Crown Prince Naif underlines importance of providing jobs for youths

Second stage of Haramain train project to be signed next week

Saudi economy to witness reasonable progress this year, says Jadwa report

The Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz Al Saud received at the Royal Court in Al-Yamamah Palace this week princes; the Grand Mufti of The Kingdom of Saudi Arabia and President of Council of Senior Scholars and General Presidency of Scholarly Research and Ifta Sheikh Abdulaziz bin Abdullah Al Al-Sheikh; scholars; sheikhs; ministers; senior officials; and a group of citizens who came to greet him.

The King also received Al Shafi Family, led by Undersecretary of 46th Regiment of National Guard Shafi Bin Salem Al Shafi and his brothers, who expressed their thanks to and appreciation of the King for his condolences to them on the death of their father, Sheikh Salem Bin Shafi Al Shafi, Commander of the 46th Regiment. The King prayed to Allah Almighty to bless the soul of the deceased commander.

The audience was attended by Prince Mohammed bin Abdullah bin Jelawi; Prince Fahd bin Mohammed bin Abdulaziz; Prince Fahd bin Mishari bin Jelawi; Crown Prince Naif bin Abdulaziz Al Saud, Deputy Premier and Minister of Interior; Prince Salman bin Abdulaziz, Minister of Defense; Prince Faisal Bin Mohammed Bin Saud Al-Kabeer; Prince Abdullah bin Musaed bin Abdulrahman; and Prince Muqrin bin Abdulaziz, Chief of General Intelligence.

Meanwhile, Crown Prince Naif bin Abdulaziz Al Saud, Deputy Premier and Minister of Interior, received at his office in the Royal Court Dr. Tawfiq bin Fawzan Al-Rabiah, Minister of Commerce and Industry; Engineer Abdullah bin Said Al-Mabti, President of Council of Saudi Chambers; and Chairmen of Saudi Chambers of Commerce across the regions of the Kingdom of Saudi Arabia.

During the audience, the Crown Prince hailed the commercial and industrial development witnessed by the Kingdom, stressing the importance of cooperation between the Ministry of Commerce and Industry and Chambers of Commerce to contribute in advancing the country's development, and creating new job opportunities for young people.

The audience was attended by a number of princes and officials.

Prince Salman bin Abdulaziz, Minister of Defense, received the Rector of Imam Muhammad bin Saud Islamic University Dr. Suleiman bin Abdullah Aba Al-Khail and members of the University's Council who came to greet and congratulate him on the royal trust in his appointment as Minister of Defense.

During the meeting, the Prince praised the University for its scholarly disciplines, particularly disciplines in Islamic religion, which is the constitution of the Kingdom of Saudi Arabia.

For his part, Dr. Aba Al-Khail expressed his appreciation of Prince Salman for his support for the University which has contributed to its significant progress in scientific and research fields.

Prince Salman also received the President of Council of Saudi Chambers of Commerce and Industry, Eng. Abdullah Saeed Al-Mubti and members of the Council, who came to greet and congratulate him on the royal trust in his appointment as Minister of Defense.

During the meeting, the Prince said, 'You represent all business sectors in the Kingdom; and the works of businessmen at the present time benefit your country and citizens. Whenever our young people have found jobs and businessmen contributed to this, we get rid of a large number of foreign workers. We thank Allah Almighty for bestowing upon us the honor to serve the Two Holy Mosques and the care of security and stability of pilgrims and Umrah performers, as well as facilitation and provision of all services for them to perform their rituals'.

For his part, Eng. Al-Mubti said, ' We, in the private sector, appreciate the support of our government for this sector and we complete the efforts of the Ministry of Defense in giving opportunities to the private sector for military manufacturing and supplies.

Prince Salman also received President of Saudi Publishers Association Ahmad Fahd Al-Hamdan and the Association's members, who came to greet and congratulate him on the royal trust in his appointment as Minister of Defense.

During the meeting, the Prince was briefed on the activities of the Association at local, regional and international arenas with regard to the introduction of Saudi books.

The Saudi Railways Organization (SRO) is ready to award the third phase of the Al Haramain high-speed rail project, which will link Makkah, Madinah and Jeddah.

The project is expected to be carried out by a Saudi consortium that will buy 35 trains and 13 carriages, install traffic signs and lay railway tracks at an estimated cost of $8bn, according to constructionweekonline.com.

Under this phase, the winning bidder is expected to carry out maintenance and operations of the rail project for 12 years. During the third phase over 153 bridges will be built outside the urban area as well as 678 flood drainage canals.

The Saudi Railways Organization awarded a $9.4bn contract to the AlShoula consortium in October last year to deliver the second phase of the Haramain project.

The contract covers the construction of 450km of high-speed track, which is expected to transport over 160,000 passengers a day.

The project involves the construction of railway tracks, electrification and an operational control centre, installation of signaling and telecommunication systems, and supply of 35 Talgo 350 trainsets.

The project will be completed in three years.

The consortium includes two Saudi Arabian and 12 Spanish companies including Spanish rail operator Renfe, Obrascon Huarte Lain, Talgo, Adif and eight others. The 450km Makkah-Madinah rail link is part of a major railway expansion project that includes linking Jeddah with the Riyadh-Dammam railway and North-South railway systems.

The high-speed railway line will initially carry three million pilgrims per year and is being designed to carry more passengers in the future, as passenger numbers are expected to rise to 20 million within the next 25 years.

The rail track is expected to reduce travel time between Mecca and Madinah to two hours, and shorten the travel time between Jeddah and Mecca to half an hour.

On the other hand, the Jadwa Investment firm in Riyadh released “The Saudi Economy in 2012″ report this week.

The report expected another year of reasonable economic performance in 2012. Non-oil growth is strong and inflation should ease. Lower oil production will cause total real economic growth to slow, and combined with lower oil prices, will reduce the budget and current account surpluses. High government spending will remain the engine of the non-oil economy.

It also expected economic growth to fall to 3.1 percent in 2012, from 6.8 percent in 2011. This sharp decline is because oil production is forecast to drop after a large rise in 2011. Growth in the non-oil economy will be 4.7 percent.

Government spending will be supported by greater bank lending and high consumer spending. Construction, the main beneficiary of government spending, should be the fastest growing sector.

Budgeted government spending for 2012 is well below the actual level for 2011, but this latter figure was distorted by one-time payments. Investment is budgeted at a record high and total spending will provide an important stimulus to the economy.

The report also expected another budget surplus in 2012. The government will draw down its foreign assets, which stood at around $520 billion at the end of October, to finance its expenditure plans in the event of any shortfall in revenues.

Inflation is forecast to moderate to an annual average of 4.4 percent in 2012. Negligible external price pressures, due to lower commodity prices, a strong dollar and subdued inflation in trading partners, will underpin the decline. This will be supported by lower rental inflation, as more properties enter the market, though the amount of new supply, and therefore its impact on inflation is not clear.

These factors should offset the local inflationary pressures caused by the high level of consumer and government spending. Interest rates will remain exceptionally low. This will bolster the economy, though it will hinder the government should it need to tackle inflation. No change was expected to the riyal’s peg to the dollar.

The main risks to our forecast stem from the external environment. There is a danger that the debt crisis in the Eurozone could spiral out of control, causing renewed global recession and a shock to the global financial sector similar to that of late 2008. The implications for the Kingdom would be serious, but not disastrous, given the government’s willingness and ability to honor its spending commitments.

Regional political uncertainty will continue to hang over the economy and any heightening of tensions would hit business and consumer confidence.

Absent serious reform, ongoing high growth in government spending and domestic energy consumption mean that 2012 is the last year we can confidently forecast a fiscal surplus in the foreseeable future.