Saudi Arabia's investment chief on Monday slammed the slow pace of privatization in the oil-rich kingdom, saying that combined with failure to open major sectors to foreign investors, it was harming the economy more than any alleged terror threat.
"None of the big sectors have been opened up yet, and in the case of sectors taken off the 'negative list', public sector monopoly holders are preventing new investors from coming into the market," Prince Abdullah bin Faisal bin Turki said.
Bin Faisal heads the Saudi Arabian General Investment Authority (SAGIA), which since its establishment in April 2000 has licensed some 2,000 projects worth more than 52 billion riyals (14 billion dollars), in which the share of foreign investors totals 85 percent.
But the SAGIA chairman said this was by no means satisfactory in a market the size of Saudi Arabia, and he blamed "blimps" from the bureaucracy for hampering privatization despite the fact that it was sanctioned by the highest levels of government.
"Privatization is important not only to bring in money, but because it creates competition and thus results in better services. Basically, government departments should get out of the way," he said.
The Saudi government endorsed a plan a year ago to open up 20 vital sectors to local and foreign private investors in a bid to generate tens of billions of dollars to pay for a staggering public debt, and in order to improve services and create more jobs for nationals.
The plan opened up telecommunications, water desalination, air transport, airport services, construction and management of highways, seaport services and local oil refineries for the private sector.
But sectors like telecommunications, oil exploration, security, retail and wholesale, education, and land and sea transport are among 16 activities still barred to foreign investors.
Bin Faisal said the legislation needed to encourage privatization and foreign investment was also coming in at a snail's pace.
"Until when will we think we have a timeframe different from that of the rest of the world?" he asked.
The investment boss said the slowness of privatization was more of an impediment to investment than political factors such as the high tension that preceded and accompanied the US-led war on Iraq launched in March.
And he dismissed a perceived threat to Saudi Arabia from Islamist extremists such as those presumed to have carried out triple suicide bombings in Riyadh on May 12 that left 35 people dead.
"Saudi Arabia was not born from a political deal or an agreement between oil companies. This is an old and strong country that is the product of its own evolution," he said.
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