JEDDAH, 16 April 2007 — Dr. Said Al-Shaikh, chief economist at the National Commercial Bank (NCB), said “we live now in a period of transformation in the financial sector, after long years under which the banking sector was limited to Saudi 11 banks that used traditional means in funding, such as corporate funding of large- and medium-sized companies in addition to personal finance.
The transformation started, when Capital Market Authority licensed 49 companies including financial institutions and investment consulting, part of which in the field of investment banking and mediation work.
Talking to a group of Business Management senior students from the King Abdul Aziz University who paid a visit to the bank’s headquarters here as part of the public relations program to communicate with all sectors of society, he said “today we live a new phase of investment banks, brokerage companies and financial consulting firms. This new shift in the financial sector accompanied by international competition with entrance of foreign banks individually or through partnerships with local banks, adds a new dimension to dealing with the banking business.
For example, the bank’s signed strategic partnership agreement with Goldman Sachs, the largest investment bank in the world and the signing of an agreement with Capital Group with Morgan Stanley, one of the biggest investment banks and the signing with Saudi investment partnership management of assets with B N Paribas, the largest European banks. The key to this transformation in banking today is in the asset management, project financing and bond issuance.
Al-Shaikh said there were new opportunities and changes in light of the Kingdom’s economy taking an unprecedented extraordinary leap in its structures. If it were associated with oil, however, the surge was due to the demand, not supply.
He added that if this is achieved, it would result in substantial resources that would allow state spending on infrastructure projects such as roads, airports, schools, hospitals and economic cities. He explained that the main objective of these projects was to create growth sources and economic diversification as well as reduce dependence on oil in order to create new industries as overlays of the oil industry and the create professional class in Saudi society, which did not exist with the required magnitude to raise the level of growth and achieve greater prosperity in the Kingdom.
Al-Shaikh expected fuel prices to stay high at least for the next five years in light of the economic factors affecting fuel demand.
He underscored the importance of future career planning by choosing the employment fields that suit the student’s inclinations, capabilities and job marker demand. He added that these would undoubtedly have an impact on those entering the labor market to take advantage of available opportunities.
“Now you are at the steps of the labor market, try to be selective of the institution that you believe can satisfy you,” he said. He added that everyone was looking forward to having an active role in the community by working in an effective institution that contributes to his development, training and growth in order reach a leading level one day.” He concluded by saying that the sense of responsibility and commitment to ones work, and self development through reading, exploration and interaction with others brings about national growth and economic progress.
