Saudi Arabia's Ministry of Finance budget performance report has revealed a wider deficit of SAR115.6 billion ($30.82 billion), 2.8% of GDP, in 2024, higher than the budget estimate of SAR79 billion, and a deficit of SAR80.9 billion in 2023, a report said.

 

Total expenditures rose 6.3% y/y mainly on higher current spending which expanded by 7% y/y, noted the NBK-Economic Research report.

 

The increase in current spending was broad-based, but came mostly from higher outlays on employee compensation, subsidies, and other expenses. Capital expenditures rose by a more modest 2.2% y/y, much less than the previous year’s increase (30%), as the government recalibrates investment spending and taps alternative, off-budget channels, mainly the sovereign wealth fund (PIF), amid ongoing fiscal shortfalls, it said. 

 

The higher spending outweighed a 3.9% y/y increase in total revenue thanks to a 9.8% jump in non-oil revenue (mainly taxes), while oil revenue growth was near-flat (0.3%), weighed down by Opec oil production cuts. The deficit was financed entirely through debt issuances, with public debt up 16% y/y to SAR1.22 trillion from SAR1.05 trillion at the end of 2023, while reserves stood unchanged at SAR390 billion, it highlighted. -TradeArabia News Service