What to expect from the Saudi 2030 Vision
The shifts aim to make Saudi - which relies off oil revenues for about 90 percent of its budget - depend on investments, not energy
The future of Saudi Arabia’s economy and its youth – two key topics discussed with the kingdom’s deputy crown prince in a Bloomberg interview – hint strongly at the Saudi government’s vision, set to be unveiled on Monday.
In two marathon interviews with the US news outlet in April, Prince Mohammed bin Salman made several large announcements: that the kingdom would sell off around 5 percent of its state oil giant Aramco, and the creation of a $2 trillion sovereign wealth fund.
Aramco is estimated to be the world’s most valuable company, while the sovereign wealth fund would be the largest of its kind.
The shifts aim to make Saudi - which relies off oil revenues for about 90 percent of its budget - depend on investments, not energy, to fill government coffers within the next decades, the prince said.
Another $100 billion per year of government revenue could come from a taxation regime affecting sales of luxury goods and sugary drinks among other measures, Mohammed bin Salman told Bloomberg.
However, new taxes will not come at the expense of the country’s poor, Prince Mohammed said, adding that he only wants to “exert pressure on wealth people.”
The deputy crown prince also made a nod of support towards the right of Saudi women to drive. “We believe women have rights in Islam that they’ve yet to obtain,” he said. Although no law is formally in place, Saudi women are banned from driving in the conservative kingdom.
The 30-something prince was keen to talk about Saudi’s youth. Half of the kingdom’s population is under 25. “We [the younger generation] think in a very different way. Our dreams are different,” he told Bloomberg.
Sweeping fiscal reform - including the cutting of unnecessary expenses – was another issue discussed in the interview.
One of the deputy crown prince’s advisors said that “inefficient spending” in previous years had resulted in a quarter of the kingdom’s entire budget going to waste every year.
Last year, Prince Mohammed, who leads the government’s Council of Economic and Development Affairs, cut the state budget and restarted strict controls on spending.
The deputy crown prince said that he wishes to convince both “our public” and the world of the country’s new economic vision.
Prince Mohammed also granted his first-ever television interview to Al Arabiya News Channel. The interview will air on Monday.