GCC GDP 2024: Real and nominal figures differ, but both show non-oil sectors make up over 70%

Time of India

6 hours ago

In 2024, non-oil sectors made up 77.9% of nominal GDP and 70.6% of real GDP across the GCC/ Image: FIle
The Gulf Cooperation Council (GCC) economies showed steady growth in 2024, with rising contributions from non-oil sectors offsetting a decline in oil output. Real GDP rose 3.3% in the fourth quarter, backed by strong performance in manufacturing, trade, and construction.
This marks a continuing shift away from oil dependence, reinforced by national reform programs and increased investment in non-hydrocarbon industries.
Real GDP – Growth despite oil sector contraction
In constant price terms, or real GDP, the total output of the six GCC countries rose by 3.3% in Q4 2024, reaching USD 456.3 billion, compared to USD 442.3 billion in Q4 2023. Quarter-on-quarter, the region's economy expanded by 1%, rising from USD 452.2 billion in Q3 2024.
The bulk of this real GDP came from non-oil sectors, which made up 70.6% of total real GDP in Q4. In contrast, oil-related activities contributed the remaining 29.4%.
Looking at the year as a whole, the overall real GDP across the GCC rose by 2.4%. However, this masks a notable divergence between sectors:
Non-oil GDP increased by 3.7%, driven by robust growth in industry and services.
Oil GDP declined by 0.9%, primarily due to voluntary production cuts under the OPEC+ framework.
Country-wise, Qatar recorded the highest annual increase in real GDP at 4.5%, followed by the UAE at 3.6%, and Saudi Arabia at 2.8%.
In Saudi Arabia, non-oil activities grew by 4.6%, while oil activities contracted by 4.5%, indicating a substantial shift in the country's economic composition.
Nominal GDP – Growth tempered by market prices
In nominal terms (i.e., unadjusted for inflation), the GCC's GDP rose by 1.5% year-on-year, reaching USD 587.8 billion by the end of Q4 2024, up from USD 579 billion in Q4 2023.
Unlike real GDP, nominal GDP reflects current market prices, and can be influenced by inflation or deflation.
While the overall increase was modest, the non-oil sector's contribution to nominal GDP was higher at 77.9%, showing a broader diversification trend in monetary terms.
The remaining 22.1% came from oil activities, a significantly lower share compared to their contribution in real terms. This disparity suggests that while oil remains a large physical output driver, price pressures and production curbs have diminished its monetary weight in the economy.
Sector contributions – Manufacturing and trade lead
A closer breakdown of nominal GDP reveals the growing role of diverse non-oil industries:
Manufacturing: 12.5%
Wholesale and Retail Trade: 9.9%
Construction: 8.3%
Public Administration and Defence: 7.5%
Finance and Insurance: 7%
Real Estate Activities: 5.7%
Other Non-Oil Activities: 27%
These sectors have underpinned the GCC's non-oil expansion, with each contributing steadily to national and regional outputs. In Saudi Arabia specifically, the National Industrial Development and Logistics Program (NIDLP) contributed SAR 986 billion (USD 262.8 billion) to non-oil GDP, accounting for 39% of Saudi Arabia's non-oil economic output.
Non-oil activities now represent 55% of Saudi Arabia's total GDP.
This growth has been supported by government spending, which increased by 2.6% in Saudi Arabia during 2024, enabling momentum in infrastructure, services, and industry.
Reform agendas and future outlook
The GCC's shift from oil-dependency to broader economic resilience is no longer just policy ambition — it is increasingly reflected in macroeconomic data. Growth in 2024 was driven by sectors aligned with national strategic reforms:
Saudi Vision 2030
UAE Economic Vision
Qatar National Vision 2030
Oman Vision 2040
These plans emphasize tourism, logistics, manufacturing, finance, and digital infrastructure, backed by regulatory changes and significant public-private investment.
The year's data confirms that these structural transformations are not only underway but are starting to deliver tangible economic diversification. Despite setbacks from oil market volatility, the region is expanding in real output, broadening its industrial base, and recalibrating its sources of long-term growth.
Real vs. nominal GDP – Simplified
To help readers understand the two metrics used:
Real GDP adjusts for inflation, showing actual physical output growth or contraction. It's more useful for comparing economic performance over time.
Nominal GDP is the economy's total value of goods and services using current prices, reflecting the monetary size of the economy but can be skewed by price changes.
In the GCC's case, real GDP growth (3.3%) outpaced nominal GDP growth (1.5%), which suggests that while the region is producing more goods and services, price effects (like lower oil prices) dampened the apparent value increase.