A newspaper said,Financial TimesThe British newspaper reported that talk of the need for caution in spending is increasing in Saudi Arabia, about 8 years after the launch of Vision 2030, which included value investment projects hundreds of billions of dollars.
The newspaper said that there are several factors that push Saudi Arabia to take such a step, the most obvious of which is the decline in the Kingdom’s income due to the decline in the oil prices.
The newspaper says that a source familiar with the work of the Public Investment Fund in Saudi Arabia says that the Fund, which has pledged not to spend less than $40 billion annually in the Kingdom, under pressure from the Saudi government to show that there is a return on its activities.
The source says that there is confidence that Vision 2030 is moving in the right direction, but there is also a need for caution and control over spending.
The Public Investment Fund controls assets worth $925 billion, making it slightly smaller than the Abu Dhabi Investment Authority, the region’s largest sovereign wealth fund.
This fund is the main tool used by Crown Prince Mohammed bin Salman to implement his economic agenda, which aims to reduce the Saudi economy’s dependence on oil revenues.
An executive director at a consulting company that deals with the Saudi government says that many projects do not go according to schedule or budget.
The newspaper reveals that the consulting companies that have come to the Kingdom over the past ten years are among those most affected by a reduction in spending.
Almost every government ministry or state entity must hire forces of consultants to prepare strategies aimed at achieving the goals of the so-called “vision achievement programs,” according to the newspaper.
Another senior executive at a consulting firm confirms that “everyone is tightening their belts,” adding, for example, that the NEOM project’s spending on consultants has decreased by 20 to 30 percent over the past six months.
Speaking to the newspaper, a senior Saudi official admitted that the government is constantly evaluating its priorities, as “the global and regional political and economic environment is rapidly evolving.
Another senior Saudi official believes that “the road may be a little bumpy, but this will not have much effect.”
He continues that those responsible for Vision 2030 can set priorities and postpone some projects, “and this will take some time.”
Last month, Saudi Arabia announced that it expects to record a deficit in its budget for the year 2025 at around 2.3 percent of gross domestic product, with it continuing at greater levels until 2027, a reflects the increase in spending and the decline in oil. income.
Saudi Arabia’s production is currently at around nine million barrels per day, less than the production capacity of 12 million barrels per day.
Crown Prince Mohammed bin Salman’s “Vision 2030” initiative, first unveiled in 2016, aims to diversify the oil-dependent economy and attract foreign investment.
Saudi Arabia is currently investing hundreds of billions in several sectors, starting with “NEOM”, the new futuristic city on the coast of the Red Sea, all the way to resorts and entertainment events, member -foot among them, as he attracted several stars of this. fun with expensive contracts in the summer of 2023.
2024-10-16 14:26:00
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