Press Release Recent Economic Developments And Highlights Of

press release ============= recent economic developments and highlights of fiscal years 1431/1432 (2010) & 1432/1433 (2011) 20 decem

Press Release
=============
Recent Economic Developments
and Highlights of Fiscal Years 1431/1432 (2010) & 1432/1433 (2011)
20 December 2010
On the occasion of the approval of the Government’s budget for fiscal
year (FY) 2011 by the Council of Ministers, The Ministry of Finance is
pleased to highlight the actual outcome of FY 1431/1432 (2010), the
1432/1433 (2011) budget, and recent economic developments in the
Kingdom of Saudi Arabia.
Actual Outcome of Fiscal Year 1431/1432 (2010)
The Ministry of Finance projects actual revenue to be SR 735 (US $196)
billions in 2010 and actual expenditure to be SR 626.5 (US $167.1)
billions. Increases in actual over budgeted expenditures in 2010 of SR
86.5 (US $23.1) billions reflect increases in expenditures as a result
of the 13th month salary, increase in expenditures on projects in the
Two Holy Mosques and other Mashair, implementation of new compensation
system for universities faculty, adjustment in military salaries, and
the cost of increased admission to universities as well as abroad
scholarship program.
Total number of government projects signed with the private sector in
2010 were 2460 with a total value of more than SR 182.5 (US $48.7)
billions, an increase of 26 percent over 2009.
Preliminary estimates indicate that the value of public debt will
decline from SR 225 (US $60) billions at the end of 2009 to SR 167 (US
$44.5) at the end of 2010, which represents (10.2) percent of
projected GDP for 2010. The stock of debt is totally domestic.
The National Budget for 1432/1433 (2011)
The followings are the main highlights of the 1432/1433 (2011) budget:
1.
Total revenues are projected at SR 540 (US $144) billions.
2.
Government expenditures are budgeted at SR 580 (US $154.7)
billions.
3.
Fiscal deficit is projected at SR 40 (US $10.7) billions.
The national budget for 1432/1433 (2011) will continue to focus on
enhancing the development process and ensure that the investment
programs remain conducive to strong and sustainable economic growth.
The budget puts emphasis on optimizing the use of available resources
and giving priority to projects that ensure balanced development as
well as more employment opportunities and job creation. Specifically,
focus will be on education, health, social and security services,
municipal services, water and sewage services, and roads and highways.
Moreover, the budget attaches a particular importance to projects
related to research and development (R&D) as well as science and
technology projects for the e-government.
Appropriations
The 1432/1433 (2011) budget includes financing for new and on-going
projects with a total value of SR 256 (US $68. 3) billions.
Appropriations for the main development and public service sectors for
1432/1433 (2011) are as follows:
1.
Education and Training:
a.
Total expenditure amounts to SR 150 (US $40) billions,
representing 26 percent of FY 2011 appropriations and an increase
of 8 percent over FY 2010 appropriation.
b.
Continued implementation of King Abdullah Bin Abdulaziz Public
Education Development Project (Tatweer) amounting to SR 9.0
billion through the Education Development Holding Company owned by
the Public Investment Fund (PIF).
c.
New projects include 610 new schools (in addition to 3200 schools
currently under construction and more than 600 schools completed
in FY 2010) and rehabilitation of 2000 existing school buildings.
d.
For higher education, the new budget includes appropriations for
the completion of construction of campuses for the newly created
universities including housing of faculty. Furthermore, the
scholarship program (first and second phase) will continue next
year.-
Health and social Affairs:
a.
Total expenditure amounts to SR 68.7 (US $18.3) billions, an
increase of 12 percent over FY 2010 appropriation.
b.
Projects include new primary care centers throughout the Kingdom,
12 new hospitals. At the present, there are (120) hospitals under
construction with a capacity of ( 26700) beds.
c.
For social services, the new budget includes appropriation to
build sport clubs, social centers, social welfare and labor
offices. In addition, it includes further support for poverty
reduction programs that will shorten the time frame required to
eradicate poverty.
2.
Municipality services:
a.
Total expenditure amounts to SR 24.5 (US $6.5) billions, an
increase of 13 percent over FY 2010 appropriation.
b.
New project include inter-city roads, bridges, and road lights,
which should help ease traffic bottlenecks. It also includes other
environment-related projects.
3.
Transportation and telecommunication:
a.
Total expenditure amounts to SR 25.2 (US $6.7) billions, an
increase of 5 percent over FY 2010 appropriation.
b.
New projects include roads totaling 6600 kilometers (km) to be
added to 30200 km of roads currently under construction. Also, the
budget includes appropriations to build 4 new airports and
rebuilding of king Abdulaziz International Airport. In addition,
the budget includes projects to build additional berths and
enhancing the power network in some ports.
4.
Water, Agriculture, and Infrastructure Sector:
a.
Total expenditure amounts to SR 50.8 (US $13.5) billions, an
increase of 10 percent over FY 2010 appropriation..
b.
Appropriations for new projects include enhancing water sources,
dams and wells, as well as expanding and improving water and
sewage networks. There are also allocations for new water
desalination stations and upgrading existing stations. New
projects will be undertaken in the industrial cities of Jubail,
Yanbu, and Ras Azur to accommodate new investment projects.
5.
Specialized Credit Development Institutions and Government
financing programs:
Specialized credit institutions (Real Estate Development Fund, Saudi
Industrial Development Fund, Saudi Credit and Saving Bank, Saudi
Arabian Agriculture Bank, Public Investment Fund, and Government
Lending Program) will continue to provide loans to the industrial and
agriculture sectors, housing, and small and medium enterprises which
will support job creation and enhancing growth prospect.
It is estimated that SR 47 (US $12.5) billions will be disbursed in
2011 by these Institutions. The total value of loans provided by these
institutions since their inceptions amounts to more than SR 414.3 (US
$110.5) billions.
Economic Developments in 2009
1 - Gross Domestic Product (GDP)
According to Central Department of Statistics and information, GDP is
estimated to reach SR 1,630 (US $434.7) billions in current prices in
2010, reflecting a growth of 16.6 percent compared to 2009. Private
sector is estimated to grow by 5.3 percent in current prices in 2010.
In real terms, Overall GDP is estimated to grow by 3.8 percent, with
government sector growing by 5.9 percent and private sector by 3.7
percent in 2010 and its contribution to GDP is expected to be 47.8
percent. All components of the GDP recorded positive growth in 2010.
In particular, the non-oil industrial sector is estimated to grow by
5.0 percent; construction sector by 3.7 percent; electricity, gas, and
water sector by 6.0 percent; transport and communication sector by 5.6
percent; wholesale, retail, restaurants, and hotels by 4.4 percent;
and finance, insurance and real estate by 1.4 in constant prices.
2 - General Price Level
Inflation, as measured by the cost of living index, is estimated at
3.7 percent in 2010, while the non-oil GDP deflator showed an increase
of 1.5 percent.
3 – Foreign Trade and balance of payment
According to the Saudi Arabia Monetary Agency (SAMA) preliminary data,
total exports of goods are estimated to be SR 886.3 (US $236.3)
billions in 2010, representing an increase of 23.0 percent over 2009.
Non-oil exports of goods are estimated at SR 124.2 (US $33.1)
billions, reflecting an increase of about 14.0 percent and
representing 14.0 percent of total goods exported.
Total imports of goods are estimated at SR 326.2 (US $87.0) billions
in 2010, representing a growth of 0.7 percent compared to 2009.
According to the Saudi Arabia Monetary Agency (SAMA) preliminary data,
trade balance is estimated to record a surplus of SR 557.9 (US $148.8)
billions in 2010, an increase of 41.4 percent compared to last year,
as a result of the increase in oil and non-oil exports and the low
growth in imports.
Current account is estimated to record a surplus amounting to SR 260.9
(US $69.6) billions in 2010 compared to SR 78.6 (US $21.0) billions in
2010, an increase of 32.0 percent.
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