Saudi Arabia sees 2022 budget surplus, first in eight years

Saudi Arabia sees 2022 budget surplus, first in eight years

Saudi Arabia’s main budget forecast released on Sunday sees a surplus of SAR90bn ($24bn), the first in eight years. It is the kingdom’s first budget surplus since 2013, as higher oil prices and production boost its finances. This year’s budget deficit of SAR85bn ($22.7bn), or 2.7 per cent of gross domestic product, was the smallest since 2014, according to a Finance Ministry statement. Next year, government spending is expected to fall to SAR955bn, while revenue is estimated to rise to SAR1.05 trillion, leaving a surplus of SAR90bn. Officials expect the economy to expand 2.9 per cent this year and grow by a further 7.4 per cent in 2022, according to the statement. The results are a sharp turnaround from last year, when energy market turmoil and the pandemic combined to crater the kingdom’s nascent economic recovery from the last oil price rout. But they also underlined that despite years of efforts by Crown Prince Mohammed bin Salman to diversify the economy — including progress in new sectors like entertainment — the fortunes of the world’s largest crude producer still rise and fall with the price of oil. That could spell trouble next year, as the emergence of the omicron variant