ISTANBUL

Saudi Arabia has decided to downsize its 2020 budget due to economic conditions caused by the novel coronavirus and falling oil prices. 

This year’s budget will be cut by $13.3 billion, corresponding to less than 5% of overall expenditure, Finance Minister Mohammed al-Jadaan said in a statement.

Al-Jadaan said the decision was taken due to the economic crisis caused by the coronavirus outbreak and sharp fall in growth in the global economy and its impact on oil markets.

Riyadh had originally set spending at $272 billion for 2020, down 7.8% on 2019 estimates, with revenues estimated at $222 billion, down 14.6%.

But economic growth expectations and oil consumption are weakening due to the virus.

On Tuesday, Saudi Energy Minister Abdulaziz bin Salman announced that in a few months, the kingdom’s oil exports are set to increase to more than 10 million barrels per day, as it plans to use more gas for domestic power generation instead of crude.

Since first being detected in Wuhan, China in December, the novel coronavirus has claimed more than 7,870 lives globally, according to the World Health Organization (WHO).

More than 194,000 cases of the virus have been confirmed in at least 164 countries and territories, with Europe as its epicenter, according to the WHO.

Due to financial risks to industries caused by the epidemic, countries have started announcing economic relief packages.

Despite the rising number of cases, most people who get infected suffer mild symptoms and recover.

*Writing by Firdevs Bulut