Saudi government approves 2003 budget; 10.4 billion deficit
Saudi Arabia, Economics, 11/29/2002

Saudi Arabia, the first oil exporter in the world, on Wednesday evening approved the general budget for 2003 with a deficit estimated at 39 billion Saudi riyals ( USD 10.4 billion), representing a decrease of 3.13 % in comparison with the deficit it had expected for the current year ( USD 12 billion). However, due to the increase in oil price, the deficit in the Saudi budget for 2002 will not exceed USD 2.2 billion, according to estimates of the new government.

The budget of 2003 expects the state's revenues to reach 170 billion riyals (USD 45.3 billion) and the spending to 209 billion Riyals (USD 77.55 billion), according to the Saudi minister of information Foaud Bin Abdul Salaam Bin Muhammad al-Farisi, whose statements were quoted by the official Saudi news agency in conclusion of the meeting of the Saudi cabinet under the chairmanship of King Fahd bin Abdul Aziz.

Concerning spending, the budget allocates USD 9.5 billion for new projects and allocates USD 2.15 for education, vocational training for Saudi citizens and USD 1.6 billion for health services. Administrative spending constitute more than 85% of the budget.

This is, however, the third running year in which the Saudi budget expects a dedicit.

Since 1982, Saudi Arabia has not recorded a surplus in the budget except in 2000, it was then USD 1.6 billion. The kingdom has not disclosed the other means of revenues for 2003. However, more than 75% of these revenues come from sales of oil and oil byproducts.

In the mid of this November, the Saudi government approved a plan to open 20 official ( government) sectors in the economy before local and foreign investments. An initiative which is presumed to bring in billions of necessary dollars in order to absorb the general debts estimated at USD 168 billion by the end of 2001.

Saudi Arabia produces 6.7 million barrels of crude oil per day, 90 % of which is exported.

Local studies estimate the average price of the Saudi crude oil at USD 22 for one barrel in the first six months of the year, while the barrel is priced in the Saudi budget at USD 16 or 17.

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