Saudi economy to grow 3.2% from 2023-2026: Moody’s

The Kingdom of Saudi Arabia's flag

Saudi Arabia’s economy is expected to grow by 3.2% on average between 2023 and 2026. The non-oil sector will likely contribute 3.5% on average to the Kingdom’s growth in the same period, Moody’s Investors Service said in a recent report.

The National Debt Management Center quoted the agency's forecasts that the non-oil sector will be strong in the coming years, driven by project implementation, supportive oil prices, and potential increase in private sector investments. The forecasts are based on the economic, legal, and social structural reforms implemented by the government to strengthen the business environment. 

The Saudi government, according to Moody's, is making progress in implementing its comprehensive reform programs, which will support the sustainability of economic diversification efforts in the medium and long term.

The agency indicated that the increase in expenditures is linked to the government's ambitious programs for economic diversification while maintaining the strength of the government's current financial position.

Meanwhile, the agency expects the average deficit to reach 2% of the Kingdom’s GDP in 2023 and 2024, and 3.5% in 2025 and 2026, compared to a fiscal surplus of 2.5% in 2022, according to the government spending forecasts.

Moody's praised the efficiency of the Kingdom's monetary, macroeconomic, and financial policy, as well as the organization of the banking sector, which supports the Kingdom's credit rating.