Saudi Arabia has made "rapid progress" in its bid to privatize state-owned five star hotels, according to Finance Minister Dr. Ibrahim Al-Assaf. "We have estimated their assets and will soon present some ideas to the Supreme Economic Council on the privatization process," he told Al-Eqtisadiah newspaper.
However, the minister pointed out that it would take some time to float the hotel shares to potential investors.
In addition, Al-Assaf disclosed plans to sell government shares in some other private ventures. He called on the investors to get correct information from official sources.
Earlier, addressing the Shoura (Consultative) Council, Al-Assaf said the Kingdom had made progress toward the privatization of 20 major sectors including air transport, water, desalination, electricity and railways.
Two years ago the government announced plans to gradually privatize 21 sectors including government hotels. Other sectors targeted for privatization include telecommunication, civil aviation, highway management, railways, sports clubs, municipal services, health services and desalination plants.
In May this year, the Cabinet also decided to privatize the National Company for Cooperative Insurance (NCCI) and Saudi Arabian Mining Company (Maaden). The move is projected to bring at least SR550 million to the national coffers.
SEC Secretary-General Dr. Abdul Rahman Al-Tuwaijeri said the council's meeting decided to sell state shares worth SR250 million owned by Public Investment Fund in NCCI, which has a capital of SR500 million. The General Organization for Social Insurance and Pension Fund are expected to maintain their stake (25 percent each) in the Kingdom's only official insurance company, which has five
million shares, each with a nominal value of SR100.
Maaden, which is fully owned by the government, is projected to sell 40 to 50 percent of its stake in the precious metals sector in which the company has invested SR600 million.
Efforts are also under way to privatize the Kingdom's desalination plants established at a total cost of SR54 billion. "All the desalination plants are scheduled for privatization and will be presented to the private sector once the studies are completed," said Fehaid Al-Sharief, governor of the Saline Water Conversion Corporation (SWCC). (menareport.com)
© 2004 Mena Report (www.menareport.com )