RIYADH — The World Bank expected the Saudi economy to register strong growth of 7.9 percent in 2027, raising its forecast by about 3 percentage points from its April projection of 4.9 percent growth.
Conversely, the bank has lowered its forecast for the Saudi economy in 2026, projecting a 2 percent contraction in real GDP, compared with its April forecast of 3.1 percent growth — a difference of 5.1 percentage points.
According to the Middle East, North Africa, Afghanistan, and Pakistan Economic update, Saudi Arabia has benefited from the East-West pipeline, which has enabled it to redirect its exports to the port of Yanbu on the Red Sea.
The bank noted that the economic repercussions of the conflict were concentrated primarily in the Gulf economies, although the extent of the impact varied. It pointed out that the impact on shipping lanes, damage to energy infrastructure, and the ability to redirect exports were crucial factors affecting economic activity.
The bank projected a 4.3 percent contraction in the gross domestic product (GDP) of the Gulf Cooperation Council (GCC) countries in 2026, driven by sharp declines in hydrocarbon production and exports following the closure of the Strait of Hormuz, along with repercussions for the tourism, logistics, and aviation sectors.
The World Bank’s 2027 growth forecast for Saudi Arabia stands at 7.9 percent, below the Ministry of Finance’s projection in its 2027 budget statement, which anticipated real GDP growth of 12.8 percent, compared with a projected decline of 3.6 percent this year.
Source: Saudi Gazette