REUTERS/Faisal Al Nasser/File Photo

The king issued a royal decree restoring “all allowances, financial benefits, and bonuses” following calls for protests in four Saudi cities over the weekend, adding a two-month salary bonus for forces fighting in the kingdom’s intervention in Yemen. “The royal order returns all allowances, financial benefits, and bonuses to civil servants and military staff,” said the decree, broadcast on state-run Ekhbariya TV. In September Saudi Arabia cut ministers’ salaries by 20 percent and scaled back financial perks for public sector employees in one of the energy-rich kingdom’s most drastic measures to save money at a time of low oil prices. The measures were the first pay cuts for government employees, who make up about two-thirds of working Saudis, and prompted complaints about the impact of austerity on ordinary Saudis. IMPROVING FISCAL POSITION

The decree said the cuts had come as a response to the sharp drop in the price of oil, which sank to a low of around $28 last year. “A number of fiscal adjustment measures were taken over the last two years which led to a strong improvement in the government’s fiscal position.”

Alsheikh and other key officials highlighted trends pointing to economic recovery. The central bank governor said the trade deficit was expected to drop in 2017, possibly moving into a surplus, while the deputy economy minister said the kingdom had reduced its deficit in the first quarter of the year by more than half, in part because of prudent management of government spending. Minister Of State Mohammed Alsheikh said Deputy Crown Prince Mohammed bin Salman, who serves as chairman of the Council for Economic and Development affairs, recommended the reinstatement of allowances after an official review and better-than-expected budgetary performance in the first quarter of 2017. Further decrees replaced the kingdom’s information and civil service ministers and set up a committee to investigate allegations of abuse of the civil service office.
Saudi Arabia's King Salman issues a number of royal decrees, one which restores financial allowances for civil servants and military personnel that had been cut seven months ago in response to the drop in oil prices.