​Saudi budgets for a rare surplus and Oman sees its deficit narrowing

GULF COUNTRIES - Report 14 Dec 2021 by Justin Alexander

* The estimated 2021 Saudi deficit of -2.7% of GDP, the least since 2013, is larger than our forecast largely because of a sharp drop in revenue remitted from sovereign wealth funds.
* The oil price assumption for 2022 has been hiked to about $65 (from $50 in the September pre-budget statement), resulting in a budgeted 2.5% of GDP surplus. This assumes a decline in spending by -6% for a second consecutive year, which will be challenging to achieve.
* Oman released apparently contradictory estimates for 2021 ​suggesting a deficit ranging from -3% to -6% of GDP. The most plausible figure released is -4%. [N.B. updated on 15 December].
* Oman budgets a -4.6% of GDP deficit in 2022. However, its forecast revenue is surprisingly high given the stated oil price assumption of $50, and spending is 9% higher than had been previously planned.

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