In a rare acknowledgment of the challenges facing Saudi Arabia’s ambitious Vision 2030, Finance Minister Mohammed Al-Jadaan has announced that the kingdom will revise its plans to transform its economy. The move comes eight years after the launch of Vision 2030, which aims to diversify the economy away from oil and attract foreign investment.
Analysts have long pointed to the difficulties in implementing the vision, including financial and logistical challenges. The admission is seen as a sign of realism and a willingness to adjust plans to achieve the desired goals.
“We will adjust our plan to transform our economy according to our needs,” Al-Jadaan said. “We will reduce the size of some projects, accelerate others, and focus on ensuring the quality of our future economic growth.”
The Saudi government has been working to accelerate its efforts to diversify the economy, with non-oil activities showing strong growth in recent years. However, the kingdom still relies heavily on oil revenues to drive investment and economic growth.
The International Monetary Fund (IMF) has forecast that the Saudi economy will grow by 2.6% this year, down from previous estimates of 4% growth. The IMF also notes that the kingdom needs oil prices to rise to $96.2 per barrel to avoid a budget deficit in 2024.
The adjustment of Vision 2030 plans comes after reports of a review of projects, including the ambitious NEOM project, which aims to build a $500 billion futuristic city. The project has been scaled back, with officials now expecting it to accommodate fewer than 300,000 residents by 2030, down from initial estimates of 1.5 million.
The government’s decision to adjust its plans is seen as a positive step, acknowledging the difficulties in implementing the vision and the need for a more realistic approach.
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