Saudi Arabia

The Kingdom’s banks are moving toward the second half of 2011 in a strong position, but their ongoing conservative positions have triggered criticism. Saudi Arabia’s financial institutions are cashed up with healthy levels of liquidity, operating in a secure and growing economy, and have shown new earnings and investment potential. Despite this, there have been calls for the Kingdom’s lenders to be more active in advancing credit, after two years of building up reserves.

With a new mortgage law in the works and government plans to spend nearly $70bn on low-income housing, Saudi Arabia’s real estate market appears on track for a period of expansion.

Plans by the Saudi Arabian government to boost public expenditures and invest in the nation’s infrastructure could prompt local companies to step up their own investments. As Islamic financial services expand in the Kingdom, some of these borrowers may well turn to sharia-compliant bonds as a means of finance.

Saudi Arabia is embarking on a massive programme to boost its logistics and cargo-moving capacity as part of a much larger scheme to broaden the base of the economy and pave the way for future expansion.

Saudi Arabia’s third-largest mobile phone service provider appears set for a change of leadership as Zain, its Kuwait-based owner, bows out after four less-than-profitable years.

While the Kingdom may be transitioning away from domestic wheat production, Saudi Arabia is stepping up efforts to ensure food security by increasing imports and investing in agricultural projects overseas.