[Washington, DC] -- Adding force to its drive for economic reform, Saudi Arabia is selling off government shares in one of the Arab world's largest insurance companies, the National Company for Cooperative Insurance (NCCI), and privatizing the Saudi Arabian Mining Company 'Ma'aden,' which is wholly owned by the Ministry of Petroleum and Mineral Resources. Both decisions came during a meeting of the Supreme Economic Council (SEC), chaired by Crown Prince Abdullah bin Abdulaziz, Deputy Prime Minister and Commander of the National Guard, and are part of a broader privatization program directed at helping to modernize and expand the Saudi economy.
Ambassador to the United States Prince Bandar bin Sultan stated: "We are continuing to develop and diversify our economic base. Substantial private and foreign investments are crucial to a healthy and stable economy."
The sale of government shares in NCCI will help open up the Kingdom's insurance market, which is estimated at more than $2.5 billion. NCCI has assets of about half a billion dollars and is the only insurance company officially licensed in Saudi Arabia. However, new insurance legislation, passed on July 14, 2003 and introduced as part of Saudi Arabia's sweeping economic reform program, has cleared a path for potential competition.
The decision to privatize the Saudi Arabian Mining Company will help attract the enormous investments required to fully capitalize on the Kingdom's wealth of mineral resources.
Saudi Arabia has previously announced and implemented plans to privatize many of its vital economic sectors including telecommunications, civil aviation, desalination, highway management, railways, sports clubs, municipal services, health services and government hotels.