Al Nassr secures 5-1 victory over Al Ain to edge closer to knockout stage    Saudi Deputy FM meets Lt. Gen. Al-Burhan of Sudan    Al-Khateeb: Saudi Arabia is the largest global investor in tourism sector "Saudi Land" pavilion inaugurated at World Travel Market in London    Saudi Crown Prince, Japanese PM discuss over phone efforts made to achieve peace in the region    Saudi Arabia, in its drive to enrich Arab culture, launches Arab Week at UNESCO in Paris    Neymar exits Al Hilal match with muscle injury, leaving fans disappointed    AlHisn Big Time Studios unveiled to transform film and TV production in Riyadh    Saudi Arabia approves cooperation agreement with US for the use of outer space for peaceful purposes    Quality of Life Program CEO highlights Saudi urban transformations at UN-Habitat conference in Cairo    Almarai wins 'Best Corporate Sukuk' at Asset Triple A Islamic Finance Awards    Top climber falls to death after rare Himalayan feat    US voters flying home in time for election    Drones and snipers on standby to protect Arizona vote-counters    India's Modi condemns violence after Canada temple incident    Elon Musk can keep giving $1m to voters, judge rules    Mitrovic's hat-trick leads Al Hilal to 3-0 victory over Esteghlal    Al Ahli extends perfect start with 5-1 victory over Al Shorta    Quincy Jones, titan of US music, dies aged 91    Hidden sugars in Asia's baby food spark concerns    HONOR unveils pre-order of the stunning HONOR MagicBook Art 14 Featuring an ultra-slim design, HONOR Eye Comfort Display and AI Cross-OS WorkStation    India puts blockbuster Pakistani film on hold    The Vikings and the Islamic world    Filipino pilgrim's incredible evolution from an enemy of Islam to its staunch advocate    Muted Eid celebrations for millions of Nigerian Muslims    Exotic Taif Roses Simulation Performed at Taif Rose Festival    Asian shares mixed Tuesday    Weather Forecast for Tuesday    Saudi Tourism Authority Participates in Arabian Travel Market Exhibition in Dubai    Minister of Industry Announces 50 Investment Opportunities Worth over SAR 96 Billion in Machinery, Equipment Sector    HRH Crown Prince Offers Condolences to Crown Prince of Kuwait on Death of Sheikh Fawaz Salman Abdullah Al-Ali Al-Malek Al-Sabah    HRH Crown Prince Congratulates Santiago Peña on Winning Presidential Election in Paraguay    SDAIA Launches 1st Phase of 'Elevate Program' to Train 1,000 Women on Data, AI    41 Saudi Citizens and 171 Others from Brotherly and Friendly Countries Arrive in Saudi Arabia from Sudan    Saudi Arabia Hosts 1st Meeting of Arab Authorities Controlling Medicines    General Directorate of Narcotics Control Foils Attempt to Smuggle over 5 Million Amphetamine Pills    NAVI Javelins Crowned as Champions of Women's Counter-Strike: Global Offensive (CS:GO) Competitions    Saudi Karate Team Wins Four Medals in World Youth League Championship    Third Edition of FIFA Forward Program Kicks off in Riyadh    Evacuated from Sudan, 187 Nationals from Several Countries Arrive in Jeddah    SPA Documents Thajjud Prayer at Prophet's Mosque in Madinah    SFDA Recommends to Test Blood Sugar at Home Two or Three Hours after Meals    SFDA Offers Various Recommendations for Safe Food Frying    SFDA Provides Five Tips for Using Home Blood Pressure Monitor    SFDA: Instant Soup Contains Large Amounts of Salt    Mawani: New shipping service to connect Jubail Commercial Port to 11 global ports    Custodian of the Two Holy Mosques Delivers Speech to Pilgrims, Citizens, Residents and Muslims around the World    Sheikh Al-Issa in Arafah's Sermon: Allaah Blessed You by Making It Easy for You to Carry out This Obligation. Thus, Ensure Following the Guidance of Your Prophet    Custodian of the Two Holy Mosques addresses citizens and all Muslims on the occasion of the Holy month of Ramadan    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



IMF: Arab oil exporters see budget gap in 2016
Published in The Saudi Gazette on 13 - 11 - 2013

JEDDAH – The Arab world's energy exporting states are not saving enough of their oil windfall and as a group may start running a fiscal deficit in 2016 if current policies do not change, the International Monetary Fund said on Tuesday.
“Together with substantial oil revenue risks, this prospect underscores the need for countries to build or strengthen their fiscal and external buffers,” the IMF said in a report.
In 2012, total state spending in the six Gulf Cooperation Council members - Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Oman and Bahrain - climbed 9.7 percent, a Reuters calculation based on IMF data shows.
That is much less than the 17.7 percent jump in 2011, when governments boosted social welfare and infrastructure spending to ease social tensions during the Arab Spring uprisings.
The IMF expects growth in the GCC's state spending to slow further in coming years; it forecasts an average rise of just over 4 percent annually in 2013-2018, compared to the 15 percent clip seen over the last decade, its data showed.
But on current indications, this spending restraint will not be enough to prevent state budgets in many countries from going into the red, the IMF predicted. Bahrain is currently the only GCC country in the red; it is expected to be followed by Oman as soon as in 2015, and Saudi Arabia in 2018.
The combined budget surplus of 11 Arab oil exporters, including those in North Africa, is now projected to decline to 4.2 percent of gross domestic product in 2013 from 6.3 percent last year. In April this year, the IMF projected a 4.7 percent surplus for 2013.
Even as spending grows too fast, revenues are threatened by the risks of lower oil prices and a drop in global demand for Arab oil, the IMF added. Oil export receipts account for over 80 percent of government revenues in the region, and the IMF said the most important threat to revenues was now the possibility of excess supply in the global oil market.
“Notwithstanding the tightness caused by unexpected production disruptions and elevated geopolitical risks in the summer of 2013, a combination of weak global oil demand growth and strong supply growth from unconventional sources in the non-OPEC countries could reduce demand for OPEC oil by about a half-million barrels per day by 2016,” the IMF said.
Most Arab oil exporters now need an oil price above $90 to balance their budgets at forecast production levels, the IMF said, adding that rising volatility in oil production meant uncertainty over revenues would increase. “A sustained period of oil prices remaining $25 below the baseline...would lead to deficits from 2015 onward in all countries except Kuwait and the UAE...in the absence of a fiscal policy adjustment.”
Kuwait is projected to have the lowest budget break-even oil price of $52 per barrel this year, while Yemen tops the table with as much as $215, the IMF report showed.
IMF said Arab governments should search for new, non-oil sources of revenue. Most governments in the region say they understand the risks and are taking steps to manage them, including policies to diversify their economies and create private sector jobs for their citizens.— Reuters


Clic here to read the story from its source.