Saudi Q2 2026 Budget Deficit Narrows to SAR 34.3bn

Saudi Arabia recorded a budget deficit of about SAR 34.3 billion in the second quarter of 2026, a notable narrowing compared with the first quarter of the year,

Government revenue reached SAR 338.8 billion during the quarter, while total expenditure stood at SAR 373.1 billion, leaving a gap of SAR 34.289 billion. The improvement came as revenues strengthened while spending remained at elevated levels.

The Q2 result marks a sharp reduction from the SAR 125.713 billion deficit posted in the first quarter of 2026. For the first half of the year, the combined deficit reached SAR 160.002 billion.

The half-year gap was fully covered through borrowing of SAR 160.002 billion, with no drawdown from government reserves during the period. For the full 2026 fiscal year, the deficit is estimated at around SAR 165 billion.

Why it matters

Public spending remains a key driver of activity across the Kingdom, funding infrastructure, services, and major development programs that affect residents and businesses in cities such as the Riyadh and Jeddah areas. A narrowing quarterly deficit, supported by stronger revenue, points to steadier fiscal conditions heading into the second half of the year. Continued reliance on borrowing rather than reserves reflects an approach aimed at preserving financial buffers while sustaining investment in the economy.

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