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Saudi Arabia expects budget deficit to hit $35bn in 2019

A man counts Saudi riyal banknotes at a market in Riyadh, Saudi Arabia on 3 October 2016 [Fayez Nurdeline /AFP/Getty Images]
A man counts Saudi riyal banknotes at a market in Riyadh, Saudi Arabia on 3 October 2016 [Fayez Nurdeline /AFP/Getty Images]

Saudi Arabia said yesterday that it expects the budget deficit to reach 131 billion riyals (nearly $35 billion) or 4.2 per cent of gross domestic product (GDP) in 2019.

King Salman announced the figures explaining that state spending will increase by more than seven per cent next year to reach $295 billion; the largest in the Kingdom’s history, in a bid to encourage economic growth which has been hit by falling oil prices.

Saudi GDP growth is expected to reach 2.6 per cent in 2019 compared to 2.3 per cent this year.

Saudi Arabia’s crude oil exports in October rose to 7.7 million barrels per day (bpd) from 7.433 million bpd in September, official data revealed yesterday.

READ: 12 professions now only open to Saudi nationals

Saudi Finance Minister Mohammed Al-Jadaan said earlier this month that his country’s public debt would not exceed 21 to 22 per cent of GDP in 2019.

The public debt will reach 678 billion riyals ($180.8 billion) in 2019, representing about 21.7 per cent of GDP.

The king ordered government to continue paying a living allowance to state employees, military personnel, pensioners and students for another fiscal year.

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