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Saudi Arabia to Expand Private Sector Role in Military Industries

The Federation of Saudi Chambers has announced the formation of the first-of-its-kind national committee for military industries (Asharq Al-Awsat)
The Federation of Saudi Chambers has announced the formation of the first-of-its-kind national committee for military industries (Asharq Al-Awsat)
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Saudi Arabia to Expand Private Sector Role in Military Industries

The Federation of Saudi Chambers has announced the formation of the first-of-its-kind national committee for military industries (Asharq Al-Awsat)
The Federation of Saudi Chambers has announced the formation of the first-of-its-kind national committee for military industries (Asharq Al-Awsat)

The Saudi private sector is stepping up its involvement in military industries to boost sector development and ensure long-term project success. The aim is to meet the Kingdom’s goal of localizing more than half of its military spending by 2030.

Recently, the Federation of Saudi Chambers has announced the formation of the first-of-its-kind national committee for military industries in the Kingdom. Salman Al-Shatri has been elected chairman of the committee while Zeyad Al-Mohaimeed is the vice chairman.

This is the first time that a committee concerned with the military industries sector has been formed under the umbrella of the private sector, represented by the Federation of Saudi Chambers, to work with relevant bodies such as the General Authority for Military Industries (GAMI), the Saudi Arabian Military Industries (SAMI) and other authorities.

Speaking to Asharq Al-Awsat, Al-Shatri said that the committee’s goal is to boost the number of companies in the sector and manage increasing investments effectively through collaboration.

Moreover, the committee aims to represent the private sector both domestically and internationally, and to work closely with GAMI to ensure programs serve the sector’s needs well.

Al-Shatri explained that the committee will directly communicate with relevant ministries to ensure local and sustainable projects in the sector. They’ll share feedback with authorities like the Ministry of Industry, Investment Ministry, and others to remove obstacles and utilize support programs.

He emphasized the committee’s focus on technology localization and research. They'll work closely with defense development and military industry authorities to develop needed technologies and ensure project resources.

Al-Shatri stressed that achieving Saudi Vision 2030 goals requires the right environment for research, development, and factory infrastructure. That's what the committee aims to address next.

The creation of the new committee follows recent directives from the Saudi Chambers of Commerce, aimed at modernizing the economy in line with the Kingdom’s vision.

Among the focus areas is the military industry, which aims to localize over 50% of its operations by 2030.

Government efforts have led to a significant increase in military industry capabilities, with localization rates rising from 4% to 13.6% by the end of 2022.

Saudi Arabia has issued permits for 265 companies in the military sector and announced over 74 investment opportunities to localize the supply chain.

In February, Riyadh hosted a global defense show with over 773 exhibitors from 75 countries and participation from defense ministers and senior officials.

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Omani Revenues Rise 15% in 2024, Driven by Higher Oil Prices

The Omani Capital, Muscat (Omani News Agency)
The Omani Capital, Muscat (Omani News Agency)
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Omani Revenues Rise 15% in 2024, Driven by Higher Oil Prices

The Omani Capital, Muscat (Omani News Agency)
The Omani Capital, Muscat (Omani News Agency)

Preliminary data from Oman’s Ministry of Finance showed that the country’s revenues in 2024 reached approximately 12.7 billion Omani rials ($33 billion), marking a 15% increase compared to initial budget forecasts.

Spending was reduced to 11.65 billion rials ($30 billion), a 4% decrease from planned expenditure. This resulted in an actual surplus of 540 million rials, instead of the anticipated deficit of 640 million rials.

The improved financial performance was largely due to a 37% rise in the average price of oil, which reached $82 per barrel, compared to the initially projected $60. However, Oman’s average daily oil production saw a slight decline, dropping to 1.001 million barrels from 1.031 million barrels.

The additional revenue of 468 million rials was allocated to social spending and economic growth initiatives. This included funding for fuel subsidies, electricity, water, sanitation, and waste management. Health and education sectors received increased budgets to support service expansion, while additional funds were provided for social security beneficiaries, low-income families, and debt forgiveness for small and medium-sized enterprises.

Oman’s public debt declined by 5.3% in 2024, falling from 15.2 billion rials at the start of the year to 14.4 billion rials. Debt now represents 34% of GDP, down from 36.5%.

In November, the International Monetary Fund (IMF) reported significant economic expansion in Oman, with growth accelerating from 1.2% in 2023 to 1.9% in the first half of 2024. This growth was driven by non-oil sectors such as construction, manufacturing, and services, despite reduced oil production. The IMF highlighted Oman’s progress in implementing Vision 2040 reforms, which included strengthening social safety nets, improving labor market flexibility, and enhancing the business environment. The country’s sovereign credit rating was upgraded to investment grade, reflecting its improved economic fundamentals.

While growth in 2024 is projected at 1.2%, further recovery is expected in 2025 as hydrocarbon production increases alongside non-oil sector expansion. Challenges such as oil price volatility and geopolitical risks remain, but Oman continues its efforts to diversify the economy and attract investments.

Sultan Haitham bin Tariq approved Oman’s 2025 budget, which anticipates a deficit of 620 million rials ($1.6 billion). Revenues are estimated at 11.18 billion rials ($29 billion), a 1.5% increase from 2024, while spending is projected at 11.8 billion rials ($30.65 billion), a 1.3% rise.

Finance Minister Sultan al-Habsi emphasized that global economic uncertainties, including trade tensions and weaker oil demand, present challenges for oil-exporting nations. The 2025 budget focuses on maintaining fiscal and social stability, allocating significant funds to education, health, housing, and social welfare. Subsidies for social protection and electricity support are also prioritized.

Development spending across provinces reached 147 million rials by the end of 2024, aligning with efforts to promote decentralized growth. Oman is also undertaking financial reforms, including periodic reviews of government service fees, simplifying administrative processes, and modernizing financial regulations to improve fiscal management.