2004 News Story

Kingdom’s economic growth not affected by terrorist acts

Minister of Finance Dr. Ibrahim Al-Assaf predicted yesterday that Saudi Arabia’s economic growth this year will be close to last year's 6.4 percent. The wave of terrorist bombings and shootings, he said, has not affected the Kingdom's robust economic expansion, and any budget surplus would be available for government debt reduction. Asked if the recent attacks had provoked capital outflows from the Kingdom, he replied: "Absolutely not. It has been the other way around; we have an increase in liquidity."

Dr. Al-Assaf cited the health of the stock market, which has already risen 35 percent this year, after a 76 percent rise in 2003. Turnover since the start of the year has been SR500 billion [U.S. $ 133.5 billion], which is close to the SR600 billion [$ 160.2 billion] recorded for the whole of last year. Saudi Arabia’s financial sector, he said, including the insurance industry as well as banking and the stock market, would be the “driving force” of the economy for the rest of 2004.