Saudi Arabia announces support measures as electricity and water tariffs rise

Saudi Arabia has unveiled a set of measures to alleviate the strain caused by increasing electricity and water tariffs, with effective dates set before the January 1 tariff adjustments. The measures, detailed by the Saudi Press Agency, include monthly financial aid for civil and military employees, retirees, and eligible social security households.

Crown Prince Mohammed bin Salman, on the orders of King Salman, proposed a monthly stipend of 500 riyals ($133) for these groups, with the allowance also covering bereaved relatives of social insurance beneficiaries.

In addition to the monthly payments, the government has raised the minimum wage requirements for Saudi nationals in the private sector under the Nitaqat initiative. The minimum monthly wage needed to qualify as a full worker for a company's nationalisation quota will rise to 5,000 riyals, with the figure increasing to 6,000 riyals 12 months after the initial increase. The package aims to mitigate the impact of the tariff hikes while maintaining wage levels and promoting Saudi employment in the private sector.

The support package is crucial as Saudi Arabia confronts growing threats from Yemen's Houthis, who have disrupted operations at the Riyadh airport and caused parts of the capital to grind to a halt. These attacks, coupled with the broader challenges facing the Vision 2030 economic overhaul, add to the kingdom's ongoing struggle to diversify away from oil dependency and attract foreign investment.

The renewed Houthi campaign, targeting key infrastructure such as oil sites and airports, exacerbates the pressure on Saudi Arabia's ambitious reform agenda.