Public expenditures typically have acted as the vanguard for economic growth and development since the early 1970s. After completing the infrastructure in the 1970s and early 1980s, the emphasis of development expenditures moved to education and training, to encourage private enterprise. By 1987, 70% of nonoil GDP was coming from the private sector. Deficits have been common since 1983, as oil revenues have declined. Oil revenues typically account for nearly 75% of government revenues. Deep budget cuts over the past years; higher charges on energy, electricity, water, telephone, worker and visa fees; and reduced subsidies on fuels, utilities, and airline fares; have combined to reduce the deficit. To finance the deficit, the government borrows from domestic financial markets.
However, Sa'udi government finances are not transparent; a perennial uncertainty being the difference between the revenues received by the national oil company, Aramco, and what is turned over the Ministry of Finance to fund government expenses. The difference goes to Aramco's operating expenses and numerous off-budget expenditures. Observers believe that one major use of the off-budget money has been to pay down arrears on contracts, amounting to an estimated $30 billion in 1995. Estimates are that such arrears had been reduced to $3 billion by 2000. With the exception of the year 2000, the Sa'udi government has run a deficit every year since 1982. Rising oil prices in 2000, recovering from near-record lows in 1999, helped produce a $12 billion surplus as oil revenues came in 60% higher than expected. The accumulated domestic debt in 2000, however, was an estimated 105% of GDP, which has been financed by government pension funds and bonds held by banks and some companies. External debt from transactions in the privatized portions of the economy had reached nearly $40 billion in 2001, but this represents a still manageable 21% of the annual GDP.
The US Central Intelligence Agency (CIA) estimates that in 2002 Sa'udi Arabia's central government took in revenues of approximately $42 billion and had expenditures of $54 billion. Overall, the government registered a deficit of approximately $12 billion.