Saudi Arabia orders 5 per cent contract spending cut in fresh austerity drive | The National

Saudi Arabia orders 5 per cent contract spending cut in fresh austerity drive | The National:

"Saudi Arabia’s government, its finances strained by low oil prices, is opening a fresh austerity drive by ordering ministries to cut their spending on contracts by at least 5 per cent, a document seen by Reuters shows.

The spending cuts could further slow economic growth in the world’s top oil exporter and hurt the construction industry, where many companies are struggling with deteriorating cash flow and rising labour costs.

The document, sent by the central government to all ministries and state bodies, instructs them to reduce the value of outstanding contracts signed to support their operations, as well as construction contracts included in the 2016 state budget, by “not less than 5 per cent of remaining obligations"."



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