Saudi Arabia unveils SR1.02 trillion budget in privatization push

King Salman announced the 2020 budget at a cabinet meeting. (SPA)
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Updated 11 December 2019
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Saudi Arabia unveils SR1.02 trillion budget in privatization push

  • King Salman pledges to empower private sector and boost transparency across the economy
  • Saudi Finance Minister Mohammed Al-Jadaan said government would continue its focus on developing the private sector

RIYADH: Saudi Arabia is set to spend SR1.02 trillion ($272 billion) next year as the Kingdom embarks on a major privatization push amid a widening budget deficit.
The government’s annual budget released on Monday predicts revenue of SR833 billion in 2020, leaving a projected deficit of SR187 billion — or the equivalent of 6.4 percent of GDP. It anticipates real GDP growth of about 2.3 percent next year.
King Salman announced the figures at a cabinet meeting in Riyadh.
“We are determined to continue implementing economic reforms, diversifying sources of income, including investing the proceeds of Saudi Aramco by the Public Investment Fund, optimizing the use of available resources, empowering the private sector and raising the level of transparency and efficiency of government spending to boost growth and development rates,” he said.

Announcing the budget breakdown, Saudi Finance Minister Mohammed Al-Jadaan said that while spending next year would be less than in 2019, the government would continue its focus on developing the private sector, stressing there would be no increases in taxation.
“Privatization is at the top of the government’s priorities,” he told reporters.
“We will continue to support big projects and will continue to support promising projects,” he said. ” Enabling the private sector is the top priority of Vision 2030. We have more to come and our journey toward Vision 2030 demands it.




Saudi Finance Minister Mohammed Al-Jadaan said the government would continue its focus on developing the private sector. (Ahmed Fathi)

The budget takes place against a backdrop of quickening reforms in 2019 and a number of key events from the record initial public offering of Saudi Aramco to the creation of fast track tourism visas.
“We believe that the revenue assumptions in the budget are realistic, both oil and non-oil,” Monica Malik, chief economist at Abu Dhabi Commercial Bank, told Arab News.
“Despite the planned pullback in government spending, we expected to see a pickup in real non-oil GDP growth as investment activity strengthens. Spending by the PIF will be central for the higher investment activity.

"The finance ministry hosted a visit of international investors to coincide with this year’s budget announcement, underscoring the government’s desire to attract more overseas investment in the slipstream of the world’s biggest IPO. The group included a number of international investment companies, insurers and asset managers, including Goldman Sachs, Mayfair Bank, Etiqa Insurance and Nippon Life Insurance Company among others.
Saudi banks such as SAAB, Samba, NCB, Bank AlJazira and Alinma Bank also attended.
While reducing the Kingdom’s dependence on oil revenues is a key part of the Vision 2030 reform agenda, the commodity remains the principal driver of spending trends for both Saudi Arabia and other Arabian Gulf oil-exporting nations.
They have been coordinating production cuts since 2017 through the OPEC+ group of producers that includes Russia, in an effort to keep the market in balance amid surging output from US shale producers.
Last week the Kingdom spearheaded an agreement between the OPEC+ group of exporters to commit to further output cuts to help avert an oversupply of oil on the global market.
Education gets the lion’s share of government spending in 2020 with some SR193 billion set aside for the sector after more than 500 schools were opened in 2019.
The budget analysis also reveals that most non-oil sectors of the economy posted positive growth rates during the first half of this year with the construction sector recording growth for the first time since 2015.
That helped to reduce the unemployment rate among Saudis at the end of the first half of the year by 0.4 percentage points to 12.3 percent compared to the end of 2018.
US-based IHS Markit analyst Bryan Plamondon, told Arab News: “The 2020 budget highlights rationalized spending, with debt issuance and reserves helping to fill the gap from weaker revenues. We expect the Kingdom’s fiscal account will post wider deficits during 2020–21 as spending on Vision 2030 continues.”

*Click here for the full budget statement from the Ministry of Finance


Digital Cooperation Organization secretary-general holds meetings in Cairo

Deemah Al-Yahya, secretary-general of the DCO, holds talks with Egyptian Minister of Communications and Information Technology.
Updated 18 sec ago
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Digital Cooperation Organization secretary-general holds meetings in Cairo

  • Al-Yahya affirmed to Talaat that there were several opportunities for cooperation between DCO and Egypt in light of the latter’s digital strategy

RIYADH: Deemah Al-Yahya, secretary-general of the Digital Cooperation Organization, held talks with Egyptian Minister of Communications and Information Technology Amr Talaat, and the Arab League’s Secretary-General Ahmed Aboul Gheit during her visit to Cairo.

Al-Yahya affirmed to Talaat that there were several opportunities for cooperation between the organization and Egypt in light of the latter’s digital strategy.

She added that this was the result of Egypt’s economic components and strategic goals aligning with the organization’s aims.

Al-Yahya added that the organization was able to provide opportunities that could be leveraged to achieve digital economic growth and prosperity.

She also praised the Digital Egypt Pioneers Initiative, which drives digital transformation by developing skills and innovation while supporting young talents in business.

Al-Yahya affirmed that the organization seeks to enhance cooperation with different sectors in Egypt to boost cooperation in the infrastructure of information technology and communications, as well as innovation ecosystems, through partnerships between private and public sectors.


Saudi Arabia, Jordan to airdrop aid to Palestinians

KSrelief has delivered equipment, tools to Jordanian Hashemite Charity Organization that will be sent to support Palestinians.
Updated 17 min 9 sec ago
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Saudi Arabia, Jordan to airdrop aid to Palestinians

  • Jordan’s Armed Forces will airdrop the 30 tonnes of supplies into the area that remains under siege by Israel
  • This effort is a part of Saudi Arabia’s campaign to help the Palestinian people

RIYADH: Saudi Arabia’s aid agency KSrelief has delivered equipment and tools to the Jordanian Hashemite Charity Organization that will be sent to support Palestinians in Gaza.

Jordan’s Armed Forces will airdrop the 30 tonnes of supplies into the area that remains under siege by Israel.

This effort is a part of Saudi Arabia’s campaign to help the Palestinian people.

The Kingdom remains committed to delivering humanitarian aid into Gaza through various means, the Saudi Press Agency reported on Thursday.


Black cloth covering Kaaba in Makkah raised ahead of Hajj

Updated 23 May 2024
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Black cloth covering Kaaba in Makkah raised ahead of Hajj

  • Procedure meant to keep the cover, Kiswa, free from getting soiled and tampered
  • 36 specialized technical personnel carried out procedure with aid of 10 cranes

RIYADH: In keeping with the annual tradition, officials raised the lower part of the kiswa — the elaborately designed black cloth covering the Kaaba — in Makkah on Wednesday ahead of this year’s Hajj pilgrimage.
As approved by the General Authority for the Care of the Affairs of the Two Holy Mosques, the exposed part was covered with a white cotton fabric, two-and-a-half meters wide and 54 meters long on all four sides, according to the Saudi Press Agency.
Carrying out the procedure were 36 specialized technical personnel with the aid of 10 cranes.

In this handout photograph, taken and released by Saudi Press Agency, specialized technicians are seen at work at the Kaaba in Makkah on May 23, 2024, raising the special cover to keep it from being soiled and damaged ahead of the annual Hajj pilgrimage. (SPA)

As described in the SPA report, the kiswa is lifted in several stages: It starts with unscrewing the bottom of the cover from all sides, separating the corners, then untying the bottom rope and removing it from the fixing rings, after which the cloth is rolled upward. The lanterns are then dismantled and the white cloth are put in place, after which the lanterns are reinstalled over the white cloth until the final stage.
The procedure is repeated every year to protect the kiswa from getting soiled and damaged as pilgrims circumambulate the Kaaba.

In this handout photograph, taken and released by Saudi Press Agency, specialized technicians are seen at work at the Kaaba in Makkah on May 23, 2024, raising the special cover to keep it from being soiled and damaged ahead of the annual Hajj pilgrimage. (SPA)

The annual Hajj in Saudi Arabia is considered the world’s largest human gathering, with year 2012 marking the biggest number of participants at 3.16 million.
At the height of the COVID-19 pandemic, Saudi authorities allowed only a symbolic observance of Hajj with just a thousand pilgrims. The numbers were gradually raised as the health crisis was placed under control worldwide. Last year, almost 1.84 million pilgrims performed the “once in a lifetime” journey and the figure is expected to go higher this year.
Every year, on the ninth day of the Islamic month of Dul Hijjah, the black silk cloth is removed and a new kiswa is draped in its place.


Saudi Arabia welcomes move by Norway, Ireland and Spain to formally recognize Palestinian state

Updated 23 May 2024
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Saudi Arabia welcomes move by Norway, Ireland and Spain to formally recognize Palestinian state

  • Palestinian Authority and its rival group Hamas both welcomed the recognition
  • Israel recalls envoys to Spain, Ireland and Norway for consultations

RIYADH/COPENHAGEN: Saudi Arabia said Wednesday it welcomed the “positive” decision taken by Norway, Spain, and Ireland to recognize a Palestinian state. 
The Kingdom said it appreciated this decision “which confirms the international consensus on the inherent right of the Palestinian people to self-determination,” in a foreign ministry statement. 

The kingdom also called on more countries to swiftly take the same stance, “which would contribute to finding a reliable and irreversible path to achieve a just and lasting peace that fulfills the rights of the Palestinian people.”

Leaders of Norway, Spain and Ireland said on Wednesday they were formally going to recognize Palestine as a state.

Norwegian Prime Minister Jonas Gahr Store said: “There cannot be peace in the Middle East if there is no recognition.”

Spanish Prime Minister Pedro Sanchez also announced that the country’s council of ministers would recognize an independent Palestinian state on Tuesday May 28.

“Next Tuesday, May 28, Spain’s cabinet will approve the recognition of the Palestinian state,” he said, adding that his Israeli counterpart Benjamin Netanyahu was putting the two state solution in “danger” with his policy of “pain and destruction” in the Gaza Strip.

Irish Prime Minister Simon Harris said it was a move coordinated with Spain and Norway, marking “an historic and important day for Ireland and for Palestine.”

The Palestinian Authority and its rival group Hamas both welcomed the recognition of a Palestinian state by Ireland, Spain and Norway.

The Palestinian Authority exercises limited self-rule in the West Bank territory while Hamas runs Gaza.

Jordan hailed the coordinated move as an “important and essential step towards Palestinian statehood.”

“We value this decision and consider it an important and essential step towards a two-state solution that embodies an independent, sovereign Palestinian state along the July 1967 borders,” Jordanian Foreign Minister Ayman Safadi told a press conference.

Qatar’s foreign ministry welcomed the announcement as an “important step in support of a two-state solution,” expressing hope that other countries would follow suit.

The six-member Gulf Cooperation Council also spoke out in support of the European countries’ move, with secretary general Jasem Mohamed Albudaiwi saying it represented “a pivotal and strategic step towards achieving the two-state solution” to the Israeli-Palestinian conflict, a statement said.

The Organisation of Islamic Cooperation, based in the Saudi city of Jeddah, similarly welcomed the move as an “important historic step”.

Several European Union countries have in the past weeks indicated that they plan to make the recognition, arguing a two-state solution is essential for lasting peace in the region.

Israel recalled envoys to Spain, Ireland and Norway over their moves to recognize a Palestinian state.

“Today, I am sending a sharp message to Ireland and Norway: Israel will not go over this in silence. I have just ordered the return of the Israeli ambassadors from Dublin and Oslo to Israel for further consultations in Jerusalem,” Foreign Minister Israel Katz said in a statement.

Sanchez said in March that Spain and Ireland, along with Slovenia and Malta, had agreed to take their first steps toward Palestinian recognition, seeing a two-state solution as essential for lasting peace.

The efforts come as a mounting death toll in Gaza from Israel’s offensive to rout Hamas prompts calls globally for a ceasefire and lasting solution for peace in the region.

Norway, which is not a member of the European Union but mirror its moves, has been an ardent supporter of a two-state solution between Israel and the Palestinians.

“The terror has been committed by Hamas and militant groups who are not supporters of a two-state solution and the state of Israel,” the Norwegian government leader said.

“Palestine has a fundamental right to an independent state,” Gahr Store told a press conference.

The move comes as Israeli forces have led assaults on the northern and southern edges of the Gaza Strip in May, causing a new exodus of hundreds of thousands of people, and sharply restricted the flow of aid, raising the risk of famine.

The Scandinavian country “will therefore regard Palestine as an independent state with all the rights and obligations that entails,” Gahr Store said.

Norway’s recognition of a Palestine state comes more than 30 years after the first Oslo agreement was signed in 1993.

Since then, “the Palestinians have taken important steps toward a two-state solution,” the Norwegian government said.

It said that the World Bank determined that Palestine had met key criteria to function as a state in 2011, that national institutions have been built up to provide the population with important services.

“The war in Gaza and the constant expansion of illegal settlements in the West Bank still mean that the situation in Palestine is more difficult than it has been in decades,” the Norwegian government said.


Black cloth covering Kaaba in Makkah raised ahead of Hajj

Updated 23 May 2024
Follow

Black cloth covering Kaaba in Makkah raised ahead of Hajj

  • The procedure is meant to keep the cover, known as kiswa, free from getting soiled and tampered with as pilgrims performing Hajj circumabulate the Kaaba

RIYADH: In keeping with the annual tradition, officials raised the lower part of the kiswa — the elaborately designed black cloth covering the Kaaba — in Makkah on Wednesday ahead of this year's Hajj pilgrimage.

As approved by the General Authority for the Care of the Affairs of the Two Holy Mosques, the exposed part was covered with a white cotton fabric, two-and-a-half meters wide and 54 meters long on all four sides, according to the Saudi Press Agency.

Carrying out the procedure were 36 specialized technical personnel with the aid of 10 cranes.

As described in the SPA report, the kiswa is lifted in several stages: It starts with unscrewing the bottom of the cover from all sides, separating the corners, then untying the bottom rope and removing it from the fixing rings, after which the cloth is rolled upward. The lanterns are then dismantled and the white cloth are put in place, after which the lanterns are reinstalled over the white cloth until the final stage.

The procedure is repeated every year to protect the kiswa from getting soiled and damaged as pilgrims circumambulate the Kaaba.

The annual Hajj in Saudi Arabia is considered the world's largest human gathering, with year 2012 marking the biggest number of participants at 3.16 million.

At the height of the COVID-19 pandemic, Saudi authorities allowed only a symbolic observance of Hajj with just a thousand pilgrims. The numbers were gradually raised as the health crisis was placed under control worldwide. Last year, almost 1.84 million pilgrims performed the "once in a lifetime" journey and the figure is expected to go higher this year.

Every year, on the ninth day of the Islamic month of Dul Hijjah, the black silk cloth is removed and a new kiswa is draped in its place.