Saudi Arabia’s 2018 national budget outlined an ambitious effort to expand the kingdom’s non-oil economy, with government projections indicating stronger growth driven by reforms, public investment and new revenue streams.

The budget projected real gross domestic product growth of about 2.7 percent in 2018 following a slight contraction the previous year, with policymakers expecting non-oil activities to play a central role in the recovery.

Officials said the expansion would be supported by structural reforms designed to strengthen private-sector participation and diversify government income beyond oil exports.

The spending plan marked the largest budget in Saudi Arabia’s history at the time, reflecting the government’s decision to increase expenditure to stimulate economic activity while continuing long-term fiscal reforms.

The strategy aligned with the broader Vision 2030 program, a national initiative aimed at reducing dependence on oil and building new engines of growth across sectors including infrastructure, healthcare, education and technology.

Officials also emphasized the importance of developing alternative revenue sources.

The introduction of a five percent value-added tax across Gulf Cooperation Council states at the start of 2018 was expected to boost non-oil government income and help strengthen the fiscal position after several years of lower global oil prices.

Financial data released during the year indicated that diversification measures were already contributing to stronger revenue performance.

Authorities reported notable increases in non-oil revenues during early stages of the fiscal year, suggesting that policy reforms and economic initiatives were beginning to deliver measurable results.

Economists noted that expanding the non-oil sector was central to stabilizing Saudi Arabia’s economy against fluctuations in global energy markets.

Policies introduced alongside the budget included subsidy adjustments, investment programs and initiatives designed to encourage private enterprise and entrepreneurship.

The 2018 spending plan also aimed to gradually reduce the budget deficit while sustaining economic growth.

Government projections indicated the fiscal gap would narrow compared with previous years as reforms improved revenue streams and strengthened economic activity.

Taken together, the budget signaled a significant shift in the kingdom’s economic strategy.

By prioritizing diversification and non-oil development, Saudi Arabia positioned the 2018 fiscal plan as a key step toward transforming its economic model and building a more resilient foundation for future growth.