Saudi Arabia’s Vision 2030 implementation not set in stone

In a recent report, Bloomberg News revealed that Saudi Arabia is conducting a review of its major projects, reprioritizing spending and adjusting budgets — increasing some while decreasing others. However, for those closely following the Saudi economic landscape, this news hardly comes as a shock.

Over the past few years, Saudi Arabia has already adjusted the pace of several projects and extended the timelines of some programs. These include the extension of the National Transformation Program and the deferment of fees for small and medium-sized enterprises, among other significant initiatives. This recalibration reflects the Kingdom’s commitment to sustainable growth and fiscal responsibility.

In an encounter in 2023, Crown Prince Mohammed bin Salman met with a select group of economists and journalists, myself included, to discuss the Kingdom’s Vision 2030 plan. During this meeting, the crown prince stressed that “Vision 2030 is not the Qur’an,” emphasizing that the plan is not set in stone but rather open to modification and adjustment.

The crown prince has consistently maintained that Vision 2030 plans and projects are regularly reviewed. He revealed the existence of specialized committees tasked with aligning these initiatives, sorting and classifying them according to current priorities and the principle of “what is possible and not harmful.”

During this meeting, the crown prince also tackled head-on some of the most important decisions adopted by the Kingdom, namely the expatriate levy, the extension of the National Transformation Program and concerns about potential price surges in cement and steel due to the high demand from megaprojects like NEOM, the Red Sea Project and Qiddiya. Responding to these issues, the crown prince consistently emphasized that these matters are closely monitored and managed in phases, adding that each issue is subject to ongoing evaluation.

Vision 2030’s cornerstone lies in its commitment to maximizing impact and fostering private sector engagement throughout Saudi Arabia’s economic transformation journey. This strategic approach is designed to catalyze a profound shift in the Kingdom’s economic landscape, while allowing for periodic reviews of strategies, policies, programs and initiatives to enhance their effectiveness and correct their course if necessary.

Saudi Arabia’s Vision 2030 is proving to be a resilient and flexible roadmap, continuously adapting to reach its overarching goals, which aim to meet the aspirations of all Saudi citizens, despite encountering obstacles and necessitating modifications and periodic reprioritization.

Seven years into its ambitious Vision 2030 plan, Saudi Arabia is steadily advancing toward achieving its targets, overcoming both anticipated and unforeseen obstacles, including the COVID-19 pandemic and the subsequent oil price slump. Other challenges include the ongoing geopolitical tensions in the region and beyond, particularly the conflict in Yemen, the Russia-Ukraine war and the Gaza conflict. Key to its progress has been the Kingdom’s commitment to fiscal discipline, spending efficiency and optimal resource utilization.

Saudi Arabia’s commitment to financial stability as a cornerstone of sustainable growth is clearly evident in its annual state budgets. A prime example of this strategy is Saudi Arabia’s decision to tap into global debt markets despite having substantial reserves. Simultaneously, the Kingdom has moderated spending on certain projects. These moves underscore Saudi Arabia’s determination to maintain a growth and spending pace that does not compromise its crucial strategic goal of “financial sustainability.”

Recalling the crown prince’s meeting with the economists, he stated that “implementing 70 percent of Vision 2030 would be sufficient and satisfactory for the leadership’s ambitions and will bring about the desired change in the Saudi economy.” This statement reflects the ambitious scale of Vision 2030 and acknowledges the potential challenges in achieving all its goals. This bold declaration demonstrates the leadership’s recognition that the goals set within the Vision 2030 agenda are exceptionally high and acknowledges that some may prove difficult to achieve fully — which is natural for a major transformation like the one currently underway in the Saudi economy.

Saudi Arabia’s successful bid to host Expo 2030 and the potential opportunity to organize the 2034 FIFA World Cup necessitate postponing some previously planned initiatives to accommodate the more pressing and significant projects.

The concepts and culture championed by the crown prince in implementing Vision 2030 has permeated through most state institutions. These entities now routinely develop plans for massive projects with substantial budgets and also launch systems and programs, while also demonstrating a willingness to reassess and periodically review them. In some cases, they do not hesitate to roll back initiatives if they are found to be misaligned with their strategic objectives.

A recent example of this flexible approach is the suspension of the “Ejada” program. Launched by the Riyadh Municipality several years ago, the program was recently replaced after officials recognized its negative impacts on the financial and business sectors, particularly affecting small investors.

Saudi Arabia’s implementation of diverse and massive projects across various sectors has made project review, cancellation, downsizing or delay a common practice. This approach is increasingly recognized as a healthy economic phenomenon, recommended by many economists and major project planners and executors worldwide. Numerous examples support this, but this is not the place to mention them. In the contemporary understanding of economics, the process of continuous reform is fundamental until the final, successful formula for any project is achieved. However, not everything reported about project delays or budget cuts is necessarily accurate and should be taken at face value.

• Mohammed Al-Bishi is editor-in-chief of Al-Eqtisadiah newspaper and managing editor of Asharq Business with Bloomberg in Saudi Arabia.