All indications are that the 2015 budget to be unveiled by Custodian of the Two Holy Mosques King Abdullah on Thursday will keep spending at current levels, which will boost growth, ensure an ideal business environment and create jobs.

Economists do not expect any fall in government spending for next year despite a 50 percent plunge in oil prices. They have predicted a slight increase in spending in 2015 compared to the projected expenditure of SR855 billion this year.

“I believe there will be a slight increase in spending,” said Abdullah Allawi, assistant director general for research at Aljazira Capital, adding that it would be financed by the Kingdom’s huge reserves.

The Kingdom’s total cash reserves stood at SR1.492 trillion in October 2014 while its total reserves in assets amounted to SR2.78 trillion, according to figures published by Asharq Al-Awsat Arabic daily.

Saudi revenue has been higher than projected in recent years, ranging between SR95 billion and SR650 billion annually, as a result of rising oil prices. Government spending also rose by SR55 billion to SR224 billion.

Mazin Al-Sudairy, head of research at Istithmar Capital, expects the Kingdom’s revenue to be SR1.4 trillion, spending at SR1.8 trillion, with a deficit of SR40 billion in 2014, especially because of huge spending on infrastructure projects. “I don’t expect any decrease in spending in 2015,” said Al-Sudairy. However, he said the government might postpone some big projects.

The impact of oil prices on the Kingdom’s budget has placed a greater focus on the role of the Saudi private sector in driving growth and diversifying revenue sources.

Abdul Rahman Al-Zamil, president of the Council of Saudi Chambers, said the private sector would play a leading role in the Kingdom’s development in the coming years. The dependence on the private sector has been evident in many economic activities, especially education, health and social services, Al-Zamil said, adding that its contribution to the country’s GDP rose to 59 percent in 2013. “This shows that the Saudi private sector is capable of driving the Kingdom’s growth,” he said.

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