of fintech platforms such as STC Pay and Tamara, and rising insurance demand driven by mandatory health coverage requirements across all employment categories.
Manufacturing industries excluding oil refining grew 4% year-on-year — the second-fastest expanding segment — as the Kingdom’s industrial diversification programme attracts capital into non-petroleum manufacturing facilities across NEOM, Riyadh’s special economic zones and Yanbu Industrial City.
Tadawul Responds: 1.3% Rise to 11,115 Points
The Saudi Exchange Tadawul All Share Index rose 1.30% to close at 11,115.37 points on June 10, with SR 7.60 billion (approximately USD 2.03 billion) in trading turnover and 315.7 million shares changing hands. Among the session’s standout performers, ACWA Power climbed 7.73% to SR 202.20 and United Cooperative Assurance surged 9.9% to SR 3.33. Across the main market, 203 stocks advanced against 54 declining — a strongly positive breadth reading.
Full-Year Forecast: Up to 4.5% Growth
Regional investment banks and research houses forecast Saudi Arabia’s full-year 2026 GDP growth at up to 4.5%, driven primarily by non-oil sector momentum and continued government spending under the Vision 2030 National Investment Strategy. Saudi Arabia’s Public Investment Fund (PIF) continues to act as a major domestic growth engine, committing capital across giga-projects and international investments that create multiplier effects in construction, engineering, retail and services.
What It Means for Businesses in the Kingdom
Strong Q1 performance reinforces Saudi Arabia’s position as the largest economy in the Arab world. Companies in financial services, manufacturing, construction and consumer goods can expect continued demand growth as Vision 2030’s target to increase private sector GDP contribution from 40% to 65% drives regulatory reforms, new market licences and expanded procurement opportunities across sectors throughout 2026 and beyond.
Also Read: Gulf Markets Rally: Tadawul +1.3%, Dubai +0.9%, Qatar +1.9% on June 10
