Riyadh pulls the plug on billion-dollar projects

Saudi Arabia's Council of Economic and Development Affairs (CEDA) headed by the country's Deputy Crown Prince Mohammed bin Salman bin Abdulaziz, has decided to cancel projects worth $266.6 billion, announcing that it will clear all private sector payments by December.

During a meeting on Monday, the CEDA discussed a number of economic and development issues, including unsettled payments in the private sector which have been attributed to a sharp decline in oil reserves in the Kingdom, according to a report from the official Saudi Press Agency (SPA). According to the official SPA, the Council also discussed the status of ongoing state projects, assessing measures taken by the state and reviewing several measures while rearranging budgetary priorities according to their importance and efficiency, including ways to overcome operational



obstacles procedurally. The cancelled projects include those that were deemed unable to generate economic or developmental returns and those that are inefficient in improving the living standards of the people.

It has been reported that the cancelled projects have an estimated value of some $266.6 billion. On Dec. 25, 2015, the government raised the prices of non-durable goods substantially, including fuel, water and electricity, implementing a series of austerity measures to lessen the country's dependency on oil that include subsidy cuts, lower wages in the public sector and delaying of major projects. After announcing a budget deficit of $98 billion last year, Saudi Arabia aims to restructure and diversify its oil-based economy in the framework of "Vision 2030" which includes aims to reduce the budget deficit to $87 billion by the end of 2016.