High oil prices continued to help the bank balances of Middle East countries up to the end of 1996, according to the latest data from the Bank for International Settlements (BIS). The net assets of regional countries held in the banks of the OECD countries rose by 8 per cent during the last quarter of 1996.

This largely reflects increases in the net assets of the Gulf Arab oil- producing states, notably Saudi Arabia, which had fallen in the previous quarter. Algeria’s debt to foreign banks continued to shrink, as did Iran’s. Egypt’s substantial foreign reserves did not change much in size during the period.