Corona’s negative repercussions on the economies of the Arab region, especially the Gulf countries, are suffering from multiplier effects due to their total dependence on oil, which collapsed after the outbreak of the virus in various countries of the world.
The Saudi authorities were forced to take many strict measures and harsh decisions, after the outbreak of the serious disease and the worsening number of injuries inside the Kingdom.
The Saudi Finance Minister, Muhammad Al-Jadaan, announced today, Wednesday, that the Kingdom has approved a partial reduction in its budget by about 50 billion riyals, as part of financial measures to counter the effects of the outbreak of the Corona virus.
Al-Jadaan said: “In view of the economic and global conditions resulting from the consequences of the global epidemic (Covid 19), the sharp decline in the growth forecast for the global economy and its negative impact on oil markets, and its direct impact on public finances in the Kingdom, the government has taken measures to reduce From the impact of low oil prices, additional measures will be taken to deal with the expected price drop. “
The minister indicated that the government worked on preliminary measures, ensuring the provision of the necessary financial requirements to implement preventive and direct measures to deal with the consequences of the epidemic and limit its spread to protect government installations and agencies and the continuity of their work.
He stressed that the government will provide all the additional credits required, and the necessary health services for prevention, treatment and non-proliferation, while emphasizing the priority of social spending, and reorienting government spending with what the stage requires socially and economically.
He pointed out that Riyadh has maintained huge government reserves and assets that enable it to deal with emerging challenges, and reduce the impact on its goals in maintaining financial sustainability and economic stability in the medium and long term.
He considered that it is possible to re-evaluate the developments, review the items of expenditures and take appropriate decisions if the effects of the spread of the Corona virus and its consequences on the global economy worsen.
Reducing the budget means giving up some of the expenses in light of declining revenues as a result of a crisis or stagnation so that the budget deficit does not worsen, and is reflected on citizens with more austerity and less spending on services, bonuses, grants and incentives.