Saudi Arabia’s Information Ministry will publish the Kingdom’s 2018 budget today. Economic forecasters expect the budget to continue to advance
Saudi Arabia’s Information Ministry will publish the Kingdom’s 2018 budget today.
Economic forecasters expect the budget to continue to advance Crown Prince Mohammad bin Salman’s “Vision 2030” initiative, which seeks to diversify the country’s heavily oil-dependent economy by encouraging private sector growth.
The country’s petroleum sector currently accounts for nine out of every 10 dollars of government revenue. Efforts to diversify government income fell short last year, with the share of oil revenues increasing slightly from the previous year.
At the centre of the reform strategy is a plan to privatise a small part of Saudi Aramco—the country’s largest energy producer and rumoured to be the world’s most valuable company.
The proposed reforms also call for an ambitious series of tourism-boosting initiatives, such as a plan to convert 50 islands and several Red Sea coastal areas into luxury resorts and a $500 billion mega-city project.
Expect the drive for economic reform—spearheaded by the burgeoning leadership of the ambitious crown prince—to continue to promote a move away from an oil-dependent economy. Just how successful this proves remains to be seen.
Delve deeper: Reforming the Saudi economy