Abu Dhabi, UAETuesday 18 February 2020

Saudi Arabia’s water minister sacked after complaints over tariffs

Saudis turned to social media to express their anger after the increase in prices of water and the consumer protection association asked the government to reevaluate the decision.

RIYADH // Saudi Arabia’s King Salman fired the water and electricity minister following public complaints over a surge in prices less than six months after the government cut generous utility subsidies.

Agriculture minister Abdel Rahman Al Fadhli will take over the water and electricity post from Abdullah Al Hasin, the official Saudi Press Agency reported on Saturday, citing a royal decree.

Saudis turned to social media to express their anger after the increase in prices of water and the consumer protection association asked the government to reevaluate the decision.

Deputy Crown Prince Mohammed bin Salman said earlier this month that the ministry’s implementation of the new water tariff was “unsatisfactory”.

In March, the Arab News daily reported that Mr Al Hasin had called on citizens to get permits to dig their own wells in the face of increasing complaints about high water bills.

Earlier this month the newspaper said that the advisory Shura Council “appeared unconvinced” when its members grilled Mr Al Hasin and his officials about the bills.

The government announced cuts in utility and gasoline subsidies in December as it tried to rein in spending after a steep drop in oil prices.

Including future reductions, authorities expect the restructuring to generate US$30 billion (Dh110bn) a year by 2020, part of a broader plan to raise non-oil revenue by $100bn to reduce the country’s reliance on crude exports.

“Now, we are working diligently on reforms within the water ministry so that things will be in accordance with the agreed plan,” Prince Mohammed said, without providing details.

Water prices climbed as much as 500 per cent for Saudi nationals, according to John Sfakianakis, Riyadh-based director of economic research at the Gulf Research Center, a think tank.

Raising prices poses a challenge to Gulf Arab monarchies. A survey of young Arabs found that more than 90 per cent of those questioned in the Gulf states of Qatar, Oman and Bahrain want subsidies to continue, while 86 per cent agreed in Saudi Arabia, the world’s largest oil exporter.

Prince Mohammed said the kingdom will limit the impact of cuts on its citizens by developing a mechanism to provide cash to low- and middle-income Saudis.

The prince – the king’s son and second-in-line to the throne – is leading the biggest shake-up of the economy since Saudi Arabia’s founding after oil prices fell from the end of 2014.

He is set to announce on Monday his “Saudi Vision 2030”, which is expected to set goals for the next 15 years and a broad policy agenda aimed at diversifying an economy that depends on oil for 70 percent of state revenues.

* Bloomberg, Agence France-Presse and Reuters

Updated: April 24, 2016 04:00 AM

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