SAUDI ARABIA IS MARCHING TOWARDS THE FUTURE
The following text constitutes a brief presentation of the VISION 2030, an ambitious plan which is believed that till 2030 will transform the Kingdom completely. The text is based on the official plan, presenting the main sectors and providing a link for each one, due to its extended size.
The plan itself is very detailed due to the combination of economic actions with social parameters and political transformations. Thus, it presents several difficulties in identifying the specific points, which interest the companies willing to participate.
Our aim is to give a concise presentation of the project, a kind of guide or directory for facilitating the stakeholders. For the same reason, detailed references are listed at the end of this text, concerning the main points of each action included in the plan. (1)
VISION 2030 is an immense plan and it will change everything in the KSA, economically, socially, politically, structurally – namely in all sectors of people’s lives, as well as in the structures and institutions of the Kingdom. Vision 2030 is Mohammad bin Salman’s vision for the future of his nation.
According to The Economist, Vision 2030 could be described as a “Thatcher revolution” for Saudi Arabia and it will require tremendous investments, nearly to $4 trillion, between today and 2030.
A VERY WELL-PLANNED DREAM
This is our “Saudi Arabia’s Vision for 2030.” We will begin immediately delivering the overarching plans and programs we have set out. Together, with the help of Allah, we can strengthen the Kingdom of Saudi Arabia’s position as a great nation in which we should all feel an immense pride.
Saudi Arabia – the heart of the Arab and Islamic worlds – the investment powerhouse – the hub connecting three continents.
The successful visions are based on strong pillars. VISION 2030 is based on three pillars.
The first pillar of our vision is our status as the heart of the Arab and Islamic worlds. We recognize that Allah the Almighty has bestowed on our lands a gift more precious than oil. Our Kingdom is the Land of the Two Holy Mosques, the most sacred sites on earth, and the direction of the Kaaba (Qibla) to which more than a billion Muslims turn at prayer.
The second pillar of our vision is our determination to become a global investment powerhouse. Our nation holds strong investment capabilities, which we will harness to stimulate our economy and diversify our revenues.
The third pillar is transforming our unique strategic location into a global hub connecting three continents, Asia, Europe and Africa. Our geographic position between key global waterways, makes the Kingdom of Saudi Arabia an epicenter of trade and the gateway to the world. (2)
Mohammad bin Salman bin Abdulaziz Al-Saud
Chairman of the Council of Economic and Development Affairs
Mohammad bin Salman bin Abdulaziz Al-Saud Mohammad bin Salman was appointed Crown Prince in June 2017 after a decision of his father Salman bin Abdulaziz Al Saud , the King of Saudi Arabia. King Salman is also the Prime Minister of the Kingdom, the Custodian of the Two Holy Mosques and the head of the House of Saud since 2015.
Mohammad bin Salman bin Abdulaziz Al Saud besides being the Crown Prince of Kingdom of Saudi Arabia, is also the First Deputy Prime Minister, the President of the Council for Economic and Development Affairs and the Kingdom’s Minister of Defense.
Holding these titles and therefore serving the corresponding positions, Mohammad bin Salman is considered as the power behind his father, King Salman.
Governance Model for Achieving Saudi Arabia’s Vision 2030
The Council of Ministers has entrusted the Council of Economic and Development Affairs with the task of establishing the mechanisms and measures necessary to achieve Saudi Vision 2030. The Council of Economic and Development Affairs has developed a comprehensive governance model aimed at institutionalizing, enhancing its work, facilitating the coordination of efforts among relevant stakeholders and effectively following-up progress.
FOUR LEVEL ESCALATION MECHANISMS
Given the need for a clear escalation mechanism for addressing issues that may impede the achievement of Vision 2030’s desired objectives, a mechanism was adopted to reinforce the relevant stakeholders’ responsibilities, to increase their awareness of delayed or stalled initiatives, and, if necessary, to activate their accountability role. This shall be carried out on various levels according to the complexity of the problems and the time required to resolve them. Under the supervision of the Project Management Office of the Council of Economic and Development Affairs, four different parties shall assume responsibility for escalation. This mechanism aims to bring about effective achievement and quick problem solving as follows:
Level One: Defines the directions and the making of decisions.
Issues shall be addressed within each executive body in charge of implementing the programs and initiatives, under the direct supervision of its head (for example, the relevant minister). If the issue does not fall under the jurisdiction of a specific body, the issue shall be referred to a higher level.
Level Two: Develops the strategies.
The Strategic Management Office, operating under the Council of Economic and Development Affairs, shall be asked to examine the matter and prepare a complete dossier for the clarification of facts, convergence of views, and acquisition of the necessary information from all relevant bodies. Should it be impossible for the Office to address the concern, the Office shall submit the dossier to the Strategy Committee for resolution.
Level Three: Implementations.
The Strategy Committee shall, at its own discretion, decide on the matters referred to it by the Strategic Management Office that fall under its jurisdiction, or it shall refer them to the Council of Economic and Development Affairs for resolution.
Level Four: The role of the CEDA.
References to the Council of Economic and Development Affairs for a resolution. (3)
THE THREE REALIZATION PROGRAMS
I. National Transformation Program
“Saudi Arabia’s Vision 2030” was adopted as a methodology and roadmap for economic and developmental action in the Kingdom of Saudi Arabia. In its aim to grant the Kingdom a leading position in all fields, Saudi Arabia’s Vision 2030 sought to identify the general directions, policies, goals, and objectives of the Kingdom.
Accordingly, some ministries, institutions, and government entities underwent a restructuring process to align them to the requirements of this phase.
In order to build the institutional capacity and capabilities needed to achieve the ambitious goals of “Saudi Arabia’s Vision 2030”, the National Transformation Program 2020 was launched across 24 government bodies operating in the economic and development sectors in its first year. It is notable that the program’s strategic objectives are linked to interim targets for the year 2020. Furthermore, the first phase of initiative implementation will be launched in 2016 and will be followed every year by phases involving more public bodies.
The program uses innovative methods to identify challenges, seize opportunities, adopt effective planning tools, activate the role of the private sector, bring about implementation, and evaluate performances. It has also determined the interim targets for some of the Vision’s strategic objectives to ensure the establishment of a solid foundation for government action and the continuity of innovative planning, implementation, and follow-up methods on the national level. (4)
II. The Fiscal Balance Program
The Fiscal Balance Program will be a key component in developing a more effective government, by providing intense scrutiny of government finances and acting as a spur to increased efficiency.
The government published Vision 2030, which defined a journey for a deep and ambitious socio-economic change in the Kingdom. Subsequently the National Transformation Program also set out specific commitments of Government Ministries and other Entities for the period up to 2020.
Beyond fiscal balance and government performance, this program contributes to key socioeconomic impacts sought by Vision 2030. This includes targeting the social welfare system on the neediest and supporting them effectively, and also making our economy more competitive.
Most importantly, by carefully managing the government’s finances, space can be created in the budget to enable investment in the long-term programs that will ensure a successful delivery of the Vision. (5)
III. The Public Investment Fund (PIF) Program (2018-2020)
With the guidance of God Almighty , we have embarked on a new era of growth and leadership toward comprehensive economic and social development, with the launch of Saudi Arabia’s Vision 2030 : “Saudi Arabia… the heart of the Arab and Islamic worlds, the investment powerhouse, and the hub connecting three continents”. The Vision revolves around three pillars: a vibrant society, a thriving economy, and an ambitious nation.
The Public Investment Fund (PIF) Program (2018-2020) is one of twelve vision realization programs. The Program outlines our objectives in local and international investments that enable the diversification of the Kingdom’s sources of development and growth. The Program crystalizes PIF’s role as the engine behind economic diversity in the Kingdom by developing strategic sectors. It also seeks to grow PIF into one of the largest sovereign wealth funds in the world, as well as to build strong economic partnerships to deepen and strengthen the impact and role of Saudi Arabia on the regional and global stages. (6)
THE THREE VISION THEMES
The Vision is built around three themes: a vibrant society, a thriving economy and an ambitious nation. (7)
1. The first theme: A Vibrant Society
The first theme is vital to achieving the Vision and a strong foundation for economic prosperity. We believe in the importance of a vibrant society. Members of this society live in accordance with the Islamic principle of moderation, are proud of their national identity and their ancient cultural heritage, enjoy a good life in a beautiful environment, are protected by caring families and are supported by an empowering social and health care system.
1.1. Vibrant Society With Strong Roots
We have enormous untapped opportunities and a rich blend of natural resources, but our real wealth lies in our people and our society. We take pride in what makes our nation exceptional: our Islamic faith and our national unity. Our nation is the core of the Arab and Islamic worlds and represents the heart of Islam. We are confident that, God willing, we will build a brighter future, one based on the bedrock of Islamic principles. We will continue to excel in performing our duties towards pilgrims to the fullest and promote our deep-rooted national identity.
– Living by Islamic values
– Focusing our Efforts to Serve Umrah Visitors
– Taking Pride in our National Identity
Among our goals by 2030…
– To increase our capacity to welcome Umrah visitors from 8 million to 30 million every year
– To more than double the number of Saudi heritage sites registered with UNESCO
– The honor to serve the increasing number of Umrah Visitors in the best way possible
– The largest Islamic museum (8)
1.2. Vibrant Society With Fulfilling Lives
The happiness and fulfillment of citizens and residents is important to us. This can only be achieved through promoting physical, psychological and social well-being. At the heart of our Vision is a society in which all enjoy a good quality of life, a healthy lifestyle and an attractive living environment.
– Promoting Culture and Entertainment
– Living healthy, being healthy
– Developing our Cities
– Achieving Environmental Sustainability
Among our goals by 2030…
-To increase household spending on cultural and entertainment activities inside the Kingdom from the current level of 2.9% to 6%
-To increase the ratio of individuals exercising at least once a week from 13% of population to 40%
-To have three Saudi cities be recognized in the top-ranked 100 cities in the world
“Daem”: meaningful entertainment for citizens (9)
1.3. Vibrant Society With Strong Foundations
Our goal is to promote and reinvigorate social development in order to build a strong and productive society. We will strengthen our families, provide the education that builds our children’s fundamental characters and establish empowering health and social care systems.
– Caring for our Families
– Developing our Children’s Character
– Empowering our Society
– Caring for our health
Among the goals by 2030 are :
– To raise our position from 26 to 10 in the Social Capital index
– To increase the average life expectancy from 74 years to 80 years
– “Irtiqaa”: A more prominent role for families in the education of their children
– Corporatization: efficient and high quality health care (10)
2. The second theme: A Thriving Economy
The second theme, a thriving economy provides opportunities for all by building an education system aligned with market needs and creating economic opportunities for the entrepreneur, the small enterprise as well as the large corporation. Therefore, we will develop our investment tools to unlock our promising economic sectors, diversify our economy and create job opportunities. We will also grow our economy and improve the quality of our services, by privatizing some government services, improving the business environment, attracting the finest talent and the best investments globally, and leveraging our unique strategic location in connecting three continents.
2.1. Thriving Economy investing for the long-term
Diversifying our economy is vital for its sustainability. Although oil and gas are essential pillars of our economy, we have begun expanding our investments into additional sectors.
We understand that there are complicated challenges ahead but we have long-term plans to overcome them. In the past 25 years, the Saudi economy has grown by an annual average rate of more than 4 percent, contributing to the creation of millions of new jobs. Although we are already among the 20 largest economies in the world, our ambitions are even greater. We aspire to have an even higher ranking by 2030, despite the headwinds of the global economic slowdown and the expected impact of our structural economic reforms. This requires us to invest in all our resources in order to diversify the economy, unleash the capabilities of our promising economic sectors and privatize some government services.
– Maximizing our Investment Capabilities
– Launching our Promising Sectors
– Privatizing our Government Services
Among the goals by 2030 are:
– To move from our current position as the 19th largest economy in the world into the top 15 economies
– To increase the localization of oil and gas sectors from 40% to 75%
– To increase the Public Investment Fund’s assets, from SAR 600 billion to over 7 trillion
– Localized defense industries
– A mining sector contributing to the national economy at full potential
– A renewable energy market (11)
2.2. Thriving Economy Leveraging its unique position
Saudi Arabia is right at the crossroads of important international trade routes, between three continents: Asia, Europe and Africa. We will therefore maximize the benefits from our exceptional and strategic geographic position, agree new strategic partnerships to grow our economy and help Saudi companies to increase exports of their products. We will leverage the proximity of energy sources and our distinctive logistical offer to stimulate a new phase of industrialization and to catalyze exports and re-exports.
– Building a unique regional logistical hub
– Integrating regionally and internationally
– Supporting our national companies
Among the goals by 2030 are:
– To raise our global ranking in the Logistics Performance Index from 49 to 25 and ensure the Kingdom is a regional leader
– To raise the share of non-oil exports in non-oil GDP from 16% to 50% (12)
2.3. Thriving Economy Rewarding Opportunities
The skills and competencies of our children are one of the most important and cherished assets. To make the most of their potential, we will build a culture that rewards determination, provides opportunities for all and helps everyone acquire the necessary skills to achieve their personal goals. To this end, we will reinforce the ability of our economy to generate diverse job opportunities and institute a new paradigm in attracting global talents and qualifications.
– Learning for Working
– Boosting our Small Businesses and Productive Families
– Providing Equal Opportunities
– Attracting the Talents we Need
Among the goals by 2030 are:
– To lower the rate of unemployment from 11.6% to 7%
– To increase SME contribution to GDP from 20% to 35%
– To increase women’s participation in the workforce from 22% to 30%
– An education that contributes to economic growth
– A bigger role for small and medium-sized enterprises (13)
2.4. Thriving Economy Open for Business
Opening Saudi Arabia further for business will boost productivity and smooth our journey to become one of the largest economies in the world. We will improve our business environment, restructure our economic cities, create special zones and deregulate the energy market to make it more competitive.
Improving the Business Environment
Rehabilitating Economic Cities
Establishing special zones
Increasing the competitiveness of our energy sector
Among the goals by 2030 are:
– To rise from our current position of 25 to the top 10 countries on the Global Competitiveness Index
– To increase foreign direct investment from 3.8% to the international level of 5.7% of GDP
– To increase the private sector’s contribution from 40% to 65% of GDP.
– A restructured King Abdullah Financial District
– A Flourishing Retail Sector
– A Developed Digital Infrastructure (14)
3. The third theme: An Ambitious Nation
Our nation is ambitious in what we want to achieve. We will apply efficiency and responsibility at all levels. Our third theme is built on an effective, transparent, accountable, enabling and high-performing government. We will also prepare the right environment for our citizens, private sector and non-profit sector to take their responsibilities and take the initiative in facing challenges and seizing opportunities.
3.1. An Ambitious Nation Effectively Governed
The roles and requirements of government have grown significantly since the Kingdom of Saudi Arabia’s founding. Government – any government – needs to evolve and improve continuously, if only to keep pace with rising expectations and new challenges. This requires us to meet high standards of transparency and accountability. We are committed to managing our finances efficiently and effectively, and to creating agile public organizations and to tracking both their own performance and that of the government overall.
– Embracing transparency
– Protecting our vital resources
– Engaging everyone
– Committing to efficient spending and balanced finances
– Organizing ourselves with agility
Among the goals by 2030 are:
– To increase non-oil government revenue from SAR 163 billion to SAR 1 Trillion
– To raise our ranking in the Government Effectiveness Index, from 80 to 20
– To raise our ranking on the E-Government Survey Index from our current position of 36 to be among the top five nations.
– King Salman Program for Human Capital Development
– Shared services to our government agencies
– Effective e-government
– “Qawam”: increasing spending efficiency (15)
3.2. An Ambitious Nation Responsibly Enabled
The nation we aspire to build will not be realized without a grand, collective national effort where everyone contributes. We all have roles to fulfill, whether we are working in the public, private or non-profit sectors. We will therefore work continually to achieve our hopes and fulfil our aspirations and responsibilities to our country, our society, our families, and to ourselves.
– Being responsible for our lives
– Being responsible in business
– Being responsible to society
Among the goals by 2030 are:
– To increase household savings from 6% to 10% of total household income
– To raise the non-profit sector’s contribution to GDP from less than 1% to 5%
– To rally one million volunteers per year, compared to 11,000 now (16)
THE APPROVAL OF VISION 2030
Cabinet Approves Kingdom of Saudi Arabia s Vision 2030
Riyadh, Rajab 18, 1437, April 25, 2016, SPA — The Cabinet devoted its session on Monday, Rajab 18, 1437 AH corresponding to April 25, 2016 AD under the chairmanship of the Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud to consider the draft of the Kingdom of Saudi Arabia s Vision 2030 on which the Council of Economic Affairs and Development issued the decision No. (3-31/37) dated on 12/7/1437 AH, and the contents of the letter of the Deputy Crown Prince, Second Deputy Premier, Minister of Defense and Chairman of the Council of Economic Affairs and Development No. (2719) dated on 18/07/1437 AH on the draft of the vision; and the Cabinet decided the following:
– First: The approval of the Kingdom of Saudi Arabia s Vision 2030 on which the Council of Economic Affairs and Development issued the decision No. (3-31/37) dated on 12/7/1437 AH according to the attaching version of this decision.
– Second: The Council of Economic Affairs and Development shall set the necessary mechanisms and arrangements to implement this vision and follow it up.
– Third: The ministries and other governmental bodies – each in its respective authority – shall take the necessary measures to implement this vision according to the mechanisms and arrangements referred to in item (second) of this decision. (17)
REFERRENCES, FROM THE GOVERNMENT TEXT:
(1) http://vision2030.gov.sa/en, All rights reserved to Saudi Vision 2030.
THE COMPLETE GOVERNMENT TEXT OF VISION 2030 CAN BE FOUND HERE:
ADDITIONAL DATA RECEIVED FROM:
International News and Markets