The Saudi Cabinet, in its session chaired by His Royal Highness Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister, approved the state budget for the fiscal year 2026. This approval comes as a continuation of the economic and financial reforms taking place in the Kingdom under Vision 2030, affirming the strength of the Kingdom's financial position and its ability to continue funding major development projects.
Continuing the approach of financial sustainability and economic diversification
The approval of the 2026 budget reflects the wise leadership's commitment to the fiscal sustainability approach adopted by the Kingdom in recent years. Fiscal policies focus on enhancing the efficiency of government spending and directing it towards strategic priority sectors, while maintaining safe levels of government reserves. This budget culminates years of efforts aimed at decoupling government spending from the traditional link between oil price volatility, through a strong focus on developing non-oil revenues, which have witnessed remarkable and historic growth since the launch of Vision 2030.
Context of national transformation and background of reforms
Given the historical context of this event, the 2026 budget represents a pivotal moment as the Kingdom approaches the deadline for achieving the goals of Vision 2030. Since 2016, the government has been working to restructure the national economy, launch Vision 2030 programs, and establish a legislative and regulatory infrastructure that attracts investment. This budget is the culmination of fiscal balance policies that have successfully navigated global economic challenges, including the repercussions of previous crises, positioning the Saudi economy among the fastest-growing and most resilient economies in the G20.
Strategic importance and expected impact
The approval of this budget carries significant implications at the local, regional, and international levels:
- Locally: The budget ensures the continued injection of liquidity into mega-projects such as NEOM, Qiddiya, and the Red Sea, which enhances job opportunities for citizens and raises the quality of life, in addition to supporting and empowering the private sector to be the main driver of economic growth.
- Regionally: The Kingdom’s financial stability enhances its position as a leading economic power in the Middle East, which positively impacts the stability of regional markets and attracts foreign investment to the region as a whole.
- Internationally: The approval of the budget sends reassuring messages to international financial institutions and credit rating agencies about the Kingdom’s seriousness in committing to the path of structural reform, which enhances confidence in the Saudi economy as a safe and stable global investment destination.
In conclusion, the approval of the 2026 budget represents a significant step towards achieving the Kingdom’s ambitions to build a prosperous and diversified economy based on innovation and knowledge, and to achieve sustainable well-being for citizens and future generations.
