Saudi Arabia to reduce expenditures 'sharply' amid COVID-19 crisis

Amid the unprecedented outbreak of deadly coronavirus, Saudi Arabia has said that it would ramp-up the precautionary measures to rectify the economic impact of the global health crisis. As the global death toll of COVID-19 continues to rise, Saudi Finance Minister Mohammed Al Jadaan said in an interview with the local media outlet on May 2 that the budget expenditures will be reduced “sharply” and added that “all options for dealing the crisis are open”. One of the biggest challenges that the world leaders across the globe are facing is to strike a balance between the plunging economy and the healthcare of citizens.

According to reports, Jadaan said that the impact of the coronavirus outbreak on Saudi finances would start showcasing from the second quarter of 2020. Kingdom’s Finance Minister has said, “Saudi finances need more discipline and the road ahead is long”. One of the measures that Saudi Arabia is planning would be slowing down of the projects funded by the government including the mega-projects in a bid to cut short the expenditures.

Kingdom’s central bank foreign exchange reserves reportedly plunged in March and the fastest rate in nearly 20 years and collapsed at the lowest level since 2011. Meanwhile, since the oil industry was also spiralling, Saudi Arabia’s economy crashed to a $9 billion budget deficit pushing the government to take "strict, painful" measures.

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Saudi Arabia’s deal with China

Meanwhile, just last week in a bid to expand coronavirus testing in Saudi Arabia, the Kingdom has signed a strategic deal worth $265 million with China. As per reports, Beijing will provide as many as nine million coronavirus test kits to the Saudi government to help its COVID-19 relief effort. The recent deal comes as the deadly virus has been spreading rapidly across the Kingdom. 

After a phone call between Saudi Arabia’s King Salman bin Abdulaziz and Chinese President Xi Jinping, the two leaders are said to have also agreed upon 500 specialised Chinese experts and technicians testing people and training medics in the Kingdom. As per reports, the Saudi government will set up nearly six regional labs while the Chinese health officials will ensure the quality of tests for a period of eight months and also overseeing tests throughout the country. 

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(Image Source: AP)