RIYADH: Saudi Arabia’s top economic body, chaired by Custodian of the Two Holy Mosques King Abdullah, said yesterday that the global financial crisis will have ‘limited’ impact on the Saudi economy.
The Supreme Economic Council (SEC), which met in the wake of the global economic meltdown, approved measures to mitigate the effects of the world turmoil on the Saudi economy.
One of the major steps decided by the SEC was for the Saudi Arabian Monetary Agency (SAMA), the country’s central bank, to guarantee the liquidity of Saudi banks as well as bank deposits.
“The SAMA would monitor domestic banks to guarantee their well-being by providing liquidity when they need it,” acting Secretary-General of the SEC, Abdul Rahman Al-Towaijeri, said.
The SEC also decided that SAMA would reduce the reserve requirements if local banks faced any liquidity problem and would also cut down the cost of financing, Al-Towaijeri added. “The government will continue to ensure the health of the Saudi banks and bank deposits,” the official said.
The SEC also decided to call on the finance ministers and central bank governors in the Gulf Cooperation Council (GCC) states to coordinate their actions with the Kingdom’s efforts, the official added. “The process of development will continue despite the global nature of the crisis. The effect of the crisis on the Saudi economy would be limited as the local economy is currently witnessing a boom, registering high rates of growth, seeing increased investment in diverse sectors and having sound financial position of local banks,” King Abdullah said at the meeting.
The king also ordered related government departments to monitor the crisis and take every step to check its impact on the national economy and affecting the welfare of the people, Al-Towaijeri added.
The king told the advisory board to monitor the situation, make proposals and submit periodic reports on the matter.