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Tue 13 Dec 2011 08:35 PM

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Saudi names new central bank governor

Fahad al-Mubarak appointed to replace Muhammed al-Jasser who is new economy minister

Saudi names new central bank governor
Former Saudi Central Bank governor Muhammad al-Jasser

Saudi Arabia, the Arab world’s biggest economy, on Tuesday named a new central bank head and shuffled cabinet ministers amidst King Abdullah’s record spending plan to fight unemployment and lessen dependency on oil.

Fahad al-Mubarak was appointed as governor of the central bank, replacing Muhammad al-Jasser, who was named the new economy and planning minister, state run-al-Ikhbariya television reported. A new trade and industry minister was also appointed.

Saudi Arabia’s drive to create jobs comes amid a wave on popular uprisings in the Middle East, triggered in part by unemployment.

King Abdullah announced a $130bn spending plan in the first quarter and in August 2010 unveiled a $384bn plan to develop transportation, housing and education.

The country needs the non-oil economy to expand at an average 7.5 percent in the next five years to lower joblessness by half to 5 percent, the IMF said.

Non-oil output will slow to 5 percent in 2012 from 5.4 percent this year, while growth in oil GDP will grind to a halt next year, IMF data shows.

Saudi banks have tightened lending criteria after two family-owned businesses defaulted on at least $15.7bn of loans in 2009 and the global credit crisis hurt the economy. Growth slowed to 0.1 percent in 2009 from 4.2 percent the previous year, IMF data shows.

More than half of new jobs went to foreigners between 2004 and 2009, the International Monetary Fund said in a September report.

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