How Saudi Arabia moves to become a mining power
Saudi Arabia wants to detach the economy from oil and focuses on mineral deposits.
In Saudi Arabia, the black gold country's budget surplus breaks records, posting an 8.6% increase in its GDP thanks to a soaring Brent price in 2022. With the barrel reaching $100, the At the same time, the country plans to increase its economy by diversifying it in favor of the exploitation of its mineral resources . The goal is to triple the mining sector's contribution to GDP, to the tune of $75 billion.
THE MINING WEALTH OF SAUDI ARABIA
Saudi Arabia is particularly rich in minerals. The Saudi Geological Survey (SGS) has listed over 48 minerals in its soils, including phosphate, gold, copper, silver, zinc, nickel, lithium, as well as uranium and rare earths. This prospecting is already attracting the interest of foreign actors. China, through the China National Nuclear Corporation (CNNC), has thus worked in concert with the SGS to assess the kingdom's uranium resources.
THE ECONOMIC DIVERSIFICATION
The redesign of the Saudi economy fits both into the desire to diversify its economy, to anticipate movements in global demand on mineral markets, but also to sustainable development goals. The World Bank estimates that at least three billion tonnes of minerals will need to be exploited to achieve the global warming goal of less than 2°C by 2050. Saudi Arabia has therefore perfectly integrated the important role that metals will play in the energy transition, and this has been for some years now.
Indeed, this transition was launched in 2016 with the Vision 2030 plan and the development of the mining sector is announced as an important construction site of the National Industrial Development and Logistics Program (NIDLP), economic pillar of Vision 2030.
As for funding, the Kingdom has planned to grant an important role to the Saudi Public Investment Fund (PIF) – the sixth most endowed investment fund in the world with $607.42 billion of assets -, placed under the aegis direct from the Crown Prince. At the same time, the country launched a new mining investment fund that will be owned 49% of the PIF along with the national majority shareholder Ma'aden Mining Company.
THE FORUM ON MINERALS OF THE FUTURE
To position itself as a key player in the sector and improve its image, Saudi Arabia is multiplying far-reaching initiatives. In particular, Riyadh hosted, at the beginning of January, the Forum on Minerals of the Future, the most important event on the subject.
With a record number of delegations from over 130 countries, this forum was a great success. In this momentum, the country also showed its ambitions at the Davos forum in mid-January by sending top officials, including foreign affairs, investment and finance ministers.
INVESTMENTS IN SPORT
This large economic construction site will certainly attract many foreign capitals that can support these investments. Thus, for some years now, the Kingdom has been taking action to enhance its image among Westerners, in particular by investing heavily in the sporting environment (purchase of ESL, Faceit, NewCastle United Football Club, LIV Golf, etc.).
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/energia/arabia-saudita-risorse-minerarie/ on Fri, 12 May 2023 05:47:26 +0000.