Press Release: Saudi Arabia Plans Major Economic Shake-Up Amid Oil Slump: Sources

Saudi Arabia's deputy crown prince has privately outlined plans to reshape the economy to withstand low oil prices, sources said, in what could be the biggest policy shake-up since the kingdom's economy was last hurt by cheap oil over a decade ago.

The strategy was presented by Mohammed bin Salman at a meeting this week with senior officials, businessmen and economists. It includes state spending reforms and privatizations in the world's top oil exporting country, the sources said.

The plans are expected to be made public in the next few weeks, probably in January. They represent a shift of authority over economic policy to Mohammed bin Salman, the Council of Economic and Development Affairs that he chairs, and the Ministry of Economy and Planning, the sources added.
The two sources, from the private financial and business sectors, declined to be named because of political sensitivities.
Officials have been talking about some of the reforms discussed at the meeting for years, but they have been blocked by political opposition, bureaucratic inertia and technical challenges.
Under previous administrations, institutions such as the Ministry of Finance dominated policy, but they have now been partially sidelined as pressure on the economy has grown because oil prices have dropped.
The government has been running an annual budget deficit of over $100 billion, forcing it to liquidate over $90 billion of foreign assets in the past 12 months to pay its bills — a pattern that is not sustainable for more than a few years, the International Monetary Fund has warned.