RIYADH, Saudi Arabia (AP) – Saudi Arabia on Monday published a budget for 2011 that includes a $10 billion deficit, but the year might end with a surplus because of high oil prices.
Past budgets have undervalued the sale price of oil, skewing projected income downward. Saudi Arabia is world’s largest oil exporter, and most of its income is from oil sales.
The 2011 Saudi budget totals $154 billion dollars (580 billion riyals), and revenue is estimated at $144 billion, the government said.
In contrast, the current year will end with a $20 billion surplus, according to the Saudi Finance Ministry. The key is that oil prices remained significantly higher than the 2010 budget predicted, inflating incoming funds.
Oil accounts for close to 90 percent of government revenues. Saudi officials say the fluctuations of oil prices make it difficult for them to issue precise forecasts. The kingdom does not release its price projections, but media reports said 2010 budget was based on a price of $45 a barrel, far below the current levels of about $90 a barrel.
The Finance Ministry said it expects total expenditures in 2011 to increase by 16 percent.
Saudi Arabia is expected to spend about $40 billion, 26 percent of its budget, on education, higher education and training, according to the Finance Ministry. The 2011 allocation is 8 percent more than to 2010 education budget.
Expenditures on health and social development services will be increased in the coming year by 12 percent to $18 billion, the ministry said.