Saudi Arabia's Ministry of Finance today (November 26) announced the state budget for FY 2025 with revenues projected at SAR1.18 trillion ($315.7 billion) and expenditure at SAR1.28 trillion ($340 billion). 

 

These estimates indicate a deficit of SAR101 billion ($26.8 billion), which represents about 2.3% of GDP, reported SPA.

 

The figures align with projections from the ministry’s pre-budget statement in September, showing a 4% decline in both revenues and expenditures, and a 12% lower deficit compared to the latest FY 2024 estimates.

 

The Finance Ministry forecasted Saudi Arabia’s Real GDP growth at 4.6% in 2025, up from the 0.8 percent estimate for 2024. This growth will be driven by a rise in non-oil sector activities, it stated.

 

Declining oil prices and extended voluntary production cuts by the world's largest oil exporter have weighed on Saudi Arabia's revenue in recent years but Riyadh is pushing ahead with a spending surge to boost growth and deliver on its Vision 2030 economic transformation plan.

 

The FY2025 forecast are based on a baseline scenario, which represents a middle ground between higher and lower revenue projections, taking into account potential changes in economic activity and global petroleum market conditions.

 

Lauding the leadership, Saudi Minister of Finance Mohammed Al Jadaan, said the economic transformation journey of the Kingdom's Government is ongoing towards diversification, innovation, and investment in promising sectors, adding that the results to date confirm the success of economic and fiscal reforms. 

 

These reforms will continue to enhance comprehensive economic growth and develop public financial management, focusing on improving the quality of services provided to citizens, residents, and visitors.

 

Al Jadaan noted that the Government aims to expand strategic spending through the FY 025 Budget on development projects in line with sectoral strategies and Saudi Vision 2030 programs.

 

The government also reiterated its commitment to delivering programmes and projects with sustainable economic, social, and environmental returns. 

 

It will further enhance the business environment to improve its attractiveness, as well as improve the kingdom's trade balance, while increasing the volume and types of local and foreign investments, he added.

 

Minister Al Jadaan pointed out that the deficit was part of the overall fiscal planning for the budget. 

 

"The government aims to continue domestic and international fiscal operations to bridge the expected 2025 deficit and repay debt due during 2025 and over the medium term. The Government also aims to take advantage of available market opportunities to implement alternative government fiscal operations that enhance economic growth, such as spending that is directed towards strategies, mega projects, and Saudi Vision 2030 programs," he stated. 

 

It is expected that the public debt balance will reach SAR1,300 billion (29.9% of GDP) by the end of 2025, compared to SAR1,199 billion (29.3% of GDP) in 2024, he added.