Saudi government approves privatisation law

17 Mar 2021
Saudi government approves privatisation law

Saudi Arabia’s Council of Ministers has approved the country’s Private Sector Participation (PSP) Law, which is aimed to boost private sector investment in the kingdom’s infrastructure projects and provision of public services

 

Saudi Arabia’s Council of Ministers has approved the country’s Private Sector Participation (PSP) Law, which is aimed to boost private sector investment in the kingdom’s infrastructure projects and provision of public services.

The eagerly anticipated PSP law will support the use of public-private partnerships (PPPs) for projects and the privatisation of public sector assets.

The PSP Law provides a framework for government entities to participate directly in a project company while protecting the rights of private partners.

The kingdom’s National Centre for Privatisation (NCP) is supporting 16 sectors targeted for privatisation, which includes a pipeline of projects that have the potential to be developed as PPP schemes and state-owned assets that can be sold off to the private sector.

Increasing the role of the private sector in the kingdom’s economy is a central pillar of the Vision 2030 economic reform programme, which aims for the private sector’s contribution to GDP to increase from 40 per cent to 65 per cent.

The NCP was established in 2017 to lead the kingdom’s privatisation programme. In 2018, the NCP launched the 2020 Delivery Plan, which set out the first round of targets and metrics for the kingdom’s privatisation programme. Privatisation of the Ras al-Khair power and desalination cogeneration plant was one of the first projects identified to be privatised.

Energy & Utilities recently reported that prequalified groups had been invited to submit proposals for the planned Ras al-Khair cogeneration plant privatisation, a deal which is likely to be worth up to $3.5bn.

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