RIYADH, October 1, 2026 — Saudi Arabia’s Ministry of Finance on Wednesday unveiled the kingdom’s Pre-Budget Statement for 2027, projecting a fiscal deficit of SR191 billion ($50.9 billion), or 3.6 percent of gross domestic product, as the kingdom presses ahead with Vision 2030 development spending despite an oil-driven economic contraction this year.
Total government expenditure for 2027 is estimated at SR1.392 trillion ($371.2 billion), against expected revenues of SR1.202 trillion ($320.5 billion), according to the statement released by the ministry. State media reported that the fiscal framework balances support for economic growth and continued development priorities with maintaining long-term financial sustainability.
Return to Growth
The statement projected real GDP growth of 12.8 percent in 2027, a sharp rebound after what officials described as a difficult 2026. Preliminary estimates indicate the Saudi economy contracted by 3.6 percent this year, driven by an approximately 21.8 percent decline in oil activities amid economic and geopolitical developments, the ministry said.
Non-oil activities, however, continued to show resilience, posting estimated growth of 3.2 percent in 2026 and helping to cushion the impact of weaker oil-sector performance, according to the figures. The ministry attributed the non-oil economy’s resilience to reforms introduced since the launch of Vision 2030, which have diversified the economic base and expanded the private sector’s contribution to growth.
Deficit Narrows From 2026
The projected 2027 deficit of 3.6 percent of GDP marks an improvement on the estimated 2026 deficit, which widened to SR245 billion ($65.3 billion), or about 4.9 percent of GDP, on the back of shifting macroeconomic conditions, trade sources said. Looking further ahead, the statement forecasts the deficit narrowing to 3.1 percent of GDP in 2028 before edging to 3.3 percent in 2029, with expenditure reaching SR1.544 trillion in that year.
Revenues are expected to rise over the medium term, from SR1.202 trillion in 2027 to SR1.351 trillion by 2029, supported by continued diversification initiatives. The ministry noted that non-oil revenues have nearly tripled over the past decade, rising from SR166 billion in 2015 to SR505 billion in 2025, strengthening the stability and sustainability of public revenues.
Non-Oil Milestones
The statement highlighted several economic milestones, reporting that non-oil activities grew 1.8 percent in the first half of 2026, lifting their share of GDP to a record 57.3 percent. Inflation is projected at around 2.1 percent for this year before easing to 1.9 percent annually between 2027 and 2029, while unemployment among Saudi nationals declined to 6.5 percent in the second quarter, officials said.
The ministry said the government would maintain balanced fiscal policies across economic cycles, continuing to fund strategic priorities and projects with economic and social returns while preserving financial sustainability.
