Saudi Arabia orders inventory of delayed payments to private sector

A Saudi royal decree has ordered an inventory of all delayed payments to the private sector, urging a careful study of outstanding dues, the official Saudi Press Agency (SPA) said on Monday, citing Minister of Commerce and Investment, Majid Al-Qasabi.

Al-Qasabi will head a new committee that will gather data on payments owed to private sector suppliers and contractors and propose suitable solutions to expedite clearance of outstanding dues. 

The committee will also look into the reasons behind delayed payments, verify any irregular practices, and refer disbursement documents to the Ministry of Finance, in coordination with the chairman of Saudi chambers.

The world’s top oil exporter has been looking to boost growth in the private sector, which was hit hard by cutbacks in government spending on projects, after crude prices collapsed in 2014.

In September last year, the finance ministry said it had paid SAR 525 billion dues under 345,000 invoices for 450 government-related entities until mid-September as the Kingdom sought to settle delayed contractor dues.

A total of 125,000 invoices-- around 36 percent of total payments --were related to private sector companies, the ministry said at the time.

Meanwhile in December, Saudi ruler King Salman approved the allocation of a SAR 72 billion package to boost the private sector growth.