IMF forecasts 7.9% growth for Saudi Arabia in 2027 — Asharq Al-Awsat

The International Monetary Fund forecasts that Saudi Arabia’s economy will grow by 7.9% in 2027 after an expected contraction of 3.3% in 2026. The recovery is expected to occur due to increased production and exports of energy resources, as well as the gradual recovery of regional trade, Asharq Al-Awsat reports.

Change in the IMF forecast

In its October World Economic Outlook, the Fund substantially revised its estimates for the kingdom. In April, the IMF expected Saudi Arabia’s economy to grow by 3.1% in 2026 and by 4.5% in 2027. The new forecast takes into account developments in the conflict and assumptions about the recovery of economic activity.

The IMF’s baseline scenario envisages that the Strait of Hormuz will begin reopening to shipping in March 2027, with a broad return to pre-war conditions by October. According to the Fund’s assessment, this will facilitate the recovery of energy flows, transportation, insurance services and payment systems.

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Alternative export routes

Saudi Arabia has alternative oil supply routes, including the East-West Pipeline, which transports oil from the Eastern Province to the Red Sea port of Yanbu. Its capacity is approximately 7 million barrels per day, and the kingdom seeks to increase it to 10 million barrels per day.

The IMF also forecasts a sharp recovery in a number of other Gulf economies in 2027: Qatar by 18.8%, Kuwait by 17.1%, Bahrain by 13.9%, and the United Arab Emirates by 7.7%. For Oman, the forecast is 2.2%. According to the Fund’s scenario, the pace of recovery will depend on the course of the conflict and the stability of maritime shipping.