RIYADH: The former prime minister of Japan, Shinzo Abe, said that Custodian of the Two Holy Mosques King Abdullah had been strongly promoting the modernization of the business environment in the Kingdom.
Speaking on the final day of the Third Global Competitiveness Forum held in Riyadh yesterday, Abe pointed out that Saudi Arabia’s government had introduced a series of reforms that included investment protection schemes and easy ways for registration of companies and real estate in the Kingdom. As a result, he said that it has made a great leap in the World Bank’s survey on “The Ease of Doing Business” and it has moved to the 16th place and had also reached 27th place in the World Economic Forum’s survey on “Nation’s Competitiveness.”
He said total foreign investment in the Kingdom has expanded from $2 billion to $20 billion during the past three years. “More than half of that investment is in non-oil industries, so it matches the Kingdom’s strategy for industrial diversification.”
Japan has made a total direct investment of $3.5 billion in the Kingdom in 2006, which accounts for 19 percent of the total foreign investment of Saudi Arabia and it is the largest foreign investor in the Kingdom.
Citing reasons for the global financial crisis, he said that investment was excessively concentrated on the financial markets in the United States and Europe. The other side of the coin is that there are no adequate investment opportunities in emerging and developing economies, he noted. For the world economy to come back to sound development, he stressed that it was necessary that there be further development of industries and technologies in regions other than Europe and United States and asset markets should be created for abundant investment opportunities. “It is urgent to consider global measures to stabilize finance to include emerging economies in the Middle East and Asia.”
“The crisis of the world economy beginning with the subprime problem in the United states has a potential risk of evolving into a once in a century crisis,” he said.
“As leaders, we have a strong belief that the world economy will definitely recover. We should not yield to the temptation of protectionism but we must take financial action to stimulate the economy,” he added. “We need to build a freer and more open world economic system with a wide range of emerging economies such as the Middle East.”
To reinstate the engine of the world economy which has stalled, he urged major economies to make fiscal injection to stimulate the economy and cooperate with one another to reconsider the financial system that has become dysfunctional.
Japanese government has adopted a series of countermeasures to the economic depression by investing 75 trillion yen in projects since October last year. “The most important among them is providing employment opportunities in small and medium enterprises.”
In his concluding remarks, Abe said: “To overcome the current financial crisis pave the way for innovation and work for the improvement of industrial competitiveness.”
