JEDDAH: The economic challenges of the coronavirus pandemic are great and neither Saudi Arabia nor the world will be the same when it is over, the Kingdom’s Finance Minister Mohammed Al-Jadaan said on Saturday.
Saudi Arabia would take strict and painful measures to deal with the impact, and “all options for dealing with the crisis are open,” the minister said in an interview with Al-Arabiya TV.
“We must reduce budget expenditures sharply,” Al-Jadaan said, and some government projects may be slowed down to reduce expenditure.
Al-Jadaan said that citizens’ welfare and their benefit is top priority, but that some of the action taken will be “painful, but for everyone’s benefit.”
“Current actions taken to date to cut spending are not enough, and Saudi public finances will need more control and the journey ahead is long.
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“Expenses must be reduced to cope with the fallout from coronavirus and we need to be careful not to increase the cost of debt.”
“We are currently reviewing a set of initiatives to support the economy, the private sector and the health sector. Revenues have declined dramatically and are expected to continue to decline over this year and possibly until the beginning of the next fiscal year. Therefore we must be prepared, economically and financially, to confront this pandemic.
“We have to plan for the worst, take matters seriously and shrink … in order to continue providing citizens and expats with services, and manage the government.”
Al-Jadaan said that the Kingdom released economic support packages valuing SAR180 billion ($47.8 billion), but that it had used up SAR1 trillion from its reserves over the past four years.
“The real impact of the coronavirus pandemic will appear in the second quarter, and we have to face a very big revenue shock,” he said.
“We must tighten the belt and come out of the crisis strong.”
The number of virus cases in the Kingdom reached 25,459 on Saturday, an increase of 1,362, and the death toll rose by seven to 176. Worldwide, the virus has infected nearly 3.5 million people, and killed more than 240,000.