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Tue 18 Feb 2020 12:05 PM

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Saudi fiscal deficit expected to grow to 8.1% in 2021

Saudi Arabia's 2020 budget projected a shortfall of $50b for the year

Saudi fiscal deficit expected to grow to 8.1% in 2021

Saudi Arabia might have a fiscal deficit of 7.4 percent in 2020, and 8.1 percent deficit in 2021, according to S&P Global analysts.

According to Reuters, S&P analyst Zahabia Gupta said that the fiscal deficits of the GCC states – including Saudi Arabia – will increase in 2021 as a result of higher spending and lower oil prices.

The forecast assumes oil prices of $60 a barrel this year, and $55 per barrel next year, Gupta added.

Saudi Arabia passed its 2020 budget in December, in which it projected a shortfall of $50 billion for year, up $15 billion from its 2019 budget.

It predicted next year's deficit would grow to 6.4 percent of GDP, up from 4.7 percent in 2019.

Spending was set at $272 billion, down 7.8 percent on 2019 estimates, while revenues were estimated at $222 billion, also lower by 14.6 percent.

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