Riyadh, Asharq Al-Awsat—The Saudi economy is capable of withstanding any shocks caused by the current oil price slump, the World Bank’s Country Director for Gulf Countries Nadir Mohammed said on Monday.
Speaking to Asharq Al-Awsat, Mohammed said the Saudi economy was diversified enough to withstand current low oil prices and possessed highly competitive labor and investment environments due to its long-term growth prospects.
Oil prices slumped dramatically in the second half of 2014, with prices halving from highs of above 100 US dollars per barrel in the first half of the year. Since then, prices have hovered around the 50-dollar mark. Saudi Arabia is the world’s biggest oil exporter.
Mohammed also said Saudi Arabia was the World Bank’s most important strategic partner in the Middle East, and that there were a number of joint projects between the organization and the Kingdom in various sectors.
The World Bank is committed to working with Saudi Arabia on a host of different projects and offering any technical assistance needed to keep the Saudi economy at its usual levels, he said.
“The Bank currently provides a number of different technical assistance programs to all Gulf countries in order to help them meet the challenges which their economies face in general,” he said.
He added, however, that Gulf countries were not in need of direct financial assistance from the World Bank, given that they all enjoy healthy national incomes.
The World Bank instead offers Gulf countries a number of joint initiatives to improve their financial services sectors, business planning programs, competitive intelligence, and investment environments.
Such programs also include those related to social welfare, education, infrastructure, and labor, as well as food security, water, and energy.
The programs are being carried out in coordination with individual governments, institutions, and the General Secretariat of the Gulf Cooperation Council (GCC).
“The six countries of the Gulf are among the biggest member countries of the World Bank and [supporters of] its initiatives. Saudi Arabia and Kuwait, for example, help a number of poor countries as part of their continuous support for the activities of the International Development Association [IDA, the World Bank’s specialized fund for poor countries],” Mohammed said.
“This takes place [as a result of] of the presence of Kuwait’s Dr. Merza Hasan as one of the executive directors of the World Bank, who also represents other Gulf countries. While Saudi Arabia is represented by [Executive Director Khaled Alkhudairy].”
The World Bank’s relationship with Gulf countries goes back to 1975, when the organization opened a regional office in the Saudi capital Riyadh.