Foreign investment, youth workshops imperative to achieve Saudi Vision 2030

In order to attract foreign investors, Saudi Arabia is well on its way to opening up markets and adapting regulations to enhance ‘Ease of Doing Business’ in the country, according to Pearl Initiative, a leading Gulf business-led non-profit organization promoting a corporate culture of accountability and transparency across the GCC.

The country is highlighting its role in fostering an innovation and knowledge-based economy whereby small and medium-sized enterprises are being supported and assisted when entering the market, said vice chairman of the board of directors at Pearl Initiative Abdulaziz Al Jomaih.

Saudi Arabia’s competitiveness index ranks 25th out of around 140 countries, according to the World Economic Forum’s 2015/16 Global competitiveness report.

Speaking on the future of the Saudi economy laid out by Vision 2030, Al Jomaih said the government’s plans to listing Saudi Aramco on the domestic stock exchange is anticipated to “be a game changer both for domestic and foreign investors”. He noted “the standards of corporate governance and transparency which would be followed could set the benchmark for other companies.”

Al Jomaih, who is also the managing director of investments at Al Jomaih Group, further said “as part of its Vision 2030, Saudi Arabia insists on increased transparency and an increased reliance on investment to mobilize private and foreign capital. The government is also taking measures to ensure zero tolerance for corruption and demand global benchmarks of accountability in the workplace to drive greater efficiency. This will also encourage foreign investors to consider Saudi Arabia as a hub for their regional projects and offerings.”

When asked about the challenges faced in implementing such benchmarks, he said whether it is a large multinational or a family-owned business, integrity and ethics must be ingrained into the organization’s business values by several factors, including a code of ethics for the organization, monitoring and auditing enforcement of policies, and assigning experts to oversee matters on a full-time basis.

Another challenge of fulfilling successful public-private partnerships would be lack of a robust legislative framework. “The Saudi government is looking into setting PPP laws in place as it will help achieve its vision of ending its dependency on oil and diversify its economy as well as increase foreign investment. This will generate interest from investors and sponsors who are keen to enter the Saudi market, but might be concerned,” Al Jomaih added.

Asked about the key factors to stimulate productivity and competitiveness in the market, he said in addition to opening the market for foreign investors, educational training and workshops must be prioritized to make the economy more knowledge-based, as 29.5% of Saudi Arabia’s youth aged 15-24 are unemployed. This will eventually lead to job creation and innovative economy in a rapidly industrializing Saudi Arabia.