Saudi Arabia leads $2 trln Vision 2030 drive as GCC economic reforms gain speed

Al Arabiya

6 days ago

The Gulf Cooperation Council (GCC) countries are accelerating their sweeping economic transformation programs under Vision 2030 initiatives, with Saudi Arabia leading a $2 trillion regional drive to reduce dependence on oil revenues and build knowledge-based economies.
Arab Gulf states' vision
Each GCC nation has crafted distinct but complementary transformation strategies under their respective vision programs.
Collectively, GCC nations have committed over $2 trillion to Vision 2030-related projects, representing one of the largest coordinated economic transformation efforts in modern history, according to estimates by economic consultancy Gulf Intelligence
'The GCC's Vision 2030 programs are moving with tremendous momentum, powered by the UAE and Saudi Arabia's transformational initiatives,' said Vijay Valecha, chief investment officer at Century Financial, in an exclusive interview with Al Arabiya English.
'They are setting a rapid pace for the region's economic and social diversification, often surpassing interim targets.'
Saudi Arabia's Vision 2030, the most comprehensive regional blueprint, has been driving massive infrastructure projects – including the $500 billion NEOM megacity and Red Sea tourism development. It achieved rapid progress with 93 percent of performance indicators met partially or fully since launching in 2016, according to experts at Century Financial.
Meanwhile, the United Arab Emirates has advanced its UAE Vision 2030 and 2071 vision, focusing heavily on space technology and artificial intelligence (AI) while positioning itself as a regional hub for financial technology and cryptocurrency regulation.
Qatar's National Vision 2030 emphasizes sports infrastructure and knowledge-based industries, building on 2022 FIFA World Cup momentum through heavy investments in education partnerships with international universities and research institutions and establishing Education City as a regional academic center.
The New Kuwait 2035 vision still focuses on transforming the country into a regional financial and trade hub despite implementation challenges.
Oman's Vision 2040 prioritizes logistics and manufacturing, leveraging the sultanate's strategic location between Asia and Africa, while Bahrain's Economic Vision 2030 emphasizes financial services and aluminum production as the kingdom works to maintain its position as the region's banking center while developing its manufacturing base.
Saudi Arabia sets regional benchmark
Saudi Arabia's progress has been a frontrunner in the GCC, with 85 percent of the 1,502 initiatives launched either completed or on schedule for completion.
The transformation has propelled Saudi Arabia to fourth place worldwide and first in the region on the UN E-Government Development Index, reflecting heavy investments in digital governance and smart government systems.
'Saudi Arabia's Vision 2030, now in its accelerated second phase (2021-2025) and transitioning into its final delivery phase in 2026, demonstrates a high rate of achievement,' Valecha noted.
'The Saudi Kingdom backs its sweeping economic and social reforms with heavy spending on smarter government, digital tools, and new industries.'
The Kingdom's economic diversification efforts have yielded concrete results across multiple sectors.
Home ownership rates reached 65.4 percent in 2024, surpassing the 64 percent target and advancing toward the 70 percent goal for 2030.
Meanwhile, the tourism sector has experienced extraordinary expansion, with foreign Umrah visitors totaling 16.80 million in 2024, significantly beating the target of 11.3 million.
The Public Investment Fund (PIF) has emerged as the primary driver behind this transformation, with assets under management increasing over 390 percent between 2016 and 2024.
This growth has contributed to reducing unemployment to 7 percent by the end of 2024, achieving the Vision 2030 objective six years ahead of schedule.
'Saudi is investing in local supply chains and workforce skills. The key is not just building things, but creating systems: stable regulation, better education, local talent,' Konstantin Vladimirovich Tserazov, strategic business consultant and Former Senior Vice President at Otkritie Bank, told Al Arabiya English.
'If enough long-term thinking holds — and not everything becomes a vanity project — the payoff will be real,' he added.
NEOM key part of Saudi transformation
At the center of Saudi Arabia's transformation lies NEOM, a $500 billion megaproject spanning 26,500 square kilometers that represents the Kingdom's flagship Vision 2030 initiative.
'NEOM is bold, but risky. It's a bet — not just on a city, but on a whole new economic model. If it works, it changes how the world sees Saudi Arabia. But it's very expensive, and some timelines feel optimistic,' Tserazov said.
The Line is a 170-kilometer city powered entirely by renewable energy, designed to accommodate 9 million residents in vertically layered, car-free communities.
The project also includes Oxagon, an industrial city on the Red Sea touted as 'the world's largest floating structure,' with plans to revolutionize supply chains using fully automated ports and logistics hubs.
'With futuristic developments like The Line, Oxagon, and Trojena, NEOM is attracting global attention and investment, helping Saudi Arabia's tourism sector grow rapidly—already contributing 4.45 percent to GDP and targeting 10 percent by 2030,' Valecha said.
Neom has already created 100,000 jobs in construction, energy, and tech and has pulled $10 billion in FDI, according to Tserazov.
'Think of it less as a single city, more as a trigger. It forced government, business, and foreign investors to think bigger. That matters,' he explained.
UAE's forward vision
The United Arab Emirates continues to press ahead with its vision goals, particularly in economic diversification, sustainability, and technological advancement, according to Valecha.
The nation is set to achieve its Dh4 trillion dirhams ($1.089 trillion) target for non-oil foreign trade within two years and ahead of the original 2031 goal, he noted.
The emirates' commitment to clean energy is evident in significant investments in solar energy projects, with the flagship Mohammed bin Rashid Al Maktoum Solar Park seeing its output goal lifted from 5,000 MW to more than 7,260 MW by 2030. The project is expected to cut more than 6.5 million tons of carbon emissions annually once completed.
Smart city investments represent another major focus, with spending on smart-city technologies, networks, and buildings potentially reaching $100 billion by 2030 as part of the plan to lead globally in artificial intelligence, blockchain, and Internet of Things technologies.
The UAE has also strengthened its climate commitments, now promising to slash emissions 47 percent from business-as-usual levels by 2030 – a significant increase from earlier goals.
Economic diversification
Among major oil-producing GCC nations, the UAE has demonstrated the most significant progress in reducing oil dependency.
'The UAE becomes a major oil producer that has by far led the GCC countries in reducing its oil dependency, with non-oil sectors accounting for 75.5 percent of its GDP by the end of last year,' compared to 68.6 percent a decade ago, Valecha explained.
Trade led non-oil growth, accounting for 16.8 percent of GDP, followed by manufacturing (13.5 percent), financial and insurance activities (13.2 percent), construction (11.7 percent), and real estate (7.8 percent).
The transport and storage sector emerged as the fastest-growing contributor to overall GDP, achieving 9.6 percent growth propelled by strong airport performance, with UAE airports handling 147.8 million passengers, representing a 10 percent increase.
'Non-oil GDP already makes up 73 percent of their economy this year. Dubai's ports, Etihad Rail, ADGM — these are not just shiny projects. They're working systems. Dubai's ports handled 15 million TEUs, and ADGM added 1,200 firms in 2023,' Tserazov said.
Tourism, mega-infrastructure projects drive growth
Tourism-related mega initiatives are building cultural soft power across the region.
According to Valecha, Saudi Arabia has already surpassed its original target of 100 million annual visitors, prompting a new target of 150 million visitors, and positioning the Kingdom to host global events like Expo 2030 and the FIFA World Cup 2034.
Across the border, the UAE plans to enhance the legacy of Expo 2020 and establish itself as a premier global destination through its 'Projects of the 50' initiative, targeting a GDP contribution of Dh450 billion, attracting AED 100 billion in new investments, and welcoming 40 million hotel guests by 2031.
Qatar aims to attract six million visitors annually by 2030, building on FIFA World Cup 2022 infrastructure and expanding cruise ports to position itself as a Gulf cruise hub with new terminals and maritime partnerships.
These programs are building systems that last, according to Tserazov.
'The next generation gets jobs in tech, tourism, not oil. Inclusivity's key to avoid elite capture. If they get that part right, the region won't just transform — it'll stay competitive for decades.'
Technology, renewable energy integration
GCC nations are also positioning themselves as leaders in emerging sectors through substantial investments in renewable energy and advanced technologies.
Saudi Arabia aims to achieve 50 percent renewable energy in its electricity mix by 2030 by developing 58.7 GW of renewable capacity, including the NEOM Green Hydrogen Project targeting 1.2 million tons of green hydrogen annually.
'The GCC nations are committed to lowering their carbon footprint and reliance on fossil fuels,' Valecha said.
Technology integration, particularly artificial intelligence, represents a key priority.
The UAE targets 44 percent clean energy by 2050 with significant investments in solar and nuclear power, including the 1.2 GW Noor Abu Dhabi Solar Park and the 5.6 GW Barakah Nuclear Plant.
'KSA aims to leverage AI and IoT to enhance manufacturing efficiency, automate thousands of factories, and develop NEOM as a tech-driven green city powered by renewable energy,' Valecha said.
The collective efforts could help GCC nations save 354 million barrels of oil equivalent and reduce carbon emissions by 136 million tons by 2030 through green bonds, public-private partnerships, and international collaborations, according to a 2020 S&P Global report.
International investment opportunities
The Vision 2030 initiatives are transforming the GCC into one of the most attractive emerging markets for international businesses and investors, according to Valecha.
'GCC governments are making it easier for businesses by reducing bureaucratic hurdles, liberalizing investment laws, and opening up previously restricted sectors,' he said.
Saudi Arabia has introduced 100 percent foreign ownership in various industries, streamlined business licensing under 'Invest Saudi,' and launched giga-projects actively courting global partners in infrastructure, AI, mobility, and sustainable development.
The UAE continues attracting capital through its Golden Visa program, competitive free zones, and digital economy strategies, with Dubai and Abu Dhabi becoming regional hubs for fintech, blockchain, and clean energy startups.
'There have been more successes than setbacks. Many of the now popular residency visas programs have arisen because of Vision 2030, such as the UAE Golden Visa,' Simon Gordon, MD UAE Sovereign PPG, told Al Arabiya English in an interview.
'We have seen how this has blown up across the world stage, with a staggering number of foreign nationals and investors moving to the UAE through residency programs such as the Golden Visa,' he said.
Sovereign wealth funds including Saudi Arabia's PIF, UAE's Mubadala, and Qatar Investment Authority are co-investing with international firms domestically, creating opportunities for joint ventures, technology transfers, and innovation-driven collaborations.
Foundation for post-2030 development
The Vision 2030 programs are establishing foundations for fundamental economic and societal transformation beyond 2030, transitioning the region from hydrocarbon-led growth to knowledge-based, innovation-driven economies.
'While the countries are competitive, all strive to achieve economic growth and overall strength of the region.
Leveraging their wealth, building their reputation as leaders and bidding to host the world's most popular events and performances,' Gordan noted.
And beyond 2030, according to Valecha, 'these initiatives are expected to transition the region from hydrocarbon-led growth to knowledge-based, innovation-driven economies anchored in private sector dynamism, technological advancement, and human capital development.'
Youth empowerment represents a key pillar, with the majority of the GCC population under 30 benefiting from investments in education, entrepreneurship, and upskilling programs. National strategies emphasize STEM education, AI, fintech, and green technologies to ensure the next generation can compete globally.
'The transformations underway are enabling a more agile, inclusive, and sustainable future for GCC citizens, fostering innovation, opportunity, and prosperity for generations to come,' Valecha said.
According to Tserazov, what's being witnessed in the Gulf isn't just a short-term plan.
'It's groundwork,' he said. 'Saudi Arabia, the UAE, Qatar, and others are building entire economies around life after oil…. 'This isn't about hype. It's about survival—and ambition,' Tserazov said.
GCC nations show varying degrees of progress.
While Gulf countries are advancing overall, not all are moving at the same pace.
'Progress is real, but uneven. Saudi Arabia, the UAE, and Qatar moved faster, driven by strong central leadership and big investments. Others lag behind due to either bureaucracy or budget constraints. Deadlines have shifted — that's expected with something this ambitious,' Tserazov explained.
He also said the biggest test for the GCC is execution.