JEDDAH, 26 June 2004 — Finance Minister Ibrahim Al-Assaf has given the go-ahead to a loan guarantee scheme aimed at encouraging small and medium enterprises.
The loan guarantees, according to the Saudi Press Agency, will encourage banks to fund SMES.
The Saudi Industrial Development Fund (SIDF) will manage the scheme, for which SR200 million have been earmarked, half of which was paid by the government and the rest by local banks.
The scheme is part of the Kingdom’s economic reform program which seeks to boost the role of the private sector.
“The Saudi government is working to enhance the investment environment by modernizing laws and simplifying regulations, applying transparency and adopting economic policies to encourage local and foreign investment,” the minister said Thursday night in a speech in Beirut, where he was attending an Arab conference on finance and investment.
Dr. Al-Assaf said human resource development was the cornerstone of the Kingdom’s development strategy.
Expenditure on the sector increased from 20.6 percent of total expenditure of the first five-year development plan (1970-1975) to 56.7 percent in the seventh development plan (2000-2005), he said.
The share of education in successive development plans has more than doubled during the period, from 3.5 percent of GDP in 1970 to 9.5 percent in 2002.
The number of schoolchildren jumped from 984,000 in 1970 to more than five million by the year 2002, with the number of girls attending secondary school and college increasing to the point where girls now outnumber boys in both.
The minister said the comprehensive reform process in the Kingdom focused on economic, social and cultural development, with the priority given to the private sector. With more than 45 percent of the Kingdom’s population under 15 years of age, the government would continue to prioritize education, he added.
