in many other fora. of course, there is always the risk that in such sessions the questioning can tend to aim more at political point scoring. public communication is, however, a two edged sword. for every occasion when there is something important to say, there is another at which a central banker finds him or herself giving a speech, or releasing a formal document, which has little new to say on the economy, in an environment in which markets and observers already have a good understanding of the central bank ’ s assessment. on those occasions there is always the risk that further communication will inadvertently dislodge perfectly sensible expectations – which is one reason why speeches and documents are often, quite deliberately, a little on the unexciting side. colour and movement are not necessarily useful in the central banker ’ s case. it is for this reason that the rba was, for a long time, somewhat ambivalent about the practice adopted by some other central banks of making a statement of reasons for the policy decision even when the decision is to leave rates unchanged. while a decision to change rates has for many years been accompanied by a pretty detailed explanation in our case, a decision not to change rates often meant that we had little new information to impart. we adhered to the old adage “ when you have nothing to say, keep your mouth shut ”. these reservations were valid. but an increasing number of other central banks have managed to construct these statements and issue them regularly, without apparently doing much harm. more importantly, while there are plenty of occasions in which no change in interest rates is widely expected, and hence perhaps needs little explanation, there are others in which a no change decision does require careful explanation. having reflected on this for some time this year, the reserve bank board came to the judgement that the downside risks of such statements no longer outweigh the likely benefits. accordingly, we have adopted the practice of issuing a short statement after every meeting, explaining the policy decision, whether or not the cash rate is to change. the first “ nochange ” statement was issued last week. last week ’ s decision was a good example, in fact, of one where no change to the cash rate needed explanation. the statement noted the concern the board had about the outlook for inflation, given the recent price data and the apparent strength in demand. it also noted that the outlook for the world economy looked a little weaker, and that trends in financial market pricing, over

and others are about to finalize necessary procedures. more licenses are expected to be issued soon. the banking system is also being expanded by allowing foreign banks to open branches in the kingdom. so far ten licenses have been issued for that purpose to 5 gcc banks and to 5 banks from other countries. all of them have already established their branches in the kingdom, or are likely to open their branches in the very near future. also, in march 2006 the council of ministers approved the foundation of a saudi joint - stock company under the name " alinm'a bank " with a capital of sr 15 billion to carry out normal banking business and investment. this bank is likely to become operational in the near future. saudi arabia has one of the youngest populations in the world. this means that one of the challenges facing the national economy is to continue creating jobs for our young people to enter the labour market. this involves development of education and training to qualify the youth and prepare it to meet the requirements of the labour market. this subject is being given a high priority in the state's plans which envisage expansion in the establishment of more universities, specialized colleges, training centers and encouraging the private sector to contribute to the effort in that direction. notable progress has been made in providing most government jobs to saudis. a major achievement of the saudi banking system has been in areas of human resources, where banks have continued to increase the use of saudi citizens. i am therefore pleased to note that in this regard the banking sector is ahead of all other industrial sectors and currently a level of about 80 percent saudization has been achieved. the employment of saudis at senior executive level has reached 70 percent. however, one of the most important challenges currently facing the financial sector is the great increase in the need for qualified skills due to the expansion by banks in their business and establishment of financial services institutions and insurance companies and insurance related services and free professions. this will result in a great pressure on available technical skills in these fields. this has been noted recently in the high rise in the wages for such specialized skills and competition by financial institutions to attract such skills. i hope that exaggeration in this competition will not increase the rotation of the manpower in this sector in a manner that would affect work in its institutions. the next stage in the saudization policy is to increase the proportion of saudis in the new jobs that are being created by our expanding economy. the government has recently launched a program to support small -