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Saudi Arabia is expected to overshoot forecast spending by nearly $29 billion in 2024 but the budget deficit will remain relatively small, according to a Saudi think tank.
Actual expenditure is also expected to hit its highest level in 2025 as the world’s largest oil exporter will take advantage of a surge in revenue due to higher oil prices and production, Jadwa Investment said in a report sent to Zawya Projects on Monday.
Jadwa estimated actual spending at around 1,293 billion Saudi riyals ($344.8 billion) and expected it to climb to nearly SAR1,361 billion ($362.9 billion) in 2024.
Saudi Arabia, by far the largest Arab economy, forecast spending for 2024 at SAR1,251 billion ($333.6 billion) and revenue at SAR1,172 billion ($312.5 billion).
In its report, Jadwa projected actual expenditure to continue rising to reach a record high of SAR1,391 billion ($370.9 billion).
Revenues were forecast at SAR1,266 billion ($337.6 billion) in 2024 and as high as SAR1,391 billion ($370.9 billion) in 2025.
Actual budget deficit is expected to remain relatively small at around SAR95 billion ($25.3 billion) in 2024 and SAR44 billion ($11.7 billion) in 2025.
Jadwa said high revenues in 2025 would be a result of an increase in oil production to around 10.2 million bpd from 9.4 million bpd and in prices to $86 from $81 a barrel.
High government spending is expected to boost Saudi GDP from around $1,022 billion in 2023 to $1,038 billion in 2024 and a record high of nearly $1,114 billion in 2025, according to the report.
(Writing by Nadim Kawach; Editing by Anoop Menon)
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