The private sector’s contribution to the gross domestic product of Saudi Arabia grew to 48.22 percent in 2017 while non-oil private sector GDP rose from SR1,227.5 billion in 2016 to SR1,236.6 billion in 2017, said a report issued by the Council of Saudi Chambers.
The CSC highlighted the private sector’s contribution to the GDP in different sectors irrespective of global economic downturn, including falling oil prices. The private sector registered the highest growth rate of 5.76 percent in electricity, gas and water sector, it added.
Mining and quarrying stood second with 5.68 percent, followed by financial, insurance and real estate services 2.92 percent, transport, storage and communications 2.83 percent, agriculture 2.35 percent and banking 0.82 percent.
The CSC report reviewed the real opportunities the private sector has in light of Vision 2030 through a series of initiatives offered by the government, which envision a leading role for the private sector in boosting the Kingdom’s economy in the coming years.
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The government has allocated SR72 billion to support the private sector, the report said while commending its move to privatize education, health and other sectors. Vital locations have been allocated for educational institutions, markets and recreational centers and large portions of land have been set aside on the Corniche for tourism and industrial projects.
The report praised the government’s endeavors to create a suitable atmosphere for private sector’s growth and strengthen confidence of Saudi and international investors in the national economy. “The Kingdom has launched another program to encourage Saudi exports.”
The government has welcomed opinion of private sector regarding the various rules and regulations in order to improve them, the report said, adding that the commercial courts have started their activities. It praised the state’s support for small and medium enterprises (SMEs).
“Banks and financial institutions have been strengthened to issue products that meet the requirements of businesses, industries and other sectors,” the report said. They include financial products as well as support to small-scale business enterprises.
The council commended the government’s efforts to speed up issuance of licenses to business firms following international standards and regulations. The private sector’s increasing contributions to the GDP reflect on the good performance of the Saudi economy, the report said.
“This good performance is significant as it comes despite challenges at national, regional and international levels,” the CSC said. The economic indicators also showed good performance of the financial sector, foreign trade and stock market, it added.
This shows the success of five-year development plans and initiatives of Vision 2030 that were instrumental in expanding contribution of the private sector and diversifying the Kingdom’s economic base, the report pointed out.
Speaking about CSC’s strategic objectives, the report said: It boosts national development programs, strengthens business sectors in cooperation with government agencies, monitors economic changes at national and international levels, supports SMEs and contributes to Saudization of jobs. “Promotion of foreign economic relations, representation of Saudi businesses at international forums, activation of social responsibility initiatives and development of Saudi industries are other major objectives,” the report added.
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