JEDDAH, 19 May 2004 — Saudi Arabia yesterday decided to make strides in the privatization drive by selling off its shares in the National Company for Cooperative Insurance (NCCI) and privatizing the Saudi Arabian Mining Company (Maaden).
Both decisions came at a Supreme Economic Council meeting chaired by Crown Prince Abdullah. “The SEC meeting approved the sale of all shares owned” by the Public Investment Fund “in NCCI to citizens,” said Abdul Rahman Al-Tuwaijeri, the SEC secretary-general.
The meeting also approved “basic steps for the privatization of Maaden,” and a framework for the private sector’s participation in e-government, the Saudi Press Agency quoted Tuwaijeri as saying.
The SEC’s decision is part of a move to open up the Saudi insurance market, which is estimated at more than SR10 billion. NCCI is the only insurance company officially licensed in the Kingdom and dominates a market that includes a number of other, Bahrain-based companies that operate through agents here.
Competitors will have an uphill struggle challenging NCCI, the largest insurance company in the Arab world with a paid-up capital of SR250 million and assets of SR1.8 billion.
The privatization of Maaden, which is wholly owned by the Ministry of Petroleum and Minerals, would help attract massive funds required to exploit the country’s vast mineral resources. Maaden, which was set up in March 1997 with a capital of $1 billion, plans to establish a SR22 billion mineral industrial complex in Jubail.
