Saudi Arabia Expected to Achieve Fiscal Surplus for the First Time in 10 Years

[Asia Economy Reporter Yujin Cho] The world's largest oil producer, Saudi Arabia, is expected to achieve a fiscal surplus for the first time in 10 years next year, supported by rising international oil prices.

According to major foreign media on the 13th (local time), Saudi Arabia is projected to achieve a fiscal surplus equivalent to 2.5% of its Gross Domestic Product (GDP) next year.

Mohammed bin Salman, Crown Prince of Saudi Arabia, stated, "Fiscal revenues will be used to respond to the COVID-19 pandemic crisis."

Saudi Arabia had been running fiscal deficits due to low oil prices and fiscal burdens, but thanks to the recent rise in international crude oil prices, it succeeded in turning a quarterly surplus for the first time in two years in the third quarter of this year.

Experts analyzed that the background for the forecasted fiscal surplus next year is "the recent high oil prices and increased production, reduced COVID-19 expenditures, and the effect of transferring economic diversification investment burdens to the Public Investment Fund (PIF)."

Saudi Arabia expects its GDP growth rate to jump significantly to 2.9% this year and 7.4% next year over the next two years.

The Saudi government set next year's budget at 955 billion riyals, a 6% reduction from this year. It also announced plans to cut military spending by about 10% compared to this year's budget, which is being interpreted as a signal of easing the conflict with neighboring Yemen.

This content was produced with the assistance of AI translation services.