Saudi assets touch a new height

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Saudi assets touch a new height

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Saudi Arabias foreign assets are forecast to reach a new peak of SR1.9 trillion at the year end.

24 July,2011 08:00 pm

The sustained strong oil prices coupled with higher crude output pushed the Kingdom’s foreign assets to a record high of more than SR1.8 trillion at the end of May this year.The country boosted supply to one of its highest levels of 9.4 million bpd to offset Libya’s supply disruption.In recent years, the Kingdom’s policy of stockpiling foreign assets has been noticeable. This policy has not changed. The economic outlook for the Kingdom of Saudi Arabia in 2011 is outstanding given the fact that the wole world is experiencing acute recession. The Kingdom posted a real gross domestic product growth of 4.1 percent in 2010 and expects an average rate of 4.3 percent in 2011. Further, package of decisions taken by the Saudi King Abdullah Bin Abdul Aziz Al Saud to enhance the purchasing power of citizens and increase investment in housing and health may lead to higher growth estimates of around 6 percent for the current year. As a result, net foreign assets (NFA) reached a new record by surpassing the SR1.8 trillion mark in May. Over the three months period of March to May, NFA grew by 10.9 percent, 13.2 percent, and 15.6 percent, respectively.Foreign currencies and gold grew by a remarkable 25.1 percent, while deposits with banks abroad expanded by 23.9 percent. The main composition of NFA constituting over 70 percent, investments in foreign securities, gained 12 percent and has been growing in double digits through the preceding five months.