The efficiency of public spending in Saudi Arabia

Saudi Arabia faces challenges in using public expenditures to create successful public programs and projects. Additionally, in developing countries like Saudi Arabia, the public sector is a key to supporting economic development, since the private sector's contribution to gross domestic product (GDP) tends to be small. This study investigates the relationship between government spending and key issues that have shaped Saudi national plans, including Vision 2030 (e.g., economic growth, human development, and the unemployment rate), over the period from 1996 to 2017. The outcome of the study finds that the efficiency of public spending in Saudi Arabia is essential for sustainable development. Even though some factors are significant, insignificant factors in relationship to government spending are those that need special attention to reach the strategic goals set by the government, especially economic complexity, and to control the wasting of public funds. In addition, this study finds that public expense efficiency is a key to economic development. Thus, the decision-makers in Saudi Arabia need to emphasise on improving the quality of the budgeting process, through enhancing the effectiveness and efficiency of the budget allocations, to reach sustainable development.