Saudi Arabia’s Minister of Finance, H.E. Mohammed bin Abdullah Al-Jadaan, approved the annual borrowing plan for 2024 following its endorsement by the National Debt Management Center’s board at its last meeting.
The plan includes public debt developments, debt market initiatives started in 2023, and the 2024 funding plan and its guidelines. It also includes the calendar of domestic sukuk issuances under the Local Saudi Sukuk Issuance Program in Saudi Riyal.
The 2024 annual borrowing plan highlighted the estimate of financing needs at approximately SAR86 billion. This includes repayment of outstanding debts and financing the expected deficit in the state budget for 2024. The total debt portfolio is expected to reach SAR1.115 billion by the end of 2024.
The 2024 annual borrowing plan
The 2024 annual borrowing plan includes meeting Saudi Arabia’s financing needs through financing activities locally and internationally. It also includes financing the estimated deficit in the 2024 state budget and repaying debts due in 2024 and in the medium term. In addition, it seeks to seize available opportunities according to the market and the conditions necessary to implement additional financing activities to repay debts due in the coming years. Furthermore, it is committed to leveraging market opportunities and implementing alternative government financing activities that promote economic growth. This includes financing different development and infrastructure projects.
Notably, Saudi Arabia expects only a slight decline in revenues in the 2024 budget. However, it plans on extending the oil production cut despite the decline in crude prices. Moreover, it intends to enhance spending, especially on projects that support its non-oil economy.
Last year, Saudi Arabia achieved one of the highest growth rates among the G20 countries and its first budget surplus in nearly a decade. Since then, the decline in oil production and prices have affected its economy. In addition, its non-oil GDP growth reached about 5.9 percent in 2023, significantly outpacing the performance of its general economy.
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2024 goals
In a previous statement, Saudi Crown Prince His Highness Mohammed bin Salman explained that the 2024 budget aims to enhance growth in the non-oil economy. This will be done by enhancing spending and investing in infrastructure, local industry, and services.
In addition, the Ministry of Finance stated that total spending in 2024 will reach SAR1.251 trillion ($334 billion). This represents an increase of about 12 percent compared to the 2023 budget. Moreover, the kingdom estimates that total revenues in 2024 will reach SAR1.172 trillion, while 2023 revenues are expected to amount to SAR1.193 trillion, revised upward from the pre-budget statement issued in September. The increased revenue expectation for 2023 comes despite the extension of the voluntary oil production by 1 million barrels per day.
Saudi Arabia expects a 4.4 percent growth this year and stated that it will resort to debt markets to manage an expected budget deficit of SAR79 billion.
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