Posted: Thursday, January 4, 2024, 6:22 p. m.
Last Updated: Thursday, January 4, 2024, 8:12 p. m.
Saudi Arabia estimates its financing needs at about 86 billion riyals ($22. 93 billion) in 2024 under a debt plan approved by Finance Minister Mohammed Al Jadaan, the National Debt Management Center (NDMC) said on Thursday.
The kingdom, the world’s top oil exporter, has forecast a budget deficit of 79 billion riyals in 2024, slightly smaller than a deficit of 82 billion riyals projected for last year as lower crude production and global prices reduced revenue.
But the government, tasked with implementing an economic transformation timeline known as Vision 2030, will also increase spending in the coming years to spur domestic expansion and non-oil GDP.
The NDMC said the borrowing plan finances the budget deficit and the payment of upcoming debt maturities, as well as opportunistically exploiting markets as a component of the country’s liability control strategy.
“In addition, (the borrowing plan) commits to taking advantage of market opportunities to execute select government financing activities that promote economic growth, such as financing progress and infrastructure projects. “
Public debt is expected to reach 1,115 billion rials until the end of 2024, or about 26 percent of GDP, the government had previously announced.
Saudi Arabia has invested heavily in projects to diversify its economy away from oil and gas, as the domestic call for expansion and the dynamism of non-oil activities last year drove last year, which outpaced the overall expansion.
But the country remains reliant on hydrocarbon revenue to bolster public finances.
Saudi Arabia tapped debt markets to obtain a $10 billion tripartite bond in January 2023, followed by a $6 billion Islamic bond in May.
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