Riyadh:The Ministry of Finance has released the Pre-Budget Statement for FY2027, which anticipates expenditures of approximately SAR1,392 billion and revenues of about SAR1,202 billion, resulting in a projected deficit of 3.6% of GDP. This fiscal strategy aims to support economic growth, prioritize development projects, and maintain fiscal sustainability. According to Saudi Press Agency, the statement highlights the benefits of economic reforms under Saudi Vision 2030, which have diversified the economic base and improved the business environment. These reforms have bolstered non-oil activities, contributing to economic growth and enhancing the Kingdom's resilience to economic shocks. The Ministry expects that ongoing economic diversification initiatives and reforms will boost revenues in the medium term, with projections indicating revenues will rise to approximately SAR1,351 billion by 2029. The initiatives have substantially increased non-oil revenues from SAR166 billion in 2015 to SAR505 billion in 2025 . Expenditures are expected to grow to around SAR1,544 billion by 2029, focusing on development and strategic projects with economic and social returns. The deficit of 3.6% of GDP in 2027 is part of Saudi Arabia's long-term financial strategy, enabling balanced fiscal policies across economic cycles. This approach supports growth while implementing priority projects aligned with Vision 2030. Economic and geopolitical developments in 2026 have impacted growth, with an estimated real GDP decline of 3.6%, primarily due to a 21.8% decrease in oil activities. However, non-oil activities are expected to maintain positive growth rates of around 3.2%, mitigating the impact. The statement reviewed key economic indicators for 2026, noting a 1.8% growth in non-oil activities in H1, increasing their GDP contribution to 57.3%. Inflation is projected to rise to 2.1% in 2026, while Saudi unemployment decreased to 6.5% in Q2 of 2026. The government plans to continue borrowing through bonds, sukuk, and loans, as well as e xpand alternative financing through project and infrastructure financing and export credit agencies in 2027 and the medium term. Finance Minister Mohammed Aljadaan emphasized that the 2027 budget must be viewed in the context of global economic uncertainty and geopolitical developments. The Kingdom will manage public finances with a long-term perspective to maintain fiscal strength and respond flexibly to global changes. The Pre-Budget Statement reflects the government's commitment to transparency in public finance by providing preliminary data to inform citizens, investors, and stakeholders of upcoming economic and fiscal developments.
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