2002 News Story

Cabinet meeting

Deputy Prime Minister and Commander of the National Guard Crown Prince Abdullah bin Abdulaziz today chaired the regular weekly meeting of the Council of Ministers, and briefed the cabinet on talks he held recently with King of Bahrain Shaikh Hamad bin Isa Al Khalifa, and meetings, messages and contacts with a number of leaders of brotherly and friendly countries, stressing that all of these focused on the latest developments in the Middle East, particularly the Palestinian issue. These developments, he said, necessitated such exchanges of views in order to reach just solutions and unified Arab stands based on the relevant United Nations resolutions.

Crown Prince Abdullah then took the opportunity of congratulating all students on the start of the academic year, and wished them every success. The overall progress in education in the Kingdom, he said, reflects Saudi Arabia's generous support for all specializations and all stages of education, ever since its foundation by King Abdulaziz, a support emanating from the deep belief that comprehensive development can only be achieved through promoting education, qualifying young people, and providing them with learning, faith and the principles of Shariah [Islamic Law].
The cabinet went on to praise the final communiqué of the foreign ministers of the Gulf Cooperation Council (GCC) in their 84th regular meeting in Jeddah, and the resolutions issued by the foreign ministers council of the League of Arab States in its 113th session in Cairo.
Turning to domestic issues, the cabinet passed a number of resolutions, including actions concerning the sale of part of the shares of the Saudi Telecommunications Company (STC), after review of a recent decision by the Supreme Economic Council (SEC), as follows: firstly, to increase STC's capital from SR 12 billion [ U.S. $ 3.2 billion] to 15 billion [$ 4 billion] through posting part of the company's reserved benefits to its capital; secondly, to offer for sale 30 percent of the government's shares in STC, with at least 20 percent of this going to  private Saudi citizens and not more than 10 percent equally divided between the Pensions Department and the General Organization for Social Insurance (GOSI). The cabinet also decided that sale of shares is to take place during the fourth quarter of 2002 for a period of 21 days. One share is valued at SR 170 [$45.4], available for sale in multiples of ten. In the event that the demand for shares exceeds the number offered, distribution shall be on a pro rata basis, with each applicant receiving at least the minimum ten shares. Purchasing the shares through powers of attorney is acceptable, provided each agent represents not more than ten clients. Banks are requested to announce credit options they are offering for buyers; however, banks should not cover more than 50 percent of the value of acquired shares. The media campaign covering this process will begin once the relevant routine measures are completed, and the telecommunications sector will then be open for competition. To start with, the mobile telephone service will be partially opened during the last quarter of 2004 and land telephone lines in 2008. By the first day of 2003, the government's revenues from the company's income, standing for its provision of telecommunications services, will be reduced from 27 percent to 20 percent and further reductions will be considered following the opening of the communications sector to competition and allowing competitive companies to join the business. The company's dues against government bodies for the fiscal years following the year 2000 should be settled according to the recent agreement between the Ministry of Finance and National Economy and the Ministry of Posts, Telegraphs and Telephones (PTT) aimed at finally balancing the opening assets and financial status of STC. The General Investment Fund will be responsible for implementing the relevant regulations for sale of stocks. This measure will be coordinated with STC and supervised by the Ministries of PTT, Commerce, and Finance and National Economy.