UAE PMI up in April to highest degree in 21 months

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DUBAI: Saudi Arabia decreased its finances deficit to 7.Four billion riyals ($1.97 billion) within the first quarter of the 12 months, the finance ministry mentioned on Tuesday, as the federal government reaps the advantages of consolidation measures launched final 12 months.

The kingdom, the Arab world’s largest economic system and the world’s high oil exporter, cashed in 117 billion riyals in oil income within the first quarter – 9 % beneath the primary three months of 2020.

Total income nonetheless rose 7 % yearly, with a 75% enhance in revenue from taxes boosting non-oil income by 39 % 12 months on 12 months.

Saudi Arabia final 12 months launched measures corresponding to a tripling of a value-added tax and removing of a value of residing allowance to replenish state coffers depleted by the coronavirus disaster and decrease international demand for crude.

These steps helped it to include a finances deficit which ballooned to over 11 % of gross home product final 12 months, in response to International Monetary Fund estimates.

“The (Q1) data reflects the focus of the government to lower the fiscal deficit, both by raising VAT which supported non-oil revenue growth in yearly terms, and lowering expenditure,” mentioned Monica Malik, chief economist at Abu Dhabi Commercial Bank.

“The higher oil price was also reflected in the quarterly increase in oil revenue,” she mentioned.

In the primary quarter final 12 months the finances deficit stood at roughly $9 billion.

The Saudi authorities spent 212 billion riyals within the first three months of this 12 months, a 6 % annual discount partly because of a major minimize in capital expenditure – down by over 13 billion riyals 12 months on 12 months.

Military spending was additionally down by practically 10 billion riyals.

Supported by a rebound in oil costs, Saudi Arabia’s fiscal place seems on monitor to enhance considerably this 12 months.

The International Monetary Fund mentioned this week it expects the dominion to submit a deficit of 4.2 % of GDP in 2021 – which might be barely higher than Saudi finances forecasts.



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