Minister of Finance Mohammed Aljadaan confirmed that Saudi Arabia will maintain an expansionary spending approach in its 2026 budget, emphasizing stability and the importance of medium-term planning.
Government expenditure is expected to reach SAR 1.313 trillion in 2026, rising to SAR 1.419 trillion by 2028, supported by projected revenue growth and accelerated economic activity.
During a press conference on the approval of the 2026 general budget (fiscal year 1447/1448), Aljadaan highlighted that despite substantial investments in major national strategies and projects, the government remains committed to essential public services.
Spending on education, health, social services, and municipal services is projected to reach SAR 533 billion in 2026.
Moreover, the minister noted that a new phase focused on maximizing economic and social impact will begin next year. This stage will require strong collaboration between the government and private sector.
Saudi Vision 2030
Aljadaan reported significant progress in achieving Vision 2030 targets:
- 93% of performance indicators are achieved or on track.
- 85% of initiatives are completed or progressing as planned.
- 299 indicators have already met their targets ahead of schedule.
Budget Performance, Strategic Deficit
Addressing fiscal performance, Aljadaan referenced the 2025 budget, which closed with:
- SAR 1.336 trillion in expenditures,
- SAR 1.091 trillion in revenues,
- SAR 245 billion in deficit.
Additionally, he explained that budget deficits vary in purpose and that Saudi Arabia has pursued a strategic deficit policy—intended to drive long-term growth, with borrowing used to fund high-impact projects.
Borrowing to Support Long-Term Returns
The minister emphasized that the Kingdom’s borrowing strategy aims to ensure returns exceed borrowing costs.
Non-oil economic growth has averaged 5% over the past four to five years, and much of the current spending is expected to yield returns in the coming years.
He affirmed that expansionary spending will continue through 2026, 2027, and 2028 as long as benefits outweigh borrowing costs.
Aljadaan pointed out to a statement by Crown Prince Mohammed bin Salman underscoring that the primary objective of economic policies is to support citizens. He described 2025 social support programs as examples of this priority.
The minister highlighted the substantial structural changes since the launch of Vision 2030, including:
- Private-sector investment as a share of GDP increasing by around 40% in less than eight years.
- Growth in non-oil activities reaching 55.4%, described as a historic milestone.
He noted that the 2030 target for non-oil activity contribution may be achieved earlier than expected.
Growth of SMEs
The number of micro, small, and medium enterprises (MSMEs) has grown from 500,000 establishments to 1.7 million, creating an estimated 1.2 million job opportunities since the start of Vision 2030.
Future Economic Growth Outlook
Aljadaan stated that by the end of 2025, real GDP growth is expected to reach 4.4%, with nominal GDP projected to rise to SAR 5.6 trillion by 2028.
Sustainability, Role of Oil
While progress has been substantial, the minister emphasized that full sustainability has not yet been achieved, as revenues remain affected by oil prices.
He clarified that Vision 2030 does not aim to eliminate reliance on oil entirely but to strengthen and diversify the economy while continuing to leverage oil as a vital national asset.
Aljadaan praised the rapid growth of the Public Investment Fund (PIF), whose assets have expanded from SAR 150 billion to over SAR 800 billion.
He underscored that PIF does not distribute profits to the government, as its mandate is long-term investment for future generations.
Health, Education, Privatization
Spending on health and education will surpass SAR 460 billion next year.
Aljadaan said that privatization efforts do not reduce government responsibility. Instead, when a public asset such as a hospital is privatized, the government allocates funds to purchase services on behalf of citizens.
Responding to a question on project planning, the minister also explained that long-term development plans must accommodate evolving circumstances. Projects may be scaled up or down depending on needs and future developments.
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