IMF raises Saudi Arabia's growth forecast to 7.9% in 2027

RIYADH — The International Monetary Fund (IMF) has revised its forecast for Saudi Arabia's economic growth in 2027, projecting an increase to 7.9 percent, up from its previous estimate of 5.5 percent reported in July. This represents a notable 2.4 percentage point rise in the economic outlook, as outlined in the IMF's October 2026 World Economic Outlook report.

The IMF has also adjusted its forecast for the Saudi economy in 2026, projecting a 3.3 percent contraction, as opposed to the initial forecast of 1.7 percent growth. The report highlights Saudi Arabia's resilience to geopolitical instability, attributing this strength to the Kingdom's diversified energy export routes which mitigate the impact of supply chain and transportation disruptions.

The IMF further anticipates a decline in inflation to 1.9 percent this year, down from 2 percent in 2025, before increasing to 2.2 percent in 2027. The report also suggests an improvement in regional economic activity in 2027, coinciding with the resumption of production, exports, and logistics services at their pre-pandemic levels.

Despite global economic growth expected to decelerate to 3.1 percent in 2026, the IMF expects it to rebound to 3.4 percent in 2027, amidst the ongoing challenges posed by disruptions in energy markets and trade. The Saudi Ministry of Finance had previously forecasted a real GDP growth of 12.8 percent in 2027 and 3.9 percent in 2028, with revenues of SR1.19 trillion and expenditures of SR1.43 trillion, resulting in a budget deficit of SR245 billion.