How has low oil prices affected the vision of Mohammed bin Salman 2030?

The oil war between Moscow and Riyadh threatens the strategic vision of the Kingdom of Saudi Arabia, "Vision 2030", and in fact the plan of the Saudi Crown Prince Mohammed bin Salman, which aims to diversify the Saudi economy, did not lead to the expected results.

The Saudi economy is currently suffering from great losses as a result of falling prices of raw materials. Riyadh's attempts to end the war in Yemen are likely to have mainly economic objectives.

In a report published by the Russian "News. Rey" website, Igor Yanfarev stressed that the Saudi leadership is trying to present the game of lowering oil prices as beneficial to them.

Find alternative income sources
Despite discussions in the Kingdom of Saudi Arabia regarding the need to find new sources of added value not related to oil production, oil exports represent about 80% of the Kingdom's income, at a time when the "Vision 2030" seeks to get Saudi Arabia out of a position of total dependence on oil exports By reinvesting oil wealth into sustainable industries.

The writer quotes Laura James, a prominent Middle East expert at Oxford Analytica, as saying that the Saudi strategic program, "Vision 2030", is lagging behind most of his goals for 2020. Fundraising for reinvestment is a cornerstone of this strategy - according to the author - but it has been undermined. These plans are the result of attacks on Saudi Aramco's refineries last year. On this basis, investors were reminded of the geopolitical risks that threaten Aramco's existence entirely.

The writer mentioned that the Saudi crown prince put pressure on wealthy Saudi citizens to buy Aramco's assets in the framework of the initial public offering, at a time when the market value of the energy giant was estimated at $ 1.7 trillion, which is less than the value of two trillion dollars planned, and at the present time the company's shares do not benefit From the current energy war.

The writer added that foreign direct investment is another criterion to ensure the success of "Vision 2030", and although the value of foreign investment in the Kingdom for 2018 amounted to 3.2 billion dollars, this figure cannot be compared to the value of foreign investment for 2015, which was estimated at 8.1 billion dollars. Or for the year 2010, which was estimated at 29.2 billion dollars.

The writer stated that the growth of the non-oil private sector is another milestone in the Kingdom, and the situation seemed promising until the pace of development began to slow in December 2019.

In February this year, the growth of the non-oil private sector slowed compared to the past two years, especially with the production being undermined by the Corona virus, and at the present time, the tax pressures caused by the price war can make the situation more complicated, according to the author.

The writer concluded that one of the important results of the oil war is that it may lead to some changes in the Kingdom's foreign policy, as well as lead to the failure to carry out some military campaigns, but that does not mean the country is searching for other sources of added value that are not related to oil production.