Saudi industrial production index slips 6.9% in January 2021

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Saudi Arabia’s Industrial Production Index (IPI) fell by 6.9% year-on-year (YoY) to 113.33 points in January 2021, with 2010 used as the base year, data from the General Authority for Statistics (GASTAT) showed.

The Industrial Production Index (IPI) measures relative change and reflects the progress of production volumes of materials and goods, which is converted from raw materials into finally produced consumables in the form of commodities, for the purpose of achieving a return.

The index decline was attributed to the fall in the mining and quarrying activity index by 6% by the end of January, as the Kingdom decreased oil production to 9.1 million barrels per day (bpd) in January 2021, from 9.7 million bpd in January 2020.

Similarly, the manufacturing industry index declined 11% due to the repercussions of COVID-19, which caused a halt in production in several factories.

The GASTAT defines manufacturing industries as industries whose activity involves the conversion of raw materials into finished products or intermediate products. Electricity, gas and water supply industries are known for electricity and gas delivery, as well as water supply, sewage, waste management and treatment activities. Extractive industries are involved in the process of extracting raw materials from the ground, and these industries rely on natural materials that cannot be replenished or compensated, such as oil and minerals.

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