Saudi Arabia is adopting a comprehensive approach aimed at accelerating the localization of supply chains from raw materials to final products, according to Saudi Energy Minister Prince Abdulaziz bin Salman. This is part of the Kingdom’s efforts to localize 75% of its energy sector by 2030.
Prince Abdulaziz bin Salman inaugurated the Energy Localization Forum, held in Riyadh until Thursday, which aims to strengthen Saudi Arabia’s global standing in various energy sectors and support its role in global energy security and sustainability.
During the forum, the Ministry of Energy launched a localization initiative and signed 124 agreements worth up to SAR 104 billion Saudi ($27.7 billion) with 118 companies.
In the opening session, Prince Abdulaziz emphasized that the Kingdom has recognized the importance of supply chain localization and sustainable development based on local expertise and resources.
He noted that the COVID-19 pandemic exposed vulnerabilities in supply chains when essential goods became scarce.
He recalled: “I won’t forget those long months when we struggled to secure basic goods without which we couldn’t have overcome the pandemic.”
Prince Abdulaziz continued, explaining that over-reliance on external sources posed significant risks, prompting the government to coordinate with 15 key entities to localize critical supplies. This experience highlighted the urgent need for localization across all sectors, especially energy.
The minister stressed that localizing many energy and sustainable energy industries is crucial to securing the Kingdom’s future, making self-reliance a top priority. He noted that energy in Saudi Arabia is not just a sector but a key driver of the nation’s industries and economic growth.
He further highlighted that the energy sector contributes around 40% of the Kingdom’s GDP, underscoring the strategic importance of localizing energy industries. This opens the door for similar initiatives across all sectors of the Saudi economy.
Two years ago, Crown Prince Mohammed bin Salman launched a national initiative for global supply chains, with a budget of SAR 10 billion, offering financial and non-financial incentives to investors. The goal was to position Saudi Arabia as a key hub in global supply chains, attracting quality investments and aiming to draw 40 billion riyals in industrial and service investments within the first two years.
It is worth noting that energy sector localization programs play a significant role in supporting and developing the national value chain by boosting local content and creating high-value job opportunities in advanced energy sectors. Localization initiatives cover petroleum, gas, utilities, electricity, renewable energy, petrochemicals, hydrogen, carbon management, and the maritime sector.
