In a new positive indicator reflecting the strength of the Kingdom's economic reforms, Standard Chartered's global research team predicted that the Saudi economy will continue its upward trajectory, achieving strong GDP growth of up to 4.5% during 2026. These optimistic forecasts place the Kingdom at the forefront of emerging economies, surpassing the expected global economic growth rate of 3.4% for the same period.
Balanced growth between oil and non-oil sectors
In its press release, based on its latest report, "Global Trends 2026," the bank explained that the main driver of this growth is not based on a single factor. The non-oil sector is expected to grow at a steady rate of 4.5%, driven by a significant increase in investment and domestic consumption. This growth in the non-oil sector is a direct reflection of the success of the Kingdom's Vision 2030 programs, which aim to diversify the economic base and reduce overall dependence on hydrocarbon revenues.
In the same vein, the research team also attributed the strength of the Saudi economy to the continued momentum in the oil sector, which has returned to a positive growth trajectory. This recovery follows a balanced strategy by the OPEC+ alliance and the easing of production cuts that had been in place since 2023, boosting the Kingdom's revenues and supporting the public budget.
Structural transformation and public debt strategy
The report touched on public finance indicators, with the research team predicting that the ratio of public debt to GDP in the Kingdom would rise to 36% by the end of 2026, compared to 26% at the end of 2024. Despite this increase, experts stressed that the recent fiscal deficit did not hinder development, but rather served as a “strategic catalyst” for a profound structural transformation in the macroeconomy, with spending being directed towards infrastructure projects and major projects led by the Public Investment Fund.
Attracting foreign investment and strengthening financial markets
To ensure the sustainability of this growth, Standard Chartered believes that policymakers in the Kingdom will continue their vigorous efforts to diversify funding sources throughout 2026. These efforts include seeking to attract higher levels of foreign direct investment, leveraging the recently enacted enabling legislative environment.
The report also highlighted the importance of enhancing foreign investor participation in local debt markets. Increased foreign capital inflows are likely to boost the momentum of Saudi financial markets, particularly given the ongoing expansion of the Saudi market's inclusion in leading global investment indices, further solidifying the Kingdom's position as a leading regional and international financial center.
