By Courtney Trenwith
Finance minister says action take to write off loans taken out by Saudi nationals - report
The Saudi Arabian government has written off another $5.3bn in loans taken out by citizens, according to local media.
The Finance Ministry said on Saturday it had consumed loans worth SR1.84bn ($490m) that had been taken out with state-owned financial institutions by 20,792 Saudi nationals.
Finance Minister Ibrahim Al-Assaf said the ministry also would pay SR16bn ($4.3bn) in instalment payments to the Real Estate Development Fund and the state-owned Saudi Credit Bank after King Abdullah exempt nationals from making payments for two years.
The Real Estate Development Fund wrote off a further SR1.24bn ($330m) owed by 8,259 nationals, while the Agricultural Development Fund cancelled SR472m ($126m) worth of loans that were lent to 7,076 people and the Saudi Credit Bank wrote off SR120m ($32m) loans taken by 5,457 people.
Also recently, King Abdullah declared debts would be wiped out after death, meaning the burden will not be passed on to descendants.
Governments paying off citizens’ debts has become common in the Gulf.
In particular, the Kuwaiti government recently decided to take over loans worth an estimated $2.61bn that had been taken out by about 40,000 nationals in the lead up to the global financial crisis.
The move was heavily criticised by economists and Kuwait Banking Association chairman Hamad Al-Marzouq.
Al-Marzouq claimed the bailout was politically motivated and unjustly denigrated the reputation of the country's banking sector.
He said allegations banks had charged excessive interest rates on consumer loans during 2002-08 and violated Central Bank of Kuwait regulations were “completely false”.
The GCC states continue the free baby sitting service!
I can see you are living in UAE and making a good fortune from one of the GCC countries also to afford a good life for your children, nothing wrong with that.
But imagine you are in France... I reckon you will be parking the expensive cars which belong to people from GCC states and wish for some tips.
So, either you get a life or stop stabbing people from the back .
Not really... lots of expensive cars belong to Europeans and Americans... and the new rich people of the world aka, the Chinese, Indians, Russians... They've actually have worked hard unlike most Saudi's who have indentured labourers to do it for them..