Expected revenues of SAR 1.202 trillion and expenditures of SAR 1.392 trillion, with a deficit of 3.6% of GDP; the government maintains development priorities despite the contraction in the oil economy in 2026

Riyadh | BETH

Saudi Arabia is set to continue development and strategic spending in the 2027 budget, despite economic and geopolitical developments, with expected revenues of around SAR 1.202 trillion, expenditures of SAR 1.392 trillion, and a deficit equivalent to about 3.6% of gross domestic product.

The preliminary budget statement reflects the continuation of a fiscal policy that balances supporting growth and maintaining fiscal sustainability, while directing spending toward projects and priorities with economic and social returns.

2026.. Oil Weighs on Growth

The most prominent figure in the current year’s estimates is a decline in real GDP of around 3.6%, driven by an expected 21.8% contraction in oil activities, while non-oil activities maintained positive growth of around 3.2%.

The contribution of non-oil activities to GDP reached a historic level of 57.3% in the first half of 2026, while inflation is expected to stand at around 2.1%, and the unemployment rate among Saudis declined to 6.5% in the second quarter.

Revenue Diversification

Non-oil revenues rose from SAR 166 billion in 2015 to SAR 505 billion in 2025, while the Ministry of Finance expects total revenues to increase to SAR 1.351 trillion in 2029, against expenditures of around SAR 1.544 trillion.

The government will continue domestic and international financing through bonds, sukuk, loans, project financing and infrastructure financing under the medium-term debt strategy.

BETH Reading

The central message of the statement is not the size of the deficit alone, but the decision to continue spending despite a difficult oil cycle.

The oil economy contracted sharply in 2026, but growth in non-oil activities and the expansion of non-oil revenues gave public finances greater room to continue transformation projects.

In this sense, the 2027 budget appears to be a budget of continuity rather than contraction: accepting a calculated deficit in return for protecting growth, projects, and the objectives of Vision 2030.