President and CEO of Saudi's Aramco, Amin H. Nasser, speaks during the Future Investment Initiative (FII) successful Riyadh, Saudi Arabia October 29, 2024.
Hamad I Mohammed | Reuters
Think of Saudi Arabia and the archetypal happening that comes to caput mightiness beryllium its massive, oil-derived wealth.
While lipid continues to thrust Saudi Arabia's economy, the kingdom is present expanding into areas specified arsenic artificial intelligence, tourism and sports to diversify its maturation avenues.
According to Saudi Arabia's Minister for Investment Khalid Al Falih, much than fractional — 50.6% — of the Saudi system is present "completely decoupled" from oil.
"This percent is growing," Al Failh told CNBC's Dan Murphy, adding that authorities gross utilized to beryllium astir wholly derived from lipid money, but now, 40% of its gross comes from sectors and sources that "have thing to bash with oil."
"We're seeing large results, but we're not satisfied. We privation to bash more. We privation to accelerate the kingdom's diversification and maturation story," helium said.
Saudi Arabia is doubling down connected fast-growing sectors specified arsenic artificial intelligence, naming it 1 of its caller maturation areas, with Al Failh saying the kingdom volition beryllium a "key investor" successful processing AI applications and ample connection models. Saudi Arabia would besides physique information centers "at a standard and astatine a competitory outgo not achieved anyplace else."
"AI has emerged [in] the past three, 4 years, and it's decidedly going to specify however the aboriginal system of each nation. Those who put volition lead, and those who lag behind, unfortunately, volition lose," helium pointed out.
On Monday, AI spot institution Groq's CEO, Jonathan Ross, told CNBC that for AI infrastructure acknowledgment to its vigor surplus. The state could spot much than $135 cardinal successful gains by 2030 acknowledgment to AI, according to PwC.
Saudi Arabia's quarterly fund show report revealed that full authorities gross for the archetypal fractional of 2025 came successful astatine 565.21 cardinal Saudi riyals ($150.73 billion), with lipid making up 53.4% of the country's wide revenue, down from 67.97% successful the aforesaid play successful 2019.
In 2024, the state reported a 1.3% emergence successful full-year GDP, chiefly driven by a 4.3% summation successful non-oil segments. Oil activity, connected the different hand, fell 4.5% twelvemonth connected year.
The country's sovereign wealthiness money — the Public Investment Fund — has acquired stakes successful tech giants, video crippled publishers and shot clubs arsenic it uses lipid revenues to diversify into different sectors.
PIF has acquired stakes successful video-game heavyweight Electronic Arts, establishing the SoftBank Vision Fund with Masayoshi Son's SoftBank Group Corp successful 2017, and a takeover of English Premier League nine Newcastle United successful 2021.
When asked if declining lipid prices were piling unit connected Saudi Arabia's system and authorities revenue, Al Falih said that the state was not scaling backmost budgets and determination were nary cuts to nationalist spending.
Oil prices person fallen successful 2025, with Brent crude spot prices down 13.4% truthful acold this year, according to FactSet. Saudi Arabia's lipid gross slid 24% successful the archetypal fractional of 2025 from a twelvemonth earlier.
The authorities volition proceed to code each activities that necessitate authorities spending, Al Falih said, noting that the PIF has grown sixfold since its instauration and that the state was approaching astir $1 trillion successful superior deployed crossed sectors of strategical interest.
Tourism has besides been a cardinal maturation country for Saudi Arabia. Ahmed Al-Khateeb, the country's tourism minister, told CNBC that the sector's stock successful GDP had grown to 5% successful 2024 from 3% successful 2019.
"We are [opening] resorts, caller airlines, caller airports, and the numbers are growing, and we are focusing connected countries and visitors that are coming from extracurricular to acquisition our large culture," Al-Khateeb highlighted.
The tourism curate besides expressed assurance that the assemblage could lend 10% of GDP by 2030, aiming to rise it to 20% eventually.
"This 20% volition assistance Saudi Arabia to diversify the system and marque it much sustainable," helium added.
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