The position of Middle East states vis-a-vis international banks showed a strong improvement in the first quarter of 1995, according to the Basle-based Bank for International Settlements (BIS). Assets of Middle East states rose almost 8 per cent to $209,081 million in the three months to March 1995. In contrast, liabilities rose only 2 per cent to $81,221 million in the same period.

The improvement was mainly due to a rise in funds held by Gulf states with BIS banks. Saudi Arabia’s assets rose 14 per cent to $64,743 million during the period. The BIS report said this was ‘perhaps reflecting a shift in the composition of the country’s foreign exchange reserves out of dollar paper not included in the reported figures into deposits denominated in stronger currencies’ (see Saudi Arabia). Only Bahrain and Oman among the six states of the GCC reported a slight fall in assets.

Turkey increased its assets by almost $3,000 million in the three-month period to $21,806 million. The country’s liabilities rose by $1,369 million to $18,356 million.