Saudi Vision 2030, Crown Prince Muhammad bin Salman’s plan to wean the kingdom off oil, is running into money trouble and security trouble at the same time. In the first three weeks of October 2026, Riyadh widened its deficit forecast, prepared to cut five World Cup stadiums and postponed its flagship investor conference to 2027.
The Economist summed up the mood on 19 October 2026 with a blunt headline: “Everything is going wrong for Muhammad bin Salman”. Here is what the numbers actually show.
Key takeaways
- The Finance Ministry now expects a 2026 deficit of 245 billion riyals (about $65 billion), or 4.9% of GDP. The original budget said 165 billion riyals (3.3%).
- The economy is forecast to shrink 3.6% in 2026 because oil output fell sharply during the regional war.
- The Public Investment Fund (PIF) is reportedly preparing to drop five planned 2034 World Cup stadiums, including the one at NEOM.
- The FII10 conference, set for 26-29 October 2026, has been pushed to 2027 after Houthi attacks on Riyadh.
How big is the Saudi deficit now?
Bigger than planned, and it will stay big for a while. In its 2027 pre-budget statement, published around 1 October 2026, the Finance Ministry forecast 2026 revenue 3.7% above budget and spending 9.3% above it, according to an analysis by Tim Callen at the Arab Gulf States Institute.
The odd part is that oil revenue held up. As Semafor reported, higher prices largely offset lower export volumes. Spending is what jumped: defence, plus trade routes that avoid the Strait of Hormuz, such as pumping crude to Red Sea ports.
The ministry pencils in a smaller 2027 deficit of 191 billion riyals (3.6% of GDP). That depends on a 3% cut in nominal spending, and the ministry hasn’t said how it would make it. Callen’s central estimate for 2026 is closer to 5.5% of GDP.
Why is the Saudi economy shrinking?
The answer is oil volumes. The ministry projects real GDP to fall 3.6% in 2026. It doesn’t publish an oil-sector figure, but Callen calculates that its numbers imply oil GDP falling by roughly 17%.
The non-oil economy, the part Vision 2030 is meant to grow, is forecast to expand 3.2%. Callen calls that optimistic: it would need second-half non-oil output to run 4.6% above the same period of 2025.
Debt sits near 35% of GDP. That is low by global standards, but Semafor notes it could break the government’s own 40% ceiling before 2030 if growth stays weak. The ministry hopes for a 12.8% rebound in 2027, which depends on oil flows returning to normal.
What happened to the giga-projects?
The money squeeze started before this year’s war. NEOM, announced in 2017, was left out of the 2026 pre-budget statement. A leaked 2023 board presentation, reported by the Wall Street Journal in March 2025, put its total cost at $8.8 trillion by 2080. Think of it as a mortgage taken out on a house that kept growing extra floors.
The PIF’s 2026-2030 strategy now favours projects that earn money sooner, such as mining, logistics and AI data centres. It will also stop funding LIV Golf after the 2026 season.
| Project | Original pitch | Status by October 2026 |
|---|---|---|
| The Line (NEOM) | 170 km mirrored linear city | Being redesigned and shrunk substantially |
| Trojena | Host of the 2029 Asian Winter Games | Games postponed indefinitely (Reuters, January 2026) |
| Mukaab | 400-metre cube in Riyadh’s New Murabba | Reportedly stalled after early excavation |
| 2034 World Cup stadiums | New venues, including one on The Line’s roof | Five reportedly set to be dropped |
| FII10 conference | 26-29 October 2026, Riyadh | Postponed to 2027 |
Which World Cup stadiums are being cut?
On 14 October 2026, Semafor reported exclusively that the PIF plans to tell FIFA it will drop stadiums at King Abdullah Economic City, Qiddiya Coast, Roshn, New Murabba and NEOM. That would leave 10 venues for the tournament.
Semafor stressed that the plan wasn’t final. The PIF and the sports ministry didn’t comment.
Why was the FII conference postponed?
The cause was security. On 10 October 2026, a strike on King Khalid International Airport in Riyadh, claimed by Yemen’s Houthi movement, killed at least 12 people and injured more than 300, according to Reuters.
Nine days later, on 19 October, the Future Investment Initiative, nicknamed “Davos in the Desert”, moved its 10th edition to 2027. Its chief executive, Princess Maha Bint Mishari Al Saud, said the decision came from “a deep commitment to our partners, members, speakers and delegates”, The National reported. We covered that decision in detail in Saudi FII Postponed to 2027: Why Davos in the Desert Is Off.
FII wasn’t the only event to move:
- FIFAe Finals in Jeddah (16-25 October): postponed, no new date
- Six Kings Slam tennis exhibition: moved from October to December
- Intersec Saudi Arabia: moved from November 2026 to October 2027
- Saudi Retail Forum: moved from November 2026 to March 2027
- A planned Saudi-EU summit: postponed
Why the timing hurts Saudi Vision 2030 most
Vision 2030 sells Saudi Arabia as a safe, open place to invest, visit and hold events. A deficit can be financed by borrowing. A reputation for empty conference halls and cancelled tournaments is harder to fix.
Our view: none of these setbacks is fatal on its own. Together, they are pushing the plan toward fewer monuments and more ordinary infrastructure, which may turn out to be a healthier plan. Economy Minister Faisal al-Ibrahim had already said projects may be “shifted, delayed, or rescoped”.
What happens next
- The final 2027 budget, usually published in December, will show whether the promised 3% spending cut is real.
- FIFA’s response to a smaller stadium plan will show how much of the 2034 bid survives.
- New FII dates are expected, and organisers say registrations remain valid.
- Oil exports through Hormuz will decide whether the 12.8% rebound forecast for 2027 is realistic.
- The Asian Cup is scheduled to start in Saudi Arabia on 7 January 2027. The Asian Football Confederation has said it is open to delaying it to 2028 if needed.
FAQ
Is Saudi Vision 2030 cancelled?
No. The programme continues, and the Finance Ministry blames part of the overspend on its third phase. But several giga-projects have been delayed, scaled down or dropped.
How large is Saudi Arabia’s 2026 deficit?
The Finance Ministry forecasts 245 billion riyals (about $65 billion), or 4.9% of GDP, up from the 165 billion riyals it budgeted. Some analysts expect it to come in higher.
When will the FII conference take place?
Some time in 2027. As of 20 October 2026, organisers had not announced new dates for FII10.
To track how this develops, watch Saudi Arabia’s December budget statement. It is the clearest test of whether Vision 2030 is being reshaped or just postponed.
This article is for information only and is not investment advice.
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