Saudi Gazette report

RIYADH — The Saudi Ministry of Finance on Tuesday released the Pre-Budget Statement for Fiscal Year 2026, estimating total expenditures at about SR1,313 billion and revenues at SR1,147 billion, resulting in a deficit of 3.3 percent of GDP.

Preliminary estimates for 2026 project real GDP growth of about 4.6 percent, driven by the expected expansion of non-oil activities.

The ministry confirmed that the government will continue its expansionary spending approach, focusing on national priorities with social and economic impact, in line with Vision 2030 goals and efforts to diversify the economy.

According to the statement, since the launch of Vision 2030 the Saudi economy has undergone structural reforms that improved the business environment, strengthened the role of the private sector, and supported progress toward the Sustainable Development Goals.

The preliminary estimates for 2026 showed that total revenues are expected to reach about SR1,294 billion in 2028 from SR1,147 billion in 2026, and total expenditures are expected to reach about SR1,419 billion in 2028 from about 1,313 billion in 2026.

The Ministry of Finance confirmed that the government will continue to adopt expansionary spending policies that are contrary to the economic cycle, and directed towards national priorities with social and economic impact, in a way that contributes to achieving the goals of the Saudi's Vision 2030, and diversifying the economic base.

The Pre-Budget Statement noted that, since the launch of Saudi Vision 2030, the Saudi economy has witnessed structural reforms that have been reflected in the improvement of the business environment, enhancing the role of the private sector and helping more toward achievement of the Sustainable Development Goals. The Pre-Budget Statement reports that the positive performance of non-oil activities and the continued implementation of supporting initiatives are estimated to lead to positive developments in revenues over the medium term. The acceleration of the pace of implementation of a number of programs and projects contributed to achieving tangible gains and providing financial flexibility that enabled the government to enhance its ability to respond to developments and adopt a fiscal policy contrary to the economic cycle.

The statement predicted that the budget deficit will continue to be recorded in the medium term at lower levels to the estimated percentage for the year 2026, as a result of the government's continued adoption of expansionary and transformative spending policies, aimed at continuing the implementation of projects, programs and initiatives with economic and social returns, while maintaining financial sustainability.

The statement also reviewed the most prominent forecasts for economic indicators for the year 2025, as the real GDP is expected to register a growth of 4.4 percent, supported by the growth of non-oil activities, which is expected to register a growth of about 5 percent at the end of 2025, due to the continued growth of domestic demand and the improvement of employment levels, which led to a reduction in the unemployment rate among Saudis, which reached record levels of 6.8 percent in the second quarter of 2025.

The Pre-Budget Statement also noted that the government intends to continue local and international funding activities from public and private channels, through the issuance of bonds, sukuk and loans at a fair cost, in addition to expanding the government alternative funding activities via project finance, infrastructure financing, and through export credit agencies, during the year 2026 and the medium term.

Minister of Finance Mohammed Al-Jadaan stressed that the 2026 budget aims to consolidate the strength of the Kingdom's financial position, and ensure the sustainability of public finances, in parallel with supporting economic growth, by committing to maintaining development and social spending priorities, ensuring that structural reforms that enhance financial and economic efficiency and sustainability are moving forward.

He also noted that the ratio of public debt to GDP is still at relatively low levels compared to many other economies, and that it is within safe limits compared to the size of the economy, and is supported by financial reserves, giving the Kingdom's fiscal policies the ability to balance the requirements of growth and sustainability, while maintaining flexibility to intervene in response to shocks or in the event of crises or emergency needs.

"In light of the continued global uncertainty during 2026 and over the medium term, as a result of the possibility of continued geopolitical tensions and increasing preventive policies, the government continues to monitor and analyze these risks, as a key element in enhancing the efficiency of financial planning, and proactively guide policies to address potential global economic challenges and reduce their negative impacts," the minister said.

Al-Jadaan indicated that the government continues to support economic growth by continuing development projects and implementing national strategies, including targeted spending to support priorities with economic and social returns, and motivating the private sector to be an effective partner in development, while maintaining the efficiency of spending in the medium and long term, in order to achieve a balance between development requirements and the determinants of financial sustainability.

It is noteworthy that the Pre-Budget Statement, which is issued for the eighth consecutive year, is part of the Kingdom's ongoing efforts to deliver more transparency in public finance and enhance fiscal disclosure. It also reflects the government's efforts to complete the implementation of reforms that contributed to strengthening its fiscal position in light of the challenges witnessed in the global economy.​