RIYADH — The Ministry of Finance announced on Wednesday the Pre-Budget Statement for financial year 2027, which estimates total expenditures at approximately SR1,392 billion and total revenues at approximately SR1,202 billion, with a deficit estimated at around 3.6 percent of GDP. This was part of a fiscal approach that balances supporting economic growth, continuing to implement development priorities, and maintaining fiscal sustainability.
The statement noted that the Saudi economy has continued to benefit from the economic reforms witnessed by the Kingdom since the launch of Saudi Vision 2030, which contributed to diversifying the economic base, improving the business environment, and enhancing the role of the private sector, which was reflected in the performance of non-oil activities and their continued contribution to supporting economic growth, as well as enhancing the Kingdom's economy resilience against shocks.
In addition, the continued implementation of economic diversification initiatives and economic reforms is expected to support revenues over the medium term. Total revenues are projected to reach approximately SR1,202 billion in 2027 and rise to around SR1,351 billion by 2029. These Vision 2030 initiatives have also contributed to increasing non-oil revenues from approximately SR166 billion in 2015 to SR505 billion in 2025, strengthening the stability and sustainability of public revenues. Total expenditures are estimated at SR1,392 billion in 2027, reaching around SR1,544 billion by 2029, in light of continued spending on development, as well as strategic priorities and projects with economic and social returns.
The statement also indicated that the deficit in 2027 will be approximately 3.6 percent of the gross domestic product (GDP). This is within the framework of Saudi fiscal policy, based on long-term financial planning and maintaining fiscal sustainability, which enables the government to adopt balanced fiscal policies across economic cycles to support economic growth and to continue implementing priority projects to achieve the goals of Saudi Vision 2030.
Economic and geopolitical developments during 2026 have affected the pace of economic growth in the Kingdom, as preliminary estimates indicate that real GDP declined by 3.6 percent, due to oil activities, which are expected to decline by approximately 21.8 percent, while positive growth rates in non-oil activities are expected to continue to be maintained at around 3.2 percent, which contributes to reducing the impact of the decline in oil activities.
Key estimates for economic indicators in 2026 were also reviewed in the statement. These indicated the growth of non-oil activities by 1.8 percent in H1, increasing its contribution to GDP to historical levels of 57.3 percent. Preliminary estimates also indicate that the inflation rate will rise to about 2.1 percent for 2026. Meanwhile, the unemployment rate among Saudis declined to 6.5 percent in Q2 of 2026.
The statement explained that the government intends to continue local and international borrowing activities, in accordance with the framework of the medium-term debt strategy, through public and private channels. This will be accomplished through the issuance of bonds, sukuk, and loans at a fair cost, in addition to the expansion of alternative government financing operations through project financing, infrastructure financing, and export credit agencies during 2027 and over the medium term.
Minister of Finance Mohammed Al-Jadaan affirmed that the 2027 budget estimates must be viewed in light of a global economic environment characterized by continued uncertainty and the acceleration of geopolitical developments. He also noted that the Kingdom continues to manage its public finances according to a long-term perspective, in order to enhance its ability to deal with such variables, continue spending on development and strategic priorities, while maintaining the sustainability of public finances and the strength of the Kingdom's fiscal position.
Al-Jadaan said: "The Saudi Government continues to monitor economic and geopolitical developments and assess their potential repercussions on the global economy, supply chains, and energy markets. And we will respond to these factors with flexible and proactive policies that support the economy and enhance its ability to continue achieving the goals of Saudi Vision 2030."
He also stressed that the government seeks to continue implementing economic transformation plans by supporting economic growth and expanding the economic base, which is reflected in the growth of non-oil revenues, and which contributes to achieving more sustainable and stable levels of revenues over the medium- and long-term.
Al-Jadaan explained that the deficit estimated for 2027 is the result of a fiscal policy that aims to maintain the strength of the Kingdom's financial position and enhance fiscal sustainability, in a way that supports growth, adaptation to changes, and the management of crises and emergency needs, by maintaining sustainable levels of public debt and significant financial reserves.
The issuance of the Pre-Budget Statement with preliminary data demonstrates part of the Saudi government's ongoing efforts to enhance transparency in public finance and strengthen fiscal disclosure. Its aim is to keep citizens, investors, and interested stakeholders informed of key economic developments and fiscal projections for the coming year and over the medium term.
