Saudi Arabia has unveiled the largest budget in its history with a promised spending of 1.1tn riyals ($293bn, £219bn) in the coming year with an aim to pull its economy back from recession. An array of schemes have been announced by the Saudi monarchy as part of what Riyadh called "Vision 2030".

The Saudi kingdom, the world's biggest exporter of crude oil, said the budget intends to diversify its economic base and rejuvenate the private sector as it will spend more in 2018 than at any other time in its history.

While the government expenditure in 2018 is pegged to be about 978bn riyals ($268bn), an increase by 890bn riyals from the previous year, spending by development funds is set to bring the total spending to more than 1.1 riyals ($293bn).

According to the Saudi Press Agency, the National Development Fund will pump money into housing, industrial and mining projects. "All these are aimed at realising appropriate economic growth rates, mitigating the burden on citizens and tackling possible impacts, in addition to supporting the private sector."

The latest budget is yet another significant step taken by the Saudi kingdom in recent months, and the powerful Crown Prince Mohammed bin Salman – nicknamed MBS – is widely seen as the architect behind the new regional policies emerging in the conservative kingdom. Salman has also promised to boost a moderate version of Islam through a series of reform programmes after years of dominance by the puritanical strains of the Islamic faith.

This is the first expansionary budget for Riyadh in three years after oil prices crumbled in 2014 and its economy officially fell into recession in 2017.

Following the budget announcement, the Crown Prince said that improving the living standards of Saudi citizens is at the heart of the government's programme. "The announcement about the largest government spending program in the history of the kingdom is a strong indication of the success of our efforts in improving public financial management, despite the decline in oil prices," said Salman, adding that nearly 50% of this year's budget will be tapped from revenues from non-oil sources.

"Vision 2030 is to stimulate the main economic sectors, thus generating employment opportunities, improving basic services to citizens and developing infrastructure projects," he added.

The budget announcement comes just as Houthi rebels from neighbouring Yemen fired a ballistic missile targeting one of the royal palaces – where Saudi Crown Prince Mohammed bin Salman was supposed to be present for a discussion on the budget – located in a residential locality in Riyadh.

Saudi Arabia largest-ever budget
Saudi Arabia's Crown Prince Mohammed bin Salman attends a cabinet meeting as Saudi Arabia's King Salman bin Abdulaziz Al Saud approves the 2018 budget in Riyadh Reuters