Saudi Arabia launched $51.2 billion of investments guided by local companies including Saudi Aramco, SABIC and Ma’aden, amongst others, in a signing ceremony on Wednesday.
The event was held to announce the first wave of projects across eight companies supported by the Shareek program, which is dedicated to large companies and seeks to unlock the full potential of Saudi Arabia’s private sector, according to the country’s government news agency SPA.
The program was first established in 2021 by Saudi Crown Prince Mohammed bin Salman (MBS) as part of the kingdom’s Vision 2030, which now has a total of 28 companies enrolled.
About $32 billion will be spent by the end of 2030 by large companies, with the goal of adding $124.50 billion to Saudi Arabia’s gross domestic product by 2040 and more than 64,000 local jobs.
Shareek will implement 12 projects across four non-oil sectors, stated SPA.
Saudi Aramco will receive support to accelerate five projects to create more than 10,000 jobs including joint venture steel plate manufacturing. It will carry the goal of making Saudi Arabia 100% self-sufficient for steel plate demand by 2030.
ACWA Power will receive support to construct the world’s largest hydrogen plant, developed in partnership with NEOM Green Hydrogen Company and Air Products Qudra.
Saudi Arabian mining company Ma’aden will receive backing to build its phosphate 3 project in the kingdom’s northern region of Wa’ad Al Shamal, which is set to position the company as the third-largest producer of phosphate fertilizers globally by 2029.
Shareek aims to open up $1.33 trillion in domestic private sector investments in the next seven years to meet its Vision 2030 goals.
This involves increasing private sector contributions by 65% and increasing non-oil exports from 16% to 50% by 2030.
Business confidence among non-oil private sector firms in Saudi Arabia climbed to a two-year high in January, according to a Purchasing Managers’ Index (PMI) market intelligence report by S&P Global.
Riyad Bank Saudi Arabia PMI rose to 58.2 in January 2023 from December’s three-month low of 56.9; this was the 29th straight month of increase in the non-oil private sector.
Naif Al-Ghaith, chief economist at Riyad Bank, stated in the report that Saudi Arabia is maintaining its strong momentum and it outperformed global economic trends for activity and demand.
“The non-oil sector is starting this year with a strong headline growth at 58.2 in January, recording the second highest growth since September 2021. This growth confirms the Saudi position as the fastest-growing economy among the Group of 20 countries despite economic headwinds,” Ghaith said in the report.