Saudi Growth Holds as GOSI Waives Exited Firms’ Debts

Saudi Arabia’s non-oil private sector expanded for a seventh consecutive month in October, while the General Organization for Social Insurance (GOSI) offered eligible businesses that had closed and exited the market a 100% waiver of outstanding social insurance debts. The updates describe two sides of the same economic machinery: businesses still operating are managing rising costs and uneven demand; those that have left are being offered a formal way to settle accounts and close their records.

Growth, With Conditions

The Riyad Bank Purchasing Managers’ Index fell to 54.0 in October from 55.3 in September, according to data compiled by S&P Global. It remained above the neutral 50-point mark for a seventh straight month and was the second-highest reading since February, behind September’s seven-month high. Output growth accelerated as underlying demand improved and sales and marketing increased.

New orders kept rising, but at a slower pace than in September and below the survey’s historical average. Domestic demand remained the main driver. Export orders, by contrast, fell for an eighth consecutive month, and the contraction accelerated; about a quarter of firms reported lower export orders in October. Respondents pointed to shipping disruptions, higher transport and insurance costs, and competition.

Hiring rose for a fourth consecutive month. Employment growth, however, remained modest and slowed from September. Work backlogs increased slightly for a second consecutive month amid higher sales and some delays in supplier deliveries. Delivery times improved only marginally—the weakest improvement since April—as maritime-route disruptions affected shipments. Some firms relied more on domestic suppliers.

Costs continued to climb. Purchase prices rose at their fastest pace in six months, driven by shipping, insurance, raw material and energy costs. Staff-cost inflation reached its highest level since February. Selling-price increases slowed to a nine-month low as firms offered larger discounts amid competition, though selling prices continued to rise strongly.

The Accounts Left Behind

GOSI made businesses that had ceased operations and exited the Saudi market eligible for a full waiver of outstanding social insurance debts, subject to approved conditions. The measure aims to help companies settle accounts, close outstanding cases and resolve financial and administrative obligations, while supporting stability in the private sector. It also allows companies to formally close their records under regulations.

GOSI said the measure followed feedback from direct meetings with officials and business owners, held in cooperation with chambers of commerce. Its stated aim is to balance protection of the social insurance system and contributors’ rights with the circumstances of companies that have stopped operating. The waiver isn’t automatic; the article doesn’t specify the conditions.

Services, Installments and Expectations

GOSI notified companies and establishments about the debt waiver and other service changes. These include upgraded business registration, termination-of-activity and ownership-record services, efforts to address recurring technical problems, and improvements to digital services. The GOSI Business app now lets employers pay amounts exceeding 30,000 Saudi riyals ($8,000) in multiple installments.

The changes also clarify reasons for rejecting occupational injury claims and contributor-related transactions. Notifications through the GOSI Business and Tawakkalna apps tell users when applications are received, accepted, returned or rejected. GOSI said the changes aim to improve the user experience, speed transactions, simplify employer procedures and help resolve financial and administrative matters.

Naif Al-Ghaith, chief economist at Riyad Bank, said sustained domestic demand, stronger activity and continued employment growth supported resilience in the non-oil sector. He said faster output growth reflected businesses’ operational efficiency and marketing and sales activity, while demand had become more selective. Hiring, inventory accumulation and purchasing showed firms preparing to meet demand; expectations for output over the coming year were mildly positive and below the survey’s historical average. The numbers offer no clean victory lap. Growth continues, but exports contract, costs rise and the institutions managing business obligations are still processing accounts of firms that have already exited.