Running a Budget Deficit for Development Goals: Saudi Finance Minister
In a recent announcement, Saudi Finance Minister Mohammed Al-Jadaan revealed that the Kingdom is intentionally running a budget deficit to achieve its development goals.
The Finance Ministry’s quarterly budget performance report showed a deficit of SR12.4 billion ($3.3 billion) in Q1, with revenues at SR293.4 billion and expenditures at SR305.8 billion.
Al-Jadaan emphasized the strategic nature of the deficit, stating that it is crucial for economic development, unlike mandatory borrowing in other countries for unproductive expenses.
The minister highlighted the government’s focus on spending to accelerate the implementation of development strategies and projects.
Efforts to Attract Investments and Stimulate Economic Growth
Efforts are underway to attract both domestic and foreign investments that stimulate economic growth, reduce the budget deficit, and enhance the economy through infrastructure investments.
Optimizing Government Expenditures for Economic Development
Al-Jadaan reassured citizens that managing the budget deficit is a top priority and clarified that as long as it is directed towards productive expenses, the government views it as acceptable, generating economic returns that exceed the cost of debt.
Diversifying Income Sources and Enhancing Financial Policies
The minister highlighted the government’s efforts to reduce reliance on oil revenues by diversifying income sources. Non-oil revenues made up 38 percent of total income in 2023, compared to 9 percent in 2015.
Strategic Spending and Economic Impact
Strategic spending has a multiplier effect on the economy, creating jobs, enhancing trade, and fostering economic growth through infrastructure investments, according to Al-Jadaan.
Saudi Arabia’s International Presence and Achievements
Al-Jadaan emphasized Saudi Arabia’s remarkable international presence, attributing it to the success of Saudi Vision 2030 in positioning the Kingdom as a leading destination worldwide.
Promoting International Cooperation and Dialogue
Saudi Arabia’s commitment to promoting international dialogue and cooperation was highlighted by the minister, emphasizing the Kingdom’s strong relations with international organizations and its role in global initiatives.
Financial and Monetary Policy Successes
Recent successes in financial and monetary policies, along with active participation in global events, led to Saudi Arabia chairing the International Monetary and Financial Committee, showcasing the Kingdom’s commitment to shaping international economic policies.