Saudi Arabia on Monday said its budget deficit for next year would widen as the world's top oil exporter faces tumbling oil prices and production cuts.
King Salman announced Monday expenditures will reach $272 billion next year, a almost 8% decrease from last year's record-high spending estimate of $295 billion.
Spending was projected at $272 billion, down 7.8 percent on 2019 estimates while revenues were estimated at $222 billion, also lower by 14.6 percent.
The kingdom has been grappling with a deficit since oil prices first plunged in 2014.
Finance Minister Mohammed Al-Jadaan said in an interview that Saudi Arabia would tap both the worldwide and local bond markets in 2020 to help finance a budget shortfall that is expected to reach 6.4% of gross domestic product from 4.7% this year.
The budget is based on an average Brent crude oil price of $65 per barrel in 2020, close to current levels, according to Bloomberg Economics.
Saudi government institutions invested nearly US$2.3 billion into the initial public offering of Saudi Aramco, a transaction that was meant to find new sources of funding for the kingdom's economic diversification plan.
Following the largest IPO in history, Saudi Aramco's shares will now be listed and start trading on the main market of the Saudi oil exchange on Wednesday, December 11, the Saudi Stock Exchange, Tadawul, said last week.
The Public Investment Fund (PIF), Saudi Arabia's sovereign wealth fund, will spend "a lot" of the US$25.6-billion proceeds from the IPO for local large-scale investments, which could otherwise be too steep for the private sector to handle on its own, Saudi Arabia's Finance Minister Mohammed Al Jadaan told Bloomberg in an interview earlier this week.
The annual Saudi budget is watched closely because it offers one of the clearest indicators of whether the kingdom is on track with its Vision 2030 plans, the blueprint put forth by Crown Prince Mohammed bin Salman to overhaul the economy, particularly as sustainable sources of energy become cheaper and more popular.