ECONOMY

Saudi can endure low oil prices over medium term: finance minister

Saudi Finance Minister Ibrahim Alassaf. (Al Arabiya)

Saudi Finance Minister Ibrahim Alassaf told Al Arabiya News Channel on Thursday that the kingdom can endure low oil prices over the medium term, hours after Riyadh announced a 2015 budged marked by record spending and large deficit.

Alassaf said the kingdom follows a policy of "realism not conservatism" with regards to the state budget.

He said the deficit will reach more than 4 percent of GDP, noting that no decision has been taken on resorting to reserves to cover the shortfall of revenues.

Earlier, Alassaf said told Saudi television that the government would continue spending actively on economic development projects "over the medium term."

Asked by the interviewer whether he meant three to five years, Alassaf replied: "Yes, over three to five years...The (economic) depth we have, God willing, will be enough until prices get better."

Brent crude oil has tumbled to just above $60 a barrel from $115 in June. Alassaf said everybody expected prices to rise eventually but there was a difference over when; some people said the second half of next year while others said 2016.
 

[With Reuters]

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Last Update: Thursday, 25 December 2014 KSA 19:28 - GMT 16:28
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Saudi Arabia reveals record 2015 budget marked by high spending and large deficit
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