The economy of Saudi Arabia has seen its greatest reinvention ever over the past few years thanks to the 2030 Saudivision plan. Given this fact, the Saudi government is just about starting, according to the plans it revealed and the goals it has set for itself. Today, the non-oil sector of the Saudi economy has seen its biggest growth in five years, all while big moves are still being made with Saudi Arabia’s natural resources. Acting based on the fact that these resources are not permanent has allowed the Kingdom to create a unique new portrait of its economy, private sector and culture, even.
The corporate world is an ever-changing array of priorities, and the Saudi government has mastered predicting how these priorities will evolve and rearrange. The recent merger that led to the conception of the Ministry of HR and Social Development is an answer to the call for a corporate need for both HR services and shared services. This came at an inflection point in the curve of global economy, the COVID-19 crisis. KSA’s move in the HR and shared services departments immediately came in hand when the outbreak forced employees to work from home; not only does the concept of shared services facilitates and organizes work, but the HR aspect of that particular merger helped redistribute workers between firms with varying workloads based on how the virus affected business. It’s rather obvious than it is safe to say that Saudi Arabia was ahead of what could have been a catastrophic failure, and entities based in the Kingdom were on the same boat, mitigating damage as of today.
Such facts do suggest the question of what could be next for the economy in Saudi Arabia. There are many mysterious aspects to the current COVID-19 status of the world, but assuming this issue will be handled by the end of Q2 of 2020, Saudi Arabia could be looking at a quick resumption of its master plan for 2030. This is possible to predict based on the daily measures and initiatives made by the government to slide past the pandemic era with minimal damage. So, what is the Economy of the Future looking like?
Oil sector continues production
There is no denying the economic impact of oil production and its unique political and cultural power as a major power player on the global arena. The oil production in Saudi Arabia does not plan to speed down, it is however going to be reduced to a mere sector of a much more diverse economy.
Private sector booms
Being potentially one of the first major economies to recover from the COVID-19 pandemic, investors will find a rich culture for their business plans. Already a major key point in the Saudivision, the enrichment of business culture is set to resume its accelerating growth. Entity formation in the Kingdom is a relatively easy process today; with services such as IT, communication and HR outsourcing, all investors need is a business plan and a knowledge of local regulations and government relations. The Saudi government encourages a vast variety of investments to reshape its image and diversify its economy. All your business will need is an open channel to these details that are fast changing with everything that is going on.
Tourism to become a noteworthy player
The Saudivision promised a noticeable increase in the number of heritage sites in Saudi Arabia. This has sparked the interest among influencers and world travelers; everyone wants to know this mysterious land that is opening itself up for the world to visit. The growing number of global brands in cities like Riyadh and Jeddah is also a major attraction for visitors. The Kingdom is undergoing a make-over, and global perception of it will be less of an oil giant and more of a cultural hub of unique activities and experiences. This will push tourism further up in terms of powerful sectors of the Saudi Arabian economy.
Unemployment will be reduced radically
Saudization enforces the employment of a number of Saudi’s within any corporation, reducing the number of unemployed nationals as a result. How this will affect the economy is in the rotation of resources within the country. Previously, Saudi Arabia’s dependence on foreign workers has led to its money to travel outside as workers send money to their homes. Foreign workers will always be a part of the Saudi economy, and the Kingdom will continue to welcome them and protect them with its leading social insurance organization, GOSI (The General Organization for Social Insurance). However, the increasing employment of Saudi’s will ensure good conditions and solid salaries which will be invested in the national economy, and a better economic cycle will take place as a result.
Processes are inevitably slowed down given the current situation, but recovery is definitely a plan in the quick making for the country with a fifteen year plan that was conceived years before a virus was even an issue. Saudi Arabia has proven itself a force in digitizing processes and facilitating online services, putting your business and others’ in safe hands.