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11 December 2019
BUSINESS

Saudi overhaul under review as Crown Prince question progress

Announcing the government’s 2020 budget earlier this week, the Saudi finance minister said that the review was regular and would be completed at the end of the first quarter.

iStock/swisshippo


Saudi Arabia is reviewing its plan for life after oil with Crown Prince Mohammed bin Salman said to be unsatisfied with progress and the government seeking to control spending, reported Bloomberg.

Officials are looking at hundreds of programmes and initiatives under ‘Vision 2030’and could cut, merge and amend some of them or create new ones. However, this is not the first review since the agenda was announced less than four years ago.

The sprawling programme aims to diversify the Kingdom’s oil-dependent economy by attracting foreign investment, balancing the budget and privatising government assets. But economists say some targets have slipped while government employees have criticised overlapping remits and priorities that conflict.

The recent record initial public offering in the Kingdom’s giant oil company is a key part of the revamp, raising a windfall of almost $26 billion.

Mohammed Al-Jadaan, the Finance Minister, said, “Vision 2030 is reviewed every year and the current review will ensure that those elements that are making the right impact continue, and those that need enhancement are enhanced—and if we need new programmes or initiatives to ensure that we focus on some of the targets, these are introduced.”

Since the plan was announced, it has grown into over a dozen “Vision realisation programmes,” incorporating hundreds of initiatives and a slew of new government entities to implement it all.

There is a project to provide childcare for working women or another to develop a ‘heli-taxi’ company. Several of the Kingdom’s mega-projects, including NEOM—a $500 billion city that Crown Prince Mohammed wants to build from scratch—are Vision initiatives.

Original targets include a plan to increase the sovereign wealth fund’s assets to SAR 7 trillion ($1.9 trillion) from SAR 600 billion and another to lower citizen unemployment to seven per cent. The latter has been especially challenging, with the jobless rate rising last year to its highest level in over a decade before declining slightly to 12.3 per cent.

Ahmed Al Rajhi, the Saudi Labour Minister, said that the government has exceeded its goals in other areas, though. Women’s participation in the labour force has risen to 25.3 per cent, surpassing an official target of 24 per cent by 2020.

 “The targets are the same; the only thing we are changing is the how, because with time things do change, and we have to be dynamic,” said Bandar Alkhorayef, the Saudi Industry and Mining Minister.

 


RELATED STORIES: Crown Prince Mohammed bin Salman NEOM Vision 2030


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