Saudi Arabia has approved new privatization and agriculture laws as part of its efforts to improve the economy and attract foreign direct investments.
The country’s Cabinet made the decision during an online conference headed by King Salman bin Abdulaziz, as per the state-run Saudi Press Agency (SPA).
According to the reports, the agriculture law, when it takes effect, will replace a slew of other laws governing fisheries, poultry, beekeeping, fishing, investment, and the conservation of living aquatic resources in the kingdom’s territorial waters.
The new legislation will also replace laws regulating agricultural machinery trade and organic agriculture. The government has not yet confirmed when the new laws will take effect.
Saudi Arabia, Opec’s top oil exporter, is rapidly transforming its economy to reduce its reliance on oil revenue to drive growth. The kingdom’s Vision 2030 economic diversification plan requires privatization, and Riyadh has already begun part-selling state-controlled entities.
In, 2019, the kingdom has raised nearly $30 billion from the sale of shares in Saudi Aramco, the world’s largest oil-producing company. It’s listing on the Tadawul stock exchange was the biggest initial public offering in the world at the time. Further, the kingdom has sold a stake in two-grain mills and two more assets are being offered to private investors in the same sector.
Saudi Arabia’s National Water Company is also seeking private sector investment in the construction and operation of a series of new wastewater treatment plants across the region.
Kingdom’s finance minister, Mohammed Al Jadaan, said last year that the sale of shares in state-controlled companies would raise more than $13.33 billion (50 billion Saudi riyals) over the next five years.
The country is also developing several new projects including Neom, a $500 billion futuristic project consisting of a nature reserve, coral reefs and heritage sites on about 50 islands off the Red Sea coast, and a mega entertainment and sports project named Qiddiya in the capital Riyadh.
The Public Investment Fund of Saudi Arabia is also pumping billions of dollars into the economy to boost growth. According to Crown Prince Mohammed bin Salman, the fund will invest $40 billion annually in 2021 and 2022.
Last year, the kingdom approved a mining law to enhance foreign direct investment in the kingdom. The law came into force on January 1.
According to the International Monetary Fund, Saudi Arabia’s economy will expand by 2.6 percent in 2021, after contracting by 3.9 percent last year due to the coronavirus pandemic.