Saudi spending to hit new high
riyadh — Saudi Arabia’s expenditures will hit a record-high in 2019 as the government plans to increase state spending by seven per cent to reach $295 billion despite plunging oil prices.
The Custodian of the Two Holy Mosques, King Salman bin Abdulaziz of Saudi Arabia, announced the figures on Tuesday, saying the government expects revenue to increase by more than nine per cent to hit $260 billion. That leaves a projected deficit of $35 billion.
“This budget is a continuation of the government’s policy of focusing on the fundamental citizen services and the development of government services,” the king said at a government meeting. The king extended monthly allowances for government employees, military personnel, pensioners, social security recipients and students into next year. —
riyadh — The Custodian of the Two Holy Mosques, King Salman bin Abdulaziz of Saudi Arabia, on Tuesday announced a SR1.11 trillion ($295 billion) budget, the kingdom’s biggest ever, and said the government will move ahead with economic reforms, Reuters reported.
“We are determined to go ahead with economic reform, achieving fiscal discipline, improving transparency and empowering the private sector,” he said in a televised speech.
Under the economic Vision 2030 plan pushed by Crown Prince Mohammed bin Salman, Riyadh is seeking to create more jobs for Saudis, but businesses have been hit hard by tax rises and other steps to narrow the government’s budget deficit.
The move is seen as an effort to further boost economic growth.
“We believe that the 2019 fiscal budget will focus on supporting economic activity,” Monica Malik, chief economist at Abu Dhabi Commercial Bank, told Arab News.
A royal decree by King Salman, also announced on Tuesday, ordered the continuation of allowances covering the cost of living for civil sector employees for the new fiscal year.
“The continuation of the handout
package will be positive for household consumption by nationals,” said Malik. “We expect to see some overall fiscal loosening in 2019, which should support a further gradual pickup in real non-oil GDP growth.”
Malik said the government spending projection in the 2019 budget is in line with earlier official indications. The kingdom has run a budget deficit since 2014 as a slump in oil prices lowered state income. Saudi Arabia aims to balance its budget by 2023.