Saudi Arabia’s Finance Ministry has announced a projected fiscal deficit of 3.6 percent of GDP for the year 2027. This projection is part of the ministry’s pre-budget statement, which outlines total government expenditure at 1.39 trillion Saudi riyals ($370.21 billion) and anticipated revenues at 1.20 trillion riyals. The budget framework aims to finance key development priorities while ensuring long-term fiscal sustainability.
Looking ahead, the kingdom expects revenues to increase to 1.351 trillion riyals by 2029, with expenditures reaching 1.544 trillion riyals. Saudi Arabia attributes economic diversification, improved business conditions, and a greater private sector role in economic growth to its Vision 2030 reforms. Notably, non-oil revenues have risen from 166 billion riyals in 2015 to a projected 505 billion riyals in 2025.
Non-oil activities have shown growth, expanding by 1.8 percent in the first half of 2026 and accounting for 57.3 percent of GDP. However, the Finance Ministry’s preliminary estimates indicate a real GDP contraction of 3.6 percent in 2026, primarily due to a forecasted 21.8 percent decline in oil-sector activity. This contraction is expected to be partially offset by a 3.2 percent growth in non-oil activities.
For 2027, the ministry projects a significant rebound in real GDP growth, estimated at 12.8 percent, with inflation remaining stable, averaging around 1.9 percent annually from 2027 to 2029. To support economic growth and maintain financial stability, Saudi Arabia plans to continue borrowing through domestic and international markets, utilizing bonds, sukuk, loans, and project financing.
The government emphasized that its fiscal strategy is designed not only to support economic growth and maintain financial stability but also to preserve flexibility in responding to global economic and geopolitical developments, all while advancing the objectives of Vision 2030.
