Diversification is ‘win-win’ for Saudi Arabia, says Al-Jadaan

Mohammed Al-Jadaan

Finance ministers, speaking at the Future Investment Initiative (FII) conference, which started in Riyadh on Jan. 27, are seeking to further diversify income sources during the post-pandemic period.

The GCC is witnessing a serious change, Saudi Minister of Finance, Mohammed Al-Jadaan, said, adding: “We’re in a very healthy competition. We are complementing each other and we are trying at you to build on.”

“Diversification for us is a win-win. I'm helping the economy to grow that will then basically grow the tax base, which means more revenues to the government that would enable it to provide better services to the people and citizens of Saudi Arabia,” Al-Jadaan said.

Commenting on the diversification strategy in Saudi Arabia, Al-Jadaan, noted that the Kingdom has started delivering its 2030 Vision’s objectives.

He added that the COVID-19 pandemic was a test on how Vision 2030 is working.

“We believe actually the test was significantly less the investment that we have done,” Al-Jadaan explained, underlining the reforms adopted by the government on the structural side of the laws or regulations.

Diversifying sources of income is a profitable option for the Kingdom, the minister noted, saying it is currently planning to invest in technology, renewable energy, waste treatment, and other significant sectors.

“The opportunities in Saudi Arabia are ample,” the Saudi minister affirmed.

Bahrain’s Minister of Finance and National Economy Sheikh Salman bin Khalifa said Bahrain has done quite well in diversifying its economy, as 85% of his country’s GDP comes from non-oil revenues.

Diversification efforts started in 1970s with industries such as the aluminum industry and and petrochemicals and and other value-added industries that were brought in and of course Banking and tourism and other very important sectors The Kingdom targeted reducing dependence on oil revenues, he said, noting that it succeeded by reaching less than 20% from 40%.

“We still have a lot of work to do on our revenue diversification on the fiscal side,” Sheikh Salman added, noting that diversification efforts are important to build a wider base for the economy.

Elsewhere, Thomas Barack, founder and CEO of Colony Capital, stressed the importance of “diversifying sources of income to maintain economic growth in the Gulf States and the region in general.”