Cabinet OKs hike in gasoline, electricity and water prices
Cabinet OKs hike in gasoline, electricity and water prices
Gasoline price hikes are to take effect after 12 midnight Monday, while the adjustments in electricity and water rates will start on the first day of Rabiul Thani in the Islamic calendar, equivalent to January 11, 2016 in the Gregorian calendar.
Octane 91 will now cost 75 from the current 45 halalas. Octane 95 will increase to 90 halalas from the current 60 halalas, a Cabinet announcement carried by the Saudi Press Agency (SPA) said.
With the directive, Saudi Aramco has ordered that all gasoline stations across the kingdom be closed by nightfall to allow the adjustment of prices in their pumping machines.
Other Gulf states such as the United Arab Emirates and Kuwait have earlier raised their pump prices amid a decline in oil prices worldwide, resulting in reduced revenues.
The new rates were approved during a Cabinet session on Monday, during which Custodian of the Two Holy Mosques King Salman also announced a national budget plan of SR840 billion for 2016, with a view to reducing the deficit and a drive to raise revenues from sources other than oil.
In a press statement released earlier in the day, the MOF revealed plans to review government subsidies for fuel, electricity and water as the government announced cuts in the 2016 budget.
The ministry said it is considering “revisions in energy, water, and electricity prices gradually over the next five years, in order to achieve efficiency in energy use, conserve natural resources, stop waste and irrational use, and minimize negative effects on low and mid-income citizens and the competitiveness of the business sector.”
Another measure mentioned by the Finance Ministry is a review of current levels of fees and fines, introduction of new fees, and completion the necessary arrangements for the application of the value added tax (VAT) approved by the Supreme Council of the Arab Gulf States Cooperation Council at its 36th session held in Riyadh last month.
The ministry also called for the “application of additional fees on harmful goods such as tobacco, soft drinks and the like.”
Among the other measures outlined by the MOF are more on structural reforms, including:
• Reducing the growth of recurring expenditures, especially wages, salaries, allowances and the like, which amounted to SR 450 billion, exceeding 50 percent of the approved budget expenses.
• Optimizing operating expenditures, including the rationalization of government agencies’ expenses, the utilization of technology (IT) for the delivery of government services, and the development and strengthening control and governance mechanisms.
• Completing the revision of the government’s competitiveness and procurement law, in accordance with world-class practices.
• Establishing a unit in the Ministry of Finance for public debt management. The new unit will be responsible for developing and overseeing the public debt and financing strategy and strengthening the Kingdom's ability to borrow both domestically and internationally; thus contributing to the market for sukuk and local bonds.
Major projects, investments worth over $685bn unveiled on Saudi National Day
- The private sector’s contribution to the GDP at constant prices doubled to around SR1236.6 million in 2017
JEDDAH: A major economic boost in the form of 10 major projects and investments exceeding SR685 billion ($183 billion) were unveiled as celebrations of the 88th Saudi National Day got under way.
The Council of Saudi Chambers released a report focusing on great economic achievements in 2017.
These projects reflect the Kingdom’s vision under the wise leadership of King Salman and that of Crown Prince Mohammed bin Salman to provide a brighter future through diversifying sources of national income, tackling environmental challenges and increasing investment and prosperity.
The report summarized the most important events and economic developments in the Kingdom over the past year. These include the lifting of the ban on women driving in June, and the establishment of the General Authority for Cyber Security, in addition to the numerous royal decrees providing financial support to Saudis.
It also noted the important decisions related to the Saudi business sector. These include the launch of a private sector incentive program with a value of SR72 billion, the privatization of 10 government sectors and the establishment of the General Authority for Real Estate. The private sector is still showing a strong performance as an efficient partner in the inclusive development process and in the achievement of the Kingdom’s 2030 Vision, the report noted, as it contributes 39 percent to the Saudi gross domestic product (GDP).
The private sector’s contribution to the GDP at constant prices doubled to around SR1236.6 million in 2017. There has been increased contribution to GDP from non-oil private sector streams.
The private sector also witnessed an increase in the number of workers, in its capital, in the number of shares on the Saudi market, in the cumulative number of establishments operating in the Kingdom, and in non-oil exports.
Continued growth of the private sector was attributed by the report to the Saudi government’s support. This support comes through initiatives such as the removal of obstacles to financial development, improvements to the working environment and policies adopted to boost investment.
It also reviewed the private sector’s efforts to support diversification of the economy and lower unemployment rates.
The importance of the measures taken to prioritize the employment of qualified Saudi workers over the employment of expatriates in the private sector were stressed, as well as the sector’s role in providing education and health services.