As part of its Vision 2030 plan, Saudi Arabia plans to increase the private sector’s contribution to GDP from 40 percent to 65 percent.
This will be achieved through increasing the use of public-private partnerships (PPPs) and the privatisation of government entities.
Billions of dollars of investment will be required to meet the kingdom’s infrastructure needs. Richard Paton, head of infrastructure advisory, Middle East and South Asia, head of PPP and public sector strategy, deal advisory, KPMG, said: “PPPs reduce the requirement for capital costs, reducing pressure on government budgets, and also allows risk transfer.”
Paton also drew attention to the Saudi Arabian government’s plan to act more as a regulatory body than an operator. The kingdom’s airport company was a prime example of this, with the government aviation body set to split into two, with the government becoming a regulator and the private sector building and operating airports.