Daily Times

Last decade observed miracle changes in economic and governance systems in Kingdom of Saudi Arabia (KSA). For the first time KSA appointed a young and dynamic leader Muhammad Bin Salman as the crown prince. The Crown Prince, is member of the next generation in the royal family who is trying to revolutionize the governance and economic system of KSA. He believes in opening up of the society, culture of entertainment and sports but with strict Islamic values, morals and rules. He has recently organized big entertainment and sports events like Formula-1.

However, the real focus of Crown Prince is economy and diversification of economy. He introduced his vision in the form ‘Vision 2030’ in 2016. It is a very comprehensive document, which covers almost all aspects of economy, social life and environmental sustainability. The Vision comprises of eight themes including healthcare, living standard, sustainability of resources, social development, governmental efficiency, labor market, enabling private sector and tourism and national heritage. Under the vision there are 37 objectives, 92 indicators, 224 sub-indicators and 433 proposed initiatives. It is a vision with tangible and well-defined objectives and Key Performance Indicators (KPIs).

KSA has envisioned that till 2030 it will diversify its economy and social life in every aspect by adopting sustainable development principles, as much as possible. It has been stated that KSA will strive to increase non-oil export and its share would be 50 percent in 2030 from 16 percent in 2016. Moreover, the total revenue will be increased from SAR 163 billion to 1 trillion in 2030. This is a huge task and requires a huge investment and the complete revolutionization of economy. To achieve these targets KSA is targeting to enhance competitiveness and the role of private sector. It has set a target to achieve 10th ranking in global competitiveness index. For private sector the target is to increase the share of private sector from 40 percent to 65 percent in national GDP.

KSA is also planning to include foreign investors and proposed to achieve the target of 5.7 percent of FDI in national GDP. It has already introduced some reforms to encourage the foreign investors. It is planning to give property rights to foreign investors in some designated areas. It will definitely contribute to attract the foreign investors. Moreover, it is working dedicatedly to improve the investment environment by reducing the numbers of days required for registration of business, provision of utilities etc. It has also planned to increase the share of small and medium enterprises in national GDP. Target for 2030 is 35 percent from 20 percent in 2016. It is mentioned that fund availability for SMEs will be improved by increasing available funding up to 20 percent till 2030. It is envisioned that development of SMEs will be helpful in increasing the export of country and provision of jobs. It is in accordance with vision’s objective bring down unemployment to the level of 7 percent till 2030.

KSA has envisioned that till 2030 it will diversify its economy and social life in every aspect by adopting sustainable development principles, as much as possible. It has been stated that KSA will strive to increase non-oil export and its share would be 50 percent in 2030 from 16 percent in 2016. Moreover, the total revenue will be increased from SAR 163 billion to 1 trillion in 2030

Kingdom also identified that without participation of female and better human capital it cannot achieve the desired development. Therefore, it has set a target for increasing the participation of women in labor market. It also becomes important in the backdrop that bout 50 percent graduates from universities are female. KSA has set a target to increase women participation from 20 percent to 30 percent. First concrete step in this direction was removing ban on driving of women.

Simultaneously KSA is working to improve the condition of healthy human capital. It has already good health system, but it is planning to improve it further. It has envisaged that it will increase basic health coverage from 78 percent in 2016 to 88 percent in 2030. Citizens will also be encouraged to take part in sports and exercise. Ratio of people will be increased from 13 percent in 2016 to 40 percent who at least once a week go exercise. Education is another area which will be keep high in priority areas. Education is considered the basic element for creating healthy human capital. KSA will work to attract good human capital from other countries. They will also relax the conditions to work in KSA.

Localization of defence industry is another area of special preference for KSA. In 2016, KSA was third largest spender on the defence products but domestic share was only 2 percent. Now KSA is trying to improve this and has envisaged that domestic share will be increased to 50 percent in 2030.

Although the ‘Vision 2030’ is an excellent document but KSA will have to go a long way to make it happen. Right now, KSA is not in position to achieve these targets but they are moving in right direction. Investment on private sector, women participation, culture of sports and entertainment, and putting focus on the efficiency of government are good indications.  KSA is putting a lot of focus on the delivery through efficient governance. It was quite strange to note that till 2017 there was no Key Performance Indicators (KPIs) for evaluation of government employees. Under vision it is pointed out that till 2020 there would be 100 percent coverage of employees in terms on KPIs. Moreover, government will also strive for lower the perception and tolerance for corruption. It will improve ranking from 50th position to 40th position till 2020.

Review of Vision 2030 also reveals that there are good opportunities for Pakistan to benefit. Pakistan can benefit by sending manpower, but this time man power must be trained according to the needs of the KSA. Unskilled manpower will not serve any purpose. Pakistan should look for investments in private sector initiatives. Entrepreneurship can be another area of interest for Pakistan. Education and Health are other areas which can provide good opportunities for Pakistan. Pakistan can send doctors and teachers and should sign a contract with KSA regarding this.

Low hanging fruits are sports and entertainment industries. Pakistan has immense experience in sport industry which can be transferred to KSA. Pakistan also remained a World Champion in some sports like Cricket, Hockey and Squash etc. Pakistan can use this status as leverage to enter in the market of KSA. Especially, Pakistan can introduce cricket, hockey and squash in the KSA. On entertainment side, Pakistan is blessed with some outstanding entertainers. Pakistan should use this talent to create a soft image. It will also help attract investment in entertainment industry of Pakistan, which does not have much financial resources.

Last, but the most important area would be defence sector cooperation. Pakistan is already moving very fast on this track as of now, we have missiles, tanks, jets and most importantly we are an atomic power. Pakistan’s cooperation with KSA in this sector has a long history. Now Pakistan must extend its hand for cooperation and look for opportunities for joint research and development in defence sector and assist KSA in developing its local defence industry.

However, the benefit from these opportunities Pakistan needs to develop a strategic framework in collaboration with KSA. Pakistan should look for a model like China-Pakistan Economic Corridor Long Term Plan. Sporadic efforts of hip hazard interventions would not be of any use. Pakistan should ask KSA to formulate a ‘Vision 2030 Working Group’ for objective oriented work and to develop concrete plans and actions for the future.

The writer is COO Zalmi Foundation

Published in Daily Times, February 17^th 2019.