Moody’s has affirmed that the drop in the Saudi budget deficit in the first six months of 2017 to less than the half compared to the same period in 2016 is a credit positive to the sovereign of the kingdom. Saudi Arabia has achieved a remarkable progress in revenues of the H1 of 2017, with revenues rising 29 percent compared to the same period in 2016 – the kingdom also managed to reduce deficit averages during H1 of 2017 51 percent compared to same period in 2016.

The registered deficit in H1 represents 37 percent of the government’s budgeted full-year deficit of SAR198 billion. Further, the Saudi Finance Ministry showed in its report for the second quarter of 2017 that revenues rose 6 percent while total revenues of H1 reached around SAR307.9 billion (USD82.1 billion).

These positive figures are a result of the economic reforms. They also reflect the kingdom’s success in enhancing spending efficiency. Total revenues of Q2 reached around SAR163.9 billion (USD43.7 billion) of the current fiscal year while non-oil revenues reached around SAR62.9 billion (USD16.7 billion), and oil revenues SAT100.9 billion (USD26.6 billion) – a 28 percent growth compared to same period in 2016.

On the other hand, Saudi Arabia’s finance ministry revealed on Sunday the second quarter report of the state budget showing great progress in terms of managing the deficit. Positive progress in the first half of 2017 is backed with figures showing revenues jumping by 29 percent compared to the first half of 2016. The national budget deficit was slashed by 51 percent compared to last year.

Total revenue climbed 6 percent in the second quarter to 163.9 billion riyals after income from crude jumped 28 percent, the finance ministry said in a statement. That helped narrow the deficit from 58.4 billion riyals in the same period last year, even though revenue from non-oil sources fell by 17 percent. Spending dropped 1.3 percent, to 210.4 billion riyals.

Non-oil revenues during the second quarter of the year reached 62.9 billion riyals ($ 16.7 billion). Oil revenueswere 100.9 billion riyals ($ 26.6 billion), up by 28 percent, reported the state news agency SPA. Saudi Arabia is reporting quarterly budget figures for the first time this year in an effort to increase government transparency, part of Crown Prince Mohammed bin Salman’s “Vision 2030” plan for removing oil dependency.

The government said in December that it planned to spend a total of 890 billion riyals this year, with an expected end-of-year deficit of 198 billion riyals. The budget deficit for the first quarter was 26.2 billion riyals. The “quarterly update presents clear evidence of progress toward achieving fiscal balance by 2020,” Minister of Finance Mohammed Al-Jadaan said in the statement. “Whilst economic challenges remain, we are confident in achieving our fiscal deficit projections for 2017.”