Saudi Industrial Output Rises 7.9% in June, Showcasing Economic Resilience

Saudi Arabia's Industrial Boom: Non-Oil Manufacturing Drives 7.9% Growth Surge

Saudi Arabia's industrial production index jumped 7.9% year-on-year in June 2025, with non-oil manufacturing leading the charge at 8.6% growth—a clear signal that the Kingdom's ambitious economic diversification strategy is gaining real momentum beyond petroleum revenues.

Manufacturing Takes Center Stage in Vision 2030 Push

The standout performer was manufacturing, which surged 11.1% compared to June 2024, according to Saudi Arabia's General Authority for Statistics. This robust expansion reflects the Kingdom's systematic push to build industrial capacity across sectors from petrochemicals to consumer goods, supported by massive infrastructure investments and regulatory reforms.

Mining and quarrying activities grew 6.0%, while utilities showed steady gains with water supply up 6.9% and electricity and gas distribution rising 5.6%. Even oil-related activities contributed meaningfully, posting 7.7% annual growth despite global energy market volatility.

Beyond Oil: A Strategic Economic Pivot

The 8.6% surge in non-oil industrial activity represents more than statistical progress—it demonstrates Saudi Arabia's success in attracting foreign investment and developing domestic manufacturing capabilities. This diversification effort, central to Vision 2030, aims to reduce the economy's dependence on oil revenues from roughly 80% to under 50% by decade's end.

Regional Competition Intensifies

Saudi Arabia's industrial acceleration puts it in direct competition with the UAE and Qatar for regional manufacturing leadership. While the UAE has focused on trade, logistics, and financial services, Saudi Arabia is leveraging its larger domestic market and energy advantages to build heavy industry and consumer goods production.

Investment Implications and Market Outlook

For investors, these figures signal expanding opportunities in Saudi industrial equities and infrastructure plays. The consistent growth across multiple sectors suggests the Kingdom's economic transformation has moved beyond pilot projects into sustained expansion.

The manufacturing surge particularly benefits sectors like construction materials, food processing, and automotive assembly—industries that serve both domestic consumption and regional export markets. With Saudi Arabia's population exceeding 35 million and regional demand growing, this industrial base provides a foundation for long-term economic stability less dependent on oil price fluctuations.

The broad-based nature of this growth, spanning from traditional heavy industry to utilities, indicates the Kingdom's economic planners are successfully executing a comprehensive industrialization strategy that could reshape the Middle East's economic landscape over the next decade.