Yesterday, Finance and National Economy Minister Ibrahim Al-Assaf warned about the Kingdom's heavy reliance on oil revenues, as a high-level symposium started to draw up guidelines for the Saudi economy in the next two decades. He told the opening session of the symposium: "Dependence on oil revenues and consequently public spending as the main driving force for economic activity has made our economy vulnerable to changes in the international oil markets. Heavy dependence on one source of revenue linked to developments in the world economy and conditions in the oil markets constitutes a major challenge to fiscal policy planners in the Kingdom."

Crown Prince Abdullah, Deputy Premier and commander of the National Guard, launched the five-day symposium on a "Future Vision for the Saudi Economy" which is being held to help Saudi planners work out the Kingdom's long-term development strategy until 2020.

In his address, Al-Assaf cautioned against the reliance of domestic economic activity on external factors: "The size of public revenues and eventually Government spending is not determined by domestic economic activity but depends on external economic developments," he said. "As a result, the budget has experienced continuous deficits because revenues failed to match expenditures, and the accumulation of public debt has created pressure on the state treasury."

Saudi Arabia boasted a $6.3 billion surplus in 2000, the only budget in the black during the past 20 years. This year, there is a projected deficit of $12 billion, but preliminary financial results so far point to better-than-expected revenues due to high oil prices. The Kingdom's public debt stood at a staggering $168 billion by the end of last year and, though all of it is domestic, economists believe it is hindering healthy economic development.