Vision 2030 of the Kingdom of Saudi Arabia

http://vision2030.gov.sa/en

Saudi Arabia started to establish a long term vision by opening slowly its economy to international investors.

The kingdom plans to accumulate funds to be invested in different sectors such as petrochemical and mining to mention some. To be able for them to have this fund, the government would need to sell the 5 % of Aramco equity to start with which is worth trillions of Dollars. Many local companies are now establishing plans to be aligned to this vision. 

Some challenges would be as follows:

1. The expected fund inflow of foreign investors to the kingdom accompanies the entry of foreign competitors. Their affiliated companies would want to supply the demands of the new industries being established and might take the loyal customers of local companies.

2. Accelerating the Kingdom's transformation to a free trade market means a continues decrease in the government’s control over the prices of goods and services which will now be based on supply and demand in the local and international market. Diversification of trade activities of local companies is necessary to take advantage on the profitability of other products while decreasing the reliance on current products that are losing its profit as an expected effect of higher competition between private companies. 

3. The country’s vision would modernize the trading and e-commerce to cope up with the international standards. It is necessary for local companies to review and upgrade the current systems for purchasing, sales order processing and invoicing.

4. Privatization of some state assets like health, education, power distribution among others would propel the increase in the costs of living in the kingdom. Local companies will expect higher employee costs and utility expenses to mention some. To plan for continued optimization and upgrade of employees’ capabilities is necessary to minimize the expected higher salary demands in the coming years, considering also the entry of Saudi women labor force.

1.    5. With the country’s strategic location in between Asia, Europe in the north and Americas in the west and with lower government taxes, a big advantage is expected to be a trade partner to sell the additional products of the country at a lower costs to the international market.