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FINANCIAL NEWS
Saudi to cut 2016 budget by USD10b on plunging oil prices
27 Aug 2015
(MENAFN) Saudi Arabia’s government is considering making significant cuts to its 2016 budget because of the continued drop in oil price, sources reported.
The government could cut its budget by as much as 10 percent, roughly USD10 billion based on the country’s current investment spending of USD102 billion.
The International Monetary Fund (IMF) projected that the Saudi government would run a fiscal deficit of around 20 percent of GDP in 2015, larger than the 14.2 percent gap that it had forecast in May.
Oil accounts for 90 percent of the country’s revenue, and with the price dropping, Saudi’s finances are coming under increasing pressure, with the current budget deficit covered by drawing down financial reserves.
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