London, Asharq Al-Awsat- Saudi Arabia’s national budget for 2007 the largest in the kingdom’s history was announced today with revenues projected at $ 106.6 billion and expenditures at $101.3 billion, with a budget surplus of $5billion.
The national budget was announced in the council of ministers session chaired by the custodian of the two holy mosques king Abdullah bin Abdulaziz.
In a statement to the Saudi press agency (spa) following the session, the minister of culture and information Iyad Madani said under the directives of the king, the council discussed in session the general budget of the state for 2007. and approved it.
Around 140 billion riyals (37.3 billion dollars) have been earmarked for education, health and other projects aimed at “achieving balanced development in various regions” of the vast desert kingdom, the monarch said.
The Saudi government had projected a surplus of 14.7 billion dollars in 2006 when it passed the year’s budget.
But it said on Monday that revenues in 2006 were expected to reach 655 billion riyals (174.6 billion dollars) while expenditure would total 390 billion riyals (104 billion dollars), leaving a surplus of more than 70 billion dollars.
Expenditure in 2006 turned out to be 55 billion riyals (14.6 billion dollars) higher than projected, according to the finance ministry.
The Saudi government usually uses a conservative oil price well below market price when planning its budget, which explains the wide gap between budgeted and actual revenues in the past few years when prices rocketed to more than 70 dollars a barrel.
Saudi Arabia, the world’s top oil producer and exporter, posted a budget surplus of 58 billion dollars in 2005. The surplus reached 26 billion dollars in 2004 and 12 billion dollars in 2003.
The finance ministry said the public debt will be reduced to 366 billion riyals (97.6 billion dollars) by the end of 2006 from 460 billion riyals (122.6 billion dollars) at the end of last year.
It said gross domestic product is estimated to reach 1.3 trillion riyals (347 billion dollars) at current prices in 2006, a nominal growth of 12.4 percent compared to 23.3 percent last year. The ministry put real GDP growth at 4.2 percent.
The trade surplus is expected to reach 553.4 billion riyals (147.5 billion dollars), an increase of 17.5 percent over 2005, due to a rise in oil exports, the ministry said.
The balance of payments is expected to record a surplus of 358 billion riyals (95.4 billion dollars), a six percent increase over 2005.