Saudi Arabia on Monday passed its budget for next year, projecting a widening deficit in the face of tumbling crude oil prices and production cuts that have hit the top producer’s revenues.
The kingdom projected a shortfall of US$50 billion for the year, up US$15 billion from this year’s budget, an official statement read out on state TV said.
It predicted that next year’s deficit would grow to 6.4 percent of GDP, up from 4.7 percent this year.
The statement released after a Cabinet meeting chaired by Saudi Arabian King Salman said that Riyadh would also cut spending for next year in a rare belt-tightening measure.
Spending was set at US$272 billion, down 7.8 percent on this year’s estimates, while revenue was estimated at US$222 billion, also lower by 14.6 percent.
Income from oil was projected at US$136.8 billion, down from US$160.5 billion this year, the Saudi Arabian Ministry of Finance said.
Crude oil prices have remained sluggish at about US$64 a barrel, despite additional production cuts agreed by OPEC and its allies last week. Oil income accounts for about two-thirds of Saudi Arabian public revenue.
Salman said that his government is determined to continue diversifying the kingdom’s sources of income and shift it away from its reliance on oil.
The finance ministry reported that the kingdom spent US$279.5 billion and had revenue of US$244.5 billion this year, both lower than projections, leaving the shortfall at US$35 billion.
Saudi Arabia, which pumps just under 10 million barrels of oil per day, has posted a budget shortfall since 2014, when oil prices crashed, accumulating US$358 billion in deficits up to the end of this year, government data showed.
The finance ministry has projected that spending would continue to contract until 2022 as a result of weak crude oil prices and production cuts.
To plug the growing budget shortfall, Saudi Arabia withdrew from its reserves, borrowed from domestic and international markets, and last month floated 1.5 percent of state energy giant Saudi Aramco.
That generated about US$25.6 billion in the world’s biggest ever initial public offering.
OPEC and its allies last week agreed to an additional output cut of 500,000 barrels of oil per day, set to start next month, along with an already agreed reduction of 1.2 million barrels per day.
Saudi Arabian Minister of Energy Prince Abdulaziz bin Salman said that the kingdom would unilaterally trim another 400,000 barrels per day to support sagging prices.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
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