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King Abdullah Spending US$ 128 Billion in Benefits for the Saudi Citizens

Guiding Principle

After the return from a medical treatment trip to the United States and Morocco on February 23rd, 2011, King Abdullah has issued several orders on convergent times aiming to improve life standards of the Saudi citizens. The orders includes handover cash grants directly to the Saudi citizens, raising the capital of the Real Estate Development Fund, raising the capital of the Saudi Credit & Saving Bank, raising the capital of the Public Authority for Housing – that was before announcing the establishment of the Ministry for Housing after about a month later, the set up of an Anti-Corruption Agency.

A. Direct Grants to Saudi Citizens

Upon King Abdullah’s return from convalescence in Morocco after a treatment trip to the United States, the Saudi King issued several resolutions including granting 2 months’ salary and 15% cost-of-living allowance to military & civilian employees of the state, 2 months bonus for all the students of the governmental higher education as well as granting job seekers a monthly amount of S.R. 2,000 (about US$ 533) starting from November 26th, 2011 corresponding to the start of the new Hijri calendar year.

The resolutions includes to set a minimum limit for wages of the Saudi nationals working in the state[1] by S.R. 3,000 (about US$ 800) and giving permanent employment for all Saudi nationals in temporary public sector jobs starting from the next financial year.

In addition to the resolution to extent the Outer Scholarship Program of the Custodian of the Two Holy Mosques[2] for the next five years, King Abdullah has decided to add all the students of the same fields of the Outer Scholarship Program who are studying abroad at their own expense to the program.

B. In-Direct Grants to Saudi Citizens

Furthermore, the new resolutions included raising the capital of the Real Estate Development Fund[3] by S.R. 40 billion (about US$ 10 billion) and exempting all borrowers from the fund for private housing purposes from 2 premiums for two (2) years.

The capital of the Saudi Credit & Saving Bank[4] was raised also by the new resolution by S.R. 30 billion (US$ 8 billion) exempting all borrowers from the bank for social purposes from 2 premiums for two (2) years.

C. Housing

In addition a new resolution issued by the King with regard to housing includes in-direct grants to the citizens through the allocation of the amount of S.R. 250 billion (US$ 66 billion) for building 500,000 housing units in all regions of the Kingdom, raising the capital of the Public Authority for Housing by S.R. 15 billion (about US$ 4 billion).

Moreover, the King has announced in a later resolution the establishment of a Ministry for Housing to be responsible for housing lands in all regions of the Kingdom. The resolution stipulates that all staff working in the housing field, financial allocations and duties related to housing shall be transferred to the newly established Ministry. 

D. Healthcare

King Abdullah has approved S.R. 16 billion (about US$ 4 billion) to implement and expand number of Medical cities, hospital and polyclinics all over the Kingdom, as well as raised the upper limit to fund private hospitals program of the Ministry of Finance from S.R. 50 million (about US$ 13 million) to S.R. 200 million (about US$ 53 million).

E. Security

Within the Ministry of Interior 60,000 new security jobs shall be created to reduce the unemployment rate among the young Saudis – up to date the unemployment rate in the Kingdom was estimated by 14% according to the IFC – as well as to face all the security risks arises from the turmoil in the region.

F.  Anti-Corruption Agency

Pursuant to the Transparency Policy followed by the Kingdom from several years for attracting Foreign and Domestic Investment to the Kingdom for the diversifying of sources of income, the King has announced the establishment of an Anti-Corruption Agency, where the manager of this new Agency will be on ministerial rank reporting directly to the King.

The tasks of the newly established Agency will include all sectors of the government with no exception at all. The Agency shall follow-up the implementation of the orders and instructions for the public affairs. Following-up the administrative and financial corruption aspects falls within the competence of the Agency

[1]     Several Saudi companies from the private sector have announced that they will raise the minimum limit of wages for their Saudi nationals employees to the same limit applied in the public sector.

[2]     The program is concerned with sending the elite students abroad to obtain Bachelor, Master or Ph.d. at the following fields: Medicine, Applied Health Sciences (Nursing, Radiology, Health Sciences, Medical Laboratories, Medical Technology), Pharmacy and Basic Sciences (Mathematics, Physics, Chemistry, Engineering, Computing, Law, Accounting, E-Commerce)

[3]     The Fund was established for providing loans to individuals and institutions for the establishment of real estate projects of private or commercial use.

[4]     The Bank was established for providing interest-free loans for small businesses and craftsmen and professionals as well as providing interest-free social loans for citizens with limited income to help them overcome their financial difficulties.

April, 2011  Hany kenawi
  Meyer-Reumann & Partners – Saudi Arabia Office

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