OAPEC Member Countries
7
kingdom’s investment
potentials
Third:
transforming the
kingdom’s strategic
and
geographic
position
between
important
global
waterways into a
global hub connecting
three continents, Asia,
Europe and Africa.
Among the main features
of the vision is transforming
Aramco into an industrial
giant and transferring its
ownership to the Public
Investment Fund, which
will become the largest
sovereign wealth fund in
the world. The efficiency of
the fund’s management will
be increased to improve its
return on investment, with
the aim of diversifying
the government resources
and economy. The vision
encourages the growth of
Saudi companies to be a
major player in the world
markets. It also encourages
small
enterprises
and
works on mitigating long
bureaucratic
measures,
as well as, expands on
e-governance. The vision
also plans to enter long-
term partnerships with
neighbouring and friendly
countries for knowledge
transfer and trade.
On energy, the vision
stated that although KSA
has strong potentials for
solar and wind power,
and its domestic energy
consumption will increase
three fold by 2030, KSA
still lacks a competitive
renewableenergysectoruntil
now. Therefore, the vision
targets generating 9.5 gig
watts of renewable energy
as a first step. It also aims
at localizing a significant
portion of the renewable
energy value chain in the
Saudi economy, including
research and development,
and manufacturing, among
others. KSA will seek to
put in place a legal and
regulatory framework that
allows the private sector
to buy and invest in the
renewable energy sector,
while providing the required
funding through public and
private sectors’ industrial
partnerships.
The vision’s energy
goals have been summed
up as follows:
-
Moving from KSA’s
current position as the
19th largest economy in
the world into the top 15
-
Increasing
the
localization of oil and
gas sectors from 40% to
75%
-
Increasing the Public
Investment Fund’s assets
from SAR 600 billion to
over 7 trillion
Governmental subsidies
programme’s
efficiency
will be increased via
maximizing its use and
redirecting it to those who
really need it whether
citizens
or
economic
sectors. Subsidies without
clear criteria are one of
the main reasons behind
limiting the competitiveness
of the energy sector.
Using market prices as a
basis will encourage basic
services’ companies to
increase production and
competitiveness, and will
diversify the kingdom’s
energy mix on the long run.
Therefore, clear subsidies’
criteria will be set based
on the maturity of the
economic sectors, their
ability to compete locally
and internationally, and their
actual need for subsidies
without negatively affecting
promising and strategic
sectors.
Establishment of the
biggest sovereign
fund in the world
Privatizing some
of the state-owned
assets
Encouraging
public and private
sectors to invest in
renewable energies