Figures and indicators, announced yesterday by the Ministry of Finance on the performance of the State's national budget by the end of the first half of 2018, show continued endeavors to diversify sources of income and achieve financial sustainability, along with maintaining a balanced process towards government spending and raising its efficiency.
The report carried a myriad of positive indicators, topped by the high total revenues of the first half by 43% up to SR 439.851 billion, compared to the same period of the last year. Moreover, the government spending has increased by 26% up to SR 481.542 billion. Additionally, the deficit has significantly declined to be SR 41 billion, knowing that the deficit reached SR 34.3 billion during the first quarter, and SR 7.3 billion during the second quarter. This decline reflects the rapid advance in the economic reform, and the major potential decline in deficit by 7% of the GDP this year, according to the Ministry of Finance.
The budget report showed the ongoing expansionary fiscal policies which kicked off in the first quarter of this year, represented in exceeding the target in the government spending to reach SR 481 billion riyals in order to support the economic growth and disbursement for basic development projects, which is balanced and consistent increase with the growth of oil and non-oil revenues which rose by 141%, and will soon be more integrated with the economic growth.
Since the announcement of Vision 2030, the Kingdom has been witnessing a variety of economic reforms, led by the financial balance program. It was therefore not surprising for the stated figures, whether at the level of revenues, GDP growth rate of 1.2% or decrease in deficit, to confirm the effectiveness of these reforms and their importance in raising the State's level of revenues, the recovery of the non-oil sector's exports, and the non-holistic reliance on one financial resource which is the oil. The new report on the budget in the first half stresses the safety of the path we have been following and the clarity of vision to achieve the greatest goal of building a more robust varied economy that does not subject to the conditions of the oil markets.
It remains to be noted that the Ministry of Finance's continued announcement of the budget on a quarterly basis confirms persistence in enhancing transparency, improving financial disclosure standards and affirms the right approach adopted by the Saudi Arabian government in accordance with the ambitious Vision 2030. This will enable all investors and others to follow up the budget developments and measure its impacts on the economy.