Riyadh, The Ministry of Finance has announced today the pre-budget statement for Fiscal Year 2020. The pre-budget statement aims to inform citizens, interested parties and analysts of the public finance performance developments during 2019, and main fiscal objectives and economic estimates for Fiscal Year 2020 and the medium term. The statement also briefly explores key initiatives and programs that will be implemented during the coming fiscal year within the framework of Saudi Vision 2030. It also confirms the government's approach to reinforcing transparency and financial disclosures.
Mohammed Al-Jadaan, Minister of Finance, has indicated that the Kingdom's fiscal policy aims to achieve a balance between maintaining fiscal sustainability and enhancing economic growth and development, in addition to supporting economic transformation in line with Vision 2030, by continuing to increase efficiency and effectiveness within the framework of fiscal discipline, improving the basic services provided to citizens, diversifying government revenue sources, and empowering the private sector. He also adds that the cabinet's approval of the government Tenders and Procurement Law will ensure fairness and transparency, promote competition, prevent the influence of personal interests, protect public money and provide a fair treatment to competitors, which will lead to achieving the principle of equal opportunities, one of the Ministry's objectives.
He also indicated that the preliminary economic results and indicators reflect significant progress. The real GDP has achieved positive growth rates of about 1.1% during the first half of 2019 supported by the growth of the non-oil sector, which grew by 2.5% in the same period. Initial estimates indicate that GDP is expected to grow by 0.9% in 2019, with an expected acceleration in non-oil GDP growth rates. This performance is expected to continue to improve in 2020, with GDP growth projected to reach 2.3%.
The Minister of Finance stated that total expenditure in 2019 is expected to reach SAR 1,048 billion, as the government aims to achieve fiscal discipline and stability as key objectives for sustainable economic growth over the medium term. Revenues for the current fiscal year 2019 are expected to reach SAR 917 billion, a 1.2% growth compared to 2018. The ratio of non-oil revenues to non-oil GDP is expected to increase to 16% at the end of 2019 compared to only 7% in 2012. The budget deficit is expected to continue to decrease in this fiscal year 2019, reaching 4.7% of GDP, compared to 5.9% last year.
It is projected that expenditure will reach SAR 1,020 billion in 2020, focusing on improving the efficiency of spending without any disruption to diversification and transformation plans. Revenues are projected to reach about SAR 833 billion in 2020, while the budget deficit is projected reach about 6.5% of GDP.
Source: Saudi Press Agency