RIYADH — The Privatization Program, which was launched in 2018, has sought to identify the government assets and services that can be privatized in a number of targeted sectors, develop the privatization system and mechanisms, define partnership frameworks between the public and private sectors to enhance the quality and efficiency of public services, and support contribution to economic development

The program has worked on enhancing the role of the private sector in providing services with an access to government assets in a way that improves the quality of services in general and reduces their costs by refocusing the government's legislative and regulatory role entrusted to it and in line with the Kingdom's Vision 2030.

The program has also had its contributions to boosting local and foreign direct investments and improving the balance of payments.

Privatization as a concept refers to the process of transferring ownership of assets from the government to the private sector, or entrusting the provision of certain government services to the private sector which includes asset sale agreements in whole and in part, and partnership contracts between the public and private sectors, which can take many forms such as asset establishment and operation and transfer of its ownership rights to the government.

In culmination of these efforts, the Council of Ministers endorsed in mid March the privatization bylaw, which has been described by Minister of Finance and chairman of the Privatization Program Committee Mohammed Bin Abdullah Al-Jadaan as pivotal in creating investment opportunities for the private sector and boost its contribution to the GDP to enhance the sustainability of the Kingdom of Saudi Arabia's economy.

The new bylaw seeks to bolster the public-private partnership, transfer ownership of government assets, liberate state-owned assets for the private sector, allocate specific government services, and expand private sector participation in infrastructure and service projects.

The privatization bylaw aims at creating a favorable business climate essential for improving the quality of services offered to citizens and residents as well as ensuring the necessary flexibility for the privatization projects and the public-private partnerships.

The privatization bylaw will enhance the contribution and participation of the private sector in the national economy and provide investment opportunities for it by organizing procedures related to privatization projects and the public-private partnership and facilitating the provision of these opportunities in a transparent and fair manner that ensures the integrity of procedures related to contracts, and raises the level of comprehensiveness and quality of services and efficiency of related assets and improves their management.

As per the efforts to realize the targets of the program, which today offers more than 160 business opportunities in 16 sectors, 18 privatization and partnership ventures have been established with the private sector and this mechanism reduces capital expenditures and improves operational efficiency.

Among the privatization ventures awarded so far are the public-private partnership contracts in water desalination and water treatment projects, the container terminal development project in Jeddah Islamic Port and King Abdulaziz Port in Dammam, the second cargo terminal in King Khalid International Airport in Riyadh, the construction of 60 schools in Makkah Region and the asset sale projects, including the sale of assets in the Saudi Grains Organization.

There are currently 21 other projects in the tender floating phase in the municipalities, health, education, water, agriculture, environment, labor and social development sectors.

During 2020 and despite the coronavirus pandemic crisis, a number of privatization projects had been completed in the education and water sectors with investments from the private sector amounting to around SR15 billion. — SPA