Saudi mulls $20bn worth of project cancellations
Government officials in Saudi Arabia are reviewing thousands of projects worth $69bn, and could cancel a third of them, according to Bloomberg
Saudi Arabia could cancel more than $20bn (SAR75bn) worth of projects, according to a report published by Bloomberg.
Three unnamed sources close to the kingdom’s government told the newswire that officials are to review thousands of projects worth a total of $69bn (SAR259bn), and could cancel a third of them.
The country is also considering the merging of some of its ministries and the closure of others, according to two of Bloomberg’s anonymous sources.
Saudi Arabia reported a 16% budget deficit in 2015, driven primarily by the oil price decline.
Policy makers have implemented a number of defensive measures in response, including the introduction of a 2.5% white land tax, the sale of bonds, and reductions to fuel and energy subsidies.
Deputy Crown Prince Mohammed bin Salman also announced Saudi Vision 2030, which outlines the kingdom’s strategy to diversify its economy away from the oil and gas sector.
Saudi Arabia’s deficit is on course to narrow to 10% in 2016, according to International Monetary Fund (IMF) estimates.