Saudi Arabia Macroeconomic Developments
- Saudi government revenues rose 85 percent YoY in Q2 to reach SAR248 billion ($66.1 billion), according to the Ministry of Finance. Oil revenues (+38 percent) and non-oil revenues (+203 percent) both rose sharply from pandemic lows. ‘Taxes on goods and services’ (+544 percent) was the biggest category driving non-oil revenue growth, reflecting the value-added tax (VAT) hike last year.
- Saudi government expenses rose 4 percent YoY in Q2, totaling SAR253 billion ($67.5 billion). The increase was primarily due to an 8 percent rise in current expenditures such as social benefits (+101 percent) and goods & services (+30 percent). Expenditures were offset by significant reductions in capital expenses (-25 percent), subsidies (-57 percent), and grants (-79 percent).
- Saudi Arabia’s fiscal deficit stood at SAR4.6 billion ($1.2 billion) at the end of Q2 2021, bringing the H1 2021 deficit to SAR12 billion ($3.2 billion). A rebound in oil revenues during H1 2021 kept the deficit low, accounting for only 8 percent of the full-year 2021 budgeted SAR141 billion ($38 billion) deficit.