The Council of Ministers, chaired by the Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud, approved the state budget for the fiscal year 1440/1441H (2019) in a session held at Al Yamamah Palace in Riyadh on Tuesday 11th of Rabi`II, 1440H, corresponding to the 18th of December 2018.
The session began with recitation of verses from the Holy Quran. Then, the Custodian of the Two Holy Mosques addressed citizens in a speech in which he announced the budget.
Below is the text of the Custodian of the Two Holy Mosques' speech:
"We here announce the budget for the fiscal year 1440/1441H (2019) as the largest budget in the history of the Kingdom of Saudi Arabia, which aims to support economic growth in the Kingdom, raise the efficiency of spending and achieve sustainability and financial stability within the objectives of the Kingdom Vision 2030.
We are determined, with God’s help, to move forward along the road of economic reform, controlling fiscal management, promoting transparency, empowering the private sector and ensuring distinguished services are provided to citizens.
Spending in this budget is 1.106 trillion Saudi riyals, approximately 7% higher than the projected expenditure by the end of fiscal year 2018. Revenues come in at 975 billion riyals, an increase of 9% over expected revenue by the end of 2018. In line with government policy, this budget focuses on providing basic services for citizens and developing government services.
Our first concern is to continue working towards achieving comprehensive development in all regions of the Kingdom and in all fields as well. Your government will continue its efforts to achieve this. We have directed ministers and officials to quickly implement the budget programs and projects.
We ask God for help and success and thank Him for the blessing of security, stability and development. Peace, and God’s mercy and blessings be upon you."
King Salman then signed the Royal Decree on the budget after Prince Abdulrahman bin Mohammed bin Ayyaf, Secretary-General of the Council of Ministers, read it.
Following the session, H.E. Minister of Media Dr. Awwad bin Saleh Al-Awwad said in a statement to the Saudi Press Agency that H.E. Minister of Finance Mohammed bin Abdullah Al-Jadaan gave a brief presentation on the general budget of the State, during which he presented financial results for the current fiscal year and reviewed the main features of the 2019 budget.
The Minister of Finance said that the country’s financial and economic performance has improved significantly in 2018, where the budget deficit is expected to drop from a projected SAR 195 billion (6.9% of GDP) to an actual deficit of approximately SAR 136 billion, or 4.6% of the Kingdom’s GDP. The 2018 deficit of SAR 136 billion represents a significant decrease from the budget deficit in 2017, which was SAR 238 billion, or 9.3% of the country’s GDP.
The Minister of Finance added that 2019 total expenditures are expected to reach SAR 1.030 trillion riyals (one trillion and thirty billion riyals), equivalent to 35.1% of the Kingdom’s GDP, while total revenue for 2018 is expected to be approximately SAR 895 billion riyals, a 29.4% rise compared to 2017. The Minister attributed this to growth a 39.3 increase in oil revenue and a 12.4% increase in non-oil revenue.
H.E. clarified that during the next year and in the medium term, the 2019 fiscal policy focuses on spending priorities with social and economic dividends for operational expenses, such as the Hesab al Mwaten (Citizen’s Account) Program, the private sector stimulus plan, and the Vision 2030 implementation program, while continuing to increase the efficiency of government spending, where the operating expenses for 2019 are estimated to be approximately 860 billion riyals, or 77.8% of the total expenditures.
H.E the Minister of Finance indicated that the GDP growth rate is estimated to be 2.6% in 2019, compared to 2.3% in 2018. This growth is supported by reforms in the business climate and increasing investment opportunities attributable to improved private-sector involvement and growth. The government has been working towards a number of economic reforms, including stimulating investment, fostering investor confidence, launching privatization programs, enhancing directed capital spending based on economic contribution and vital projects, stimulating the private sector and developing new economic sectors and activities.
This is in addition to the important role of the Public Investment Fund in promoting economic growth, improving the Kingdom’s asset management and development capabilities in the medium and long term and raising productivity levels, among other initiatives aimed at achieving the Kingdom’s vision 2030.