The Saudi Ministry of Finance published Wednesday the second quarter (Q2) budget performance report which showed, among others, that total revenues reached SR273.588 billion in Q2, an increase of 67% year-on-year.
Q2 non-oil revenues reached SR89.423 billion, an increase of 42% year-on-year.
Q2 oil revenues reached SR184.165 billion, an increase of 82% year-on-year, driven by an increase in global oil prices.
The report included many key indicators and data that reflect the Government's commitment to achieve transparency and financial disclosure, as a step toward strengthening its public finances' governance and management, as well as attaining the objectives of the fiscal balance program.
The report noted that Q2 total expenditures reached SR280.950 billion, an increase of 34% year-on-year.
Q2 deficit decreased to reach SR7.361 billion, due to revenues growth..
Public debt increased from SR443.253 billion in the beginning of this year to SR536.954 billion by the end of Q2.
Moreover, total revenues reached SR439.851 billion in H!, an increase of 43% year-on-year.
H1 total expenditures reached SR481.542 billion, a reduction of 26% year-on-year.
Q2 actual expenditures accounts for 49% of the projected annual budget.
H1 deficit reached SR41.690 billion.
Forty two percent of H1 expenditure was on sectors of social importance such as education, health, social development and municipal services.
Commenting on the Q2 financial results, Mohammed Al-Jadaan, Minister of Finance, said: “The announced second quarter 2018 financial figures reflect the improvement in the public finances performance , which will lead us to continue our reform plans aimed at achieving economic diversification and financial sustainability." He assured that the Ministry is working side by side with other government entities to harmonize policies and measures in support of the Kingdom's macroeconomic stimulus ,and to achieve the objectives of the fiscal balance program.
The improvement in financial performance was also accompanied by an outgrowth in economic performance, where real GDP grew by 1.2% in the first quarter of this year, and the non-oil sector grew by 1.6%.
Initial economic indicators show continued improvement in economic activity in the second quarter of this year, especially in private consumption, evidenced by an increase in cash sales and cash withdrawals during the period. Private investment (PMI) performance has also shown good progress. In addition, private credit in the second quarter registered positive growth for the first time since the first quarter of 2017. These indicators provide a positive view for the continued improvement in GDP performance for the second quarter, supported by improved levels of government investment and operating expenditures, as well as the recovery of world oil markets.
Al-Jadaan welcomed the latest report of the International Monetary Fund following the Article IV consultations of 2018, which is largely consistent with the budget performance indicators. The significant improvement in fiscal conditions reflected in the recently announced budget performance has contributed to reducing the fiscal deficit, increasing the non-oil revenues, raising spending efficiency, strengthening the medium-term fiscal framework, elevating transparency, and developing the macro-fiscal analysis unit. Progress in implementing the Vision 2030 reform programs and their positive impact on the Kingdom's economic situation have led to higher economic growth expectations for the current year.