RPT-Promise of future prosperity fades as austerity hits Saudis' pockets - Reuters:
Saudi Arabia’s austerity drive will squeeze a private sector vital to its plan to diversify away from oil and may cost its powerful crown prince some prestige as citizens see their spending power shrink.
Several businessmen and economists said the tripling of value added tax (VAT) and suspension of a cost of living allowance for state employees could deepen a downturn in the Arab world’s largest economy and delay job creation.
The changes are set to ripple through most areas of business life, already struggling with weak demand due to a coronavirus lockdown, and weigh on living standards of ordinary Saudis.
“I don’t understand how this will help the private sector that is already hit by low demand,” said a Saudi retailer, who requested anonymity to speak freely.
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