As Saudi Arabia's Vision 2030 reaches its halfway point, a new LIBF whitepaper by Emmanuel Rondeau and Fouad N. Trad examines how sustainable finance is driving national economic transformation. Their analysis offers valuable insights into both the progress made and challenges faced in this significant transition.
Progress and Challenges
The transformation has yielded notable results. Non-oil revenues have doubled to reach 50% of real GDP in 2023, while private sector contribution to GDP has achieved 45%. The Public Investment Fund (PIF) has performed strongly, surpassing its target of SAR 2.7 trillion in assets under management. Among PIF's sustainable investments is a major solar power plant near Mecca.
However, the path to economic diversification faces practical challenges. Oil remains a dominant force in the economy, accounting for:
• 90% of exports
• 75% of state revenues
• 45% of GDP
Beyond Environmental Goals
Vision 2030 takes a comprehensive approach to sustainability. The framework includes practical social targets such as increasing life expectancy from 74 to 80 years, developing three Saudi cities to rank among the top 100 globally, and expanding the country's presence on the UNESCO World Heritage List.
The Future of Banking
The authors highlight an important shift needed in Saudi banks' approach to ESG: moving from viewing it as a regulatory requirement to recognizing it as a genuine business opportunity. Strong ESG performance is becoming as fundamental as financial stability.
The whitepaper emphasizes that successful transformation requires practical elements: targeted training programs for staff and leaders, development of technical skills in sustainable finance, and clear ESG standards. Saudi Arabia's experience offers useful insights for financial institutions adapting to sustainable economics.
Renewable Energy Commitment
The commitment to renewable energy stands out, with plans to invest $235 billion in clean energy projects by 2030. This substantial investment, supported by regulatory frameworks and new economic zones, shows Saudi Arabia's emerging role in sustainable finance and development.
For more insights, download the full whitepaper here.
About LIBF
Since its foundation in 1879, LIBF has been at the forefront of providing world-class education and training. Today, our qualifications equip students round the world with the skills they need for successful careers. It is one of only a few professional bodies in the world to have Taught Degree Awarding Powers and is an innovator in distance learning and online degrees.
With a focus on vocational training, LIBF delivers a broad range of qualifications and programmes to support individuals at each stage of their careers -- from entry-level to advanced professional qualifications. Since 2023, LIBF has been part of IU Group, Europe's largest edtech company and proprietor of Germany's largest university, IU International University of Applied Science, as well as the University of Fredericton in Canada. Further information at: www.libf.ac.uk
