Saudi government project savings at $4.53b
The body set up by Saudi Arabia to cut the costs of government projects has identified up to SR17 billion ($4.53 billion) in further efficiency savings, the kingdom's finance minister told Reuters.
Government sources had told Reuters earlier this week that Riyadh was ordering ministries and agencies to review billions of dollars' worth of unfinished infrastructure and economic development projects with a view to shelving or restructuring them.
The action forms part of a reform plan by the world's top oil exporter aimed at shifting its economy away from reliance on hydrocarbon revenues and paring back support for a generous welfare state to cope with the reduction in crude prices.
Mohammed Al Jadaan said this was the second major effort by the Bureau of Capital and Operational Spending Rationalisation since its establishment, after previous efforts highlighted SR80 billion of savings in 2016.
"They just were making sure that they [the projects] are done in the most efficient manner. They are about to conclude their work and they have identified about SR15 billion or SR17 billion of savings so far," Al Jadaan said, without elaborating on the nature of the savings.
To help bolster the economy, Saudi Arabia is preparing a number of mega development projects. The first, an entertainment district south of Riyadh that will house sports, cultural and recreational facilities including a safari and a Six Flags theme park, was unveiled this month.
Al Jadaan said further schemes would be announced in October, when sovereign wealth fund the Public Investment Fund unveils its strategy.
15 licences to be awarded to US firms
Meanwhile, Saudi Arabia plans next month to award licences to at least 15 US companies to operate in the kingdom, two Saudi officials said, with one saying they would go to technology and pharmaceutical firms among others.
Dow Chemical last June said it had become the first foreign company to receive a trading licence from Saudi Arabia as the kingdom seeks to diversify its economy and reduce its dependence on oil exports amid a slump in global oil prices.
"Next month we will... give 15 licenses to American companies," a Saudi official told reporters on condition of anonymity, later saying "at least 15" would be awarded and that they would go to technology, pharmaceutical and other sectors. "Most of them are outside the oil and gas field," a second Saudi official told reporters, also on condition of anonymity.
The officials said none of the licenses would go to firms affiliated with US President Donald Trump or members of his family.