JEDDAH, 2 January 2006 — The Saudi Arabian Monetary Agency (SAMA) has invested SR328.65 billion in foreign securities by November 2005, up 8.4 percent compared to the figure in the previous month, a SAMA report said.
The agency’s deposits with banks abroad increased by 18 percent to reach SR131.4 billion after a slight decline in the previous month. Monetary supply in November rose by 0.9 percent to SR540 billion, registering a 10.3 percent increase compared to the previous year.
Claims on the private sector grew by 2.5 percent to SR424.3 billion while claims on public and semi-government sectors reached SR163.2 billion. SAMA’s total assets rose to SR748.76 billion by the end of November 2005.
SAMA’s net foreign assets jumped from SR496 billion in October to SR537.7 billion in November 2005, the report said. But its gold reserves fell from 233 tons in October to 229 tons in November, the report said. Its non-gold official reserves reached $27.6 billion, down 8.2 percent.
Meanwhile, Finance Minister Ibrahim Al-Assaf said there was no plan to sell state shares in Saudi Basic Industries Corporation (SABIC). “There is no justification for floating SABIC shares now. It could have been justified when SABIC was the only petrochemical company. But now there are many petrochemical companies owned by the private sector,” he told Al-Ekhbariya satellite channel.
No official decision has been taken so far on selling state shares in SABIC, he added.
“But there is a possibility of selling the shares owned by Public Investment Fund in Samba Financial Group,” he said, adding that a decision in this respect would be taken shortly.
He said the government was able to cut down its public debt by 40 percent in 2005 thanks to soaring oil prices. He disclosed the government’s plan to publish information regularly in order to establish transparency.
“We have started publishing projects approved by the budget,” he pointed out. Al-Assaf emphasized the significance of publishing the latest information to help the private sector take decisions.
In his wide-ranging interview, the minister did not give the total cost of the proposed railway expansion project that would connect the east and the west of the country.
“The railway project is economically feasible and will boost the economy in general,” he added.
The minister said the new railway project will be carried out by the private sector.
The proposal for the privatization of Saudi Arabian Airlines has been presented to the Supreme Economic Council for it to take a final decision on the issue, he said. Plans are also under way to privatize the General Organization for Grain Silos and Flourmills.
Al-Assaf was happy with the excellent performance of the stock market, adding that it reflected the strength of the economy. The Saudi stock market ended the year with an increase of 103.66 percent. The Tadawul All-Share Index (TASI) gained 8,506.41 points in a year after closing on Dec. 31, 2004 at 8,206.23. The index failed to break the 17,000 mark but reached an all-time high of 16,988.08 points on Dec. 15, 2005.
“About one-third of the Saudi population has taken part in Yansab IPO,” said Assaf. “This is a record for Saudi Arabia and makes us optimistic about the stock market.”
