Saudi Arabia Greenlights $23 Billion Borrowing Plan to Fuel Vision 2030 Initiatives

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Saudi Arabia’s Minister of Finance, Mohammed bin Abdullah Al-Jadaan, has given the green light to the kingdom’s borrowing plan, aimed at securing funds amounting to 86 billion riyals ($23 billion) for the year 2024. The National Debt Management Centre (NDMC) announced the approval, emphasizing the necessity of the financing to address debt maturities and support the projected deficit outlined in the 2024 budget.

Borrowing Plan Overview:

The borrowing plan for 2024 is structured to meet the country’s financing needs through a combination of domestic and international channels. This includes addressing the budget deficit, settling debt maturing in 2024 and the medium term, and exploring market opportunities for additional financing activities.

Projected Debt Portfolio:

By the end of 2024, Saudi Arabia’s debt portfolio is estimated to reach SAR1.115 trillion, reflecting the scale of financial commitments undertaken to support the nation’s economic objectives. The borrowing plan incorporates public debt developments and a schedule for domestic sukuk issuances.

Strategic Approach:

The approved borrowing plan is not merely a financial maneuver to cover immediate shortfalls; it aligns with a broader strategy. Saudi Arabia aims to leverage market opportunities to execute alternative government financing activities that promote economic growth. This includes financing critical development and infrastructure projects, emphasizing a commitment to the ambitious Vision 2030 plan.

Vision 2030 and Economic Transformation:

As part of Vision 2030, Saudi Arabia has embarked on various giga projects to diversify its economy and reduce dependency on oil revenues. The borrowing plan for 2024 reflects the kingdom’s determination to continue funding initiatives aligned with Vision 2030, emphasizing the importance of economic transformation.

Budget Deficit and Expenditure Forecast:

In anticipation of a budget deficit of SAR79 billion in 2024, equivalent to approximately 1.9% of its gross domestic product (GDP), Saudi Arabia remains committed to financing initiatives outlined in the Vision 2030 plan. Total expenditures are projected to reach SAR1.25 trillion, with revenues forecasted to hit SAR1.172 trillion.

Saudi Arabia’s approval of the $23 billion borrowing plan for 2024 underscores its commitment to Vision 2030 and the transformative initiatives aimed at diversifying the economy. The strategic approach outlined in the borrowing plan not only addresses short-term financial needs but also seeks to stimulate economic growth through targeted investments in development and infrastructure projects. As Saudi Arabia navigates the evolving economic landscape, the borrowing plan serves as a crucial tool in achieving its long-term vision.

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