Saudi Arabia and the US are two countries whose bilateral relationship has not only benefited the Saudi and American peoples, but has shaped the wider world. For more than eight decades, our two economies and societies have been intertwined, from the successful search for oil in Saudi Arabia by American geologists and their Saudi guides in the 1930s, through the subsequent development and exponential growth of close ties and cooperative efforts in areas like diplomacy and security, trade and investment, education and training, arts and culture — and increasingly in research, technology, innovation and entrepreneurship.
Just as significant are the people-to-people friendships that have taken root alongside institutional partnerships. Over the decades, hundreds of thousands of Saudis have experienced the best of America by living, working and studying in the US; conversely generations of American engineers and professionals, military and diplomatic personnel, and their spouses and children have come to regard the Kingdom as their second home. Indeed, our bilateral relationship is very much a story of “friendship and prosperity,” and is grounded in shared values, common interests and mutual respect.
This is a story whose relevance and importance goes well beyond our two nations, and which has touched the entire world. The continued strength and ever-expanding diversity of the US-Saudi relationship has benefited global security and economic growth, made worldwide energy supplies more secure and global markets more robust, and provided economic, investment, commercial and job opportunities to countries, companies and communities around the world.
When two nations of the size, stature and strategic importance of the US and Saudi Arabia work together, their positive impact is felt far and wide. Of course, this beneficial ripple effect has become even more pronounced in recent decades through increased globalization and economic integration, the catalytic effect of technological innovation and connectivity, and transformative socio-economic and demographic trends.
Now this impact is set to increase still further as a result of Saudi Vision 2030, a comprehensive framework through which we are constructing a stronger, more globally competitive and more sustainable Kingdom. Having been announced last year, Vision 2030 and the associated National Transformation Program are already being enacted, with major changes and new initiatives steadily gaining momentum and picking up speed.
The objectives of Saudi Vision 2030 include greater economic diversification, including further expansion into knowledge economy sectors and better leveraging the Kingdom’s position between Asia, Europe and Africa as a hub for manufacturing, services, tourism and logistics. This is coupled with the promotion of the private sector, including strategic privatization of selected public sector functions and services, as well as significant localization of goods and services and enhanced value addition.
When two nations of the size, stature and strategic importance of the US and Saudi Arabia work together, their positive impact is felt far and wide.
Khalid A. Al-Falih
The vision also places a strong emphasis on the digitization of the economy and cloud computing, development of ICT and the Internet of Things, and the deployment of automated systems and robotics. At the same time, the Kingdom will continue to build upon the three existing pillars of our economy — namely oil and gas, chemicals and mining — where we will be making world-scale capital investments and further integrating activities along the energy value chain, often in partnership with top-flight international companies.
In addition, the asset portfolio of the Kingdom’s Public Investment Fund (PIF) will grow to some $2 trillion, in part through the initial public offering of a percentage of Saudi Aramco, the Kingdom’s integrated energy and chemicals enterprise, as well as other privatization measures. The PIF’s assets will be used to diversify Saudi Arabia’s sources of revenue through investments both in-Kingdom and abroad — including in the US — helping to extend the benefits of Vision 2030 globally. Examples to date include the PIF’s 5-percent stake in Uber, as well as its $45 billion share of a new $100 billion technology fund, undertaken in partnership with Japan’s SoftBank.
In addition, Vision 2030 sets out guidance for intensive capacity building and job creation efforts, as well as encouraging a more vibrant and tolerant society; expanding leisure, entertainment and tourism offerings and infrastructure; and unleashing greater opportunities for Saudi youth and women in the labor force and in civil society.
The Kingdom will be going through a series of step-changes in virtually every aspect of its economy, as well as in many elements of its social fabric. The expectations of our people are high, and so are our national aspirations for the future. As a result, we can no longer be content with gradual evolution or rely on incremental change to get us to our targets, but instead are embracing innovation and a degree of creative disruption to reach our objectives.
This sense of urgency and activity becomes even more pronounced when we consider the speed of scientific and technological change. Moore’s Law — the notion that the number of transistors on a single computer chip would double every two years — is perhaps the most familiar metric of this acceleration. But growth in DNA sequence data, bits per dollar of magnetic data storage, fiber optic throughput, and Internet backbone bandwidth measured in bits per second have all seen similar exponential increases over the years.
The rate of technology adoption is also increasing: While it took more than three decades for radio and the telephone to be adopted by at least a quarter of the American population, Internet use reached that mark in only seven years, while smartphone penetration in the US went from 5 percent to 40 percent in just four years — in spite of the 2008 economic recession.
This accelerating speed of change is just one reason why the efforts, ideas and insights of this group are so important.
So let us innovate and invent together, generating opportunities for our two nations and their peoples and positively impacting the wider world around us.
• Khalid A. Al-Falih is Saudi Arabia’s minister of energy, industry and mineral resources. He delivered these remarks at the Saudi-US Innovation to Impact Roundtable at the King Abdullah University of Science and Technology (KAUST) on May 19.