for its financial solvency and also won the united nations public service award for the year 2008 for developing sadad ( bill presentment and payment system ). moreover, the kingdom ranked sixteenth among 181 countries worldwide in terms of competition in business and investment performance environment according to doing business 2009 report published recently by ifc and the world bank. given the economy ’ s current position and its performance indicators, it is expected to continue its strong and comprehensive growth in the coming years. custodian of the two holy mosques, inflation, which many countries suffer from, is a global phenomenon and it is also a natural and inevitable result of strong economic growth. in the kingdom, inflation growth rates accelerated to 4. 1 percent in 2007 and to 11. 1 percent in july 2008, but then, it decreased to 10. 9 percent in august 2008. this has posed a difficult challenge due to the contradiction between measures that control inflation, i. e. strict tightening of domestic liquidity and public spending, and the ambitious goals of enhancing economic growth fundamentals that require expansionary fiscal policies to build and complete the various development projects and improve citizens ’ standard of living. after having witnessed low levels of inflation, accompanied by moderate and sometimes low economic growth in the past decades, the economy began to grow strongly in response to restructuring reform policies adopted by your wise government since about seven years. inflationary signs have not shown up until 2006 when the demand side for goods and services began to exceed supply, impacting prices. the wave of high prices worldwide along with high expectations of individuals and institutions have played a role in increasing pressures on available resources and, consequently, higher inflation especially following the considerable improvement in the government income. the phenomenon of inflation has become at the top of your concerns. accordingly, you have instructed the various appropriate authorities and bodies to combat it and reduce its effects on the society, while maintaining the momentum of development achievements. the package of the various procedures, introduced by the government at the beginning of this year, is an appropriate preliminary step aimed at addressing inflation sources that directly affect the society segments who are less able to bear its impacts. as for the monetary policy, the saudi arabian monetary agency ( sama ) has taken steps to control excess domestic liquidity by increasing rates of reserve requirements many times. however, because of the dominance of the fiscal policy over the economy, the greater burden falls on reviewing spending priorities and its programming to be in harmony with the absorptive capacity of the national economy and its ambitious

( 2010 – 2014 ). you, may allah bless you, instructed all organs of the state to be very keen on the implementation of their programs and projects and achieving their goals within their set time limit, giving a high priority to those which have direct impact on raising the standard of living of citizens and improving their life quality, especially in light of what have been allocated as an ambitious development expenditure which amounted to rls 1, 444 billion, 67 percent more than the allocations of the eighth development plan. this plan is complementary to the achievements of previous development plans that led to a quantum leap in living standards of citizens and laid solid foundations for the saudi economy to assume an important position in the global economy. the plan focuses on five main points, namely, continued efforts to improve the standard of living and life quality of citizens, the development and employment of the national manpower, structural development of the saudi economy, balanced development of the kingdom ’ s regions and enhancing the competitiveness of the national economy and saudi products in domestic and overseas markets. custodian of the two holy mosques the endorsement of the ninth development plan coincided with the announcement by the central department of statistics and information of preliminary results of the population census. the population of the kingdom amounted to 27. 1 million, of whom about 18. 7 million are saudis, and 8. 4 million are residents. the number of houses stood at 4. 6 million. these results support your royal instructions to exert every effort to achieve the objectives of the ninth development plan in a timely manner, especially with regard to enhancing citizens ’ welfare, providing housing, employment, education, health care services, and modern facilities needed, and working hard to fight poverty, paying special attention to balanced development in all regions of the kingdom. at the regional level, the four member states of the gcc monetary union ( bahrain, saudi arabia, qatar and kuwait ) have ratified, at the beginning of this year, the convention of the monetary union. by your royal encouragement and support and that of your brothers the leaders of the council ’ s states, the monetary council began its work as the nucleus of the central bank to be established upon the completion of the main facilities and infrastructure of the monetary union. the central banks and monetary agencies, members of the monetary council, are doing their utmost to conduct the council ’ s work in accordance with the guidance of the leaders of the council ’ s states. in spite of these bright achievements, there are still many challenges posed to