By Sumayya
RIYADH: Saudi Arabia’s financial market is predicted to expand by deeper than double the world rate in 2027, with a 7.9 percent growth estimated by the International Monetary Fund.
The growth — beating the anticipated global average of 3.4 percent — will be backed by the Kingdom’s varied power export tracks, which have assisted shield the impact of regional breaks.
The IMF raised its Saudi growth estimate for 2027 by 2.4 percentage points from its July update, showing a tougher bounce back following an expected drop this year as the Middle East clash and the long shutdown of the Strait of Hormuz break power making and trade across the area.
The Kingdom’s complete domestic output remains predicted to drop by 3.3 percent in 2026, after expanding by 4.6 percent in 2025, according to the IMF’s October World Economic Outlook.
The estimate matches a World Bank statement put out earlier this month predicting that the Kingdom’s GDP would drop by 2 percent in 2026 before bouncing back by 7.9 percent in 2027.
In its newest report, the IMF estimated Bahrain, Iraq, Kuwait, and Qatar will face double-digit drops of their financial systems in 2026 due to a longer shutdown of the Strait of Hormuz.
“Saudi Arabia remains somewhat less hit, as an economy with deeper varied export tracks, with a predicted drop of 3.3 percent in 2026 and growth of 7.9 percent in 2027,” expressed the report.
The bounce back relies on trade and power flows returning to normal. The IMF anticipates the Strait of Hormuz to launch opening again in March 2027, with shipping states returning broadly to pre-war levels by October.
According to the report, Saudi Arabia’s price rise rate remains likewise anticipated to stay limited at 1.9 percent in 2026 and 2.2 percent in 2027.
Globally, the IMF projects growth of 3.1 percent in 2026 — an upward change of 0.1 percentage point from its July update — down from a gauged 3.5 percent in 2025 before speeding up to 3.4 percent in 2027.
“Global economic action keeps proven tough once again. The technology rise, shields, and changes have assisted lower the damage from geopolitics-led breaks,” it supplemented.
The fund cautioned that the outlook stays open to a long clash, higher power values and fresh breaks to shipping.
Funding, tourism and transport logistics
Commenting on Saudi Arabia’s economic outlook for 2027, Thomas Kuruvilla, managing partner of Arthur D. Little Middle East and India, informed Arab News that a “bounce back in regional stability and economic action should back funder trust, while Saudi Arabia’s public investment capacity gives continuity for top projects and reforms”.
He supplemented: “The bigger opening remains for that trust to translate into deeper private and world capital sharing.”
Kuruvilla expressed Saudi Arabia’s tourism sector should likewise gain as regional trust and travel normalize, but the deeper vital event would be the sector’s shift from rapid space growth toward lasting value creation.
“The next phase will increasingly be about occupancy, pricing power, visitor spending and returns on those assets,” he expressed.
Kuruvilla expressed transport logistics could be single of the clearest gainers of the fresh disruption, which had reinforced the value of tough and varied trade tracks.
“Saudi Arabia mixes Red Sea entry, Gulf links and heavy funding in harbors, airports, rail and transport logistics infrastructure.”
As firms place greater weight on supply-chain toughness alongside cost and output, he noted that the Kingdom keeps an opening to reinforce its spot as a regional transport logistics and distribution hub linking Asia, Europe and Africa.
Regional outlook
The broader Middle East and Central Asia zone remains predicted to drop by 0.3 percent in 2026 — a heavy downward change from earlier estimates — before expanding by 6.3 percent in 2027.
Having named Bahrain, Iraq, Kuwait and Qatar as among the hardest hit financial systems in the zone in 2026, the IMF estimated double-digit growths for them in 2027 once states normalize.
The UAE market remains expected to drop by 3.9 percent in 2026, followed by a sharp bounce back to 7.7 percent in 2027.
