Top oil exporter and Middle East power Saudi Arab’s deputy crown prince Mohammed bin Salman unveiled a plan to diversify and become one of the 15 biggest economies in the world.
Presenting “Saudi Arabia’s vision for 2030,” deputy crown prince Mohammed bin Salman said the kingdom’s huge oil wealth was now holding the country back.
“We have a state of addiction in the Saudi Arabian kingdom, by everyone, and that’s dangerous. That is what held up many sectors from developing in the past years,” he told Al Arabiya television in an interview.
Under his plan, Saudi Arabia wants to boost non oil revenues sixfold to $266 billion by 2030, sell part of national oil company Aramco on the stock market, and create a $1.9 trillion public fund to invest at home and abroad.
Oil makes up 87% of Saudi Arabia’s revenues and the collapse in world crude prices since 2014 has left the kingdom struggling. It has already cut subsidies and borrowed billions to try to balance its books.
Saudi Arabian oil is among the cheapest in the world, costing just under 10 dollar per barrel to produce. But the kingdom needs to sell it for about $86 per barrel — or double the current world market price — to keep its budget balanced, according to International Monetary Fund estimates.
The IMF expects GDP growth to slow to 1.2% in 2016 from 3.4% last year, and it has warned that without a major overhaul, the kingdom willrun out of cash in less than five years.