DTIC ADA528521: Deducing Budgetary Priorities in Saudi Arabia: The Impact of Defense Expenditures on Allocations to Socio-Economic Programs

11 Pages·1 MB·English

by  Defense Technical Information Center

PUBLIC BUDGETING AND FlNANCIAL MANAGEML"'IT
Vulwn. 4, Number 2. 1992
CONTENTS
,
Annuunr.....n'"
I'8lterns and T......ds in BudM~1 Fonnal lnoo.ation Am0"ll
LocoI Go......,..,...,lli ...........................••.. 187
D. E O'Toole WId B, Slipak
Oeducl"ll Bud,!:ota..,. PrioriIi.. ;" Saudi Arahia' T~ Impa,1
oIDd'.....~ Exponditura on Allo<atiom tu Sucio·Economir
Prog......... . . . . . . . •. • . . . . . •. . . • • • • • • • • • • • . . . . . . .. 311
R, E. Loonry
Bud~tta.,. TradeolT. Undw Tup.no"" and Bonum·Up
Budgrlillll 327
R Jlfndrict
Tax IleIas in Staleand Loral Gu.ernrnml To SItu<1unI'
Anal)"is . . . . . . . . .. . . . . . . . . . . . . . . . . .. . .. . .. . . . .. 3S'
D. G. Pudut
St:lm:s ON INNOVATlOr\S IN STATE ANO LOCAL t'OIlEC.c>"NG
ForOl><';ling 51.>1. Il.••~n...., E.pandinK Ihe Dimensiu.... Dr
Budgotary Fo"",,"-<u"I Il..,....,..,h •. • • • • • • • • . • • • . . . . . . . .. 3S1
W E. Klay and G, A Grlwt
In«nI,,'" r Forua<linl Itdonn Am<>nJ: Local f1na~
0fIir<:n . . . . . . . . . . . . . . . . . . . . . . . . . . • . • . . • • •• 407
J. McCollough 0'1<11/. Frank
MARCEL DEKKER, L,"C. N..... Vurk, Ila.od, Ilun~ KU"ll
Cunlrlhuliu.... In Ihis juu"",l ani' puhlisl>o1l fre. nf,h"'1le
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1992 2. REPORT TYPE 00-00-1992 to 00-00-1992
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Deducing Budgetary Priorities is Saudi Arabia: The Impact of Defense
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Expenditures on Allocations to Socio-Economic Programs
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PUBLIC BUDGETING &FIN. MNGMT., 4(2), 311-326 (1992)
Deducing BUdgetary priorities in saudi Arabia: The Impact of
Defense Expenditures on Allocations to Socio-Economic programs
by
Robert E. Looney
Professor, National Security Affairs
Naval Postgraduate School
Monterey, California 93943 USA
Introduction
The 1990 Saudi bUdget, set at just over that for 1989, and the
1990-95 five year plan, with spending targets on the current price
equivalent of five times the 1990 bUdgetary figure, indicate fairly
clearly that Saudi Arabia's days of priming the non-oil economy are
essentially over, but that its commitment to price stability
remains [Economist Intelligence Unit, 1990, p.4].
The five year plan has proposed growth targets averaging 3.2
percent a year between 1990 and 1995, roughly in line with what
might be expected to be the popUlation growth rate. The oil sector
is expected to grow at a real rate of 2.7 percent a year, but the
oil and gas sector combined by only 2.2 percent. The domestic non
oil economy is expected to grow at 3.6 percent. The overall growth
rate in the non-oil sectors is likely to improve when the
contraction in government services has flattened out.
Over the medium term, the plan's spending targets suggest a
very heavy bias towards defense, social services, and SUbsidies,
with extra revenue to be used to rebuild reserves. As with the
1989 budget, the government's 1990 spending plans anticipate that
increased overall revenues would reduce,the government's borrowing
needs, eliminating the necessity for any further reductions in the
country's foreign reserves.
The intention of the bUdget is to increase the already large
human resources development. To meet this objective, reductions in
funding must be made in most other sectors. However, these cuts
have been minimized in the areas of defense, administration, health
and social development. The local subsidies section of the bUdget
has been kept unchanged largely for political reasons to reflect
King Fahd's promise to protect the living standards of low income
Saudis [Economist Intelligence Unit, 1990, p.4].
311
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