Mining sector gears up to compete with Saudi oil dominance 
For several decades, Saudi Arabia has depended heavily on oil as its main source of income, despite relentless efforts to diversify the Kingdom’s economy.
In 2016, oil contributed more than 80 percent of the Kingdom’s revenues, while non-oil income accounted for around 16 percent of GDP in 2017.
Saudi Vision 2030 recognizes the risk of continued reliance on oil, given the sharp fluctuations in prices that have adversely affected the country’s economic and social-development plans.
To mitigate this risk, the Saudi government has adopted an ambitious reform program. Saudi Vision 2030 has targeted several promising economic sectors, including mining, tourism, entertainment, transportation, and logistics.
The mining sector is expected to generate $1.3 trillion in investments for the Kingdom. The sector has remained unexploited for many years, despite the presence of 48 different types of minerals covering an area of 700,000 square kilometers.
The growth of the mining industry in the Kingdom depends greatly on increasing local demand, as well as ambitious plans to localize the manufacture of 50 percent of Saudi Arabia’s military requirements — including drones, warships and airplane fuselages — and to produce 500,000 electric vehicles by 2030.
I believe that the mining industry will soon position itself as the third-largest contributor to the Kingdom’s non-oil GDP, thus supporting Saudi Vision 2030’s goal of diversifying the Kingdom’s economy.
The presence of advanced industrial zones such as Ras Al-Khair, Waad Al-Shamal, and over 40 others, will offer further support to the mining sector.
Finally, the Kingdom’s location as a strategic corridor connecting Europe, Asia, and Africa, and overlooking two vital seas, will also bolster the mining industry, particularly in terms of international trade.
I believe that the mining industry will soon position itself as the third-largest contributor to the Kingdom’s non-oil GDP, thus supporting Saudi Vision 2030’s goal of diversifying the Kingdom’s economy.
There have been almost three times the number of exploration and mining licenses issued in the Kingdom in the last three years (613) — following the enactment of the mining law — as there were in the seven years prior to that (224).
The Ministry of Industry and Mineral Resources is also actively stimulating the sector’s development, enhancing foreign investment and positioning the Kingdom as a competitive mining hub globally.
• Talat Zaki Hafiz is an economist and financial analyst. X: @TalatHafiz
