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Khalid Al Sulaiman Deputy Minister for Industry

بسم الله الرحمن الرحيم. National Industrial Strategy 2007 - 2020. Khalid Al Sulaiman Deputy Minister for Industry. KSA into 2020. The Home Front:. The Goal of Economic Diversification Oil and Related Activities still Dominate the Economy

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Khalid Al Sulaiman Deputy Minister for Industry

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  1. بسم الله الرحمن الرحيم National Industrial Strategy 2007 - 2020 Khalid Al Sulaiman Deputy Minister for Industry

  2. KSA into 2020 The Home Front: • The Goal of Economic Diversification • Oil and Related Activities still Dominate the Economy • Contribution of Manufacturing Industry to GDP is Weak • Contribution of Manufacturing Industry to Overall Employment is Low • Employment Of Saudis in Manufacturing Industryis Low • Time for Updating National Industrial Policy

  3. KSA into 2020 The world: • globalization and openness, • alliances and partnerships, • unprecedented pace of innovation However , …..

  4. Unprecedented favorable context Policy formulation and commitment at the highest levels Consensus among Stakeholders that industry is the catalyst for achieving economic diversification Fully-integrated vision of the Kingdom’s future (Vision 2020) Current abundance of financial resources Strong regional and global linkages (GCC, Arab world, WTO,Asia) Strong natural resource base ِAccumulated experience in existing industries Strategic geographical location and good infrastructure base This is an optimal mix of favorable conditions to opt for an aggressively promising future

  5. National Consensus • Industry is the strategic choice for sustaining growth • Industrialization does not imply disregarding the oil sector, but to developing a framework for the use of this important sector in restructuring the economy to sustain future growth • The oil sector will remain an important growth vehicle not through its contribution to an increased purchasing power but as a driver for the creation of new channels for growth (integration in global value chains, creating competitive clusters, creating a national innovation system, … etc) • Industry is the primary driver of growth , since it enjoys various forward and backward linkages with other sectors in the economy … • Growth targeting in other productive sectors without a prime role for industry will result in the leakage of income from the Kingdom to other economies through greater pressure on the import sector to meet the needs of growth

  6. Featuresof The National Industrial Strategy • The aim is to foster economic competitiveness and economic security • It will opt for an aggressive industrialization drive • It is a partnership between the government and the private sector • It acknowledges the importance of oil as a valuable economic resource to fuel future growth • It builds upon a detailed diagnosis of the competitiveness of Saudi industry. In-depth studies have indicated the current strengths, weaknesses, opportunities and challenges facing the kingdom

  7. Diagnosis STRENGTHS • Strategic location • Oil and oil-related sectors • Large domestic market • Availability of capital WEAKENESSES • Concentration on energy intensive industries • High export concentration • Output of education system does not match industry needs • Wages stagnant at high levels with falling labour productivity • High proportion of foreign labor limits development of national capabilities • Meagre non-oil R&D and FDI • Unfavorable business conditions for SMEs OPPORTUNITIES • GCC & Greater Arab Free Trade Area • Private sector eager to engage • FDI as a source of technology and knowledge transfer • Build on increasing oil prices to support diversification THREATS • Growth volatility and fiscal vulnerability • Marginalization of technology and FDI • Comparatively superior industrial performance by competitors

  8. More challenges • closing the gap between economy growth and population growth

  9. The National Industrial Strategy • Vision • Strategic Foundations • Strategic Objectives • Key Strategy Programs • Industrial governance

  10. Vision "An industry with global competitiveness based on innovation and acting as a basic tool in transforming national resources into sustainable wealth"

  11. Strategic Foundations … • A cluster based strategy • Focus on industries is based on national comparative advantage • Moving up towards higher value-added products • Shifting to industries with high technological content ( KBI ) • Supporting and promoting small and medium enterprises • Building a national ( industrial ) innovation system • Improving the business environment • Providing and developing the infrastructure • Raising the competitiveness of domestic products • Focus on regional industrial development • Strengthening regional and global linkages

  12. Key Anchor Programs Industrial Clusters Industrial Sevices and Support Systems Human Resources SME s Business Environment National Industrial Strategy National Innovation System

  13. Thanks ….

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