Saudi Gazette report
RIYADH — Saudi Arabia posted a surplus of SR6.68 billion in the third quarter budget this year for the first time since 2019, the Ministry of Finance said on Sunday.
Total revenues for the third quarter amounted to SR243.3 billion. The non-oil revenues amounted to SR95.4 billion, while oil revenues amounted SR147.9 billion. These figures confirmed the feasibility of economic reforms.
The expenditures for the third quarter amounted to SR236.6 billion.
The Q3 report affirmed Saudi Arabia's commitment of transparency and financial disclosure, as key factors, which are consistent with the Kingdom Vision 2030 and its objectives.
The report highlights the progress in achieving the defined objectives within the Financial Balance Program.
The surplus in the Saudi budget during the third quarter of 2021 is the first after a deficit that lasted for nine consecutive quarters, starting from the second quarter of 2019. Higher oil prices fueled the Kingdom’s first quarterly surplus in over two years.
The last surplus recorded in the budget was in the first quarter of 2019, which at that time registered a surplus of SR27.84 billion. The state budget deficit decreased during the first nine months of this year to SR5.37 billion, bringing revenues to about SR696.25 billion, while expenses recorded SR701.62 billion.
Oil prices have rallied to multi-year highs with global crude futures climbing 4.5 percent in the quarter, helped by a decision by OPEC and OPEC+, to maintain a planned output increase rather than raising it on global supply concerns.
Earlier on Sunday, Saudi Aramco said its third-quarter net profit more than doubled, boosted by higher crude oil prices and volumes sold.
The Kingdom had last year introduced measures such as tripling of a value-added tax (VAT) and removal of a cost of living allowance to replenish state coffers depleted by the historic slide in crude prices and as the pandemic hit non-oil revenues.
The budget deficit had ballooned to over 11 percent of gross domestic product (GDP) last year, according to International Monetary Fund estimates. The IMF expects Saudi Arabia to bring down its fiscal deficit to 4.2 percent of GDP this year.
According to the Ministry of Finance report, the value of oil revenues in the third quarter amounted to SR147.98 billion, accounting for 60.8 percent of revenues, and oil revenues increased by 11.98 percent compared to the second quarter of this year, which was then recorded SR132.15 billion, with an increase rate of 26.93 percent compared to the first quarter.
With regard to non-oil revenues, their value in the third quarter amounted to about SR95.41 billion, equivalent to 39.2 percent of total revenues.
With regard to budget expenditures up to the third quarter of the current year, the municipal services sector recorded the lowest percentage of expenditures that amounted to SR22.7 billion, representing 45 percent of the approved budget of SR50.8 billion.
The military sector expenditures amounted to the highest with SR134.43 billion, equivalent to 77 percent of the approved expenditures estimated at SR175.1 billion.
The health and social development, basic equipment and transport sectors came in second place with the highest expenditures for their planned budgets, and their expenditures amounted to 76 percent of the two planned budgets.
The expenditures of the health sector amounted to SR124.37 billion out of approved expenditures for the whole year with a value of SR174.68 billion, while the expenses of basic equipment amounted to 38.39 billion out of expenses of SR45.82 billion.
The Ministry of Finance revealed that it will finance the first and second quarter deficits of SR51.09 billion, with an amount of the total financing that was not used to finance the deficit until the end of the third quarter of the year, and it will be used to pay the budget deficit during the remainder of the year.
The financing is distributed through external debt for an amount of SR27.3 billion, and through internal financing amounting to SR23.8 billion.
