Saudi Arabia’s economy grows 1.2% in Q2

DUBAI, Sept 7 (Reuters)Saudi Arabia’s economy grew 1.2% in the second quarter, year-on-year, government data showed on Thursday, with non-oil growth vastly outperforming overall growth, which decelerated sharply from last year on the back of a decrease in oil activities.

Oil sector activities declined by 4.3% in the second quarter from the same period a year ago, data from the General Authority for Statistics showed, but non-oil activities surged 6.1%, driven by domestic demand.

Earlier official estimates had indicated GDP growth of 1.1%in Q2.

Saudi Arabia’s economy grew 8.7% last year, allowing it to record its first budget surplus in almost a decade. But cuts to production this year and lower prices have hit oil revenues and will weigh on growth.

(Reporting by Rachna Uppal; Editing by Christina Fincher)

((rachna.uppal@thomsonreuters.com;))

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