The figures and funds allocated as part of the Kingdom’s public budget for 2018 are very promising. They assure that our country is on the right track and that there are no fears from future fluctuations of oil price. The Kingdom really adopts knowledge-based economy which proves to be better than the economy based on natural resources. Therefore, the new budget may described as the budget of “investment attraction”, “real expansion” and “comprehensive development”.
If there is no factor of surprise in announcing the figures of the public budget after Finance Ministry has decided for the first time in its history to announce quarterly results of the budget, the surprise has existed since the quarterly announcement was made. The surprise is the ability of wise government to overcome the consequences of drop in oil prices since 2014 and the success of the government in supporting the national income by new sources of income. This is apart from the farsighted vision of reconsidering some financial policies and introducing economic reforms to the organs of the government.
The best fruits of the 2018 budget so far is the narrowing of the financial deficit gap. Moreover, the non-oil sectors have jumped to 50%, as promised in the 2030 Vision. This is in addition to the revenues for the year 2017. The efforts exerted by the Kingdom for enhancing international prices of oil and the continuity of economic reforms were behind achieving such revenues. At present, the Kingdom has several sources of income, including oil, taxes on foreign companies, selective commodities, value-added tax, service fees, expatriate fees, privatization of government institutions and internal borrowing via governmental bonds.
While there were some cuts in expenditure in the Kingdom’s budgets during the last few years along with the reconsideration of spending mechanism in numerous developmental projects, the economic landscape this year is quite different. The slogan is the “efficiency and generosity of spending” by directing capital funds towards high-return investments which have high effects on development. Such investment will focus on the giant projects announced as part of the 2030 Vision, such as Neom project which will bring the Kingdom close to the economics of knowledge, technology and innovation. What is really fine in the aforementioned landscape is the fact that all such achievements are accomplished in the Kingdom while the countries of the world suffer from a severe economic crisis and retreat of growth.
The most important aspect of the new landscape is the great attention paid by the country to the private sector, motivating it with incentives valued at SR 72 billion via several initiatives enhancing the capabilities of the private sector and opening vast horizons for it to assume its anticipated role in the development process. This is particularly true in view of the important role undertaken by private countries in the past and the success scored by them. We can affirm that the private sector awaits such role after the international recession prevailing in the economics of countries.
We are assured that Allah, Almighty, Has Granted our country numerous bounties and that these bounties have reinforced the process of development and prosperity for Saudis during the past decades depending on oil revenues. We were exporting 10 million barrels a day. However, the 2030 Vision has pinpointed that it is inappropriate to depend on oil as the sole source of income. It is clearly declared in the Vision that such mechanism must cease to operate and that a strong economy shall replace it, an economy depending on revenue-generating economic sectors which are beneficial to the country and attractive of domestic and foreign investments, thereby creating job opportunities. The Vision was successful in its first year. This makes us optimistic that the future will be better. Tomorrow, fluctuations we will harvest more of the fruits of the Vision.