Saudi 2023 budget deficit at $22bn as oil revenue dips

Aramco

Saudi Arabia recorded a budget deficit of SAR81 billion ($21.6 billion) in 2023 in line with expectations, as expenditure increased against a backdrop of falling oil revenue, the finance ministry said on 15 February.

Total expenditure increased by 11 percent annually to SAR1.3 trillion last year, as revenues reached SAR1.2 trillion, according to data released by the finance ministry.

Oil revenues fell 12 percent year-on-year to SAR755 billion as the kingdom reduced oil output in an effort to sustain prices in a weak global market.

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Non-oil revenues rose 11 percent year on year to SAR458 billion, accounting for 40 percent of the total last year.

This week’s announcement is in line with the kingdom’s December 2023 budget statement, where the government expected expenditure and revenues to be SAR1.3 trillion and SAR1.2 trillion, respectively, with the deficit estimated at SAR82 billion.

The government has forecast a deficit of SAR79 billion in 2024.

The government’s General Authority for Statistics has said economic growth declined by just under 1 percent in 2023, and the International Monetary Fund last week lowered its 2024 forecast for GDP in Saudi Arabia to 2.7 percent, down from 4 percent forecast last October.

Last year’s slowdown followed a surplus of $30 billion in 2022, the first in almost a decade after crude prices surged as the world emerged from the pandemic.

The finance ministry statement said oil revenue rose 28 percent year-on-year in the fourth quarter of 2023, driving total revenue higher by 13 percent to SAR358 billion. Expenditure also increased 9 percent over the year to SAR395 billion.

Total public debt was at around SAR1 trillion at the end of 2023, the ministry said.