World Economy

Saudi Arabia Withdraws $65b to Meet Budget Deficit

Saudi Arabia Withdraws $65b to Meet Budget DeficitSaudi Arabia Withdraws $65b to Meet Budget Deficit

Saudi Arabia withdrew 244 billion riyals ($65.1 billion) from its general monetary reserve during the first five months of 2015, a Saudi official said.

The governor of the Saudi Arabian Monetary Agency, Fahad Al Mubarak, said at a press conference on Thursday that the country intends to use the fund to meet the expected budget deficit due to the decline in oil prices. 90% of Saudi Arabia’s revenues come from oil sales, Middle East Monitor reported.

Mubarak said his country has also issued government bonds worth 15 billion riyals ($4b) during the last two months, expecting Saudi public debt to rise during the year 2015.

Saudi Arabia estimated its expenditures for the year 2015 to reach 860 billion riyals ($229b) with revenues estimated at 715 billion riyals ($191b), resulting in an expected deficit of 145 billion riyals ($39b), equivalent to 0.5% of gross domestic product at current prices.

Saudi Arabia’s public debt fell in 2014 to 44.26 billion riyals, equivalent to 1.6% of GDP, compared with 60.1 billion riyals in 2013.

The price of crude oil reached $57.75 a barrel on Thursday compared with $115 in June 2014.

Mubarak said he expected the deficit to rise to over 145 billion riyals after the government paid two months’ salary to all public employees in January. King Salman bin Abdulaziz ordered the payment when he came to power after the death of King Abdullah bin Abdul Aziz.