By Sumayya
RIYADH: Saudi Arabia’s plan shift toward non-oil income remains making its market strength tougher, even as the Kingdom’s growing state gap and big online growth build fresh money needs, a fresh study displayed.
The cabinet posted a SR160 billion ($42.7 billion) state gap in the initial half of 2026, 71 percent higher than the SR93 billion gap a year earlier, mostly because of raised capital spending, S&P Global Ratings expressed.
S&P predicts the gap will widen to 5.8 percent of gross domestic product in 2026, before shrinking to an average of 3.4 percent over 2027-29. It expressed authorities remain resetting the speed of Vision 2030 plans, which should assist hold down gaps and the buildup of state debt through 2029.
The shift remains already visible in market operations. Non-oil fields grew 0.9 percent year on year in the secondary quarter, according to changed data from the General Authority for Statistics, while true GDP shrank 4.7 percent, mostly because oil operations fell 24.8 percent.
S&P Global Ratings credit expert Hina Shoeb expressed: “Despite budget and regional challenges, Saudi Arabia remains advancing its goals to turn into a diverse market through rising non-oil income and quick online growth.”
She supplemented: “But the money needs of this shift remain high, and the banking field alone will fail to be able to meet them.”
In its record printed on Oct. 6, S&P expressed the plan shift in Saudi Arabia’s income base toward non-oil pools “backs long-term strength, though there remain short-term hurdles.”
Expert Talat Hafiz informed Arab News: “What gives the non-oil market its strength remains the rising variety and depth of its growth drivers. It remains no longer dependent on state spending alone.”
He supplemented that S&P’s review of the Kingdom’s tough net state asset spot likewise reinforces this strength.
War and reserves
S&P’s basic case assumes upset from the war in the Middle East will move on into 2027, keeping area oil sales below prewar levels.
Saudi Arabia nevertheless keeps a massive outside asset base. Foreign-exchange funds stood at $494 billion, or 48.7 percent of GDP, in June 2026, up from near $437 billion, or 45.6 percent of GDP, at the close of 2024.
Digital economy
The quick growth of the online market remains turning into a top pillar of the change strategy, with data hubs coming up as a primary source of infrastructure investment.
S&P expressed Saudi Arabia had near 222 megawatts of working data-center IT power in the initial quarter of 2025, with 451 Research planning compound yearly growth of near 29 percent through 2030.
Expert group Alvarez & Marsal gauges that Saudi Arabia could reach 1 gigawatt of placed data-center power by 2030, demanding $7 billion-$9 billion of project funds, including $3.5 billion-$7 billion of debt. A heavy setup of 2.5GW-3GW would demand $28 billion-$42 billion of funds.
S&P stressed that these remain probable outcomes rather than promised spending.
Fresh deals show the funding models coming up around the field. DataVolt agreed to invest an initial $5 billion in the initial phase of a 1.5GW AI base at Oxagon, with the initial phase planned for 2028.
In January, Humain and the National Infrastructure Fund, or Infra, agreed a loose money frame of up to $1.2 billion spanning up to 250MW of massive AI data-center power.
Banks seek new funding
Saudi banks remain likewise looking past deposits as lending grows. State-field deposits made up 33 percent of total system deposits in June 2026, up from near 20 percent at the close of 2018. S&P still expects “the loan-to-deposit rate to move on rising from 104 percent at the close of June 2026, forcing the gathering of outside money.”
Banks remain checking structured money. Securitisation, including home loan-backed sukuk, remains coming up as an option as home lending tops $200 billion, though secondary-quarter land deal values fell 49 percent.
