Weekly MENA Newsletter will be delivered to your email in PDF format every Friday (52 Issues per Year).
Recent economic reforms in Saudi Arabia to curb the budget deficit in the wake of tanking oil prices are a positive step according to Masood Ahmed, Director of the IMF’s Middle East and Central Asia Department. But more needs to be done to develop the kingdom’s non-oil sector, and government spending cutbacks risk depressing growth in these sectors.
Speaking to the Saudi daily Asharq al-Awsat Mr Ahmad commended the Saudi government for taking measures to reduce government spending in 2015, lowering the budget deficit to 16% of GDP, well below the IMF’s projected 20% (MEES, 8 January). He also notes that for the 2016 budget the kingdom is maintaining a tight grip on spending which could help to cut the deficit further. These measures can help “maintain monetary flexibility at a time of falling oil prices,” he said. (CONTINUED - 744 WORDS)