A year and a half since the onset of the coronavirus disease (COVID-19) pandemic, the world economy is still suffering from its negative impact. The World Bank said: “The global economy is poised to stage its most robust post-recession recovery in 80 years in 2021.” However, it expects the rebound to be uneven across countries, as major economies look set to register strong growth even as many developing economies lag. The Saudi economy is one of the former and has started to show positive signs of recovery since the beginning of this year. According to a flash estimate revealed by the General Authority for Statistics, the Saudi gross domestic product recorded a positive growth rate of 1.5 percent in the second quarter of this year. This is the first time since the start of the COVID-19 pandemic that the GDP recorded such positive growth, compared to a negative growth of -3 percent in the first quarter of this year. The latest Budget Performance Report (BPR) for the second quarter of 2021, issued by the Ministry of Finance, revealed financial indicators that not only support such growth but also prove that the national economy is on the path to recovery from the pandemic. This is evidenced by the government’s efforts to contain the negative effects of the pandemic and preserve the safety and health of Saudi nationals and residents. The positive results reflected in the BPR, such as the growth witnessed in total revenues (oil and non-oil) by 85 percent in the second quarter compared to the same period last year and the marginal increase in the total expenditure by 4 percent, are the result of the government’s efforts to drive the national economy to a quick but safe recovery. It is worth noting that the total revenues reported in the second quarter of this year amounted to SR248 billion ($66.1 billion), while the total expenditures amounted to SR252.7 billion. Likewise, the total revenues for the first half of this year amounted to SR452.9 billion, showing an increase of 39 percent over the same period of the last year. In contrast, the total expenditures for the first half of this year amounted to SR464.9 billion, a decrease of 1 percent from the same period last year. I believe that the government has done a good job in leading the national economy to a safe and sound recovery, evidenced by the excellent financial results reported in the second quarter of this year. Talat Zaki Hafiz These significant improvements in the financial results confirm that a number of vital economic sectors have started to show signs of strong recovery, especially entertainment and tourism. The recovery of these sectors, in addition to the increase in revenues generated from various taxes, has contributed to a significant increase in the non-oil revenues for the second quarter and half of this year by more than 100 percent compared to the same periods last year. The Kingdom’s efforts and coordination at the international level, especially with OPEC and OPEC+, have led to the stability of the oil markets, which in turn have reflected positively on the level of revenues generated from oil in the second quarter and first half of this year compared to the same periods in 2020. However, despite the improvement in the financial results, the first half of this year reported a budget deficit of SR12.1 billion against SR143 billion during the same period last year. This proves that the budget deficit is starting to narrow down. Due to budget deficit, governments generally either borrow or withdraw from the reserves in order to fund the main expenditures related to salaries and other operating expenses. As a consequence, the public debt has grown in the first half of this year by 8 percent to reach SR922 billion compared to the balance at the beginning of the period at SR853.5 billion. Looking at all the figures and data, I believe that the Kingdom’s Vision 2030, specifically the National Transformation Program, has helped to achieve such results, especially on the non-oil revenues side of the budget. I believe that the government has done a good job in leading the national economy to a safe and sound recovery, evidenced by the excellent financial results reported in the second quarter of this year as well as in the first half. If the government continues its efforts to control public expenditures and maintain oil prices at a reasonable level, it will be able to further narrow the budget deficit, most likely to less than what has been originally estimated at SR140.9 billion for this year. • Talat Zaki Hafiz is an economist and financial analyst. Twitter: @TalatHafiz Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News" point-of-view