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Saudi industrial plan aims to drive $450bn in investments

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Saudi Arabia's Crown Prince Mohammed bin Salman officially approves the NIDLP initiatives. (Twitter: @emileforum)
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Saudi Arabia's Crown Prince Mohammed bin Salman arrives at the forum to oversee the signing of deals and memorandums of understanding. (Screenshot)
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Leading architects of Saudi Arabia’s economic transformation will gather on Monday in Riyadh to set out the next steps in the Kingdom’s development. (Supplied)
Updated 28 January 2019
Frank Kane
HALA TASHKANDI
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Saudi industrial plan aims to drive $450bn in investments

  • Crown Prince approves deals in mining, industry, logistics and energy as a key pillar of Vision 2030 strategy
Updated 28 January 2019
Frank Kane HALA TASHKANDI

RIYADH: Leading architects of Saudi Arabia’s economic transformation will gather on Monday in Riyadh to set out the next steps in the Kingdom’s development. Follow Arab News' live coverage below...

20:15 - The Minister of Energy, Industry and Mineral Resources, Khalid Al-Falih inaugurated the TAADIN (Mining) Platform to serve mining investment and launched the pilot version of the National Geological Database to serve investors in mining fields.
The move coincides with the official launch of the National Industrial Development and Logistics Program (NIDLP), one of the most prominent programs toward achieving the Kingdom’s Vision 2030.
In statement to Saudi Press Agency (SPA), Al-Falih said, “since the approval of the Kingdom’s mining strategy, we have placed our interest in the mining sector, with its unlimited opportunities, to exploit diverse mineral resources in the Kingdom.”
He said the project emphasizes the need to provide the appropriate investment environment, in addition to overcoming all obstacles to the private sector and investors from inside and outside the Kingdom.
He said that the TAADIN platform aims to facilitate issuance and renewal of mining licenses, inquire about mining sites available in the Kingdom, improve the investor experience and link the investor to electronic systems, in order to cope with the digital transformation plan targeting the mining sector.

19:30 - The NIDLP is a historic event in the march of national development, affirmed the president and chief executive officer of Saudi Aramco.
In a press statement, Amin Nasser stressed that the Kingdom will witness a new era for industrial and economic prosperity due to the Kingdom’s unique strategic location as a hub among three major continents. 
He added that this program invests in the Kingdom’s global energy power in order to generate more investment opportunities as well as national and international partnerships.
“The National Industrial Development and Logistics Program is a comprehensive umbrella that integrates the efforts of many strategic sectors to establish an advanced future system that will enable the Kingdom to become a global leading player in the fields of infrastructure, industry, mining, logistics and supply chains by 2030. 
“Through strengthening the Kingdom’s status in the energy field, the program will achieve a qualitative leap in industrial exports in addition to creating huge opportunities for private sector, employment and innovation in technology and business,” he said.
The Aramco CEO added that the program also focuses on the qualitative aspects, including Fourth Industrial Revolution techniques, achieving the highest degree of efficiency, competitiveness and regional and international integration through developing the attractive environment for work, investment and talents. 
He affirmed that the Saudi Aramco will be a key pillar of the program.

19:00 - The announcements come to a close and Crown Prince Mohammed bin Salman officially approves the NIDLP initiatives.

18:50 - Arab News' very own Noor Nugali announcing some of the deals that have been signed during the NIDLP event...

18:35 - The program will see the signing of 66 agreements worth $55 million in four sectors: Industry, mining, energy, and logistic services. The energy minister has thanked the crown prince and promises anyone who invests in the Kingdom will not lose...

18:25: Energy Minister Khalid Al-Falih takes to the stage to give more detail regarding what deals will be signed and the numbers involved...

18:15 - Saudi Arabia's Crown Prince Mohammed bin Salman arrives at the forum to oversee the signing of deals and memorandums of understanding...

18:00 - The private sector panel has come to an end - Georges Schorderet, CEO of Almarai Company, saying: “The change the Kingdom has achieved over the past years is remarkable.”

Jim McIlvenny, CEO of Dow Chemical, added: “Reliable investment is the investment in local capabilities and new generations. We see a number of training governmental facilities meant to pave the way for young Saudis and foster their skills.”

Dr. Yasser Al-Obaida, CEO of Sudair Pharma said: “The governmental sector’s support was second to none in terms of licensing and regulations, we are very optimistic to see how NIDLP will unfold in the future.”

17:15 - Among the MoUs signed so far include agreements to establish a joint entity with the French company, Thales, with a localization rate of more than 50% in the military sectors and a commercial entity with CMI by 50% localization to provide multi-function armed towers with high capabilities for armored vehicles.
Investment agreements were also signed to establish and operate the Trans Asia Saudi plant in Jazan for basic and conversion industries and for an oil to chemicals conversion complex between Aramco and SABIC.
Saudi Aramco also signed another MoU with Saudi Customs to establish a deposit and re-export area in King Salman Energy City.
An MoU was signed between the High Chemicals Company and Eastman Chemical Company to establish a plant for hydrocarbon resins in the Kingdom.
Another agreement was signed between Ma’aden and Al-Sadiq to supply phosphate ore and to establish a complex for the manufacture of yellow phosphorus.

16:45 - Saudi Arabia is seeking to attract $427 billion of private sector investment of the total $450 billion 2030 target over the next ten years... 

16:00 - The third panel with a discussion about the private sector is about to begin, stay tuned for details...

14:50 - Saudi Arabia's deputy minister of energy, industry and mineral resources said the main priority of the program is to attract investments to the industrial sector.
Speaking to Al-Arabiya, Abdulaziz Al-Abdul Kareem said "at the moment Saudi Arabia has one of the best strategic locations for industry, as it is a gateway to Africa, Asia and Europe."
He explained that the Kingdom has set up mechanisms to facilitate procedures, from logistics and manufacturing to exporting to attract more investors, adding that they are seeking Foreign Direct Investment (FDI).
The minister said most of the investors at the moment are Chinese, and have been vetted by the Ministry of Interior.




Abdulaziz Al-Abdul Kareem, Deputy Minister of Energy, Industry and Mineral Resources.

14:45 - Export procedures today do not exceed 12 hours and do not require more than two documents to serve the manufacturers, the governor of the General Authority for Customs said at Saudi Arabia’s National Industrial Development and Logistics Program on Monday.

Twelve targets were set to meet the challenges of the export sector according to governor Ahmed Al-Qahbani. He explained that the customs authority is working on changing and enhancing competitive objectives to serve the private sector in the Kingdom and achieve the objectives of Vision 2030.

The governor also said that they hold periodic meetings with logistics companies and industrial committees to develop procedures.

"We have revised regulations in 2017 to serve the sector after important remarks and we are working on finding specialized studies for some of the target markets," Ahmed Al-Qahbani said.

14:10 - In an interview with Al Arabiya News Channel, Minister of Energy, Industry and Mineral Resources Khalid Al-Falih revealed that new memoranda will be announced at the event, most of which have not been announced in the initiatives sponsored by (NIDLP).

He said that agreements worth $62.6 billion will be signed on the sidelines of the event, including large deals in military industries, as well as a major agreement between Aramco and SABIC after reaching economic feasibility of the project to convert oil to petrochemicals, site selection and engineering studies.

Stimulus programs for the automotive manufacturing sector in Saudi Arabia at $10.6 bln are also expected to be announced, with a significant presence from the private sector and international companies to seize the opportunities offered by the national industrial development program.

13:30 - More details are emerging about the sheer scale of Saudi Arabia’s National Industrial Development and Logistics Program. By 2030, the program aims to stimulate private sector investments worth more than $450 billion, according to documents circulated today in Riyadh. The plan spans four sectors: Mining, industry, logistics and energy.

13:15 - Arab News reporter Frank Kane gets a look inside the “Deals Room” at today's conference...

12:45 - Aabed Abdullah al-Saadoun, deputy minister of Energy, Industry and Mineral Resources says the Saudi Arabian government will spend $27 billion in 2019 and 2020 as part of its industrial development programme.

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READ MORE: Saudi Arabian government to spend $27 billion on industry development plan

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10:34 - "This vision embodies the national industry development program and logistics best because it aims to integrate the capabilities of state agencies in the Kingdom and attract local and global investment," Al-Amudi says.

9:45 - Saudi Arabia's Minister of Transportation Nabeel Al-Amudi says that the Kingdom is working on more than 300 initiatives in the industrial development program and urges everyone to look into the program and invest.

9:00 - Saudi Arabia's Minster of Transportation Nabeel Al-Amudi is set to give the opening remarks at the event, followed by an introduction to NIDLP from its CEO and Deputy Minister of Energy, Industry and Mineral Resources Dr. Aabed Abdullah Al Saadoun.

8:00 - The National Industrial Development and Logistics Program, which has the aim of attracting $427 billion over the next decade from Saudi and global private-sector investors, is set to be launched today in Riyadh. The program is a key pillar of the Vision 2030 strategy aimed at diversifying the economy away from dependence on oil revenues and government spending.

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INTERVIEW: Saudi Arabia open for business, says SAGIA governor Ibrahim Al-Omar

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Energy Minister Khalid Al-Falih said earlier that the Kingdom would announce multibillion-dollar projects to boost the industrial, mining, energy and logistics sectors. The program was “quite ambitious but it is over a 10-year period so we have got the time to do it,” he said. 

“We will have a huge contribution from the private sector outside the Kingdom, but we will leave the biggest share for the Saudi private sector.”

The program is being launched at a crucial time in the Kingdom’s economic development, amid volatility in global energy markets and increasing concerns about world economic growth prompted by the trade confrontation between the US and China.

Ibrahim Al-Omar, the governor of the Saudi Arabian General Investment Authority (SAGIA), told Arab News at the World Economic Forum annual meeting in Davos last week: “Vision 2030 isn’t just for the Saudis, it’s for everyone. I think this is a golden opportunity for investors to join us on our journey.

“We’re in a massive transformation on a scale that has never been seen before. We’re changing economically, socially and culturally. We’re three years into a 15-year journey to transform and diversify our economy, and we’re doing that with such speed because we have a can-do, make-it-happen attitude.”

Topics: Vision 2030 National Industrial Development and Logistics Program Energy Minister Khalid Al-Falih Saudi industrial development program

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Hong Kong, Chinese investors set eyes on Saudi market

Updated 13 sec ago
Reina Takla
MANAL AL-BARAKATI
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Hong Kong, Chinese investors set eyes on Saudi market

  • A delegation of business leaders is set to explore diverse sectors in the Kingdom
Updated 13 sec ago
Reina Takla MANAL AL-BARAKATI

RIYADH: Hong Kong and Chinese companies are gearing up for substantial investments in the Saudi market, marking a significant step toward strengthening economic ties, a top official said. 

A delegation of 30 business leaders from Hong Kong and mainland China is set to explore diverse sectors in the Kingdom, propelled by the ambitious Vision 2030 outlined by Saudi leadership, King Leung, global head of financial services and fintech at Invest Hong Kong, said in an interview with Arab News. 

Explaining the reason for his visit to Riyadh, Leung said: “I’m bringing a delegation of 30-plus executives across different disciplines to explore ways to do business in Saudi Arabia. This is not just about attracting inbound (investment), but also helping mainland Chinese companies use Hong Kong as a base to springboard to key markets like Saudi Arabia.” 

Outlining the potential for co-investment between the two nations, he said: “Definitely, it’s going to be a huge number,” a sentiment that echoes the palpable excitement among Hong Kong investors who are eager to tap into the vast opportunities offered by the Saudi market. 

The convergence of interests between Hong Kong and Saudi Arabia is underpinned by a notable synergy observed between businesses in both regions, the executive said, with an eye on forging strategic partnerships. 

Hong Kong delegates, including private sector leaders and venture capitalists, are eager to explore avenues for collaboration that align with the objectives of Vision 2030. 

“All these things that we are now finding out allow business leaders to see that some businesses from Hong Kong actually have very, very good synergy with Vision 2030 in your country.”  

“It’s hard to quantify the exact number, but definitely, it’s going to be (a) huge number. I have to say these investments cut across different sectors, where you can imagine the market size is enormous,” he said, emphasizing the allure of megaprojects such as NEOM and the King Salman Park, which are set to transform the Saudi investment landscape. 

These projects not only serve as magnets for investment but also catalyze growth in ancillary sectors such as financial services and consumer products, the head of financial services emphasized. 

“These are megaprojects. So, all these things are going to really attract a lot of business activities, of course, initially in construction. But once you have all this construction coming in, then you need the other peripheral sectors to service them, like financial services, consumer products, and payments. So, all these things present a lot of opportunities that really get our delegates and investors from Hong Kong and China very excited,” he further explained. 

Another testament to the nation’s favorable investment ecosystem is its “impressive GDP growth and low debt ratio,” factors that instill confidence among investors. 

Among the sectors garnering attention are green energy and advanced manufacturing, the delegate said, affirming that Saudi Arabia is “paving the way for the future” of clean energy. 

Hong Kong-based companies, armed with cutting-edge technologies, are eyeing opportunities to contribute to Saudi Arabia’s sustainable development goals. 

“I understand that your country is also paving the way for the future, including adopting green energy now. So, one green energy company that I have been talking to in mainland China, they have been in the green hydrogen space for some time, and they are evaluating to put a green hydrogen factory in Saudi Arabia.” 

Thus, projects such as the green hydrogen factory, poised to harness solar power for hydrogen production, exemplify this collaborative spirit. 

“Now, of course, the reason why they’ve done that, part of it, is because the way they generate hydrogen is to use solar power. So they need to go to a place where this is something in abundance. Now, at the same time, you also have some highly visionary, highly capable investment vehicles from the PIF and other funds,” he noted. 

Furthermore, the burgeoning fintech ecosystem in Saudi Arabia presents fertile ground for collaboration between Hong Kong and the Kingdom.  

Fintech companies from Hong Kong are eager to leverage their expertise to enhance banking services and drive digital transformation initiatives in the Kingdom, the executive noted, adding, “In our delegation, we have roughly, I’ll say between 10 to a dozen or so fintech companies that are very keen to see if they can bring the business and set up in Saudi Arabia so that they’re able to service the banks here.” 

On the opposite end, recognizing the potential for synergy, banks from Saudi Arabia are contemplating establishing a presence in Hong Kong to bolster their trade and financial services, he said. 

This strategic move aims to capitalize on Hong Kong’s strategic position as a gateway to the Chinese market, thereby facilitating closer economic ties between Saudi Arabia and China. 

“Of course, we would love to see some Saudi companies set up in Hong Kong. In fact, two of the significant meetings we had were with banks, and now these banks are interested in setting up a presence in Hong Kong,” the official said. 

“This is because of the close trading relationships, and they would like to have a presence in Hong Kong to serve, for example, Chinese customers. This way, they can facilitate services like trade finance and various other services handled by the headquarters in Riyadh,” he added. 

This comes after a pivotal moment in strengthening the economic ties between Hong Kong and Saudi Arabia, marked by the signing of a memorandum of understanding between Invest Hong Kong and the Ministry of Investment of Saudi Arabia last year. 

As a result of this agreement, delegates from Hong Kong have been afforded unique insights into Saudi Arabia’s macroeconomic landscape, grand vision, and burgeoning investment opportunities, further fueling their enthusiasm for collaboration and investment in the Kingdom. 

“Last year, our leader at Invest Hong Kong signed an MoU with MISA. That MoU brought us even closer together. They have been very kind to bring in leaders from different aspects to educate us about your country, from macroeconomic data to the grand vision from leaders in both the public and private sectors,” he said.  

Leung said they also shared insights into projects that have already gained significant traction. “All in all, our delegation was super impressed by the progress made by the country,” he concluded. 

 

 

Topics: SaudiVision2030 Investment China Hong Kong ties economy

Japan keen to forge partnerships with Saudi Arabia in the field of IT, says minister

Updated 41 min 59 sec ago
Nada Hameed
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Japan keen to forge partnerships with Saudi Arabia in the field of IT, says minister

Updated 41 min 59 sec ago
Nada Hameed

JEDDAH: Lauding Saudi Arabia’s efforts in developing giga-projects and the ongoing digital transformation in the country, a top Japanese official expressed his country’s willingness to strengthen collaboration with the Kingdom in the field of information technology.

Speaking to Arab News, Japanese Minister for Digital Transformation Taro Kono described his recent visit to one of the crown jewels of Vision 2030, NEOM, as truly remarkable.

The minister said that “he had the opportunity to fly over the project and witnessing it firsthand was truly remarkable.”

Since the launch of Vision 2030, Saudi Arabia has been in overdrive to diversify its economy away from oil and emerge as a hub of tourism, entertainment, technology, and renewable energy. On its road to transformation, the Kingdom is forging strategic partnerships with its global allies to achieve its target and work on mutually beneficial arrangements.

“I heard a lot about NEOM and The Line, I saw that the progress made was very impressive. And we heard the vision from the CEO. And it’s very convincing. So I was very glad that I came to NEOM this time. It was a very short (trip), but I think it was worth it,” the minister told Arab News.

NEOM, often referred to as the “city of the future,” is a $500-billion megacity project situated in the northwest region of Saudi Arabia. Encompassing 26,500 sq. km, the project aims to become a global leader in technology, innovation, and tourism through futuristic urban design and sustainable energy solutions.

Talking about Saudi Arabia’s demography, the minister said it is “a very young country” where the majority of the people are under the ages of 30-35. “And I see the Kingdom becoming more vibrant. And projects like NEOM” show that the country is swiftly moving forward.

Acknowledging the Kingdom’s success in adapting to the latest technologies, particularly related to cybersecurity, Kono praised the country’s leadership and its vision. He expressed his eagerness to forge a partnership with his Saudi counterpart to “learn from the Kingdom’s success.”

“I think the Kingdom is building up its resilience against any malicious attacks in cyberspace. So, I believe it is very ready to take a bold step forward. And I had a meeting with Saudi Minister of Communications and Information Technology Abdullah Al-Swaha and I think there’s a lot to learn from the Kingdom,” the Japanese minister said, adding that he had instructed his team to get in touch with their Saudi counterparts to learn from their approach.

Kono, however, stressed the need to develop non-English datasets to train artificial intelligence and proposed collaboration between Japan and Saudi Arabia in this regard.

While Japan has historically led in hardware technology, the minister admitted a lag in digital technology investment. Recognizing this gap, he signed a memorandum of cooperation with Al-Swaha to learn from Saudi Arabia’s IT advancements.

He said that although Japan excelled in analog technology during the 20th century, admittedly, they have fallen behind in investing in digital technology.

Their discussions reportedly included topics such as E-ID utilization, where Kono hopes to collaborate on developing mutual use cases to propel Japanese progress. He added: “I think the Kingdom and Japan could work together to advance in the field of IT software AI, so very much looking forward to that.”

With shared visions such as Vision 2030 and upcoming events like Expo 2025 in Osaka and Expo 2030 in Riyadh, the two countries have maintained a strong relationship for nearly seven decades.

Kono believes there is immense potential for collaboration between the two countries, particularly in joint projects for Expo 2025 in Osaka and Expo 2030 in Riyadh. “I am looking forward to continue working closely with the Kingdom,” he added.

Expo 2025 is scheduled to be held in Osaka, Japan. It will be held for 184 days This will be the third time for the Japanese city to host the event. Earlier Osaka hosted the global event in 1970 and then in 1990.

The theme for Expo 2025 is “Designing Future Society for Our Lives,” focusing on creating a better future through innovation and sustainability. The expo will provide a platform for countries to share their ideas and solutions to global challenges.

Expo 2030 is scheduled to be held in Riyadh. As the first World Expo to be hosted in the Middle East, it presents an opportunity for the region to showcase its cultural heritage, technological advancements, and vision for the future. The theme for Expo 2030 in Riyadh is “The Era of Change: Together for a Foresighted Tomorrow.” It is expected to align with Saudi Arabia’s Vision 2030 goals of diversifying the economy and promoting innovation.

Kono said: “When we had our expo in Osaka for the first time, I was probably seven or eight years old. But it gave us sort of a good, big push for the economy, or not just the economy, for society as well. Expo brings in a lot of our dreams, and dreams we had back then come true. So, this Expo 2025 will hopefully bring in another dream. And I hope it will make a bridge to 2030 and we (Saudi Arabia and Japan) can work together to make our dreams come true.”

Topics: Saudi Arabia Japan Interview IT

Closing bell: Saudi main index rises to close at 12,373 

Updated 49 min 48 sec ago
ARAB NEWS 
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Closing bell: Saudi main index rises to close at 12,373 

Updated 49 min 48 sec ago
ARAB NEWS 

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Sunday, gaining 20.78 points, or 0.17 percent, to close at 12,373.11.  

The total trading turnover of the benchmark index was SR5.26 billion ($1.4 billion) as 92 of the stocks advanced, while 129 retreated.  

Similarly, the Kingdom’s parallel market Nomu also rose 332.34 points, or 1.26 percent, to close at 26,790.15. This comes as 27 of the stocks advanced, while as many as 31 retreated. 

Meanwhile, the MSCI Tadawul Index jumped 4.56 points, or 0.29 percent, to close at 1,551.76. 

The best-performing stock of the day was Zahrat Al Waha for Trading Co. whose share price surged 9.97 percent to SR47.45. 

Other top performers include Raydan Food Co. as well as Saudi Cable Co. 

The worst performer was Gulf Insurance Group whose share price dropped by 9.94 percent to SR34.90. 

Other subdued performers included Al-Baha Investment and Development Co. as well as Salama Cooperative Insurance Co. 

On the announcements front, Saudi Tadawul Group Holding Co. has announced its interim financial results for the period ending on March 31. 

According to a Tadawul statement, the company’s net profit hit SR201.5 million in the first quarter of 2024, reflecting a 121 percent surge when compared to a similar quarter last year. 

The increase was mainly driven by a rise in operating revenues, operating expenditures, and earnings per share as well as a climb in gross profit and operational profit. 

Moreover, the National Agricultural Development Co. also announced its interim financial results for the first three months of 2024. 

A bourse filing revealed that the firm’s net profit reached SR101.3 million by the period ending on March 31, up 168 percent in comparison to the corresponding period in 2023. 

The increase in net profits is primarily attributed to a rise in revenue, a decrease in the cost of sales, and a reduction in finance costs, among other factors. 

Furthermore, Gulf Insurance Group also announced its interim financial results for the first quarter of the year. 

According to a Tadawul statement, the company reported a net loss of SR20.2 million, contrasting with a net profit of SR56.6 million in the same period of the previous year. 

This loss is primarily attributed to a decrease in insurance revenue combined with adverse movement in reinsurance contracts. 

Additionally, Saudi Aramco Base Oil Co., also known as Luberef, announced its interim financial results for the period ending on March 31. 

A bourse filing revealed that the firm’s net profit stood at SR239 million at the end of the first quarter of 2024, reflecting a 46.3 percent drop when compared to the same quarter a year ago. 

The decline in net profit for the current quarter compared to the same quarter of the previous year is attributed to a decrease in base oil crack margins. 

Meanwhile, Saudi Cable Co. disclosed its annual financial results for the period ending on Dec. 31. 

According to a Tadawul statement, the company reported a net profit of SR36.5 million in the first three months of 2024, a significant improvement from the net loss of SR584.9 million recorded in the corresponding period a year ago. 

Topics: Saudi Tadawul Group stock

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Saudi banks and capital market poised to drive Vision 2030 objectives: S&P Global 

Updated 05 May 2024
ARAB NEWS 
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Saudi banks and capital market poised to drive Vision 2030 objectives: S&P Global 

Updated 05 May 2024
ARAB NEWS 

RIYADH: Saudi banks and the capital market are poised to make substantial contributions alongside the Public Investment Fund in achieving the objectives of Vision 2030, stated a report by S&P Global. 

The latest analysis by the global rating agency underscores that their involvement in the Kingdom’s economic diversification endeavors will enhance leverage in both the Saudi private sector and the broader economy. 

The report, citing public sources, indicated that the Saudi government’s transformation program aimed at enhancing the country’s economic, social, and cultural diversification will necessitate approximately $1 trillion in investments over several years. 

“Part of this sum will come directly from the government and the Public Investment Fund, but S&P Global Ratings also expect banks and capital markets to contribute a significant amount,” stated the US-based agency in the report.  

It added: “This will inevitably increase leverage in the Saudi private sector and the broader economy, albeit from low levels. The pace and extent of the increase in leverage in the corporate sector remain uncertain.”  

As per the report, Saudi Arabia’s banking sector maintains a robust position, characterized by strong asset-quality indicators and overall capitalization.  

The credit rating agency further anticipates that the banks’ sound profitability and conservative dividend payouts will persist, thereby bolstering their capitalization over the next one-to-two years. 

S&P Global highlighted the expansion of the capital market in the Kingdom, noting that from January to May 2024, 13 private companies have announced potential listings on Saudi Arabia’s main market and parallel market. 

The analysis projected that Saudi Arabia will experience a real gross domestic product growth of 2.2 percent in 2024 and 5 percent in 2025, with the non-oil private sector emerging as a key contributor to this expansion. 

Earlier this month, S&P Global, in another report, noted that banks in Saudi Arabia are expected to pursue alternative funding options to manage the rapid expansion in lending. 

The agency said that this pursuit of external funding could potentially impact the credit quality of Saudi Arabia’s banking sector. 

“The ongoing financing needs of the Vision 2030 economic initiative and relatively sluggish deposits growth, is likely to incentivize banks to seek alternative sources of funding, including external funding,” said S&P Global. 

Topics: Saudi banks S&P Global PIF

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Saudi Arabia posts budget deficit of $3.3bn in Q1 2024

Updated 15 min 22 sec ago
Arab News
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Saudi Arabia posts budget deficit of $3.3bn in Q1 2024

Updated 15 min 22 sec ago
Arab News

RIYADH: Saudi Arabia’s non-oil revenues rose by 9 percent to reach SR111.51 billion ($29.73 billion) in the first quarter of 2024 as compared to the same period in 2023, the Ministry of Finance said.

In its quarterly budget performance report, the ministry said the Kingdom posted total revenues of SR293.43 billion in the same quarter, while its public spending amounted to SR305.82 billion.

According to official data, total revenues increased 4 percent as compared to Q1 of 2023.

In the first quarter of the current year, the Kingdom posted a budget deficit of SR12.39 billion with oil revenues reaching SR181.92 billion.

The report added that oil revenues rose 1.9 percent as compared to the first quarter of 2023.

Taxes on good and services amounted to SR69.9 billion up 11 percent compared to the first quarter of 2023, it showed.

Taxes collected from international trade and transactions rose 10 percent to reach SR6.03 billion as compared to Q1 of the previous year.

The Kingdom allocated SR26.79 billion for municipal services in the first quarter of 2024, up 157 percent as compared to the same period in 2023.

The Kingdom’s public debt increased to nearly SR1.11 trillion in Q1 2024, from SR1.05 trillion by the end of 2023.

The report showed that the Kingdom’s spending on the development of economic resources rose 8 percent to reach SR18.68 billion as compared to the same quarter in 2023.

Spending on public administration reached SR16.52 billion, a rise of 39 percent from Q1 of the previous year.

Military spending in the first quarter of 2024 was recorded at SR58.85 billion, a 16 percent decline from the same period in 2023.

Topics: Saudi Arabia budget performance FINANCE MINISTRY

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