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The state budget closed with a SAR 57.7 bn deficit in 4Q 2024, widening from SAR 30.2 bnin 3Q, according to the Finance Ministry’s quarterly budget performance report (pdf). Total government revenues shrunk 15% y-o-y to SAR 302.9 bn during the quarter, while expenditure fell 9% to SAR 360.5 bn.
On an annual basis: The Kingdom recorded a budget deficit of SAR 115.6 bn during 2024, compared to SAR 81 bn in 2023, far exceeding the government’s earlier forecasts in June 2024 at SAR 79 bn. Government expenditures came in at SAR 1.37 tn, with revenues clocking in at SAR 1.26 tn.
REFRESHER- The Kingdom is willing to accept modest fiscal deficits as the price of pursuing long-term diversification goals. The budget deficit is expected to come in at 2.3% of GDP (SAR 101 bn) in 2025 and to “continue at similar levels over the medium term” as the Saudi state continues to invest heavily in the diversification agenda. The government is also mindful of staying clear of “overheating” the national economy, despite the ramp-up in public spending.
THE BREAKDOWN-
Oil revenues accounted for some 56% of total government income in 4Q 2024, at a total of SAR 170.85 bn — declining 31% y-o-y. Meanwhile, non-oil revenues made up the remaining 44%, coming in at a combined SAR 132 bn, up 21% compared to the same period last year.
Total expenditures for 4Q 2024 fell 9% y-o-y to SAR 360.5 bn, with most sectors seeing declines in public spending, except for subsidies (up 55% y-o-y), financing expenses (up 23%), and employee compensation (up 4%). Non-financial assets saw the largest y-o-y decline in government spending (down 43%), followed by grants (down 35%). Meanwhile, employee compensation comprised the lion’s share of public spending at SAR 146.3 bn.
The Kingdom’s biggest expenses and moneymakers in 2024: Oil revenues marginally increased to SAR 756.6 bn in 2024, accounting for 61% of total government income. Non-oil revenues made up the remainder, increasing 10% y-o-y to a combined SAR 502.47 bn. Meanwhile, total expenditure rose 6% y-o-y to SAR 1.37 tn in 2024. Employee compensation clocked in at SAR 562.3 bn — the largest line item during the period — followed by goods and services usage at SAR 313 bn, and non-financial assets at SAR 190.7 bn.
