The Saudi cabinet approved the “national strategy to protect integrity and fight corruption” at a meeting chaired by King Abdullah late on Monday, the official SPA news agency said. It gave no details.

Newspapers Asharq al-Awsat and Arab News, both owned by a key Saudi royal, said the plan could open government officials to investigation.

“(It calls for) reducing and simplifying procedures and for applying the principle of accountability to all officials regardless of their positions,” said the dailies, which often express views close to that of the government.

Saudi officials could not be reached for comment.

The announcement is the first move to crack down on corruption since King Abdullah, who came to power on a reform agenda in August 2005, pledged to fight graft last year.

“This will help the country improve its image in the Gulf region, especially among foreign investors,” a Western diplomat said. “But its success depends on an efficient legislative framework that would really enforce accountability among the powerful royals.”

Members of the royal family hold key positions in government in an absolute monarchy with an unelected quasi-parliament whose members are appointed by the king to advise on legislation.

Some analysts say a perception of corruption in the kingdom is discouraging some foreign firms from investing.

In December, the British Serious Fraud Office (SFO) dropped a probe into a multi-billion dollar arms deal between defence contractor BAE Systems Plc and Saudi Arabia.

Prime Minister Tony Blair has said pursuing the case would have harmed national security and a crucial relationship for counter-terrorism and Middle East peace.

British newspapers said Saudi Arabia had warned Britain it might cancel the order if the probe was not stopped.