Saudi Arabia's 2022 Budget‎

The Kingdom of Saudi Arabia's 2022 Budget is a statement issued by the Ministry of Finance (MOF) in the Kingdom, detailing the state's revenues, expenditures, and the projected surplus for the fiscal year 2022. It was announced on December 12, 2021, with the statement estimating revenues at SAR1,045 billion, approved expenditures at SAR955 billion, and projecting a surplus of SAR90 billion.

The Kingdom's 2022 Budget outlined several priorities, including improving quality of life, continuing the implementation of economic initiatives and reforms to achieve the goals of Saudi Vision 2030, enhancing the transparency, efficiency, and quality of government spending to promote growth and development, optimizing the use of available resources, improving the educational environment, and developing essential facilities and services for citizens and residents. It also prioritized supporting housing plans, safeguarding and strengthening achievements, monitoring the health status amid the ongoing COVID-19 pandemic and its local and global health and economic impacts, and allocating the necessary funding for the health sector to enhance its efficiency and ensure the provision of vaccines for all citizens and residents in the Kingdom.

The Kingdom's 2022 Budget approved transferring the surplus from state budget revenues to the general reserve account. The budget achieved a surplus for the first time in eight years, despite geopolitical disruptions and inflationary pressures. By the end of 2022, the actual budget surplus reached SAR104 billion, equivalent to 2.5 percent of the gross domestic product (GDP), exceeding the initially projected surplus of SAR90 billion in the approved budget. The growth in the surplus is attributed to several factors, including increased oil revenues due to higher oil prices, improved economic activity, economic recovery, the implementation of initiatives to grow non-oil revenues, and continued enhancement of public financial management and financial planning efficiency. The fiscal policy aims to utilize these surpluses to strengthen the Kingdom's financial position by maintaining appropriate levels of government reserves, supporting national funds, and exploring the possibility of accelerating the implementation of strategic programs and projects with economic and social dimensions.

While the Kingdom's 2022 Budget projected a 7.4 percent growth rate, the actual GDP growth significantly exceeded expectations, reaching 8.7 percent, according to the General Authority for Statistics. Oil activities recorded a growth of 15.4 percent, while non-oil activities grew by 5.4 percent. This performance is attributed to measures taken by the Saudi government, its unwavering commitment to structural reforms, and the implementation of initiatives that positively stimulated economic activity.

In 2022, the Kingdom recorded the second-lowest inflation rate among G20 countries. The rise in inflation remained relatively limited compared to the significant increases seen in both advanced and developing economies. This was despite geopolitical events that disrupted supply chains and led to higher energy and food prices. The Consumer Price Index (CPI) in 2022 recorded an increase of 2.5 percent, higher than the 1.3 percent projected in the budget.

The relatively low inflation rate in the Kingdom is attributed to proactive measures taken to curb inflation and its effects, including setting a cap on gasoline prices. The Kingdom strengthened its social support programs through additional aid for social security beneficiaries, the small-scale livestock farmers support program, and the citizen’s account program. Concurrently, it allocated funds to increase strategic stockpiles of essential goods and ensure their availability. Additionally, the monetary policy adopted in Saudi Arabia played a crucial role in mitigating the effects of inflation domestically.

By the end of 2022, the government reserves stood at SAR318 billion, a decline of SAR29 billion compared to 2021. This decrease was due to meeting financing needs outside the budget, including private sector stimulus packages, payments for local loans, and foreign deposits. The current account balance at the end of the 2022 fiscal year amounted to SAR145 billion.