Subsidies distorting economy, says Saudi minister
Riyadh, May 7, 2013
Saudi Arabian government subsidies, particularly for fuel, are "increasingly distorting" the economy and the government is trying to address the issue, Economy and Planning Minister Mohammed al-Jasser said on Tuesday.
Jasser was speaking at a financial conference in the Saudi capital. He did not give details of how the government would handle the problem, or indicate whether his comments meant any new initiative by authorities.
"Rationalisation of subsidies, particularly on fuels for non-targetted participants", is a big factor hindering productivity, he said, in an apparent reference to criticism that the subsidy system can be wasteful by helping people other than the poorest sections of the population.
"This has become an increasingly important issue as these subsidies have become increasingly distorting to our economy. This is something we are trying to address."
Any changes to the subsidy system could be politically difficult in Saudi Arabia, where citizens expect handouts from the government and much industry is built on ultra-cheap industrial gas prices.
A rise in the domestic natural gas price has been talked about for years, but there is no clear sign that it will happen.
Jasser said Saudi Arabia should also resolve imbalances in its labour market, including the low level of private-sector employment among Saudi citizens, particularly women.
He said it was important for the country to diversify its economic base and develop more medium-sized companies.-Reuters
More Government & Laws Stories
- Saudi sets up panel on labour disputes
- Sand-dredging bill is hit by funding row
- Saudi rejects Maliki's charges on funding militants
- Independent foreign policy non-negotiable: Qatar
- Bahrain to crack down on bogus investments
- Bahrain urged to set up national plan to fight cyber crime
- Galfar ex-CEO gets 15 years' jail over bribes
- New law on family violence on the way in Bahrain
- Four blast suspects are remanded in Bahrain
- Bahrain to step up war on terror
- Norton Rose Fulbright moves London head to Dubai
- DSG ‘ready to implement Smart Dubai Strategy’
- Iraqi women protest new draft law
- Bahrain police 'face more danger in line of duty'
- Saudi names Brotherhood as terrorist group
- Qatar outraged over terror claims
- Bahrain PM condemns exploitation of children
- Qatar will not alter foreign policy: source
- Bahrain accuses Iran of fomenting trouble
- 'Put security before rights' in Bahrain: publisher
- 'Hizbollah trained Daih blast suspect'
- Key terror blast suspects named in Bahrain
- $2.6m Royal Fund for martyrs set up
- Bahrain to draw up new anti-terror laws
- GCC ROW: Qatar voices surprise over envoys pull out
- GCC tobacco tax rise ‘will fuel illicit trade’
- Saudi, UAE, Bahrain withdraw envoys from Qatar
- Bahrain explosion draws global condemnation
- GDN photographer hurt in blast is discharged
- Iran playing increasing role in Bahrain unrest