Vision 2030 aims to diversify Saudi Arabia's economy away from oil and develop its human capital to be more globally competitive. This top-down initiative is changing the way business is done in Saudi Arabia and employers, entrepreneurs and business owners must carefully navigate these changes to ensure they are aligned with the vision’s goals.
With any kind of rapid change, there will inevitably be some initial growing pains. But as businesses adapt to new regulations and procedures within the Kingdom, they can leverage the evolving economic landscape to their advantage.
How Vision 2030 Is Changing Business
Vision 2030 has led to the launch of many new government initiatives aimed at boosting business within the Kingdom. Let’s take a look at some of the key changes that will affect the way people do business in Saudi below.
Tech Is The Future
Saudi Arabia is positioning itself as the home of technological progress and development in the Middle East. Their decision to pour $6.4billion directly into the digital startup industry is the biggest investment of its kind in the entire MENA region. Part of this investment will go towards developing the NEOM project — a futuristic planned city located in the Northwest of the Kingdom. This project aims to create the first “cognitive city” fuelled by tech innovation.
Digital Marketing Will Be Key
The pandemic led to an unprecedented acceleration in the growth of digital marketing in Saudi Arabia. The nation’s exceptionally young population is very much online, and digital marketing will be key for local businesses that want to continue driving growth in the new diversified economy. If businesses fail to develop and invest in their marketing strategies, they risk being overtaken by more forward-thinking businesses that are capturing the younger generation of digital natives.
Digital marketing is a powerful tool that is constantly evolving and Saudis are increasingly embracing it. According to one Facebook survey, 88% of Saudi respondents said they had used augmented reality features at least once and 29% used them weekly to interact with brands.
Influencer marketing is also a growing sector — with more Saudis online, local influencers are emerging and shaping fashion and consumer trends. And in line with the Kingdom’s focus on tech development, the Metaverse will soon offer unique opportunities for marketers. This month, the leaders of the NEOM project announced that they would be creating a digital twin version of the city, based in the Metaverse.
Globally, 2021 was the strongest year for marketing budgets and Saudi Arabia was no exception. It’s an industry that has weathered the pandemic far better than others. What’s more, it’s predicted to continue growing in the Kingdom as we march ever closer to Vision 2030.
Global Investment Is Arriving
“Saudi Arabia is open to the world” announced government minister Faizal Hamza in 2020. He was not only referring to the introduction of tourist visas but also indicating that the Kingdom is keen to welcome foreign investment as part of its mission to diversify the economy.
Saudi Arabia’s National Investment Strategy aims to increase net foreign direct investment flows to $100 billion annually by 2030. This ambitious program has already been attracting the attention of international venture capitalists and global firms and saw the country receive a record-breaking $13.8 billion from foreign investors in July of 2021. To ensure that these investments will continue to benefit the economy for years to come, the government announced that foreign firms must establish their regional headquarters in Saudi Arabia by 2024 if they want to be able to secure government contracts.
Preparing Your Business For Change
While navigating this changing landscape may initially seem difficult, there are many government incentives available to help businesses overcome potential challenges and adapt to a more diversified economy.
The Saudi Ministry for Human Resources and Social Development expects these new measures to contribute to the employment of an additional 40,000 Saudi nationals in the coming years. Further government incentives and assistance are likely to emerge for private sector employers as Vision 2030 becomes a reality.