Mohammed bin Salman Photographer: Bernd von Jutrczenka/dpa/picture alliance via Getty Images
Saudi Arabia is reviewing its plan for life after oil with Crown Prince Mohammed bin Salman said to be unsatisfied with progress and the government seeking to control spending.
Officials are looking at hundreds of programs and initiatives under “Vision 2030” and could cut, merge and amend some of them, or create new ones, people familiar with the matter said. The review isn’t the first since the agenda was announced less than four years ago.
The sprawling program aims to diversify the kingdom’s oil-dependent economy by attracting foreign investment, balancing the budget and privatizing government assets. But economists say some targets have slipped while government employees have criticized overlapping remits and priorities that conflict. The recent record initial public offering in the kingdom’s giant oil company is a key part of the revamp, raising a windfall of almost $26 billion.
One motivation of the restructuring is to control spending related to the plan, three of the people said, asking not to be identified because the information isn’t public. Three people said Prince Mohammed wasn’t satisfied with achievements so far.
In an interview with Bloomberg TV on Monday, Finance Minister Mohammed Al-Jadaan said Vision 2030 is “reviewed every year.”
The current review will ensure that those elements “that are making the right impact continue, and those that need enhancement are enhanced — and if we need new programs or initiatives to ensure that we focus on some of the targets, these are introduced,” he said.
Announcing the government’s 2020 budget earlier Monday, Al-Jadaan said the review was regular and would be completed at the end of the first quarter.
Since the plan was announced, it has grown into over a dozen “Vision Realization Programs,” incorporating hundreds of initiatives and a slew of new government entities to implement it all.
There’s a project to provide childcare for working women or another to develop a “heli-taxi” company. Several of the kingdom’s mega-projects, including Neom — a $500 billion city that Prince Mohammed wants to build from scratch — are Vision initiatives.
Original targets include a plan to increase the sovereign wealth fund’s assets to 7 trillion riyals ($1.9 trillion) from 600 billion riyals and another to lower citizen unemployment to 7%. The latter has been especially challenging, with the jobless rate rising last year to its highest level in over a decade before declining slightly to 12.3%.
The government has exceeded its goals in other areas, though. Women’s participation in the labor force has risen to 25.3%, surpassing an official target of 24% by 2020, according to Labor Minister Ahmed Al Rajhi.
One of the people with knowledge of the review said key targets won’t be affected, something questioned by another of those who commented.
“The targets are the same; the only thing we are changing is the how, because with time things do change, and we have to be dynamic,” Industry and Mining Minister Bandar Alkhorayef said Tuesday.
He said the kingdom is reviewing its plan to cut domestic energy subsidies as it tries to balance its budget without hurting businesses that have relied on cheap power for a competitive edge.
— With assistance by Yousef Gamal El-Din
(Updates with energy subsidy review in last paragraph. An earlier version of this story corrected the day of interview in penultimate paragraph.)