Deputy Custodian of the Two Holy Mosques Prince Sultan bin Abdulaziz Al-Saud today chaired the weekly Cabinet meeting at Al-Yamamah Palace in Riyadh, which approved the state budget for Fiscal Year 1432/1433 H (FY 2011). In a statement delivered on behalf of the Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz, Crown Prince Sultan said that the SR580 billion ($155 billion) budget reflects an increase of SR40 billion ($10.7 billion) over FY 1431/1432 H (FY 2010).
The new budget, Crown Prince Sultan said, reflects King Abdullah’s eagerness to boost economic growth and development and create more jobs for Saudi citizens. “I am pleased to avail myself of this opportunity,” Crown Prince Sultan said, “to convey the greetings of the Custodian of the Two Holy Mosques to his people and his wishes that this budget bestow more blessings and good on the nation and nationals.” The Crown then instructed all government officials to abide by King Abdullah’s instructions to strictly implement the budget for the benefit of the nation.
In a statement to the Council of Ministers, Minister of Finance Dr. Ibrahim Al-Assaf reported that the Gross Domestic Product (GDP) for FY 1431/1432H (FY 2010) is expected to reach SR 1.36 trillion, reflecting an increase of 16.6% over FY 1431/1432 H (FY 2010) as a result of 25% growth in the petroleum sector. Public and private non-oil sectors GDP is expected to increase by 9.2%. The public sector is projected to grow by 15.7% and the private sector by 5.3 %, at current prices.
In terms of fixed prices, the GDP is projected to grow by 3.8%, the oil sector by 2.1% and the non-oil sector by 4.4%. The public sector is projected to grow by 5.9% and the private sector by 3.7%, where the contribution of the private sector to the GDP reached 47.8%. All economic activities constituting the GDP of the non-oil sector have achieved a positive growth, where the real growth in non-oil manufacturing is estimated to be 5%, the communications, transport and storage 5.6%; the electricity, gas and water 6%; construction 3.7%; the wholesale and retail trade, restaurants and hotels 4.4%; and the finance, insurance and real estate 1.4%.
Minister Al-Assaf said that inflation, as measured by the cost of living index, is estimated at 3.7% in 2010, while the non-oil GDP deflator showed is projected to increase by 1.5%, according to estimates by the Central Department of Statistics and Information.
Dr. Al-Assaf added that the volume of public debt will decline by the end of the current FY 1431/1432H (FY 2010) to approximately SR167 billion, representing 10.2% of the projected GDP for FY 2010, compared to SR225 billion or 16% of the GDP for 2009.
The Minister of Finance pointed out that in accordance with the directives of the Custodian of the Two Holy Mosques, the budget for FY 1432/1433H will continue to focus on development projects that enhance the sustainability of growth and long-term development, and increase employment opportunities for citizens. The appropriation of funds was distributed in a way that focuses on education, health, security, social and municipal services, water, sanitation, roads, electronic transactions, and scientific research support.
The budget includes new programs and projects as well as funding for additional phases of some projects previously approved with a total value of SR256 billion ($68.3 billion).