EconSource: Report says Saudi to Save $7 Billion from Energy Reforms
Saudi Arabia is expected to save $7 billion a year following the introduction of unprecedented energy price rises, a report by Jadwa Investment said Wednesday.

The report said direct savings from the kingdom’s price hike on diesel are estimated at $2.75 billion, while gasoline levies are expected to save an additional $2.5 billion. The rest of the savings will come from price rises on natural gas, fuel oil, and propane, Jadwa Investment added. The total cost of Saudi Arabia’s energy subsidies was estimated at $61 billion in 2015. The country posted a record budget deficit of $98 billion in 2015 and is projecting a shortfall of $87 billion this year. In other news, Saudi stocks fell to the weakest level in more than three years as oil prices dropped to their lowest level since 2004. [AFP, 1/6/2015]
The Turkish lira weakened to 3.0 against the US dollar on Wednesday for the first time since early October as fears about China’s stalling economy and North Korea’s nuclear test worried investors. Global pressures on emerging currencies and concerns about political interference in Turkey’s monetary policy pushed the lira 20 percent lower against the dollar last year. Pressure on the lira resumed on December 23 when Turkey’s central bank failed to hike interest rates despite stubbornly high inflation. However, analysts said they expect the lira to stabilize in the near future as temporary drivers of inflation weaken. [Reuters, Hurriyet, 1/6/2015]
Egypt’s General Authority for Supply Commodities (GASC) said it will issue delayed letters of credit for three wheat shipments waiting off France’s northern port of Dunkirk on Wednesday. The decision comes as stricter import requirements are under discussion that could delay future wheat shipments to Egypt. The shipments of more than 180,000 tonnes of French wheat have been held up because exporters have not received letters of credit or guarantees of payment. GASC Vice Chairman Mamdouh Abdel Fattah said the delay was due to an administrative problem and not dollar liquidity issues. Some traders have experienced delays receiving letters of credit for supplying goods to Egyptian state buyers amid an acute shortage of dollars. Abdel Fattah added that GASC is also discussing potentially lowering the permitted level of ergot, a fungus that infects cereals, in wheat imports into Egypt. Traders said a lower ergot level would make supplying wheat to Egypt far more difficult. [Reuters, 1/6/2015]
Morocco’s economy grew 4.7 percent year-on-year in the fourth quarter of 2015, up from 2.2 percent in 2014 period as a result of higher agricultural output, the national planning agency said on Wednesday. Morocco announced a record cereal crop of 11 million tonnes last year. While late rains are threatening this year’s harvest, the government expects a medium cereal harvest of 7 million tonnes. Additionally, Morocco’s trade deficit fell 19.7 percent in the first 11 months of 2015 due to lower energy costs and higher exports. Morocco’s central bank said 2016 growth will slow to 2.1 percent. The government has forecast 3 percent growth and the national planning agency has forecast 2.6 percent growth. [Reuters, 1/6/2015]
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