PHSSR Saudi Arabia 2025

Over the past decade, demographic changes have had signi ficant implications for the financing of Saudi Arabia’s healthcare sector. Between 2010 and 2022, the population grew from 27 million to approximately 35 million. The working-age population has increased, from 67.2% of the population in 2010 to approximately 70% in 2020, creating a higher demand for primary and specialised healthcare services. The population of people aged 65 years and older has also increased, from approximately 3% in 2010 to approximately 4% in 2020, due to increased life expectancy and declining fertility rates. This demographic shift towards an aging population has placed additional pressure on the healthcare sector, necessitating the development of age-appropriate care mechanisms and formal support systems. The country’s evolving demographic composition places a major burden on the healthcare allocation from the national budget, which is derived predominantly from oil and gas revenues. Over the past few years, the government has reduced overall spending due to a decline in oil-based revenues. However, health service expenditure increased to 8.1% in 2022 (see Figure 2). 34 Sustainability and Resilience in the Saudi Arabian Health System The Partnership for Health System Sustainability and Resilience Figure 2: Total State budget and percentage allocated to Ministry of Health (2010 –2022) Source: Ministry of Health, website. With health accounting for a greater proportion of government spending, there is a need for diversi fied funding sources to ensure both the sustainability and the stability of healthcare financing. Oil revenue constitutes over 50% of national revenue in Saudi Arabia. However, to achieve economic sustainability under Vision 2030 , the government aims to increase and diversify the economy, reduce dependency on oil revenues and improve public sector services. It aims to raise the share of non-oil GDP from 16% to 50% and increase the contributions of the private sector from 40% to 65% of GDP and the non-pro fit sector to 5%. The diversi fication of the Saudi economy will be vital to ensuring the sustainable financing of public services such as healthcare. Meeting the growing and changing needs of the population requires investment in more robust health infrastructure, and the government has the aim of attracting further private sector investment, including through public- private partnerships, to facilitate this. (Alkhamis A, 2021).