One major absence from our news feeds this January has been the sight of politicians and business leaders jetting into the Swiss Alps for the World Economic Forum in Davos. As with the G20 Conference in November, the pandemic forced the annual event online, eliminating most of the content generating opportunities that the media traditionally feeds off at this time of year. Although somewhat muted by the new format, some significant statements did come out of this year's event, including one from Saudi Arabia.
During a WEF strategic dialogue event held on January 13th, Crown Prince HRH Mohamed bin Salman, told a global audience that the kingdom has investment opportunities totalling $6 trillion over the next decade. Speaking from a desert camp in the spectacular surroundings of Al Ula, he detailed that much of this (up to 85%) will be underwritten by the Public Investment Fund (PIF) and the Saudi private sector with the remaining from foreign investment campaigns over the medium term. Up to $3 trillion worth of these opportunities are for completely new projects that underpin the Vision2030 reform program.
Using the opportunity to address over 160 selected attendees from key sectors and countries, MBS pointed to gains already made since the announcement of the Vision2030 program, including doubling non-oil revenues, significant female labour and legal reforms and raising competitiveness. He also expressed his gratitude to the multi-national partners who have already played a major and on-going role in transferring knowledge and skills to enhance domestic capabilities. Regional stability, preserving global energy supply chains, and increasing economic cooperation were highlighted as underpinning Saudi strategic objectives.
Another KSA initiative that was promoted during the session was the G20-endorsed circular carbon economy program. Focusing on "four R's" -- reduction, reuse, removal and recycling of carbon, the plan is to achieve a balance of carbon reduction alongside the supply of abundant energy. Although just a conceptual framework at this stage, the Prince indicated that Saudi will be investing heavily to take a leading position in these emerging areas of technology.
As we stated in previous posts, the pandemic appears to have done little to divert the Kingdom's energy and focus to deliver on its objectives. Messaging from the mega-projects is that this is a 10-year plan and Covid 19 represents a "bump in the road' rather than a seminal event with regard to Vision2030. Statements such as this latest one from the Crown Prince can help maintain the narrative and generate further interest from overseas investors. For the moment there is no doubt that Saudi Arabia will be the regional engine of growth and revenue-generating opportunities in the 2020's. Relevant businesses in sectors such as infrastructure, development, renewables, hospitality and entertainment can expect a steady stream of projects to bid on over the medium term.