How Vision 2030 is transforming Saudi Arabia into a globally competitive economy

Special How Vision 2030 is transforming Saudi Arabia into a globally competitive economy
Investments for NEOM’s first phase could reach SR1.2 trillion by 2030. (Supplied)
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Updated 25 April 2024
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How Vision 2030 is transforming Saudi Arabia into a globally competitive economy

How Vision 2030 is transforming Saudi Arabia into a globally competitive economy
  • From efficiency and economic performance to infrastructure and cybersecurity, the Kingdom is a desirable place to do business
  • Strides in transport, logistics and financial markets have boosted the Kingdom’s global competitiveness

RIYADH: What extraordinary feats did Saudi Arabia accomplish to see itself ranked ahead of China, Germany and the UK on a global measure of economic competitiveness?

On its eighth anniversary, Saudi Vision 2030 has reached several remarkable milestones and made steady progress since its inception by Crown Prince Mohammed bin Salman, revealing a transformative journey that continues to reshape the Kingdom’s future.




Vision 2030 has crossed several milestones and made steady progress since its unveiling by Crown Prince Mohammed bin Salman in 2016. (SPA photo)

“It is an ambitious yet achievable blueprint, which expresses our long-term goals and expectations and reflects our country’s strengths and capabilities,” the crown prince said at Vision 2030’s launch in 2016. 

“All success stories start with a vision and successful visions are based on strong pillars.” 

According to a competitiveness report by the Swiss-based International Institute for Management Development, the Kingdom ranks third among G20 nations on this metric, and 17th among all countries.

Just what are the achievements the Kingdom has made to secure this high global ranking among competitive countries?

According to the latest annual Vision 2030 bulletin, Saudi Arabia achieved significant progress in four competitiveness factors evaluated in the report. 

It leaped to sixth place in economic performance, advanced to 11th in government efficiency and 13th in business efficiency, while holding steady at 34th in infrastructure ranking.

Other performances include that the Kingdom is third among G20 countries, fifth globally in the financial market index, and second in the cybersecurity indicator.

PIF: An investment powerhouse

As the most crucial driver of economic diversification and the revitalization of vital sectors, the Public Investment Fund possesses leading investment portfolios.

These are designed to direct investments toward diversifying the economy, developing infrastructure, stimulating innovation, and strengthening global economic ties.




The Oxagon, located on the Red Sea in the Kingdom's northwest province of Tabuk, is being built as a home to advanced and clean industries in NEOM. (Supplied)

The fund has broadened its portfolio to encompass promising sectors with significant growth potential, covering everything from tourism and entertainment to financial technology, gaming, and sports. 

Its investment competence has swiftly increased, positioning PIF as a global leader in capitalizing on economic opportunities at both national and international levels.

Strides in the logistics sector

Since the launch of Vision 2030, Saudi Arabia has been unlocking the potential of the logistics sector, capitalizing on its strategic location and unique capabilities to become a leading hub.

This focus has begun to bear fruit, with a series of achievements reinforcing the Kingdom's global status in the logistics arena. 

Progress in this arena was underlined when Saudi Arabia leapt 17 places in the World Bank’s Performance Index, advancing from 55 to 38.

Additionally, the Kingdom saw an eight-place advancement in Lloyd’s List Global Ranking for Container Handling Among the World's Top 100 Ports, from 24 to 16.

Furthermore, the Kingdom made its most significant jump in the International Air Connectivity Index, moving from 27th to 13th place, according to the report by the International Air Transport Association.

Business efficiency

Since March 2020, the Saudi Business Center has delivered 2.5 million services to the private sector through its 17 branches across the Kingdom.

These services aim to streamline business startup processes and offer various related services, following international best practices.

This approach helps attract investments and creates a supportive environment, with high-quality services provided efficiently to the business sector.

The Vision 2030 report noted that the Kingdom moved up in the National Entrepreneurship Context Index from fourth to second place, a result of achieving a top ranking in several sub-indicators, revealing continuous development and a competitive global position in the entrepreneurship sector.

Saudi Arabia also ranked first in several sub-indicators for 2023, including indexes which measure the ease of starting a business, fear of failure, and individuals’ skills and knowledge. The Kingdom was also top for metrics building great wealth, knowing someone who started a new business, and the availability of good opportunities to start one.

Saudi Arabia has made significant progress on the global stage, which means that it has already mastered the smaller-scale challenges.

It led the Middle East and North Africa in venture capital investment by value for 2023, according to a report from the startup investment data platform MAGNiTT.

This top ranking reflects the Kingdom's efforts over the past several years to create an encouraging and supportive environment for entrepreneurship and investment in startups, fostering the growth of the private sector and providing more economic opportunities.




Men walk at the campus of the King Abdullah University of Science and Technology in Thuwal. (Supplied)

Transport infrastructure

The transportation sector is crucial for sustainable development and plays a key role in improving safety by enhancing roads and implementing advanced transportation systems. 

These efforts help reduce road accidents, injuries, and fatalities, creating a safer environment and boosting overall quality of life — all part of the goals of the National Transport Strategy, within the framework of Vision 2030.

The report outlined traffic safety indicators and highlighted that the road fatality rate dropped from 28.8 per 100,000 people in 2016 to 13.3 by 2022.

It also noted that the injury rate fell to 71.67 injuries per 100,000 individuals in 2022.

Competitive financial market

Saudi Arabia’s financial market has experienced significant growth and activity since Vision 2030 was announced, demonstrating the strength and robustness of the Kingdom’s financial sector.

The Kingdom was ranked fifth globally — and third among G20 countries — in the Financial Markets Index, according to the 2023 International Competitiveness Yearbook by the World Competitiveness Center.

The number of financial technology entities in 2023 reached 216, far exceeding the target of 150. This indicates rapid growth and development in the financial technology sector.

Furthermore, the number of listings in the financial market for 2023 reached 43, surpassing the target of 24, indicating increased interest from companies to list on the market.

This growth is a positive sign of investor confidence and the attractiveness of the market for public offerings, as the total number of listed companies is now 310, indicating a diverse and extensive market.

A high percentage of micro and small enterprises listed on the market, at 76.7 percent compared to the target of 44 percent, demonstrates that even smaller businesses are finding opportunities to go public, according to the report.

Saudi Arabia’s story of transformation has many authors, including the government, Saudi citizens, the private sector, and international partners.

In 2023, their combined efforts made Saudi Arabia an even better place to live, work, and visit. 

Together, they are writing the next chapter in 2024 — a year of unrivaled opportunity for the Kingdom and anyone who wants to be part of the story.
 

 


Malaysia preparing to join BRICS economic group, media report says

Malaysia preparing to join BRICS economic group, media report says
Updated 4 sec ago
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Malaysia preparing to join BRICS economic group, media report says

Malaysia preparing to join BRICS economic group, media report says

KUALA LUMPUR: Malaysia is preparing to join the BRICS group of emerging economies, Prime Minister Anwar Ibrahim said in an interview with Chinese media outlet Guancha, Reuters reported.

The BRICS group of nations originally included Brazil, Russia, India, China, and South Africa, which gave it the acronym.

The group last year began to expand its membership as it looks to challenge a world order dominated by Western economies, with Saudi Arabia, Iran, Ethiopia, Egypt, Argentina and the UAE joining and more than 40 countries expressing interest.

“We have made a decision, we will be placing the formal procedures soon ... we are just waiting for the final results from the government in South Africa,” Anwar said, according to a video of the interview posted by Guancha on Sunday.

A representative from Anwar’s office on Tuesday confirmed his comments to Reuters.

During the interview, he did not provide further details on the application process.

Anwar’s comments came ahead of a three-day visit by Chinese Premier Li Qiang this week, as part of celebrations marking the 50th year of diplomatic relations between Malaysia and China.

Malaysia and China are expected to sign several deals during Li’s visit, including renewing a five-year trade and economic cooperation agreement.


Oil Updates – crude edges down amid cautious demand outlook

Oil Updates – crude edges down amid cautious demand outlook
Updated 28 min 55 sec ago
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Oil Updates – crude edges down amid cautious demand outlook

Oil Updates – crude edges down amid cautious demand outlook

SINGAPORE/HOUSTON: Oil prices edged down in Asian trade on Tuesday, after posting gains in the previous session, as markets remained cautious about global demand growth prospects amid expectations of stronger supplies, according to Reuters.

Global benchmark Brent crude futures slipped 12 cents, or 0.14 percent, to $84.13 per barrel at 9:15 a.m. Saudi time. US West Texas Intermediate crude futures fell 14 cents, or 0.17 percent, to $80.19 a barrel.

Both benchmarks gained around 2 percent on Monday, closing at their highest since April.

“The oil market shifted its focus back to fundamentals, which have been soft for some time,” said BoFA commodity and derivatives strategist Francisco Blanch in a client note, adding that global crude oil inventories and refined product storage in the US and Singapore, among other places, was higher.

Meanwhile, global oil demand growth decelerated to 890,000 barrels per day year-on-year in the first quarter, and data suggests consumption growth likely slowed further in the second quarter, he said in the note.

China’s oil refinery output slipped 1.8 percent from year-ago levels in May, statistics bureau data showed on Monday, as refiners undertook planned maintenance overhauls and processing margins were pressured by rising crude costs.

Markets were also looking out for further clues on interest rates, and how the US demand situation would pan out, as several US Federal Reserve representatives will be speaking later on Tuesday.

Some analysts remained bullish on the price impact of an extension by the OPEC+ group of supply cuts in the near-term.

“The latest guidance provided by OPEC+, as well as their unchanged 2.25 million barrels per day demand growth outlook, signals a stagnation in oil supply growth for 2024 and an apparent downside risk to production in 2025,” said Patricio Valdivieso, Rystad Energy vice president and global lead of crude trading analysis.

“Under these conditions — and the disconnect between the OPEC+ demand outlook and all other agencies — it is hard to remain fully bearish when global oil supply growth appears decimated,” he added.

Recent rebounds in complex refining margins, particularly in Europe and Asia, were also supportive to markets, said Sparta Commodities analyst Neil Crosby.

Refining margins at a typical complex refinery in Singapore averaged at $3.60 a barrel for June so far, compared with $2.66 a barrel in May. 


Saudi Arabia climbs to 16th place in World Competitiveness Index

Saudi Arabia climbs to 16th place in World Competitiveness Index
Updated 37 min 32 sec ago
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Saudi Arabia climbs to 16th place in World Competitiveness Index

Saudi Arabia climbs to 16th place in World Competitiveness Index

RIYADH: Saudi Arabia’s ongoing economic diversification efforts have propelled the country to the 16th spot in the World Competitiveness Index 2024, up from 17th place the previous year.

According to a report from the Switzerland-based International Institute for Management Development, the Kingdom was ranked 24th in 2022 and 32nd in 2021.

The ascent, supported by Saudi Arabia’s Vision 2030 program, is attributed to significant progress in economic performance, government efficiency, and a business-friendly environment.

The report also highlighted that Saudi Arabia ranked higher than several of its G20 peers, including India, the UK, and Japan, as well as other countries like Italy, Argentina, Indonesia, Brazil, and Turkiye.


Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI

Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI
Updated 17 June 2024
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Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI

Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI

RIYADH: Saudi Arabia’s crude production increased by 13,000 barrels per day in April to reach 8.99 million, according to an analysis from the Joint Organizations Data Initiative. 

The data indicated that exports over the same month saw a decline despite this growth, dipping by 445,000 bpd to 6 million compared to March.

The Kingdom’s direct burn of crude oil, which involves using oil without substantial refining processes, increased by 93,000 bpd in April compared to the previous month – an 11 percent year-on-year growth. 

The decline in the Kingdom’s crude exports and a marginal rise in production can be attributed to the voluntary cuts adopted by members of the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+.

In March, Saudi Arabia announced the extension of its 1 million bpd cut, initially implemented in July 2023, until the end of 2024. 

Earlier this month, the Kingdom’s Minister of Energy Prince Abdulaziz bin Salman said Saudi Arabia will increase its oil production capacity from 2025 to 2027 before returning to a production level of 12.3 million bpd in 2028. 

“In 2025, we will have an incremental increase. We will have a bigger incremental increase in 2026 and 2027. And then we will go back to our 12.3 million bpd production in 2028,” said the energy minister. 

According to JODI Data, total oil demand in India, one of the largest crude consumers in Asia, slipped by 156,000 bpd in April compared to March. 

Similarly, the Asian nation’s total product exports also edged down by 85,000 bpd in April. 

On the other hand, India’s overall crude imports rose by 510,000 bpd, marking an 8.1 percent year-on-year increase. 

Earlier this month, OPEC said that oil demand globally would rise by 2.25 million bpd in 2024, driven by growth in markets such as China, India, the Middle East and Latin America. 

On June 6, speaking at the International Economic Forum in St. Petersburg, Haitham Al-Ghais, secretary-general of OPEC, said that the world will witness continued oil demand growth in the coming years. 

“Last year, OPEC’s forecast for oil demand was the best. And all those who criticized OPEC’s forecast kept adjusting their number throughout the year,” said Al-Ghais.

However, the International Energy Agency forecast oil demand growth to slow as the world continues its energy transition journey, although it noted that there would be growth of 1 million bpd in 2024. 


Saudi developer Al-Othaim Investment launches new cruise ship in Hail 

Saudi developer Al-Othaim Investment launches new cruise ship in Hail 
Updated 17 June 2024
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Saudi developer Al-Othaim Investment launches new cruise ship in Hail 

Saudi developer Al-Othaim Investment launches new cruise ship in Hail 

RIYADH: A five-star hotel is part of a new cruise ship set for Saudi Arabia’s Hail region, local real estate developer Al-Othaim Investment has announced.

The new project, also referred to as Al-Othaim Cruise Hail, is built on a total area of ​​77,000 sq. m. and includes a shopping mall, 276 residential units, 16 luxurious palaces, and multiple entertainment spaces. 

Moreover, the planned hotel on the ship contains 120 rooms and 156 apartments, as well as office spaces on six floors covering an area of over 9,000 sq. m. 

The company said in a post on X that this move falls in line with its expansion strategy, which aims to launch several projects in various regions of the Kingdom.     

“Our staff of 4,000 young Saudi men and women serve the passengers the recreational services,” the company said in its post.  

 

 

The new development is also projected to contribute significantly to sustainable development, achieving the nation’s Vision 2030 goals and enhancing Saudi Arabia’s position as a leading global investment center.  

Additionally, the planned cruise ship aligns well with the ongoing encouragement of Prince Abdulaziz bin Saad, the governor of the Hail region, to support the growth and development process in the area and to enhance its position as a leading investment destination.   

The project also occurs alongside the continuous support for the private sector from the Saudi Minister of Municipal and Rural Affairs and Housing, Majid bin Abdullah Al-Hogail, and his dedication to creating an attractive investment environment throughout the Kingdom’s various regions and cities.

In May, Saudi Tourism Investment Co.’s CEO revealed that the Kingdom’s northwestern city of Hail would home to the firm’s fifth destination development.    

Speaking to Arab News on the sidelines of the Future Hospitality Summit at the time, Fahad bin Mushayt announced the plan, which comes after the activation of the company’s projects in Al-Baha, Yanbu, Al-Ahsa, and Taif.  

Mushayt noted that the initiatives were launched within a year of the unveiling of the Public Investment Fund-owned firm Asfar.

The CEO also highlighted at the time that the company is mandated to invest in new projects and develop attractive travel destinations, incorporating hospitality, tourist attractions, retail, and food and beverage offerings in cities across Saudi Arabia.

Bin Mushayt said at the time: “In almost one year, Asfar is already playing in four destinations, with Hail coming soon, so I can reveal that.”