Saudi weighs slower subsidy to aid economy

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Saudi Arabia may cut energy subsidies more gradually and take longer to balance its budget, Finance Minister Mohammed Al-Jadaan said, as the kingdom seeks to soften the impact of its drive to repair public finances.

Jihad Azour, director of the IMF’s Middle East and Central Asia department, said Friday the kingdom is on the right track with fiscal reforms that would allow it to ultimately balance its budget. A gradual approach would enable Saudi Arabia to have more flexibility going forward, he said.

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The government will accelerate its 200 billion riyal ($53 billion) stimulus program to boost growth, Al-Jadaan said. About 40 billion riyals have been committed so far on housing and an industrial development fund, he said. A “significantly” higher amount will be announced before the end of this year and then spent as needed, he said.

Source Credit: Bloomberg
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