MAKKAH, 28 November 2002 — The Ministry of Finance and National Economy announced yesterday that the Kingdom’s gross domestic product is estimated to reach SR695 billion in 2002 in current prices, up 2.3 percent from last year. In real terms, the growth is estimated at 0.74 percent totaling SR644 billion.
The ministry announced the outcome of the current financial year in a statement after the Council of Ministers approved the state budget for the fiscal year 1423-24H (2003).
The ministry said the private sector has become the main source of growth and employment by contributing around 46 percent of the GDP in 2002. It said the private sector GDP is estimated to have grown by 4.2 percent in real terms and 3.7 percent in current prices.
All components of the private sector GDP have recorded real growth, it said. In particular, non-oil industrial sector is estimated to have grown by 5.7 percent, communication and transportation sector by 7.1 percent, electricity, gas, and water sector by 4.5 percent, construction sector by 3 percent, and wholesale, retail, hotels, and restaurants sector by 4 percent.
The ministry announced 36.3 percent surge in revenues for the current year to SR214 billion from the projected income of SR157 billion.
Actual expenditures for the current year also rose 10 percent to SR222.2 billion from the projected expenditures of SR202 billion.
This has cut the projected SR45-billion deficit to just SR8.25 billion.
The hike in revenues is attributed to a 30 percent increase in oil prices over the projected $16-17 a barrel.
General price level: Inflation as measured by the cost of living index is estimated to have declined by 0.4 percent in 2002, while the non-oil GDP deflator is estimated to show a decrease of 0.22 percent.
Balance of payments: The current account, according to SAMA preliminary data, is estimated to record a surplus amounting to SR33.7 billion in 2002, compared to a surplus of SR35.1 billion in 2001.
Non-oil exports are estimated to have grown by 1.2 percent in 2002 reaching SR31.1 billion which represent 12.1 percent of total goods exported. It is worth noting that 35 percent of non-oil exports, excluding re-exports, are non-petrochemicals which are estimated to have grown by 30 percent in 2002.
The macroeconomic policies continue to be guided by the government’s objective of maintaining price and exchange rate stability. The broad money supply during the first nine months of 2002 grew by 6.7 percent compared to 1.8 percent for the same period of last year. Regarding the banking sector, total bank’s claims on the public and private sectors increased by 5.1 percent during the first nine months of fiscal year 2002; their capital and reserves increased by 7.8 percent and profits increased by 7.9 percent.
Privatization: In addition to previous government efforts toward privatization, the Supreme Economic Council approved this year the privatization strategy. Moreover, the Council of Ministers approved the list of activities targeted for privatization. These include water and water treatment, airports, roads, railroads, education, health, and social services. Before the end of this year, the government will sell 30 percent of the shares of the Saudi Telecommunications Company (STC) to the public.
Appropriations for 2003
General Organization for Seaports SR1.41 billion; Saudi Arabian Airlines SR11.28 billion; Grain and silos SR1.034 billion; Desalination SR2.245 billion; Railways SR145 million; Royal Commission for Jubail and Yanbu SR1.01 billion; Saudi Specifications Organizations SR86.8 million; General Investment Authority SR80 million’; King Saud University SR2.403 billion; King Abdul Aziz University SR1.538 billion; King Fahd University for Petroleum and Minerals SR574.3 million; Imam Muhammad ibn Saud Islamic University SR1.25 billion; Islamic University in Madinah SR287.8 million; King Faisal University SR773 million; Umm Al-Qura University SR744.5 million; King Khaled University SR422 million; GOTEVOT SR1.54 billion; KACST SR504.4 million; Institute of Public Administration SR202.5 million;Red Crescent Society SR295.3 million; General Organization for Military Industries SR715.6 million; Saudi Geological Survey SR110.6 million; Supreme Commission for Tourism SR125 million; Saudi Telecom Authority SR80 million; Pension Fund SR29.48 billion.
