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Saudi Arabia plans to increase spending next year more than initially forecast as authorities take advantage of higher oil prices to spur economic growth and lower unemployment.
Public spending is expected to reach 1.106 trillion riyals ($295 billion) in 2019. 100 billion riyals ($27bn) more than what the government projected last year. Finance Minister Mohammed Al-Jadaan told reporters on Sunday in Riyadh.
Authorities expect spending to rise to 1.170 trillion riyals by 2021. he said. citing initial estimates.
“The statement is clear: the government is determined to grow the economy.“ he said. “We wanted to make sure that the economy grows and the private sector is enabled and creates jobs for our youth.“
The world’s biggest oil exporter is grappling with sluggish economic growth that followed the collapse of crude prices in 2014.
Measures to reduce the budget deficit and raise non-oil revenue have weighed on business sentiment. sending the unemployment rate among Saudi nationals to the highest level in more than a decade.
Despite efforts to expand the economy. growth will remain under 2.5 percent during the next three years. according to data provided at the press conference.
The government expects revenue in 2019 to increase to 978 billion riyals. before exceeding 1 trillion riyals by 2020. The estimates mean the budget deficit is also expected to shrink to 3.7 percent of gross domestic product by 2021 from an estimate of 5 percent this year.
