EconSource: Saudi Foreign Assets Fall in August on Drawdown to Cover Deficit

Saudi Arabia’s net foreign assets fell by $6.6 billion to $645.5 billion in August, the lowest level since February 2013, as the kingdom liquidated assets to cover a budget gap caused by cheap oil. Official data showed foreign assets shrinking 1 percent since July, marking a year-on-year decline of 11.2 percent. Nevertheless, the pace of decline has slowed since early this year, when month-on-month falls sometimes exceeded 2 percent. One reason for the slower fall is the government’s decision to resume issuing sovereign bonds for the first time since 2007. The government has issued about 20 billion riyals each month, reducing the need to draw down foreign reserves. Last week, Capital Economics said in a report that the slide in Saudi Arabia’s foreign reserves could continue for years, but predicted the pace would slow as Riyadh restrained spending and oil prices gradually rebounded. On Sunday, Saudi Arabia cut its oil prices following cuts made last month by rival producers in the Gulf. [Reuters, Bloomberg, 10/5/2015]

World Bank loans Egypt $550 million for sanitation project
Egypt signed an agreement on Sunday with the World Bank for a $550 million loan to fund a rural sanitation project. The project aims to improve facilities in 155 villages, which house over 800,000 Egyptians, over three years. It focuses on enhancing access to sanitation services for the rural poor and addressing the Nile pollution from untreated sewage. The project has a projected cost of $2.8 billion, $1.1 billion of which to be provided by the World Bank. The World Bank approved the first half of the loan in July, which comes as part of the sanitation and social housing program the bank introduced in 2014. “One of our strategic areas for supporting Egypt is improving service delivery especially for the poor,” said Asad Alam, World Bank Country Director for Egypt, Yemen, and Djibouti. [Ahram Online, Al Bawaba, 10/4/2015]

UAE minister says plans to boost oil output capacity on track
The United Arab Emirates (UAE) is moving ahead with its oil and gas investments and plans to boost crude output, Energy Minister Suhail bin Mohammed al-Mazroui said on Sunday. He said that the UAE’s plan to boost oil production capacity to 3.5 million barrels per day by 2017 is on track. Mazroui also said that the UAE invested $35 billion to diversify its energy mix. “We need to minimize our reliance on natural gas and its imports,” he said, adding that the UAE plans to decrease dependence on natural gas to 70 percent by 2021. [Reuters, 10/4/2015]

Tunisia inner cabinet reviews new investment code, budget
An inner cabinet meeting chaired by Prime Minister Habib Essid examined Tunisia’s draft investment code on Friday. The cabinet reviewed aspects of the new investment code, including private investment, a regulatory framework, and administrative procedures. The review is part of Tunisia’s five-year economic plan. The cabinet also discussed Tunisia’s draft 2016 budget during the meeting. Essid examined scheduled reforms and other measures that will be taken to ensure sound public finances. [TAP, 10/2/2015]

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