Saudi GDP growth likely to hit 4.5% in 2026

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Saudi Arabia is expected to deliver robust gross domestic product (GDP) growth of 4.50% in 2026, outperforming the 3.40% growth rate for the global economy, according to Standard Chartered Global Research.

In its latest Global Focus report, Standard Chartered attributes the Kingdom’s economic resilience to sustained momentum in the oil sector.

As OPEC+ eased the production cuts that had been in place since 2023, the hydrocarbon industry has returned to growth.

Non-oil sector is projected to surge steadily at 4.50%, driven by investment and consumption, and will continue supporting the economy

Mazen Bunyan, CEO of Standard Chartered Saudi Arabia, commented: “While the 2026 growth outlook for Saudi Arabia is strong, it comes with elevated downside risks to oil prices, a sector set to make a comeback in the next year. In this context, continued non-oil sector growth will ensure sustained financial stability whilst diversifying growth sources across the Kingdom.”

However, expectations for a continued increase in leverage across sector could pose additional downside risks to growth.

Standard Chartered forecasts the Kingdom’s public debt-to-GDP to increase to 36% by the end of 2026 from 26% at end-2024, taking it closer to the Kingdom’s self-imposed 40% ceiling. This comes amid projections for twin deficits between 2026 and 2028.

Moreover, the report highlighted that policymakers will exert efforts in diversifying funding sources in 2026 to reinforce the economy, seeking to attract greater foreign direct investment (FDI) alongside stronger foreign investor participation in domestic debt markets.

Higher capital flows are likely to support the Kingdom’s capital market momentum, notably thanks to greater inclusion in leading investment indices.

The headline seasonally adjusted Purchasing Managers’ Index (PMI) of Saudi Arabia dropped to 57.4 in December 2025 from 58.5 last November.