KSA handles oil plunge wisely to preserve spending rate
(MENAFN) Regardless to the ongoing oil plummet, sharing oil wealth with the Saudi Arabia's public has helped keep the Al Saud family securely in power as turmoil sweeps the region.
In particular, when the income slows down, as it's doing now, the kingdom's rulers would rather run large budget deficits than risk interfering with that bedrock social contract.
However, the International Monetary Fund forecasts a fiscal gap surpassing 20 percent of economic output this year, and says at that rate Saudi savings would run out after five years.
Furthermore, across the USD630 billion economy, average monthly retail sales are up more than 10 percent this year, although it declined 3.5 percent from a year earlier in September.
In particular, when the income slows down, as it's doing now, the kingdom's rulers would rather run large budget deficits than risk interfering with that bedrock social contract.
However, the International Monetary Fund forecasts a fiscal gap surpassing 20 percent of economic output this year, and says at that rate Saudi savings would run out after five years.
Furthermore, across the USD630 billion economy, average monthly retail sales are up more than 10 percent this year, although it declined 3.5 percent from a year earlier in September.
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