Saudi Arabia’s mining sector is undergoing a significant transformation and is gearing up to become one of the key pillars of economic diversification efforts outlined in Vision 2030. The latest report from the National Industrial and Mining Information Center reveals that Saudi Arabia issued 152 industrial licenses in January alone, bringing the total number of operating and under-construction factories in the Kingdom to 11,672. These factories represent a combined investment of $410.4 billion.
With abundant mineral wealth estimated at $2.5 trillion, Saudi Arabia sees a pivotal opportunity to expand non-oil revenue streams and bolster economic resilience alongside the oil and petrochemical industries.
The center’s report reveals significant changes in new industrial investments in Saudi Arabia’s mining sector. Notably, the number of factories operating in the country saw a 10 percent increase in 2023 to 11,549. Moreover, Saudi Arabia issued 1,379 new industrial licenses in 2023. Additionally, 1,058 new factories commenced production last year.
Accelerating exploration and development
To expedite exploration and development efforts, Saudi Arabia has ramped up investment in the mining sector. By the end of 2023, it had committed $182 million in exploration incentives. Moreover, the increase in the number of new industrial licenses underscores the government’s commitment to fostering growth in the sector.
Besides, government initiatives aim to create a conducive business environment for mining development. Programs such as the Mining Investment Law streamline licensing processes in Saudi Arabia while prioritizing environmental sustainability and community welfare.
Moreover, the Saudi Industrial Development Fund plays a pivotal role in financing advanced exploration and mining projects, offering financial support for eligible projects and initiatives across various sectors. This includes financing solutions for small and medium enterprises (SMEs), renewable energy projects, and efforts to increase local sector content.
Saudi Arabia’s comprehensive approach to economic transformation in the mining sector spans three phases.
- Phase 1: Mining Activities — Phase one entails exploration and survey operations to determine mineral quantities. It also includes conducting economic feasibility studies, developing mines, and processing raw materials.
- Phase 2: Intermediate Industries — Includes refining and smelting operations to produce basic materials.
- Phase 3: Conversion Industries — Manufacturing of semi-finished and finished products.
Supporting the sector’s growth is the Saudi Geological Survey which facilitates investment in mineral exploration through high-resolution geological data and aerial surveys. This initiative aims to attract investments, develop national competencies, and bolster confidence in exploration activities.
Moreover, Saudi Arabia’s logistics sector plays a crucial role in facilitating investment in the mining sector by providing solutions for transporting raw materials and processed minerals to industrial cities. This enhances the sector’s competitiveness and supports its integration into the global economy.
Source: economymiddleeast.com
