Agreement between the Ministry of Economy and the Federation of Chambers to support the private sector
In a strategic move aimed at fostering sustainable economic growth, the Ministry of Economy and Planning signed a significant memorandum of understanding with the Federation of Saudi Chambers of Commerce. This agreement comes within the framework of ongoing efforts to enhance joint cooperation in economic and developmental fields, with a primary focus on supporting the private sector andempowering small and medium-sized enterprises (SMEs).
General context and the Kingdom's Vision 2030
This step falls within the broader context of the major economic transformations underway in Saudi Arabia under Vision 2030. Historically, the Saudi economy has relied heavily on oil revenues, but with the launch of Vision 2030, diversifying income sources has become imperative. The Vision aims to increase the private sector's contribution to GDP from 40% to 65%, and to raise the contribution of small and medium-sized enterprises (SMEs) from 20% to 35%. Therefore, this collaboration between the Ministry of Economy and Planning and the Federation of Saudi Chambers of Commerce represents a practical implementation of these strategic objectives, as the private sector is considered the primary driver of growth and job creation.
Details of the Memorandum of Understanding and its objectives
The signing ceremony was attended by prominent figures, including the Minister of Economy and Planning, Mr. Faisal Al-Ibrahim, the Deputy Minister of Economy and Planning, Engineer Ammar Naqadi, and the Chairman of the Board of Directors of the Federation of Saudi Chambers, Mr. Abdullah Kamel. The memorandum was officially signed by the Undersecretary of the Ministry for Sectoral and Regional Development Affairs, Ms. Farah Ismail, and the Secretary General of the Federation of Saudi Chambers, Mr. Sultan Al-Muslim.
The memorandum aims to develop joint economic studies and research, and to exchange accurate data and analyses that serve decision-makers. It also focuses on supporting programs and initiatives aimed at promoting entrepreneurship, studying the challenges and obstacles facing the private sector, and working to find practical solutions to address them.
Regional development and labor market alignment
A key focus of the agreement is regional and sectoral development, ensuring that the benefits of development are distributed across the Kingdom's various regions. The memorandum includes developing advanced training programs to enhance the skills of the national workforce and aligning educational outcomes with the actual and evolving needs of the labor market. Furthermore, ongoing workshops and consultative meetings will be organized with representatives of the private sector to support sustainability efforts, promote innovation, utilize modern technology, and secure sustainable financing.
Importance and expected impact
On the local level: This cooperation will accelerate the growth of startups and provide an attractive investment environment that will contribute to reducing unemployment rates and raising the standard of living for citizens by creating quality job opportunities that match the competencies of Saudi youth.
On a regional level: This trend reinforces the Kingdom’s position as the largest economy in the Middle East, and makes the Saudi market a model environment to be emulated in supporting entrepreneurship, attracting Gulf and Arab investments and enhancing regional economic integration.
On the international level: Empowering small and medium enterprises and applying sustainability and innovation standards contributes to improving the Kingdom’s ranking in global competitiveness and ease of doing business indicators, which sends a positive message to foreign investors about the strength and resilience of the Saudi economy and its ability to adapt to global changes.
