In the summer of 2014, the oil industry—the very foundation on which the Kingdom of Saudi Arabia was built—faced a global price collapse. Suddenly, Saudi Arabia, along with the rest of the oil-dependent Middle Eastern countries, was faced with a massive economic challenge; what would happen if the ‘backbone’ of their country was no longer able to support them?
Against this backdrop in 2015, King Salman bin Abdulaziz Al Saud and his son Mohammed bin Salman Al Saud (now the crown prince) came into power. The following year, they revealed an ambitious plan, one that would shift the country’s focus from its reliance on oil, and instead, nurture it into an economic powerhouse in its own right, fuelled by a strong private sector and a diverse economy. And so, Saudi Arabia’s Vision 2030 was born.
This wide-reaching economic and social strategy aims to transform the economy relatively quickly across myriad industries which span everything from education and tourism to health care, tech, and finance. Here’s what we know about this project and what it might mean for the events industry:
Saudi Arabia Vision 2030 in a nutshell
“Vision 2030” serves as Saudi’s roadmap to end the country’s dependence on oil by 2030. It centers on three main pillars: a vibrant society, a thriving economy, and an ambitious nation, and is driven by the country’s ‘intrinsic strengths’. These include Saud Arabia’s prime geographic position (it practically connects three continents) and its potential to be an investor’s dream country.
In its simplest form, Saudi Arabia’s Vision 2030 encompasses 96 strategic objectives which have been distilled into 13 Vision Realization Programs, several “megaprojects”, including a futuristic city called Neom, and plans to develop the country into a global ‘hub’, much like Dubai.
More than that, however, amongst the various goals and objectives, there is also a number related to social aspects of the country. Saudi aims to slash unemployment rates, increase the number of women in the workplace, set up a sovereign wealth fund, and allow a partial sale of the state-owned Aramco (rumored to be the biggest company in the world).
Woven into the fabric of the plan is the desire to improve the overall quality of life in Saudi Arabia for its citizens. As Crown Prince Mohammed said, “It guides our aspirations towards a new phase of development—to create a vibrant society in which all citizens can fulfill their dreams, hopes, and ambitions to succeed in a thriving economy”. The plans for a fiscal balance program, the growth of the economy, and the privatization or partial privatization of sectors (such as the health and housing sectors) will both open up new jobs and opportunities for Saudi citizens. The developments will also add to the investment appeal of Saudi, which will further benefit the country and its residents.
There’s no doubt that the reform plan is a hugely exciting undertaking, one that will present a multitude of opportunities. As with every ambitious plan, however, it’s not without a number of challenges
The pandemic and other reform challenges
The goal of Saudi Arabia’s Vision 2030 to end the country’s oil dependence by 2030 is undoubtedly ambitious, even more so now in the midst of the pandemic which has certainly impacted the plan’s trajectory. From Moody’s investment downgrade to pandemic-related budget constraints, there will need to be somewhat of a recalculation and recovery plan if Saudi is to hit its mark by 2030. The road will likely be long and challenging, but there have already been some incredible developments in the last four years and many are still adamant that the plan will reach its goals.
Saudi’s reform developments so far
It certainly hasn’t been all doom and gloom for Saudi this year, in fact, the country moved up 30 places in the World Bank’s Ease of Doing Business 2020 index (by far the biggest climber). Plans that are already in motion have meant that there is a move towards resolving insolvency in the country, there is also greater access to credit and improved protections for minority investors.
Exports and imports have also already become more streamlined thanks to improvements in technology, upgrades of infrastructure, and more streamlined processes. Furthermore, the opening of the Saudi Stock Exchange (Tadawul) to foreign institutional investors in 2015 and the National Transformation Program (NTP) has also enhanced the country’s economic standing and is sure to continue doing so.
Saudi Arabia’s Vision 2030 also centers on spending reforms and hopes to inspire stakeholders to identify both the challenges of and solutions to the program’s initiatives. This agile approach to the various projects will hopefully lead to positive results overall.
A land of opportunity
With plans already being implemented to diversify the economy, Saudi Arabia has started gleaning interest from potential investors from across the world. Some of the megaprojects are specifically interesting for investors, including the Red Sea Development Project, Noem, Amaala, Qiddiya, and Diriyah Gate, which are sure to bring about a greater number of tourists and businesses. All the developments present exciting opportunities. If the reform programs and megaprojects are a success, then Saudi surely will rise as one of the world’s most competitive countries and economic powerhouses.
Events in the “new” Saudi
The business culture in Saudi Arabia centers on personal relationships that need to be nurtured. Since the launch of the reforms, the MICE industry has already boomed and, once in-person events are allowed once more, that trend is sure to continue, especially in the Saudi capital Riyadh. Half the business events held in Saudi Arabia happen here and it attracts a huge number of tourists. The country’s hope is that by the year 2030, Saudi will be seeing some 30 million visitors per year.
High-tech event facilities and ample world-class accommodation are already in process to accommodate any future events and tourists, the country’s infrastructure will be upgraded monumentally and there’s a huge push towards the unique culture and heritage of Saudi. If all goes well it’s very likely that it will rival Dubai in myriad ways and become a travel, business, and entertainment event hotspot. Those events, like Saudi’s megaprojects, will likely be quite extraordinary. Huge emphasis will also be placed on sporting events and a lot of money will be invested in this area, as one of the primary goals of the Saudi Arabia’s Vision 2030 is to encourage greater participation in sports on all levels. We predict that there will be some stellar Saudi sporting events in the not too distant future.
As the country moves away from its oil dependency and focuses on diversifying and boosting the country’s offerings in line with Saudi Arabia’s Vision 2030 and its sustainable economic plans, it’s going to be interesting to see what opportunities arise.
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