Official data reveals that Saudi Arabia’s Industrial Production Index experienced a slight increase of 0.3 percent in January, primarily driven by a small uptick in mining and quarrying activities. According to the General Authority for Statistics (GASTAT), manufacturing activities within the Kingdom saw a growth of 1.1 percent compared to December 2023, while mining and quarrying activities witnessed a 0.1 percent rise.
Read more: Saudi industrial sector’s success increased GDP by SAR340 billion
#GASTAT Publishes Industrial Production Index for January 2024.
— الهيئة العامة للإØصاء (@Stats_Saudi) March 10, 2024
Surge in manufacturing of coke and refined petroleum products
The rise in manufacturing activities during January was primarily fueled by a substantial 1.7 percent surge in the production of coke and refined petroleum products. Water supply, sewage, waste management, and remediation activities also experienced a 1 percent increase in January compared to the previous month, as reported by GASTAT. Conversely, there was a notable 9.6 percent decrease in electricity, gas, steam, and air-conditioning supplies in January compared to December 2023.
The Industrial Production Index (IPI) serves as an economic indicator that reflects the relative changes in industrial output volume, calculated through the production survey. However, the report highlights that Saudi Arabia’s IPI declined by 8.8 percent during the first month of 2024 compared to the same period in the previous year. This decrease in the IPI was attributed to Saudi Arabia’s decision to reduce oil production to 8.9 million barrels per day in January 2024, as stated by the authority. Furthermore, mining and quarrying activities in January 2024 witnessed a significant decline of 14.3 percent compared to the same month in the previous year.
Dominance of mining and quarrying sector
GASTAT states that due to the significant weight of 61.4 percent attributed to mining and quarrying activity in the index, the trend in the mining and quarrying sector dominates the overall trend of the Industrial Production Index. In contrast, manufacturing activities experienced a minor increase of 0.1 percent in January compared to the same month in the previous year. This marginal rise was supported by a 1.7 percent increase in the manufacturing of chemicals and chemical products. Additionally, the report highlights a 7.7 percent increase in the manufacturing of paper and paper products, as well as a 5.4 percent rise in electrical devices during January compared to the corresponding period of the previous year.
However, the production of coke and refined petroleum products witnessed a 4.7 percent year-on-year decrease in January, while the manufacturing of food products declined by 8.2 percent during the same period.
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