Future Investment Initiative (FII) Paves The Way For Diversification
The Future Investment Initiative (FII) – hosted by the Public Investment Fund of Saudi Arabia – is an international forum for expert-led discussion among global leaders, investors, and innovators who are empowered to shape the future of global investment. It focuses on the use of investment in driving growth opportunities, promoting innovation and disruptive technology, and addressing global challenges.
Speaking at the recent Future Investment Initiative (FII) conference that was held in Riyadh, finance ministers sought to further diversify revenue sources during the post-pandemic period. Diversification provides a win-win scenario. It helps to develop the economy, which then essentially raises the tax base, which means more government revenue that will allow it to offer better services to Saudi Arabia’s people and citizens. A spate of changes is being experienced by the Gulf Cooperation Council (GCC); the member nations are competing in a very healthy way. They complement each other and attempt to build each other up. As far as the diversification policy of Saudi Arabia is concerned, the Kingdom has begun to fulfill the goals of its 2030 Vision. The pandemic of COVID-19 was a test of how Vision 2030 operates. The reforms adopted by the government on the structural side of the laws or regulations have been significant.
A profitable choice for the Kingdom is diversifying sources of income. Investments in technology, renewable energy, waste management, and other critical sectors are currently being planned. The opportunities to diversify in Saudi Arabia are sufficient.
In diversifying its economy, Bahrain has done very well, as 85% of the country’s GDP comes from non-oil revenues. In the 1970s, diversification efforts began with industries such as the aluminum and petrochemical and other value-added industries that were integrated into banking and tourism and, of course, other very significant sectors. The Kingdom aimed to reduce reliance on oil revenues.
To create a broader base for the economy, diversification efforts are critical. One of the key advantages of diversification is that within it, a diversified economy helps sustain many enterprises. A diversified economy provides a balanced economic activity loop where, as the economy expands, companies continuously feed off each other and grow larger. A diversified economy opens the door to rising community demands for the provision of goods and services—the greater the needs, the greater the possibilities of satisfying them. In order to sustain economic development in the Gulf States and the region in general, diversifying sources of income would lead to a better quality of life for everyone.