Saudi unveils sweeping reform plan

“With governments in the GCC emphasising on developing human capital through education and training to achieve economic goals, strengthening digital skills is mission-critical in creating a workforce that is adaptable, agile and aware of the emerging challenges of future economies”, says Boulos. “And so, you know, if Aramco is indeed listed on a major worldwide exchange and has to reveal details of its financial accounts and its reserves and so on, that would be groundbreaking”, Mills said.

Prince Mohammed bin Salman discussed plans to set up a $2 trillion sovereign wealth fund that would be managed by a board of directors, and not Aramco.

“The Kingdom would need to be a much more transparent place to encourage greater USA investment”, Bruce Riedel, a senior analyst at the Brookings Institution, said in an e-mail.

The country will also implement reforms aimed at boosting revenue from non-oil sources, such as tourism and mining… A new residency visa programme could generate additional revenue and would allow Muslims and Arabs to live for extended periods in the country, he said.

The kingdom’s government is expected to continue holding a majority stake in the company after the IPO is issued.

“In 2020, I think we will be able to live without oil”, Prince Mohammed said. We expect the valuation to be more than US$2 trillion.

The king of Saudi Arabia has sacked the country’s water and electricity minister, Abdullah al-Hussayen, amid public anger over price hikes, state media reported. But with crude prices extending their declines – the per-barrel price of global benchmark Brent is down 60 per cent since the rout first started in June 2014.

The 31-year-old prince believes his recently-unveiled “Vision 2030” would transform the world’s top oil exporter into a global investment powerhouse.

The crown prince repeated plans to reduce consumption subsidies but said effects would be limited for low and middle-income earners.

Though the reform plan includes expanding the tax net, the Saudi government doesn’t intend to impose more extensive taxes. Aramco’s size is very big.

Mohammed bin Salman is the initiator and one of the authors of the reforms program.

Part of the funds from the share sale, Mohammed said, will be used to set up a $2-trillion sovereign wealth fund which would easily surpass Norway’s $865-billion fund as the world’s biggest.

The Saudi Vision 2030 plan can be read in full at the Saudi Gazette. Implementation and the impact on government finances will likely continue to be closely monitored. “The Vision doesn’t require high spending but restructuring”. Following the announcement, share prices in Riyadh Stock Exchange have been witnessed to rise sharply, according to a report published in The Guardian.