According to a 2019 state budget announced by King Salman yesterday, spending is expected to rise to an all-time high of 1.106 trillion riyals ($295bn) from 1.030trn riyals this year.

The country’s economy has been struggling since the fall in oil prices in 2014. The government estimates it grew 2.3% in 2018 – a slower rate than it has previously seen this decade. In 2017, the economy shrank by 0.7%.

Next year it is expected to grow by 2.6%, the minister of finance Mohammed Al Jadaan said.

The king said in a nationally televised speech: “We are determined to go ahead with economic reform, achieving fiscal discipline, improving transparency and empowering the private sector.”

The kingdom is going through an economic transformation and is implementing reforms under its Vision 2030 agenda to move away from its reliance on oil and create new revenue streams.

The government has pledged to eliminate its budget deficit caused by the low oil prices.

The deficit was 136bn riyals this year, below the 195bn riyal gap originally projected, Reuters reported. It said this was due to higher oil export revenues.

The IMF said last year that the country’s fiscal reforms were ‘bearing fruit’ and the economy was adapting to lower oil prices.