JEDDAH: Saudi economist and banking expert Fadhel Albuainain has confirmed that no burdens will be incurred on the state’s budget to finance new initiatives. This is on the grounds that the financial savings achieved will be re-directed to finance these initiatives, and some will be financed by the private sector because of its close association with investments of the sector.
“About 40 percent of government spending will be provided to finance the initiatives through the participation of the private sector,” Albuainain was quoted as saying to a local publication.
He said in an earlier statement to the publication that raising the value of non-oil Saudi exports by more than 50 percent was one of the most important objectives of Vision 2030.
“Raising this value from SR163.5 billion to SR530 billion is one of the most important goals of the vision, and by achieving this goal, other goals will be realized as well,” he explained.
He said the Kingdom badly needed to diversify its investment base in multiple areas because investment in the industrial sector would create more investment opportunities for small- and medium-sized enterprises. They would also contribute to creating more jobs, both directly and indirectly, as well as contributing to the diversification of the economy and income sources.
“It will also increase the gross domestic product. This, we describe as a ‘locomotive goal,’ which will push forward many other economic objectives as well,” he added.
He said one of the most important sectors that would contribute to the advancement of this aspect of the economy is the availability of basic industrial products in Jubail and Yanbu, and then investing these in the manufacturing business in Jubail II and Yanbu II.
He added there were also marine industries to be established in Ras Al-Khair with Saudi Aramco, in addition to investments in extractive industries which aim to create a partnership between the government and the private sector and raise the volume of investments.
He said that increasing the production of alternative energy for generating electricity from renewable sources such as solar and wind energy would significantly reduce the Kingdom’s the oil consumption.
“The war and the military industrial sector are fertile grounds for investment. Currently, domestic production offers only 2 percent of the Kingdom’s need in this area against its importing 98 percent of what is required,” he explained.
Albuainain pointed out that telecommunication and information technology is one of the fastest growing economic sectors worldwide, and it is inevitable that the vision target this sector because it is one of the economy’s largest income generators and job creators.
On the matter of decreasing the volume of government job wages from SR489 billion to SR450 billion, Albuainain said this would mean reducing the amount of the funds destined for wages and salaries — not by reducing staff salaries — but through the reduction in the difference between government salaries and those in the private sector.
“Most citizens are attracted to government sector jobs because of high salaries and job security, not to mention other benefits such as vacations. If we could make jobs in the private sector more attractive, many such problems would be solved,” he concluded.
Private sector can cover 40% of funding for govt initiatives
Private sector can cover 40% of funding for govt initiatives
