{"id":23625,"date":"2023-10-01T17:46:13","date_gmt":"2023-10-01T17:46:13","guid":{"rendered":"https:\/\/microloannexus.com\/investing\/saudi-arabia-to-tap-international-debt-markets-as-deficits-return\/"},"modified":"2023-10-01T17:46:13","modified_gmt":"2023-10-01T17:46:13","slug":"saudi-arabia-to-tap-international-debt-markets-as-deficits-return","status":"publish","type":"post","link":"https:\/\/microloannexus.com\/?p=23625","title":{"rendered":"Saudi Arabia to tap international debt markets as deficits return"},"content":{"rendered":"
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\u00a9 Reuters. A view shows vehicles driving on a street in Riyadh, Saudi Arabia February 16, 2021. REUTERS\/Ahmed Yosri\/File Photo<\/span>
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By Aziz El Yaakoubi and Pesha Magid<\/p>\n

RIYADH (Reuters) – Saudi Arabia is expected to tap the international debt markets to finance a projected budget deficit in 2023-2024, the finance ministry said, against a backdrop of lower oil prices and the country’s extended oil production cuts. <\/p>\n

The finance ministry said in a preliminary budget statement on Saturday that it expected a budget deficit of 2% of gross domestic product (GDP) this year rather than an earlier projected surplus, and a deficit of 1.9% of GDP in 2024. <\/p>\n

Both deficits are estimated at 161 billion riyals ($43 billion). <\/p>\n

Saudi Arabia is working to prepare an annual borrowing plan in accordance with a medium-term debt strategy and “access global debt markets to enhance the kingdom’s position in international markets”, the finance ministry said. <\/p>\n

The country still depends heavily on oil revenues, even though it has spent heavily on initiatives to diversify its economy.<\/p>\n

Some analysts have predicted the kingdom’s economy would shrink for the first time since 2020 at the height of the COVID-19 pandemic, although a hefty dividend from state oil producer Saudi Aramco <\/span><\/span> (TADAWUL:) could offset some of the deficits. <\/p>\n

Oil prices, which remain below last year’s average of $100 a barrel, rose above $90 after Riyadh said last month that it was extending a voluntary oil output cut of 1 million barrels per day until the end of 2023.<\/p>\n

This has pushed total revenue estimates for 2023 up to 1,180 billion riyals from an earlier projection of 1,130 billion riyals, the finance ministry said. <\/p>\n

Total revenues are still below the 2022 levels of 1,268 billion riyals. <\/p>\n

Meanwhile, total expenditure is seen rising to 1,262 billion riyals in 2023, from an earlier estimate of 1,114 billion riyals, before slowing down marginally to 1,251 billion riyals in 2024.<\/p>\n

Despite strong growth in the non-oil economy, lower oil production and revenue this year impacted the kingdom’s 2023 GDP growth which the ministry revised down to 0.03% compared with a previous forecast of 3.1%. Non-oil GDP is expected to grow 5.9% in 2023. <\/p>\n

“The higher spending targets released in the Saudi government budget indicates that domestic growth will remain strong,” said Mazen al-Sudairi, head of research at Al Rajhi Capital. “The increase in spending should support the 4% growth in non-oil GDP next year.” <\/p>\n

($1 = 3.7503 riyals) <\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

\u00a9 Reuters. A view shows vehicles driving on a street in Riyadh, Saudi Arabia February 16, 2021. REUTERS\/Ahmed Yosri\/File Photo By Aziz El Yaakoubi and Pesha Magid RIYADH (Reuters) – Saudi Arabia is expected to tap the international debt markets to finance a projected budget deficit in 2023-2024, the finance ministry said, against a backdrop<\/p>\n","protected":false},"author":1,"featured_media":11825,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[32],"class_list":{"0":"post-23625","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-investing","8":"tag-featured"},"yoast_head":"\nSaudi Arabia to tap international debt markets as deficits return | Micro Loan Nexus<\/title>\n<meta name=\"description\" content=\"\u00a9 Reuters. A view shows vehicles driving on a street in Riyadh, Saudi Arabia February 16, 2021. 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