How is Saudi Arabia moving to become a global mining power

Saudi Arabia wants to detach the economy from oil and is banking on mineral deposits.
saudi arabia mining power

Saudi Arabia’s budget surplus in the country of black gold is breaking records, recording an 8.6 per cent increase in its GDP thanks to the soaring price of Brent crude in 2022.

With the barrel reaching $100, the country plans in parallel to increase its economy by diversifying into the exploitation of its mineral resources.

The goal is to triple the mining sector’s contribution to GDP, to the value of USD 75 billions.

The mineral wealth of Saudi Arabia

Saudi Arabia is particularly rich in minerals. The Saudi Geological Survey (SGS) has listed the presence of more than 48 minerals in its soils. Thus including phosphate, gold, copper, silver, zinc, nickel, lithium, as well as uranium and rare earths.

This prospecting is already attracting the interest of foreign players. China, through the China National Nuclear Corporation (CNNC), has thus worked in concert with SGS to assess the kingdom’s uranium resources.

Economic diversification

The re-engineering of the Saudi economy is part of both the desire to diversify its economy, anticipation of global demand movements in the mineral markets, and sustainable development goals.

The World Bank estimates that at least three billion tonnes of minerals will have to be exploited to reach the target of less than 2°C global warming by 2050.

Saudi Arabia has therefore perfectly integrated the important role that metals will play in the energy transition. And has done so for some years now.

In fact, this transition was launched in 2016 with the Vision 2030 plan, and the development of the mining sector is announced as an important building site of the National Industrial Development and Logistics Program (NIDLP). This is the economic pillar of Vision 2030.

As far as financing is concerned, the Kingdom has planned to grant an important role to the Saudi Public Investment Fund (PIF) – the sixth most endowed investment fund in the world with USD 607.42 billion in assets – placed under the direct auspices of the Crown Prince.

At the same time, the country launched a new mining investment fund that will be 49% owned by the PIF together with the national mining company Ma’aden, the majority shareholder.

Read also: Gulf countries: what is their major role in global economy and geopolitical balance

The Mineral Forum of the Future

In order to position itself as a key player in the industry and improve its image, Saudi Arabia is multiplying its far-reaching initiatives. In particular, Riyadh hosted the Forum on the Minerals of the Future, the most important event on the subject, at the beginning of January.

With a record number of delegations from over 130 countries, this forum was a great success.

As part of this momentum, the country also showed its ambitions at the Davos forum in mid-January by sending prominent officials. Including the ministers of foreign affairs, investment and finance.

Investments in sport

This large economic construction site will certainly attract a lot of foreign capital to support these investments.

Thus, for some years now, the Kingdom has been acting to enhance its image among westerners. In particular by investing heavily in the sports environment (purchase of ESL, Faceit, NewCastle United Football Club, LIV Golf, etc.).

Read also: What are OPEC countries and how powerful are they in the global oil market

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