Saudi Arabia has predicted that the budget deficit is going to increase to $50 Billion in the next year as the prices of oil have been low and the production being lower is eating into the oil revenue of the Kingdom as per the budget which had been officially released on this Monday by the government of Saudi Arabia.
The budget of the year 2020 anticipates that the deficit is going to be up by $15 Billion on the year 2019 and is going to come even though Saudi Arabia has been planning to cut the spending in the next year by a rate of 7.8% to an amount of $272 Billion. The revenues have been expected to be reduced by 14.6 % as per the official statement.
The budget deficit of 2020 will be 6.5% of their GDP in the next year which is going to be more than the 4.7% which it had been in the year 2019.
It is no surprise that the budget deficit is happening in the Kingdom as the prices of oil have been falling in a sharp manner from the days of oil being at $100 and the oil production has been hit in a huge manner over the previous year as it is trying to do its most of the cutting of production of the other members who have not quite been as diligent with the cuts. In the next year as well it is expected that the production by the Kingdom is going to be lesser as Saudi Arabia has agreed to lower the figure of production even lower and then has offered to produce at a level of 400,000 barrels per day less than the figure.
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