Saudi Finance Ministry Unveils 2025 Budget: SAR 1,285B Spending, SAR 1,184B Revenue

Sanaa Hasan November 26, 2024

0 3 minutes read

Saudi Finance Ministry Unveils 2025 Budget: SAR 1,285B Spending, SAR 1,184B Revenue

The Saudi Ministry of Finance unveiled the Budget Statement for Fiscal Year 2025 on November 26, 2024, projecting total expenditures at SAR 1,285 billion and total revenues at SAR 1,184 billion. This results in an estimated deficit of SAR 101 billion, equivalent to approximately 2.3% of the nation’s Gross Domestic Product (GDP).

Table of Contents

FY 2025 Budget Statement

The FY 2025 Budget Statement outlines the key figures and specifics of revenues and expenditures, providing a comprehensive view of the Kingdom’s financial framework. It highlights the most significant achievements across various sectors in 2024, sets targets for 2025, and reviews the prominent financial and economic developments in the Kingdom. The statement reaffirms the Government’s commitment to funding and supporting programs, initiatives, and economic transformation projects aligned with Saudi Vision 2030, while prioritizing spending efficiency and ensuring fiscal sustainability over the medium and long term.

Minister Al-Jadaan highlighted the Government’s intention to increase strategic spending in the FY 2025 Budget, focusing on development projects aligned with sectoral strategies and the Saudi Vision 2030 programs. He reaffirmed the Government’s commitment to implementing initiatives that yield sustainable economic, social, and environmental benefits. Additionally, efforts will be intensified to enhance the business environment, boost its appeal, and improve the Kingdom’s trade balance, alongside expanding the scale and diversity of local and foreign investments.

Significant Investments

He emphasized that the Government, through both this and previous budgets, continues to prioritize citizens and their fundamental needs by maintaining significant investments in education, healthcare, and social services. Efforts to enhance the quality of government services and facilities persist, alongside initiatives to develop infrastructure across various regions of the Kingdom. These measures aim to improve the overall quality of life, with an ongoing focus on strengthening the social support and benefits system to ensure greater effectiveness.

Minister Al-Jadaan highlighted that the budget deficit is an integral component of the Government’s fiscal planning. He noted that the Government intends to continue domestic and international financial operations to address the projected 2025 deficit and to repay debts maturing in 2025 and over the medium term. Additionally, the Government seeks to leverage market opportunities to pursue alternative fiscal strategies that bolster economic growth, such as funding strategic initiatives, mega-projects, and Saudi Vision 2030 programs. By the end of 2025, the public debt balance is forecast to reach SAR 1,300 billion (29.9% of GDP), up from SAR 1,199 billion (29.3% of GDP) in 2024.

Strengthening Financial Position

Minister Al-Jadaan stated that the 2025 budget aims to strengthen Saudi Arabia’s financial position and ensure fiscal sustainability by maintaining manageable public debt levels and significant government reserves. Moreover, these reserves, expected to remain at SAR 390 billion by the end of 2025, will help the Kingdom manage external shocks.

He also highlighted that economic and fiscal reforms have boosted key indicators, supporting economic diversification and financial stability. Preliminary forecasts for 2024 show non-oil activities playing a growing role in real GDP growth, driven by reforms to increase private sector contributions and position it as the main driver of economic growth.

Economic Diversification, Labor Market Progress

Minister Al-Jadaan highlighted the government’s sustained efforts to enhance the labor market, which have resulted in significant achievements, including the reduction of the unemployment rate among Saudis to a historic low of 7.1% by the end of Q2 2024. He also noted the remarkable increase in women’s labor market participation, reaching 35.4%, surpassing the Vision 2030 target of 30%. These achievements reflect ongoing initiatives to diversify the economy by fostering growth in promising sectors, empowering the private sector, advancing development projects under Saudi Vision 2030, and introducing new work patterns to broaden workforce inclusion.

Minister Al-Jadaan also emphasized the essential role of Saudi citizens in driving comprehensive and sustainable economic development. He praised their embodiment of the Vision 2030 goal of building a “vibrant society,” contributing with creativity and commitment to achieving excellence across various sectors and industries.

He concluded by noting that the global economy shows improvement despite escalating geopolitical conflicts that could bring new challenges. Finally, the Kingdom maintains a strong financial position and continues advancing its development plans, thanks to effective fiscal policies that ensure readiness for domestic or global economic challenges.