International rating agencies praise Saudi Arabia’s 2022 budget statement

The credit rating agencies, “Moody’s” and “Fitch”, praised the data contained in the preliminary balance sheet of the general budget of Saudi Arabia for the year 2022, which reflects the soundness of the financial policies and structural reforms undertaken by the government in light of the Kingdom Vision 2030.

The Fitch agency felt in its report that the Kingdom’s maintenance of large financial reserves is conducive to credit ratings and also provides greater flexibility to ease public funding needs in light of the volatile oil revenue. The agency estimated that the reserve would increase in the medium term, while in previously expected its stability at a minimum level of 265 billion riyals in 2022-2023.

In turn, the rating agency, “Moody’s”, considered the spending plan referred to by the government in the preliminary balance sheet, as an indicator of a positive development for the Kingdom’s credit rating. in amid the rise in the price of oil.

The preliminary statement of the general state budget for fiscal year 2022, announced last Thursday by the Ministry of Finance, in concurrently with the issuance of the half-year report on financial and economic results for the year 2021, foresaw that total expenses would amount to approximately 955 billion riyals in 2022, continuing to work to improve the efficiency of spending and maintain financial sustainability , achieve the Kingdom Vision 2030 goals, implement economic and financial reforms, as well as the vision’s programs, initiatives and major projects, reorganize priorities in based on developments and developments, providing greater investment opportunities for development funds and the private sector, as well as allocating certain government programs and services and infrastructure development projects.

The premise estimates that the gradual return to the Kingdom’s economic recovery would lead to positive developments in Terms of revenues for 2022, and in the medium term it is expected to reach approximately 903 billion riyals. It is also estimated that the continued efforts of the government will be reflected in the diversification of the economy, through the implementation of many programs and initiatives directly linked to the achievement of the Vision 2030 goals, which leads to continuous revenue growth, reaching approximately 992 billions of riyals in 2024, also driven by expectations of local and global economic recovery in the medium term, after the effects of the Corona pandemic waned.

It is worth noting that recent reports from international rating agencies have come to demonstrate the validity of the measures and policies adopted by the government, as witnessed by the recovery and strong economic recovery, and that the easing of the restrictions of the Covid pandemic -19 will launch a new wave of demand, especially since the government launched in the first quarter of 2021 a program to strengthen the partnership with the private sector is “partner”, with the aim of strengthening the development and resilience of the economy increasing GDP and diversifying the economy, as well as launching private sector investment and accumulated investment in all axes of the national economy, to reach 5 trillion riyals by 2030 and add up to two trillion riyals to GDP by the year 2025, providing hundreds of thousands of new job opportunities, and accelerating the investment plans of large corporations, as the wheel began to spin at a pace that exceeded all expectations to achieve these goals.

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