Bahrain records $4bn deficit for 2015-16 budget
- Bahrain approves new fiscal year budget
- Project spending projected to reach $1.5bn
- Oil and gas revenues drop to $4.5bn
Bahrains Shura Council has approved the 2015-16 budget following a six month delay amid uncertainty surrounding low oil prices.
Parliament had opposed the cabinets intention to cut subsidies to save money, and there were disagreements over how state funds would be distributed.
The budget was passed with a slight increase in project spending, which is expected to go up from BD551m ($1.4bn) in 2014 to BD585m ($1.5bn) in 2016.
Despite internal disputes over drastically cutting state subsidies, the new budget will see a decrease of BD98m ($259), with government subsidies expected to sit at about BD653m in 2016.
The budget has also projected that oil and gas revenues will sit at BD1.7bn, falling from BD2.4bn in 2013.
As oil prices continue to dampen Bahrains fiscal balance, the 2015-16 budget is expected to record a $4bn deficit.
The governments debt burden has doubled since 2009, reaching about 43 per cent of GDP at the end of 2014. US ratings agency Standard & Poors (S&P) estimates that net debt will reach 20 per cent of GDP by the end of 2015, from 10 per cent of GDP in 2014, and a net asset position of 12 per cent of GDP in 2010.