Saudi Arabia’s 2022 Budget revealed that the government plans to cut spending in order to run a budget surplus for the first time since 2013. But the true fiscal stance is being muddied by an increasing reliance on government entities to drive public investment. Meanwhile, the US Federal Reserve confirmed a hawkish shift on Wednesday. Dollar pegs mean that central banks in the Gulf will have to follow the Fed when it raises interest rates, which will weigh on recoveries in non-oil sectors. And finally, Tunisia’s President Saied this week extended the suspension of parliament for another year, adding to concerns over a lack of action to tackle the country’s worsening public finances. This is our last Weekly of 2021, and the next edition will be published on 6th January.
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