The Saudi Ministry of Finance has released its preliminary budget statement for the fiscal year 1448/1449 (2027). The statement outlines expected expenditures of 1,392 billion riyals and revenues of 1,202 billion riyals, with an estimated deficit of 3.6% of GDP. This budget is part of a financial approach that balances supporting economic growth, continuing developmental priorities, and maintaining public financial sustainability.
The Saudi economy has continued to benefit from economic reforms implemented since the launch of Saudi Vision 2030. These reforms have contributed to diversifying the economic base, improving the business environment, and enhancing the role of the private sector. As a result, non-oil activities have continued to support economic growth and contribute to the country's economic resilience in the face of shocks.
The Ministry of Finance expects that continued implementation of economic diversification initiatives and reforms will support revenue growth in the medium term. Revenues are projected to reach 1,202 billion riyals in 2027 and 1,351 billion riyals in 2029. Non-oil revenues have increased significantly, from 166 billion riyals in 2015 to 505 billion riyals in 2025, contributing to stable and sustainable public revenues.
Expenditures are estimated to reach 1,392 billion riyals in 2027 and 1,544 billion riyals in 2029, as the government continues to invest in developmental and strategic priorities and projects with economic and social returns. The budget deficit for 2027 is expected to be around 3.6% of GDP, in line with a fiscal policy that prioritizes long-term financial planning and sustainability.
The 2026 economic developments and geopolitical events have affected Saudi Arabia's economic growth rate. Preliminary estimates indicate a 3.6% decline in real GDP, primarily due to a 21.8% decline in oil activities. However, non-oil activities are expected to maintain positive growth, at 3.2%, limiting the impact of the decline in oil activities.
The Ministry of Finance has also reviewed key economic indicators for 2026, which show a 1.8% growth in non-oil activities in the first half of the year. The contribution of non-oil activities to GDP reached a historic high of 57.3% during this period, driven by strong domestic demand and private investment inflows. Inflation is expected to be around 2.1% for the full year, while the unemployment rate among Saudis decreased to 6.5% in the second quarter of 2026.
Key points
- The Saudi government aims to continue implementing economic transformation plans to support growth and expand the economic base, which is expected to reflect positively on non-oil revenue growth.
- The 2027 budget is based on a fiscal policy that prioritizes long-term financial planning and sustainability, while maintaining a stable and sustainable financial position.
- The preliminary budget statement is part of the government's efforts to enhance transparency in public financial performance and provide stakeholders with key economic developments and financial estimates for the upcoming year and medium term.
