Saudi Arabia to post $25 billion surplus

Saudi Arabia will post a 95 billion riyal ($25 billion) surplus this year, despite its record spending plans, based on an average oil price of $95 per barrel, a state-owned bank said on Saturday. The biggest Arab economy rolled out its third consecutive record budget for 2011, planning to spend 580 billion riyals, and has also announced additional fiscal handouts of over $100 billion to be spent on infrastructure and other projects.
"Our estimates for the surplus, despite the government's increased spending plans, are expected to reach close to 95 billion riyals and government spending is expected to reach close to 846 billion riyals," National Commercial Bank's chief economist Said al-Shaikh said.
Speaking at a press conference in Jeddah, Al-Shaikh said business confidence in the world's biggest oil exporter will increase in the second quarter over various sectors as a result of this increased spending. "We see a jump in optimism across all variables, whether we are talking volume of sales, new orders, selling prices, or profit, all is showing an increase," he said.