The Kingdom of Saudi Arabia’s Vision 2030 is the strategic framework aimed at reducing the Kingdom’s dependence on oil, diversifying its economy, and improving public services, achieving significant progress under the leadership of Crown Prince Mohammed bin Salman and his relevant ministries.
The Saudi economy witnesses distinguished growth in line with Vision 2030
The Saudi Minister of Finance, Mohammed Al-Jadaan, confirmed that the Saudi economy is experiencing a “distinguished” phase, aligning with the objectives of Vision 2030.
During a press conference announcing the Saudi budget for 2024 on Wednesday, Al-Jadaan indicated that the non-oil economy is expected to grow at an average rate of about 6 percent until 2030.
Towards sustainable financial borrowing for Vision 2030 projects
Al-Jadaan affirmed the government’s commitment to sustainable financial borrowing in a speech delivered on Thursday at the first session of the “2024 Budget” Forum titled “Sustainable Financing.” He confirmed the government’s success in bridging the financing gap for Vision 2030 projects and aligning the required revenues with funding needs.
Al-Jadaan explained that the efficiency of projects has been assessed, considering the possibility of postponement and evaluating the ability to borrow from debt markets. This approach ensures that borrowing occurs within acceptable limits to maintain financial stability.
The public debt of the Kingdom of Saudi Arabia
In an interview with Al-Arabiya for Business on Wednesday, Al-Jadaan revealed that about 90 percent of Saudi Arabia’s debt is fixed-rate, while 10 percent is variable. This indicates a strong financial position for the Kingdom, with limited exposure to global market price fluctuations.
Economist and financial analyst Talaat Hafez expects the ratio of public debt to GDP to increase to 30 percent, which aligns with the set objectives and remains the lowest among G20 countries. Currently, this ratio is less than 25 percent.
Major projects in Saudi Arabia
The Saudi Minister of Finance pointed out that the focus on diversification in the non-oil economy within the framework of Vision 2030 is already yielding tangible results. He noted that non-oil revenues constitute 37 percent of Saudi Arabia’s total revenues in 2023.
Major projects in the Kingdom of Saudi Arabia
Saudi Arabia is witnessing the implementation of multiple mega-projects within the framework of Vision 2030. Among these projects is NEOM, a futuristic city on the Saudi side of the Gulf of Aqaba, with a cost exceeding $500 billion. It has secured financing of more than $18.2 billion, representing the highest investment level in recent years.
Tourism and entertainment projects in the Kingdom of Saudi Arabia
The tourism and entertainment sectors are witnessing the implementation of high-execution-rate projects, such as the Red Sea Project and the Amala Project, where the execution rate has reached about 50 percent. Other projects include the Al-Ula Project, the City Marvel Project, and a boutique hotel group, with execution rates of 11 percent, 14 percent, and 10 percent respectively.
Investment in the Saudi capital
The National Investment Strategy aims to elevate Riyadh to be one of the top 10 cities in the world. The Saudi capital is already experiencing a boom in the construction sector, with contracts worth $12.2 billion signed in 2022, the highest level since the $32 billion recorded in 2013, including $23 billion related to the development of the Riyadh Metro.
According to a MEED report, additional contracts worth approximately $9 billion are expected to be awarded, which could raise the annual total to over $20 billion if signed. Potential design awards and awards under review have been pegged at $110 billion and $60 billion respectively.
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