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Saudi Arabia to Privatize Four Sectors This Year | ASHARQ AL-AWSAT English Archive 2005 -2017
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Men look out of a building as the Kingdom Centre Tower is seen in Riyadh, Saudi Arabia, January 1, 2017. REUTERS/Faisal Al Nasser/File Photo

Khobar– A Saudi official said the Kingdom was planning to privatize four sectors this year, including the Saline Water Conversion Corporation, a power generation company under Saudi Electricity Co., grain silos and sports clubs.

In an interview with Bloomberg News published on Wednesday, Saudi Arabia’s deputy minister of economy and planning Mohammed Al Tuwaijri said that his country has set a list of 16 entities that are “prime for privatization”, along with more than 100 public-private partnership opportunities.

Tuwaijri minimized the impact of the drop in oil prices, which fell below $50 this month, on the plan to balance the budget.

He said the scenario shared publicly takes into account “our ability to execute a good percentage of our plans with oil stabilizing at current levels.”

Asked by Bloomberg when the kingdom would sell international bonds again, the Saudi official said that the finance ministry’s debt management office might decide to knock the market in the fourth quarter this year.

The size of the issuance will depend on market conditions and investor appetite but could potentially be as much as $10 billion, he said as quoted by Bloomberg.

In an interview aired last week on Saudi national television, Deputy Crown Prince Mohammed bin Salman said that non-oil revenue in the first quarter of 2017 exceeded expectations.

Asked about measures that the Kingdom would take should oil prices fall below $30, the deputy crown prince said: “We expect the deficit in the second, third, and fourth quarters not to be less than 44 percent, because we have raised our expenditures again.”

He added that several factors have helped the Kingdom reduce its budget deficit, including the OPEC Agreement, the improvement of oil prices and the rationalization of spending.