Speaking at a CNBC-hosted panel at the recently concluded World Economic Forum (WEF) in Davos, Switzerland, the CEO of Blackstone, Stephen Schwarzman said the reform efforts underway in Saudi Arabia are extremely positive. Change in the Kingdom is occurring at a rapid rate, he noted.
The boss of the American multinational private equity firm further observed that “What’s going on in Saudi Arabia is sort of extraordinary… you see economic growth and other good things happen when you have intelligent, informed, reform-oriented governments. As an outsider, this is like a case study, and it is happening so fast and is so bold.”
Schwarzman was referencing Vision 2030, the Saudi Arabia government’s state-run initiative to diversify its economy away from oil, invest in inventive industries and generate new jobs for its rapidly growing youth population.
The 32 year-old Prince Mohamed Bin Salman who has pledged to transform his conservative kingdom’s culture and economy was the one to first announced details of the Vision 2030.
Schwarzman believes that all the things being put in place in Saudi Arabia are things that you’d find as best practices in other parts of the world. He says the Kingdom’s reforms are orderly, but he feels there is a rush to diversify away from oil.
The kingdom has a hugely youthful population with a staggering 70 percent of the people below the age of 30.
Schwarzman noted that the Saudis have a huge challenge on their hand trying to provide a livelihood for that 70 percent. He recognized that the government’s push to diversify the economy is a clever idea that would help in meeting the needs of the populace.
Oil accounts for about 92% of the Kingdom’s revenues, 97% of earnings from exports and about half of the Gross Domestic product (GDP).
Schwarzman said part of the Vision 2030 is to develop industries, broadening an economic base and making sure that younger people have confidence in the future.
Crown Prince Mohamed Bin Salman’s steps towards achieving the Kingdom’s Vision 2030 blueprint, every so often described by outsiders as impulsive and unpredictable, have already rocked parts of the country and region.
Arresting wealthy Saudis in an anti-corruption campaign, lifting the driving ban on women, leading a fierce bombing operation against rebels in Yemen are just a few of the moves that have gained the prince both praise and reproach around the world.