Saudi Arabia’s 2026 budget forum, held a day after the Cabinet approved the new fiscal plan under the chairmanship of Crown Prince and Prime Minister Mohammed bin Salman, served as a high-level platform to explain the budget’s objectives and strategic direction.
Officials said the budget aims to balance fiscal prudence with the acceleration of Vision 2030’s third phase, intensifying efforts to implement its programs and projects to deliver sustainable economic and social impact.
The Crown Prince has repeatedly stressed that citizens’ welfare remains the government’s top priority.
The Cabinet approved the 2026 budget on Tuesday with total spending of 1.31 trillion riyals ($349.3 billion) and projected revenues of 1.15 trillion riyals ($306 billion), implying a deficit of 165 billion riyals ($43.9 billion).
Finance Minister Mohammed al-Jadaan said the government had overcome a key structural challenge by ending the link between public spending and oil price cycles. “Expenditure is now increasing in a studied, deliberate manner, away from the volatility of the oil sector,” he said.
Economy and Planning Minister Faisal Alibrahim said the kingdom is entering a new phase in which artificial intelligence will become the main driver of non-oil growth, reshaping the economy.
Technology, he said, will amplify economic returns and allow Saudi companies such as HUMAIN to play a leading role in the future economy, similar to the role Aramco played in the energy sector.
Officials said this approach is part of a broader strategy to strengthen institutional capacity and expand private-sector partnerships to sustain the momentum of non-oil growth, projected to remain between 4.5 and 6 % in coming years.
Fiscal Policy Shift: Spending Decoupled from Oil
At the forum’s opening session, al-Jadaan outlined a new fiscal policy designed to delink spending from oil-revenue fluctuations — a structural reform marking a turning point in Saudi financial management.
“The biggest challenge in previous years was that spending moved in line with the economic cycle,” he said. “Under the current policy, spending now grows in a disciplined and planned way.”
He said the shift ensures steady non-oil growth regardless of oil-market swings. The minister noted that the oil sector had recorded “negative growth for eight years,” underscoring the need for this policy change.
Al-Jadaan added that the government has capped public debt at 40 % of GDP and expects non-oil revenues this year to reach 501 billion riyals ($133.4 billion), accounting for almost 46 % of total revenues — the highest share in five years.
He said debt levels were not a concern “as long as returns exceed costs,” adding: “Debt in itself is not good on a personal level, and the same applies to the state — but there are exceptions.”
He stressed that “the government’s goal is not to raise taxes but to expand the size of the economy.”
Economic Transformation Delivering ‘Large Real Returns’
Alibrahim said Vision 2030’s transformation drive is producing “very large real returns,” reflected in strong growth across sectors. He emphasized that quality growth, not just quantity, will define the next stage.
He said 74 economic activities have grown by more than 5 % annually over the past five years, while 37 have expanded by over 10%. “The non-oil economy is now the foundation of sustainable growth,” he said, noting that cumulative growth since 2015 has exceeded 30% and reliance on oil revenues has fallen from 90 to 68%.
Non-oil growth is expected to average between 4.5 and 6% annually in the coming years.
Private-sector participation, he said, remains essential to sustaining this trajectory. Its contribution to GDP has risen from 30 to 50%, with further room for expansion “provided projects are executed at the right cost.”
Alibrahim said hundreds of international firms have entered the Saudi market, and domestic investment has surged, showing the kingdom’s progress in building a competitive business climate. “Opening long-term opportunities for the private sector is crucial to creating quality jobs and achieving sustainable growth,” he said.
He estimated that infrastructure investment needs would reach 3.5 trillion riyals over the next decade, calling infrastructure “one of the fastest-growing asset classes globally.”
The minister said artificial intelligence will power the next phase of economic diversification, boosting productivity, maximizing returns, and attracting global talent and technology firms. He cited HUMAIN, a Public Investment Fund- and Aramco-backed firm, as poised to take a pioneering role in the future economy “just as Aramco did for decades in energy.”
Foreign Property Ownership and Housing
Housing Minister Majed al-Hogail said the government will begin implementing a new law next month allowing foreigners to own property in Saudi Arabia. The legislation, he said, is intended to bring balance to the real-estate market through the white-land fee policy.
He said development housing programs for low-income families had enabled more than 50,000 households to acquire homes and protect over 16,000 families from default.
Al-Hogail said the Finance Ministry and the central bank had provided 46.6 billion riyals to inject liquidity into housing programs. More than 250,000 citizens benefited from mortgage guarantees for those with financial challenges.
He said over 20,000 rental contracts have been signed under market-balancing initiatives, with plans to add 60,000 housing units next year and 100,000 under off-plan sales. The housing program aims to grant ownership to 20,000 families by 2026.
Logistics Hub Ambitions
Transport and Logistics Minister Saleh al-Jasser said Saudi Arabia is witnessing a major transformation toward becoming a global logistics hub and a model of integrated mobility.
Private-sector investment in transport and logistics has exceeded 280 billion riyals across aviation, maritime, rail, and road services, he said.
The aviation sector, he added, is expanding rapidly with more than 500 aircraft on confirmed order for national carriers. Passenger routes have increased to 172 from 100 before the pandemic, with a target of 250 by 2030.
Projects include expanding King Abdulaziz Airport, building King Salman Airport, opening new airports in Jazan and Jouf, and launching an additional national carrier in the Eastern Province.
Air-freight volumes grew 30% last year, with a goal of surpassing 3.5 million tons by 2030. The rail network now spans 6,000 kilometers, with plans to double its length, move 30 million tons of freight and 10 million passengers, and add 10 new passenger trains.
Building a World-Class Labor Market
Human Resources and Social Development Minister Ahmed al-Rajhi said Saudi Arabia is crafting a new strategy to make its labor market among the best globally.
He said the 2020 Labor Market Strategy introduced 28 reform initiatives, 94% of which have been implemented. His ministry participates in eight of the 11 Vision 2030 programs and has completed most of its 100 related initiatives.
The number of Saudis working in the private sector rose from 1.7 million to 2.5 million in four years, he said. Engineering jobs grew from 52,000 to 218,000 Saudi nationals, and freelance work expanded to 430,000 workers nationwide.
Tourism Growth
Deputy Tourism Minister Princess Haifa Al Saud said the number of visitors to the kingdom reached 116 million, with spending totaling 275 billion riyals.
Tourists from Europe accounted for 14% of arrivals and those from East Asia and the Pacific 15%. Domestic tourism spending climbed to 105 billion riyals by the end of the third quarter of 2025, up 18% year-on-year, reflecting the sector’s growing role in diversifying revenue sources.
Defense Industries and Localization
General Authority for Military Industries Governor Ahmed al-Ohali said the sector has undergone a major transformation over the past six years, driven by regulatory reforms and investment incentives.
He said the number of licensed defense companies jumped from fewer than five in 2018 to more than 340 in 2024, while local military spending rose from 4 to 25% of total outlays and local content reached 40%.
