SAUDI ARABIAN MARKET
Saudi Arabia Macroeconomic Developments
• Saudi Arabia’s 2020 deficit will reach SAR298 ($79.5 billion), or 12 percent of GDP, compared to SAR133 billion ($35.5 billion), or 4.5 percent of GDP, in 2019 according to the Ministry of Finance. Total revenues in 2020 declined to a SAR770 billion ($205 billion), marking a 17 percent drop compared to 2019, which saw SAR927 billion ($247 billion) in total revenues. Total government expenditures in 2020 are expected to reach SAR1,068 billion ($285 billion), a marginal 0.8 percent YoY increase.
• Saudi Arabia’s budget deficit is expected be reduced by 7 percent to SAR141 billion ($38 billion) in FY2021, representing 4.9 percent of GDP. The decline in the deficit would primarily be driven by a 10 percent expected increase in total revenues in 2021, forecasted to reach SAR849 billion ($226 billion). Total expenditures will be reduced by 7 percent in 2021 to SAR990 billion ($264 billion).
• Consumer prices increased 5.8 percent YoY in November, the same rate as the previous month. CPI continues to reflect the value-added tax (VAT) tax increase from July. Increases in the prices of food & beverages (+13 percent) and transportation (+8 percent) were the main drivers of inflation while being offset by utility prices (-1.6 percent).d.