CHAPTER THREE
INFRASTRUCTURE AND
DEVELOPMENT OF
ECONOMIC RESOURCES
61
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
62
INTRODUCTION
When the Kingdom started to embrace
modernity some decades ago, its
government gave priority to the
development of oil and gas to provide
sufficient funding for the development
of infrastructure such as transport,
housing,
electricity,
water,
communications, health and education.
Consequently,
the
first
three
development plans concentrated on
building
a
broad
and
solid
infrastructure
given
its
crucial
importance to the country’s socioeconomic development. The three
development plans 1390-1405 (19701984) were followed by two
development plans 1405-1415 (19851994) characterized by reductions in
public
funds
available
for
infrastructure, due to lower revenues
from oil exports. The objectives and
policies of the two successive
development plans 1415-1425 (19952004) resulted in achieving some of the
Kingdom’s infrastructure development
goals, which enabled the national
economy to expand its capacity,
resulting in continuous economic
growth, increased employment and
improved education and public health
systems. Furthermore, the agricultural
sector developed and grew rapidly.
Presently, not only can a substantial
share of the citizens’ food needs be met
by domestic production, domestic food
processing industries are also able to
export processed food products of high
quality.
Between the beginning of the First
Development Plan in 1390/91 (1970)
and the end of the Seventh Plan in
1424/25
(2004),
government
expenditure on national development
totaled SR 2,602 billion, of which SR
746.6 billion (28.7%) were allocated to
infrastructure development, SR 946.2
billion (36.3%) to human resources
development, SR 506.9 billion (19.5%)
to economic resources development,
and SR 402.3 billion (15.5%) to health
and social development.
The First Development Plan 1390-1395
(1970-1974) allocated SR 14.1 billion
(or 41.3% of development expenditure)
for the development of infrastructure
(transportation,
communications,
housing and municipal services). In
addition, the value of investments in the
electricity and water sector in current
prices amounted to SR 81 million in
1389/90 (1969) and totaled SR 972.3
million by the end of the First Plan in
order to meet the basic needs of
industrial, commercial and services
projects as well as those of civil
purposes. Investments in transport and
63
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
communications increased from SR 42
million in the base year to SR 505
million by the end of the Plan.
During the Second Development Plan
1395-1400 (1975-1979), the allocations
for infrastructure soared to SR 171.3
billion, more than 12-fold the volume
of the First Plan. This amount
constituted 49.3% of the total
expenditures of SR 347.2 billion
allocated for development. Likewise,
the value of investments for electricity
and water totaled SR 12 billion. A
similar
dramatic
increase
in
investments could be observed for
transport and communications, which
rose to SR 6.2 billion.
The Third Development Plan 14001405 (1980-1984) saw a continuation
of the provision of funds for
infrastructure,
totaling SR 256.8
billion. This amount constituted 41.1%
of the total expenditures of SR 625
billion allocated for development. The
priority given to electricity and water
was underpinned by a significant
increase in investments, totaling SR
34.6 billion. Investments in transport
and communications increased even
more, from SR 6.2 billion to about SR
18 billion.
64
One of the salient outcomes of the first
three development plans 1390-1405
(1970-1984) was the completion of
many large-scale public infrastructure
programs.
Despite the need to expand and sustain
the Kingdom’s infrastructure, the
financial constraints during the Fourth
Development Plan 1405-1410 (19851989), caused by sharp reductions in oil
revenues, led to a 61% reduction in
funds allocated for the development of
infrastructure to SR 100.7 billion,
representing 28.9% of total expenditure
allocated
for
development.
Nevertheless, funds for the water and
electricity sectors were slightly raised
to SR 34.9 billion. Investments in
transport
and
communications,
however, were reduced by 12% to SR
15.8 billion and now focused on
balancing regional development and on
enabling
the
transportation
of
passengers
and
commodities
throughout the vast area of the
Kingdom.
Low global oil prices continued to
reduce the Kingdom’s revenues during
the Fifth Development Plan 1410-1415
(1990-1994). Funds for infrastructure
investments were therefore reduced by
26% to SR 74.2 billion, representing
22% of the total expenditure allocated
for development. However, a drastic
increase in funds for the continued
expansion of electricity and water to SR
62.5 billion was secured to meet the
growing consumption needs of
households,
government,
trade,
industry, agriculture and others as a
result of economic growth, acceleration
of social development, rise in living
standards, expansion of urban areas,
and increased population density of
cities. Similarly, the sum of SR 24.9
billion was allocated for investment in
transport and communications, an
increase of 58%.
During the Sixth Development Plan
1415-1420 (1995-1999), expenditure
for the development of infrastructure
decreased by 8% to SR 68.1 billion,
which was 16.2% of the total
expenditure allocated for development.
Investments in electricity and water
again increased by 65% to SR 103.4
billion, or 15.1% annually. The rise in
total value of investment in electricity
and water above that of infrastructure is
attributed to the interconnection
between investments in the sectors of
infrastructure and economic resources.
For example, industrial clusters and
cities calculate the cost of their
infrastructure investments as part of the
total cost associated with actual
expenditure on development of
economic resources. The funds for
transport and communications were
marginally reduced to SR 24.7 billion,
an average annual rate of 0.16%.
During the period of the Seventh
Development Plan 1420-1425 (20002004), infrastructure development
aimed at meeting the demands of a
growing
population,
balancing
development throughout the regions of
the Kingdom, providing a favorable
investment environment for the private
sector, and attracting direct foreign
investment. The Seventh Plan also
aimed at maximizing the return on
public investments by rationalizing new
infrastructure investments as well as
improving the efficiency, effectiveness
and capacity utilization of existing
infrastructure and economic resources.
The Fourth Strategic Base of the Plan
emphasized the importance of paying
attention to the maintenance of the
existing infrastructure to keep it fully
operational and thus obtain all the
expected benefits from it. Policies
consequently concentrated on the
necessity of operation and maintenance
programs for each and every
development project. The transport,
communications, municipalities and
housing sectors received SR 61.4
billion, which amounted to 12.6% of
65
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
the total expenditure of SR 485.3
billion allocated for development. For
economic resources
development,
financial allocations totaled SR 54.4
billion, which was 11.2% of the total
approved financial allocations for
development agencies in the plan.
The Seventh Development Plan also
witnessed the start of large-scale
privatization programs in several
sectors, of which the most important
were communications, transport and
electricity. Initial steps to privatize the
air transport sector were also
undertaken. In addition, a number of
public-private
partnerships
were
formed, for example, to manage and
operate seaports, or to provide various
municipal services.
66
Private commitment and investments
were also crucial to the establishment
and operation of industrial cities and
clusters set up during this period. The
business and operations models of the
Industrial Cities of Jubail and Yanbu
are considered very successful and
serve as a practical model for publicprivate partnerships in future.
The directives of the Eighth
Development Plan 1425-1430 (20052009) and the achievements during five
years emphasize the Kingdom's resolve
to go ahead with promoting the
infrastructure sector and the economic
resources sector. The Kingdom is also
determined to modernize these sectors
and to raise economic efficiency in
order to realize balanced development
and improve quality of life.
3.1
TRANSPORT AND
COMMUNICATIONS
During the Eighth Development Plan
1425-1430 (2005-2009), efforts were
intensified
to
complete
the
infrastructure in roads, railways,
seaports and sea transport, airports and
air transport, and communications.
These efforts aim at meeting the
increasing needs for travel, trade and
communications.
3.1.1 ROADS
The network of paved roads expanded
at an average annual rate of 5.0% from
8,000 km in 1389/90 (1969) to 55,000
km in 1430/31 (2009). During the same
period, the earth-surfaced road network,
which provides services to rural and
agricultural areas, expanded at an
average annual rate of 4.9% from 3,500
km to 132,600 km.
3.1.2 RAILWAYS
Most of the present railway network of
1,018 km was build before the start of
the First Development Plan in 1390
(1970). However, much of the network
was improved (e.g. construction of
modern passenger stations, introduction
of express train service) resulting in
better transport services for passengers
and freight.
The number of passengers carried
increased at an average annual rate of
5.8% from 117,000 in 1389/90 (1969)
to 1.1 million in 2009, the last year of
67
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
the Eighth Development Plan. The
volume of freight transported during
the same period increased from 733,000
tons in 1389 (1969) to 3.6 million tons
in 1430 (2009), an average annual
growth of 4.1%.
During the Eighth Plan, a significant
expansion in railway network was
initiated which includes the following:
- North/south line.
- Haramain Fast Train.
- Landbridge project.
Implementation of north/south line and
the Harmain Fast Train projects started
during the Eighth Plan period.
3.1.3 PORTS AND SEA TRANSPORT
During the early years of the
Kingdom’s development, the limited
68
capacity of seaports was among the
major impediments to economic
development. Consequently, this issue
ranked high on the government’s
priority list during the successive
development plans. Intensified efforts
led to an increase in the number of
operational quays at industrial and
commercial seaports from 27 in
1395/96 (1975) to 183 in 1425/26
(2006), of which 46 are located in
industrial ports in Jubail and Yanbu.
The privatization program of port
services has contributed to the
completion of a number of specialized
container terminals at the Kingdom's
seaports. The number of handled
containers in seaports rose from 3.19
million in 1424/1425 (2004) to 4.43
million in 1430/31 (2009).
The quantity of goods handled during
the same period reflects the steep
growth in foreign trade. While 1.8
million tons of goods were handled in
1390/91 (1970), the level reached 57.2
million tons in 1404/05 (1984) when
the Kingdom’s economy was enjoying
high growth rates, 119.9 million tons by
the end of the Seventh Development
Plan in 2004 and 142.3 million tons in
1430/31 (2009).
The increase in the volume of handled
goods reflects the growing share of
non-oil exports of which the most
important are industrial exports from
Jubail and Yanbu, which together
increased to 68.42 and 76.1 million tons
by the end of the Seventh Development
Plan in 1424/25 (2004) and the Eighth
Development Plan in 1430/31 (2009)
respectively.
3.1.4 AIRPORTS AND AIR TRANSPORT
Airports and air transport enable
movement of people and goods
throughout the vast area of the
Kingdom. There are 26 airports
including 4 international airports which
link all major cities of the Kingdom to
international destinations.
The number of passengers arriving at
the Kingdom’s airports increased at an
average annual rate of 8.9%, from 0.8
million in 1390/91 (1970) to 22.3
million in 1430/31 (2009). On the other
hand, the number of passengers
departing these airports increased at an
average annual rate of 8.9%, from 0.8
million to 22.0 million in 1430/31
(2009).
69
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
During the same period, the volume of
imported goods handled at the
Kingdom’s airports increased at an
average annual rate of 9.5% from
10,300 tons to 353,600 tons. Likewise,
the volume of exported goods increased
at an average annual rate of 9.3% from
5,600 tons to 177,000 tons.
The
Saudi
Arabian
Airlines
Corporation (SAUDIA) grew in step
with the growth in passengers and
goods. The number of passengers grew
at an average annual rate of 9.2% from
0.6 million in 1390/91 (1970) to 16.2
million in 2004 and 18.5 million in
1430/31 (2009).
The number of available seatkilometers increased at an average
annual rate of 9.3% from 1.3 billion to
70
42.3 billion between 1390/91 (1970)
and 1430/31 (2009). During the same
period, the number of available tonkilometers increased at an average
annual rate of 10.5% from 160 million
to 7.8 billion. The number of revenuegenerating ton-kilometers increased at
an average annual rate of 11.0% from
65 million to 3.7 billion.
3.1.5 TELECOMMUNICATIONS
Following the global revolution in
Information
and
Communications
Technology (ICT), the Kingdom
quickly focused on the expansion of
ICT services, which was reflected in
the development policy objectives and
measures, particularly during the
Seventh and Eighth Development
Plans.
The fixed-line telecommunications
infrastructure had received much
attention and funds since the First
Development Plan in 1390/91 (1970).
The number of operational telephones
increased accordingly during the same
period at an average annual rate of
13.5% from 29,400 lines to 4.2 million.
In 1415/16 (1995) mobile telephone
services were introduced in the
Kingdom, reaching 160,000 lines in
that year. The numbers then soared to
9.0 million in 1424/25 (2004) and 44.8
million in 1430/31 (2009).
The number of internet users rose from
2.4 million in 1424/25 (2004) to 9.8
million in 1430/31 (2009), while the
number of broadband users rose from
35,000 in 1424/25 (2004) to 2.75
million in 1430/31 (2009).
These achievements would not have
been
possible
without
policies
liberalizing and privatizing the sector,
which were initiated during the Seventh
Development Plan. Private investors
have not only contributed to expanding
the telecommunications infrastructure,
but have also caused significant price
reductions. Almost every citizen in the
Kingdom is in possession of at least
one telephone these days.
3.1.6 POSTAL SERVICES
The number of domestic mail items
increased at an average annual rate of
71
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
6.9% from 19.1 million in 1390/91
(1970) to 257.4 million in 1430/31
(2009). During the same period, the
number of incoming mail items from
international destinations increased at
an average annual rate of 6.9% from
20.5 million to 237.8 million. Likewise,
outgoing mail items to international
destinations increased at an average
annual rate of 1.0% from 13.3 million
items to 19.7 million.
The Seventh Development Plan 14201425 (2000-2004) also saw the
conversion of the General Directorate
of Posts into a more market-oriented
body, the Saudi Posts Corporation.
72
3.2
MUNICIPAL AND RURAL
AFFAIRS SECTOR
In general, all development plans aimed
at expanding the scope and quality of
municipal services for rural areas in
order to decrease disparities between
them and urban areas. Another aim was
to limit migration of rural population to
the cities by bolstering the potentials of
new and existing village clusters, and
by improving their infrastructure and
linking them to modern and efficient
transportation networks.
The Municipal and Rural Affairs sector
also experienced institutional changes
to help it provide more efficient and
advanced municipal services. An
example would be water and sewerage
services, which were transferred from
the municipalities sector to the water
and electricity sector in the third year
(2002) of the Seventh Development
Plan.
Many policies of the Eighth
Development Plan focused on aligning
the National Spatial Strategy and the
municipal services strategy to ensure
balanced development among the
Kingdom's regions. Within the context
of the National Spatial Strategy,
implementation of 185 plans is
currently in progress. This strategy
aims at improving municipal and
environmental services in cities and
villages, and improving utilization and
operational efficiency of municipal
facilities and services. It also aims at
enhancing the role of the private sector
in service delivery.
Large sums were spent to respond to
the requirements of modern urban
development all over the Kingdom. The
Ministry of Municipal and Rural
Affairs (MOMRA) has completed 232
urban plans throughout the Kingdom
covering several cities, governorates
and centers. The most vital programs
and projects in this sector are
highlighted below:
3.2.1 RAIN AND FLOOD WATER
DRAINAGE PROGRAM
This program constructs storm water
drainage networks in flood-prone cities,
villages and hamlets to prevent hazards
resulting from floods. The length of
storm water drainage networks reached
2,139 kilometers by the end of 1430/31
(2009). In addition, more than 430
protective embankments have been
constructed.
3.2.2 PUBLIC FACILITIES AND PARKS
PROGRAMS
With the purpose of extending
municipal services, 587 major and
secondary municipal premises as well
as 1,291 workshops and warehouses
have been built by the end of 1430/31
(2009).
In
addition,
492
slaughterhouses were built, of which 84
were automated. The number of public
toilets totaled 1,735 and the number of
cemeteries
and
corpse-washing
facilities 5,248. In addition, 1,090 car
parking areas have been built
throughout the Kingdom.
This group of programs also includes
the preservation of public and
environmental health by increasing the
size of green areas in urban regions.
These areas reached 74.8 million square
meters by the end of 1430/31 (2009)
including 3,475 public parks with
73
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
playgrounds for children.
3.2.3 MUNICIPAL STREETS
PROGRAM
This program includes paving main and
feeder streets and providing them with
the required services. In 1430/31 (2009)
the number of main streets reached
26,926 with a total length of 39,116
kilometers. There were 227,238
additional feeder streets with a total
length of 97,114 kilometers. The
number of lighting posts exceeded 1.43
million while the number of planted
trees reached 20.18 million.
3.2.4 MARKETS PROGRAM
This program establishes public
markets in urban and rural areas for
trading products from other areas. This
encourages agricultural development in
different regions of the Kingdom. By
the end of 1430/31 (2009), 2,075
markets, including 264 vegetable and
meat markets, had been set up
throughout governorates, centers and
cities of the Kingdom.
3.2.5 OTHER ACTIVITIES
Other activities carried out under the
responsibility of MOMRA within the
framework of the development plans
include:
- Distributing free lands to citizens.
74
- Filling up swamps.
- Disposing waste.
- Issuing aerial survey maps of
various regions.
- Completing the naming of municipal
streets and squares.
- Classification of contractors.
- Promoting awareness about Holy
Lands.
- Spraying insecticides.
- Maintaining governmental lands.
- Maintaining properties.
- Preparing studies on: urbanization
and regional planning, city structures
fees and municipal revenues,
privatization
and
municipal
performance.
- Issuing publications (books, manuals
about construction, roads and tree
plantation).
- Specifying
new
areas
for
investments.
- Updating urbanization plans through
1450.
- Real estate registration.
3.2.6 MUNICIPAL REVENUES
Municipal revenues grew at an average
annual rate of 217% from SR 1,530
million in 1424/25 (2004) to SR 2,370
million in 1430/31 (2009). In the last
year of the Eighth Development Plan,
for example, these revenues covered
54% of the costs of infrastructure
investment, operation and maintenance.
Revenue contribution to municipal
budgets grew from 16% in 1424/25
(2004) to 13% in 1430/31 (2009).
MOMRA continued its efforts to
reduce the cost of projects and to
improve the performance and quality of
services by adopting value engineering
in project evaluation. Since 1415/16
(1995), more than 55 projects, totaling
one billion Riyals, have been monitored
and evaluated. These include buildings,
roads, storm water drainage networks
and facilities, and lighting services.
Monitoring and evaluation activities
have contributed to cost reductions of
projects between 5% and 30%.
3.2.7 PRIVATE SECTOR
INVOLVEMENT
A number of municipal activities have
already been carried out by the private
sector.
MOMRA
has
been
implementing for some time a program
aimed at extending municipal services
according to commercial rules and
regulations by setting up either joint
projects with the private sector or fullyindependent
private
projects.
Objectives of this program include:
raising performance, improving quality
of service, increasing revenue, and
reducing expenditure. Many day-to-day
operations, such street cleaning
contracts, operations and maintenance
of slaughterhouses, gardens, parks and
other
municipal
activities,
are
increasingly outsourced to the private
sector.
MOMRA is currently conducting
studies to identify municipal activities
that might be considered for future
privatization, provided that this would
neither affect the quality of products
and services nor put additional burdens
on them while adhering to standards of
efficiency
and
performance
improvement.
3.2.8 IMPROVING SERVICE
EFFICIENCY AND
EFFECTIVENESS
The Eighth Development Plan 14251430 (2005-2009) included a number of
policies to raise the efficiency of the
municipal and rural affairs sector in
order to meet the challenges of urban
expansion up to 1450 (2028). The most
important of these policies are the
application of rules for urban physical
boundaries in order to link the spatial
expansion of each city to its actual
needs while preserving planned and
vacant (unplanned) governmental lands,
prevention of encroachment on these
lands, and designing mechanisms for
timely
elimination
of
such
encroachments. These policies also
75
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
include ensuring linkage between the
national spatial strategy and policies of
widening municipal services in a way
that supports balanced development
among the Kingdom's regions. A
Decree was issued by the Council of
Ministers introducing a new system for
municipal councils and continuation of
the existing membership up to
12/11/1432.
3.2.9 ENVIRONMENTAL AWARENESS
During the previous development plans
and the Eighth Plan, municipal services
were expanded in cities, villages and
centers. Further attention has been paid
to raising levels of environmental
health by combating the problem of
waste disposal through recycling and
reuse, and adherence to international
environmental
standards
and
conventions. Currently, programs are
being implemented to recycle waste
materials on a large scale using modern
technologies in a manner consistent
with environmental requirements and
economic benefits. No more than 35%
of all waste materials are currently
recycled in the Kingdom. It is expected
that this figure will rise steadily by the
end of the Eighth Plan. Private sector
involvement in this area is also
expected to increase.
76
The Council Of Ministers issued
resolutions transforming rural clusters
to municipalities comprising of
categories D and E. The resolutions
also
stipulated
raising
the
organizational
level
of
the
municipalities of Taif and Al Ahsa to
that of governorates thus increasing the
number
of
governorates
and
municipalities to 16 and 225
respectively, grouped in five categories.
Moreover, a central unit for the Saudi
Building Code was established in the
Ministry of Municipal & Rural Affairs.
The unit is responsible for monitoring
implementation of the code after it is
approved. The unit is empowered to
introduce any necessary amendments.
Furthermore, the power to issue
licenses of all kinds was made
exclusive to the Ministry, which was
also assigned the tasks of classification
of contractors, the Mina Development
Project, and public works construction.
3.3
ELECTRICITY
Since the First Development Plan, the
strategy has been to provide the
infrastructure and services (including
electricity) necessary for expansion of
productive capacities in all economic
and social sectors in order to improve
the standard of living. All development
plans, therefore, allocated the required
funds to expand electric power
networks to all elements of society in
all regions. Consequently a number of
large-scale projects in the electricity
sector were implemented, which
recently included all newly constructed
industrial cities and clusters.
Electricity generating capacity rose at
an average annual rate of 13.2% from
344 megawatt in 1390/91 (1970) to
44,600 megawatts in 1430/31 (2009).
Peak load also registered a substantial
increase from 300 megawatts to 41,200
megawatts during the same period, an
average annual rate of 13.5%. Growth
in the volume of electricity generated
was about 121-fold, from 1.8 billion
KWh to 217.1 billion KWh. Electricity
sold increased at an average annual
rate of 12.9% from 1.7 billion KWh to
193.5 billion KWh. The number of
subscribers increased at an average
annual rate of 8.8% from 216,000 to
5.7 million while average annual
consumption
of
electricity
per
subscriber increased more than fourfold from 7824 KWh to 33,934 KWh,
by the end of the Eighth Plan.
Electricity production is not limited to
stand-alone generation plants; the
Saline Water Conversion Corporation
(SWCC) also produces electricity in its
dual-purpose plants (electricity and
water) located along the coasts of the
Kingdom, from which electricity is
sold to other facilities in these regions.
3.3.1
INSTITUTIONAL SECTOR
REFORM
Institutional reform policies for the
electricity sector included establishing
"The Saudi Electricity Company", a
joint-stock national company. This
company was founded in 1420 (2000)
and incorporates all local electricity
companies as well as electricity
projects of the General Electricity
Organization. An independent entity
was also established to organize
electricity services and to review the
electricity costs and tariffs on a regular
basis.
3.3.2
PRIVATE SECTOR
INVOLVEMENT
In order to improve the management
and efficiency of the electricity sector
and
rationalize
production
and
utilization of electricity, the Council of
Ministers issued Resolution No. (169),
dated 11/8/1419 (1998), calling for the
restructuring of the electricity sector to
include increased private sector
participation.
The Eighth Development Plan 14251430 (2005-2009) includes specific
policies to expand the competitive role
77
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
of the private sector by promoting the
establishment, ownership and operation
of electricity projects while observing
socio-economic priorities.
78
3.3.3 TARIFF SYSTEM
In the course of restructuring the sector,
electricity tariffs were also reviewed
and a new tariff system was enacted,
taking into consideration the goals of
sustainable development by utilizing
energy economically and in an
environmentally sound way and at the
same time ensuring an adequate
standard of living for consumers:
extent. Revenues from oil and gas
constitute the main public financial
resource while exports of crude oil and
gas and its downstream products top the
list of commodity exports.
Household Consumption Pricing Blocs:
Over the past few years the Kingdom's
policy regarding the development of the
oil sector has established a balance
between the increasing needs of
development and the conditions in the
international energy market, which is
affected by factors beyond those of the
Kingdom’s national planning.
05 Halalas 1-2,000 KWh per month
10 Halalas 2,001-4,000 KWh per month
12 Halalas 4,001-6,000 KWh per month
15 Halalas 6,001-7,000 KWh per month
20 Halalas 7,001-8,000 KWh per month
22 Halalas 8,001-9,000 KWh per month
24 Halalas 9,001-10,000 KWh per month
26 Halalas above 10,000 KWh per month
Industrial Consumption:
12 Halalas per KWh per month
Agricultural and Benevolent Societies
Consumption:
5 Halalas 1-2,000 KWh per month.
10 Halalas 2,001-5,000 KWh per month
12 Halalas above 5,000 KWh per month
3.4
OIL AND GAS
The Kingdom is blessed with abundant
oil and natural gas. Development of the
oil and gas sector started several
decades ago, fuelling the Kingdom's
socio-economic and environmental
development
ever
since.
The
government has been successful in
promoting this sector and related
petrochemical
industries
while
conserving resources for future
generations to the furthest possible
3.4.1 CRUDE OIL RESERVES
The Kingdom's proven crude oil
reserves totaled 138.7 billion barrels by
the end of 1390/91 (1970) and rose to
168.4 billion barrels in 1399/00 (1979)
as a result of new discoveries and
reevaluation of the proven reserves.
New discoveries pushed up the reserves
to 260.1 billion barrels in 1409/10
(1989) and then further to 264.6 billion
in 1430/31 (2009), making the
Kingdom’s reserves equivalent to
19.8% of the total world crude oil
reserves.
3.4.2 PRODUCTION OF CRUDE OIL
Parallel to the increase in the
Kingdom's proven crude oil reserves,
crude oil production increased from an
average of 3.8 million barrels per day in
79
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
1390/91 (1970) to 9.9 million in
1400/01 (1980). As a result of the
worldwide decline in demand, the
emergence of new suppliers (e.g. the
North Sea countries) and increased
supply by countries such as Venezuela
and the Russian Federation, the
Kingdom reduced production to an
average of 4.1 million barrels per day in
1404/05 (1984) and eventually to 3.2
million barrels per day in 1405/06
(1985).
Production increased to 4.9 million
barrels per day in 1406/07 (1986) and
then to 5.1 million in 1408/09 (1988).
With the change in the international oil
market and the consequences of the
second Gulf War and subsequent
developments, production rose to an
80
average of 8.3 million barrels per day in
1412/13 (1992) and remained at
roughly the same level until 1418/19
(1998).
In compliance with OPEC’s policy of
controlling oil prices by controlling
production of member states, the
Kingdom reduced its production to an
average of 7.6 million barrels per day in
1419/20 (1999). Global demand,
however, increased and the Kingdom
raised production to an average of 8.1
million barrels per day in 1420/21
(2000), 9.6 million in 1425/26 (2005)
and 8.2 million in 1430/31 (2009).
In 1430/31 (2009), 96.7% of the
Kingdom's total crude oil output was
produced by Saudi ARAMCO, the
remaining 2.3% were produced by the
Arabian
Texaco.
Oil
Company and
Saudi
(2009) the rate of utilization reached
87.5%.
3.4.3 PRODUCTION AND
UTILIZATION OF NATURAL GAS
Production of natural gas took a similar
path as crude oil, as its production is
linked to the demand for crude oil.
Natural gas is mainly used as feedstock
for petrochemical industries and as fuel
for power generation plants. In 1390/91
(1970) the quantity of natural gas
utilized did not exceed 2.26 billion
cubic meters or 11% of the produced
gas. But it rose dramatically over the
years to peak at 94% in 1409/10 (1989)
and the slightly lower rate of 87.6% in
1425/26 (2005) because of the reinjection of the remaining quantities
and burning part of it. In 1430/31
3.4.4 REFINED OIL PRODUCTS
The Kingdom’s crude oil refining
industry has become a major valueadding industry. Its production capacity
increased 4-fold since 1390/91 (1970),
from 512,000 barrels per day to over
2.1 million in 1427/28 (2007).
Production of these refineries went up
from 225.3 million barrels per day in
1390/91 (1970) to 697.5 million in
1430/31 (2009), an average annual
growth rate of 2.9%.
3.4.5 PERCENTAGE DISTRIBUTION
OF REFINED OIL PRODUCTS
Refined oil products of Saudi
ARAMCO contribute to the increasing
81
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
domestic needs, and the surplus is
exported. Diesel oil industry realized
significant production increases from
21.6 million barrels in 1390/91 (1970)
to 227.7 million in 1430/31 (2009), an
average annual growth rate of 6.2%. Jet
fuel and kerosene production realized
an average annual growth of 2.9%,
rising from 20.6 million barrels to 63.5
million barrels during the same period.
Production of liquefied petroleum gas
dropped at an annual rate of 0.7% while
production of gasoline and naphtha
increased at an average annual rate of
8.3% and 1.9% respectively during that
period, and the production of fuel oil
rose at an average annual rate of 0.9%.
82
3.4.6 DOMESTIC CONSUMPTION OF
REFINED PRODUCTS AND
NATURAL GAS
Domestic
energy
consumption
increased at an average annual rate of
10.2% from 26.1 million barrels in
1390/91 (1970) to 1.2 billion barrels in
1430/31 (2009). The share of
consumption of refined products,
excluding natural gas, constituted
59.5% while the share of natural gas
was 40.5%. During the same period,
domestic consumption of gasoline
increased at an average annual rate of
8.9% from 5.2 million barrels to 145.1
million. Jet fuel consumption increased
from 1.4 million barrels to 22.2 million.
Fuel oil consumption by industries
increased about 61-fold, from 7.4
million barrels to 450.5 million.
Total domestic consumption of refined
products (excluding consumption by
the oil industry) rose at an average
annual rate of 11.4%, from 15.5 million
barrels to 1,035.4 million.
3.5
WATER DESALINATION
AND PROVISION OF DOMESTIC
CONSUMPTION NEEDS
From the very beginning, development
plans included policy objectives and
measures to ensure sufficient water to
citizens, the economy and society.
Desalination was thus one of the most
important sources tapped to fulfill the
increasing need for water resulting
from rapid economic growth, higher
living standards and expansion of urban
areas. Since the start of the First
Development Plan in 1390/91-1430/31
(1970-2009), water consumption has
increased at an average rate of 13.2%
annually.
The
great
attention
paid
by
development
plans
to
water
desalination was not limited to
household consumption but also
covered industrial and agricultural uses.
Development plans, therefore, paid
special attention to regulating water
consumption in agriculture since this
sector is a major consumer of water.
During the first three development
plans, from 1390/91 (1970) to 1404/05
(1984),
water
production
from
desalination plants increased from 5.12
million US gallons per day to 413.15
million. Ten years later, in 1415 (1994),
83
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
production capacity reached 508.3
million, and during the fifth year of the
Eighth Development Plan 1430/31
(2009) it reached 737.18 million.
The Kingdom has a large number of
desalination plants along its coasts. The
capacity of the two plants in Jubail
amounts to 293.17 million US gallons
per day. The capacity of the two plants
supplying water to Madinah and Yanbu
is 86.47 million US gallons per day
while the capacity at Jeddah, AlKhobar,
Makkah/Taif and Aseer is 98.14,
107.69, 108.62, and 24.77 million US
gallons per day respectively. The
capacities of the smaller plants in Al
Wajh, Dhuba, Al Khafgi, Umlajj,
Farasan, Hagl, Rabigh, Al Baraq and
Qunfithah amount to 18.32 million US
gallons per day. The total combined
capacity easily satisfies the needs of
most of the Kingdom.
Given the vital importance of water,
successive development plans stressed
the need to support scientific research
and technological innovations in water
desalination. The development plans
also stressed the need to raise the skills
of nationals to manage this sector in
order to reduce the cost of investment
and operation.
84
CHAPTER FOUR
INDUSTRIAL
DEVELOPMENT
85
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
86
INTRODUCTION
The Kingdom’s industrial sector made
considerable progress over the past
thirty-eight
years,
thanks
to
development plans inspired by the
diversification strategy in general, and
the development of the country's
industrial sector in particular. In order
to achieve the objectives of this
strategy, large allocations were made to
industrial
projects,
particularly
manufacturing
industries
(petrochemicals and oil refining). The
Kingdom's
significant
industrial
progress has, in turn, led to an increase
in the GDP and has generated hundreds
of thousands of jobs. Industrial
production has also contributed to
boosting exports and helped to satisfy
domestic
demand
for
various
manufactured products.
In 1430/31 (2009), the value added of
the Kingdom's manufacturing sector
was estimated at SR 105.9 billion,
equivalent to 12.6% of the country's
GDP at constant prices of 1419/20
(1999). The significance of this
considerable progress becomes more
apparent when one compares the
sector’s value added to what it was
back in 1389/90 (1969): SR 8.3 billion,
with a 5.3% share in real GDP.
A key contributor to this progress has
been the significant increase in the
value of physical investment (fixed
capital
formation)
in
other
manufacturing industries: it rose from
SR 0.074 billion in 1389/90 (1969) to
SR 12.5 billion in 1430/31 (2009).
Investment in petrochemical industries
was estimated at SR 24.1 billion in
1430/31 (2009), equivalent to 26.8% of
the sector’s total investment, compared
to 27.5% in 1389/90 (1969).
Oil refining holds a significant position
in manufacturing. In 1430/31 (2009),
its value added stood at SR 22.4
billion, compared to SR 5.3 billion in
1389/90
(1969).
Petrochemical
industries also represent a significant
share of
manufacturing
output,
generating SR 13.9 billion in 1430/31
(2009) at constant prices of 1419/20
(1999), compared to SR 0.3 billion in
1403/04 (1983).
Value
added
of
the
whole
manufacturing sector went up from SR
10.3 billion in 1390/91 (1970) to SR
15.2 billion at the end of the First Plan,
and reached 20.8 billion by the end of
the Second Plan. The sector continued
its impressive performance throughout
the subsequent development plans. Its
value added increased continuously
from the end of the Third Development
Plan until the end of the Seventh
87
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
Development Plan as well as during the
Eighth Development Plan. The sector
realized a real average annual growth
rate of 6.6% over the period 1390/911430/31 (1970-2009), a rate higher than
that of the GDP.
Value
added
of
petrochemical
industries, which stood at SR 0.71
billion in the last year of the Third Plan
(1984), increased to SR 4.95 billion in
the last year of the Fourth Plan.
However, it followed a downward trend
during the Fifth Development Plan
where it reached SR 3.45 billion by the
end of the Plan. It then started rising
again to SR 6.0 billion in 1419/20
(1999), SR 8.95 billion in 1424/25
(2004), the last year of the Seventh Plan
88
and SR 13.9 billion in the last year of
the Eighth Plan.
Value added of oil refining increased
from SR 6.98 billion in the first year of
the First Plan to SR 7.4 billion in the
last year of that plan. Its contribution
to GDP continued to rise over the
duration of subsequent development
plans where it reached SR 9.44 billion
and SR 10.83 billion in the last years of
the Second and Third Development
Plans respectively. During the period
from the Fourth to the Seventh Plan
(with the exception of only a few years)
the value added of oil refining resumed
its upward trend as it rose from SR 15.1
billion in 1409/10 (1989) to SR 17.1
billion in 1414/15 (1994), SR 18.02
billion at the end of the Sixth
Development Plan, and SR 21.6 billion
in 1424/25 (2004), the last year of the
Seventh Plan. In the last year of the
Eighth Plan it reached SR 22.4 billion.
Other manufacturing industries, which
include metals, food, building materials
and clothing, witnessed an upward
trend, with their value added at constant
prices of 1419/20 (1999) rising from
SR 3.3 billion in the first year of the
First Plan to SR 7.9 billion in the last
year, SR 11.3 billion in the last year of
the Second Plan 1399/1400 (1979), and
SR 20.8 billion in the last year of the
Third Plan 1404/05 (1984). During the
Fourth Plan it fell to SR 18.6 billion in
1409/10 (1989) then resumed its
upward trend during the successive
plans and reached SR 25.6 billion in
1414/15 (1994) and SR 38.8 billion by
the end of the Sixth Development Plan.
During the Seventh Plan, it rose to SR
50.7 billion in 1424/25 (2004) from SR
41.03 billion in 1420/21 (2000). In the
fifth year of the Eighth Plan, value
added of these industries reached SR
69.6 billion.
Overall, growth in value added of these
industries averaged 8.2% per annum
during the period 1389/90-1430/31
(1969-2009), compared to 3.6% for oil
refining.
By
comparison,
petrochemicals grew at an average
annual rate of 16.6% during the period
1403/04-1430/31 (1983-2009).
The value of physical investment
(Fixed
Capital
Formation)
in
petrochemical industries in 1430/31
(2009) reached SR 24.1 billion. In oil
refining, investment increased from SR
37 million in 1389/90 (1969) to SR
439.8 million during the First Plan, and
to SR 4385 million by the end of the
Second Plan. It then rose to SR 10.7
billion by the end of the third Plan, then
decreased to SR 9.2 billion during the
Fourth Plan. It then rose again to SR
11.3 billion in the Fifth Plan, then
posted a three-fold increase to SR 33.7
billion during the Sixth Plan. In the
Seventh Plan the value of physical
investment in oil refining almost
doubled, amounting to SR 60.1 billion.
It rose again to SR 198.52 billion
during the Eighth Plan. The cumulative
total investment in oil refining over the
past forty years amounted to SR 328.4
billion, an annual average growth rate
of 19.9%.
Financial capital invested in the
industrial sector financed several
national, joint and foreign factories.
Their number increased from 199
factories with a total capital of SR 2.8
billion in 1390/91 (1970) to 4513
89
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
factories in 1430/31 (2009) with a total
capital of SR 394.1 billion. Total
employment in these factories increased
from 13,900 to 503,500 workers over
the same period. On the other hand, in
90
1430/31 (2009) the number of foreign
and joint venture factories reached 527
or 11.7% of the total number of
factories, with total investment of SR
132.3 billion or 33.6% of total capital
invested in all factories, employed
90,700 or 18% of the total workers
employed in the industrial sector.
In its attempt to support industrial
development and provide it with
advanced technology to make it more
competitive in foreign markets by
promoting and attracting direct foreign
investment, the Council of Ministers
issued Resolution No. (2) on 5/1/1421
(2000) for the establishment of the
Saudi Arabia General Investment
Authority (SAGIA). It also issued
Resolution No. (1) on 5/1/1421
pertaining to the approval of the New
Foreign Investment Act, which aims at
removing
constraints, streamlining
procedures, facilitating issuance of
licenses, and approval of visas and
residence permits by establishing a
"one-stop shop" system. This includes
representatives from all government
agencies
dealing
with
foreign
investment. The new law also provides
many other incentives such as
ownership of real estate, increased tax
holidays, easier sponsorship rules as
well as giving the licensed investment
project all privileges and guarantees
granted to national projects.
One unique factor of industrial
development in the Kingdom has been
the establishment of industrial cities,
which contributed to providing the
basic infrastructure and services needed
for industries, including roads and
91
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
telecommunications networks, seaports
and airports to enhance competitiveness
of national products in domestic and
foreign markets.
One milestone in the Kingdom's
industrial development has been the
establishment of the Saudi Basic
Industries Corporation (SABIC). The
total value of SABIC's sales amounted
to SR 20.95 billion in 1420/21 (2000)
and increased to SR 78 billion in
1425/26 (2005) and to SR 103 billion in
1430/31 (2009).
Another important achievement in oil
refining was the increase in production
capacity from 512,000 barrels per day
in 1390/91 (1970) to 1.47 million in
1410/11 (1990), and 2.1 million in
1427/28 (2007). In general, the value
added of oil refining grew at an average
annual rate of 3.7% over the period
1390/91 -1430/31 (1970-2009).
Many other national industries achieved
significant growth as well. Cement
production increased from 667,000 tons
in 1390/91 (1970) to 32.0 million tons
in 1430/31 (2009), an average annual
growth rate of 10.4%. Chemical
fertilizers increased from 24,400 tons to
6.5 million tons during the same period,
an average annual growth rate of
15.4%.
92
Overall, the importance of these
achievements is reflected in the
increased volume, value and variety of
the Kingdom’s industrial exports, and
the increased competitiveness of these
exports in both the domestic and
foreign markets.
4.1
PRIVATE SECTOR AND
INDUSTRIAL
DEVELOPMENT
Through their objectives, policies and
projects, the successive development
plans have increasingly emphasized the
continuing support of the private sector
as a cornerstone of economic
development. This approach also helps
the country diversify its production
base as well as its revenue sources. In
addition, the private sector can play an
important role in stepping up
investments,
modernizing
and
promoting production activities and
raising economic efficiency with
rational utilization of resources.
The positive contribution of the private
sector in industrial development is
evident from the number of operating
factories in the Kingdom and the
development of these factories over the
past forty years. The number of such
factories reached 4,513 in 1430/31
(2009) with a total capital of SR 394.1
billion compared to 199 factories with a
capital of SR 2.8 billion in 1390/91
(1970). This mirrors the increased
significance of the sector in the
country’s national economy, with the
increase in its share in real GDP to
57.3% in 1430/31 (2009) from 33.2% in
1390/91 (1970).
4.2
INDUSTRIAL
INFRASTRUCTURE
The successive development plans have
adopted a comprehensive, integrated
vision to accelerate industrial growth
rates and transform the industrial sector
into a leading player in the country’s
economic development process. To
achieve this strategic objective, the
government
embarked
on
the
establishment of integrated industrial
cities as part of a strategy that takes into
account industrial diversification, the
geographical distribution of industrial
development hubs, and the availability
of material resources and sources of
wealth. This strategic directive, which
made available the required highquality infrastructure and public
services, helped to encourage industrial
investment in the Kingdom and made
its industrial cities attractive centers
which stimulate national and foreign
industrial investments.
Establishment of large industrial cities
in Jubail and Yanbu was a landmark in
industrial development. These cities
provided the necessary infrastructure
for hydrocarbon and basic industries, as
well as for related secondary and downstream industries. As a result, the
foundations of a strong industrial sector
were established. Components of the
industrial sector were strongly linked
with the other sectors of the national
economy
through
forward
and
backward linkages which contributed to
the
acceleration
of
sustainable
development.
The substantial scope of this
achievement is reflected in the fact that
total investment expenditure for the
establishment of industrial cities
reached SR 2.2 billion through 1428/29
(2008). These massive resources were
utilized to establish 14 industrial cities
with a total area of 92.1 million square
meters, of which 52.6 million square
meters were developed and equipped
with core facilities and public services
needed to establish factories. These
industrial cities were established in the
regions of: Riyadh (the first and
second), Jeddah, Damman (the first and
second), Qassim, Al-Hasa, Makkah,
Madina, Aseer, Al-Jouf, Tabouk, Hail,
and Najran.
Utilization rates of the allocated areas
93
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
in some of the existing industrial cities
have reached 100% for each of Riyadh,
Jeddah, Makkah and Dammam-first
city and 67% for Dammam-second city.
Utilization rates for Qassim, Al Hasa
and Aseer reached 95%, 95% and 40%
respectively.
Work is under way to finalize the
necessary plans for the establishment of
industrial estates in an integrated and
balanced manner throughout the
Kingdom.
In its effort to enhance the private
sector’s contribution to the national
economy,
including
privatization
policies, the Council of Ministers
issued Resolution No. 57 dated
28/3/1420 (1999) stipulating the
establishment of a Saudi Joint-Stock
Company for Services in Jubail and
Yanbu industrial cities, to undertake all
operation,
maintenance
and
management tasks as well as expansion
and construction of
infrastructure
facilities in the two cities. The Council
of Ministers also issued Resolution No.
235 dated 27/8/1422 (2001) approving
the creation of the Saudi Organization
for Industrial Estates and Technology
Zones (SOIETZ) in order to encourage
the private sector to establish, manage,
operate and maintain industrial cities
94
and to grant licenses to developers and
operators of these cities in accordance
with SOIETZ’s bylaws.
Industrial development efforts in the
Kingdom have borne fruit. Key among
such achievements were the basic and
petrochemical industries established by
the Saudi Arabian Basic Industries
Corporation (SABIC), which has
become a key contributor to GDP
growth. SABIC is also playing a
growing role in increasing the volume
of national exports. Equally significant
has been the role of the Saudi Arabian
Mining Company (MA’ADEN). This
company was created to utilize non-oil
mineral resources as a source of
national income, and to provide raw
materials necessary for industrial
projects. It has been contributing to the
establishment of new industries and
making use of resources in which the
Kingdom has a comparative advantage
and transforming them into competitive
advantages in domestic and foreign
markets.
The Saudi economy now possesses a
key pillar for industrial development
represented by Saudi ARAMCO, which
has been fully-owned by the Kingdom
as of 1400 (1980). Saudi ARAMCO
replaced the Arabian American Oil
Company, which was established in the
1940s, to undertake concession works
in the oil sector.
During the past few decades, and in
order
to
enhance
industrial
development in the Kingdom, many
plans for educational, academic,
research and training institutions have
produced
qualified
and
trained
manpower for industrial development.
King Abdul Aziz City for Science and
Technology (KACST) stands as a
landmark of such achievement. KACST
was established as per the Royal Decree
No. M/60 issued on 18/2/1397 (1977)
as an autonomous scientific body
reporting to the Prime Minister. The
Industrial Colleges at Jubail and Yanbu
have been established to meet the
industry’s need for qualified and
trained manpower. These colleges
contribute to the acquisition of
advanced industrial technology and link
the industrial and production facilities
with these centers.
The history of industrial development
in the Kingdom reflects the attention
given by development plans not only to
the provision of basic infrastructure,
but of financial resources necessary for
industrial investment. These resources
were key to setting up new industrial
projects owned by the private sector
and boosting its ability to enhance its
investments. The Saudi Industrial
Development Fund (SIDF) provided
loans to industrial projects totaling SR
69.2 billion during the period 1394/95
(1974) through the end of 1430/31
(2009). These loans have contributed to
the establishment of 1,779 industrial
projects in the Kingdom.
The creation of the Saudi Arabian
General
Investment
Authority
(SAGIA), along with the issuance of
the investment code which offers
privileges, exemptions and incentives
to encourage foreign investors, also
played a significant role in the
development of the industrial sector
and in boosting its competitiveness in
domestic and foreign markets.
4.3
THE TWO INDUSTRIAL
CITIES OF JUBAIL AND
YANBU
The twin industrial cities of Jubail and
Yanbu are considered as strategic sites
for hydrocarbon industries and energyintensive basic industries. They were
set up to ensure utilization of the
Kingdom’s natural resources with
maximum economic efficiency. As
expected, the basic industries that were
established have resulted in the
development of a series of secondary
and downstream industries. Production
95
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
of these factories is targeted to meet
over 7% of world demand for
petrochemicals.
Long experience indicates that the
responsibility of developing basic
industries in Jubail and Yanbu falls
mainly on SABIC, Sausi ARAMCO
and a select number of private
companies.
km by the end of 1430/31 (2009), and
the capacity of sewerage and industrial
wastewater treatment networks reached
114,000 cubic meters per day (42,000
for the wastewater treatment plant and
72,000 for the sewerage treatment
plant). The length of the sewerage
network reached 935 kilometer.
The infrastructure of the Jubail
industrial city covers an area of 1,016
square km and its population was
estimated at around 105,000 by the end
of 1430/31 (2009). Jubail industrial city
has become ready to accommodate
more basic, secondary and supporting
industries. Vast areas of land were
leveled. Residential quarters were
established for employees and about
17,600 residential units were built, of
which about 12,000 housing units were
constructed by the private sector.
The Royal Commission has installed an
electricity network with a length of
3,917 km and the Saudi Electricity
Company (SEC), Eastern province, is
supplying power. A system of
telephone exchanges with a total
capacity of 60,000 lines was also
completed and 27,469 telephone lines
were installed, and the network length
reached about 403 km. Infrastructure
was completed with the construction of
961 km of main and express roads and
an airport including 4,650 square
meters of terminals and tourist
facilities. Currently, there are 23 berths
at the industrial seaport.
In order to make this industrial city
self-sufficient
in
basic
needs,
particularly in water, adequate funds
were allocated to increase the
productive
capacity
of
water
desalination plants to 287,000 cubic
meters per day. The length of the main
water network reached around 1,091
With respect to the provision of
necessary health care to the city’s
population, 3 hospitals were established
in addition to 3 dispensaries and clinics,
and 3 primary health care centers,
which are now in operation.
Furthermore, 41 mosques as well as 20
Friday congregation mosques have
4. 3.1 Jubail Industrial City
96
been constructed.
Within the context of manpower
development and the provision of the
necessary skills needed for anticipated
industrial development, the Jubail
Technical College was set up, the
number of graduates reached 4,532
through 1430/31 (2009), and several
schools for boys and girls were
operating (including 25 kindergartens,
25 primary, 12 intermediate, and 8
secondary schools and 3 schools for
non-Saudis).
By the end of 1430/31 (2009), a large
number of plants were operational: 22
basic industry complexes (undertaken
by SABIC and Saudi ARAMCO), 28
plants in secondary industries (using
products of basic industries) and 172
plants in support and light industries.
network of 547 km; a sewerage
treatment plant with a capacity of
27,000 cubic meters per day in the
residential area; a wastewater treatment
plant with a capacity of 24,000 cubic
meters per day; and a wastewater
network of 538 km. The capacity of
cooling water plants increased to
580,000 cubic meters per hour. In
addition, electricity generation capacity
at the Electricity and Water Plant rose
to 761 megawatts and the length of the
power distribution network reached 744
km. Finally, the length of the city's road
network totaled 525 kilometer.
As in Jubail, a large number of
industrial plants were operational by
1428/29 (2008): 14 in basic industries,
18 in secondary industries and 52 in
light and supporting industries.
4.4
4.3.2 Yanbu Industrial City
Construction of Yanbu Industrial City
and its modern residential facilities on
an area of 185 square km has been
completed.
By the end of 1430/31 (2009), 19,845
housing units (including rooms for
laborers) were completed. The city has
a storage capacity of 400,000 cubic
meters of water for drinking and
industrial purposes; a water distribution
INDUSTRIAL
DEVELOPMENT PILLARS
IN THE KINGDOM
Over the past thirty-eight years,
development plans succeeded in
establishing a firm base for industrial
development in the Kingdom with three
majors pillars: the petrochemical,
mining and oil industries. These
industries produce good quality and
competitive products that have made
considerable contributions to national
97
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
production and exports. Management
and development of these industries are
undertaken by three giant national
corporations: the Saudi Basic Industries
Corporation (SABIC), the Saudi
Aramco Oil Corporation (Saudi
ARAMCO) and the Saudi Arabian
Mining Corporation (Ma’aden). All
three enjoy a prestigious position in the
national economy in terms of
production
volume,
international
reputation, quality of their products and
the advanced level of technology they
use. In fact, these industries serve as an
example of the success of the
development plans and its policies to
accelerate and diversify industrial
development.
resources of hydrocarbons and minerals
(particularly natural gas) to maximize
value added to the economy.
4.4.1 Saudi Arabian Basic
Industries Corporation
(SABIC)
In terms of industrial and marketing
cooperation, particularly with GCC
countries, SABIC has a 20% share in
the Bahrain Aluminum Company
(ALBA) and a 31.3% share in Gulf
Aluminum Rolling Mill Company
(GARMCO). It also owns one-third of
the Gulf Petrochemical Industries
Company (GPIC), and has a share of
25% in Energy and Water Company for
Jubail and Yanbu (MARAFEG) which
supplies energy and water to the two
industrial cities, in addition to 20% of
Betlin Company and 16.67% of ARG
Company.
SABIC was established in 1396 (1976)
with a paid-up capital of SR 10 billion,
of which 70% was owned by the Saudi
government and 30% by Saudi and
other GCC citizens. SABIC’s capital
was later raised to SR 30 billion. The
extensive industrialization program
undertaken by SABIC is considered a
milestone in the Kingdom’s industrial
development process, especially in the
area of basic, downstream and support
industries which utilize the local
98
By the end of 1428/29 (2008), SABIC
was operating 17 world-class industrial
companies in Jubail and Yanbu, most
of which were joint ventures with
international companies such as Shell,
Exxon-Mobil, Mitsubishi Chemicals,
etc. In 1430/31 (2009), SABIC’s actual
production amounted to 58.5 million
metric tons of basic chemicals,
intermediate chemicals, fertilizers,
metals and polymers. Manpower
employed by SABIC and its subsidiary
companies totaled about 33,000
employees of whom 87% are Saudis.
Box (4.1): SABIC's subsidiary companies
at Jubail and Yanbu
Saudi Iron and Steel Company (HADEED);
Saudi Methanol Company (ARRAZI);
Jubail
Fertilizers
Company
(ALBAYRONI); Saudi Yanbu Petrochemicals
Company
(YANPET);
Jubail
Petrochemicals Company (KEMYA); Saudi
Petrochemicals
Company
(SADAF);
National Methanol Company (IBN SINA);
Arabian
Petrochemicals
Company
(PETRO-KEMYA);
Eastern
Petrochemicals Company (SHARQ); Saudi
Arabian Fertilizers Company (SAFCO);
National Chemical Fertilizer Company
(IBN AL BAYTAR); National Plastics
Company (IBN HAYYAN); National
Industrial Gases Company (GAS); Saudi
European Petro-chemical Company (IBN
ZAHR);
Arabian
Synthetic
Fibers
Company (IBN RUSHD), and Yanbu
National
Petrochemical
Company
(YANSAB), Saudi Kayan Petrochemical
Company (SAUDI KAYAN) and Jubail
United
Petrochemicals
Company
(UNITED).
SABIC continues to promote relations
with consumers of its products in over
100 countries around the world., and is
always keen to explore promising
external industrial opportunities that are
consistent
with
its
domestic
investments and which enhance its
competitiveness. By the end of 1426/27
(2006), SABIC ranked 10th among the
world's
largest
petrochemical
companies. Its production accounted
for 7% of world petrochemicals
production. In 1430/31 (2009) its total
sales reached about 46.3 million metric
tons valued at SR 103 billion.
SABIC consists of six strategic
business units: basic and intermediate
chemicals; polyolefins; PVC, polyester;
fertilizers and metals. Its exports
reached more than 100 countries in
1427/28 (2007): 40% to Asia, 28% to
Middle East, 28% to Europe and 10%
to other countries.
4.4.2 Petroleum and Natural
Gas Reserves
Drilling processes and exploration of
oil and gas fields conducted by oil
companies operating in the Kingdom
continued in different areas with
drilling of deep wells in search of new
deposits of crude oil and natural gas. As
these drilling processes discovered oil
and natural gas in a number of wells,
Saudi Aramco went ahead with further
exploration. These efforts continued
through the Eighth Development Plan
and resulted in maintaining the proven
reserve level of crude oil amounting to
259.9 billion barrels in 1428/1429
(2008) and about 264.6 billion barrels
in 1430/31 (2009). Moreover, natural
gas reserves increased from 257 to
99
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
279.7 trillion cubic feet during that
period, with the natural gas produced
amounting to 14.3 trillion cubic feet. In
1430/31 (2009) Saudi Aramco drilled
293 wells in the dry and flooded area of
which 204 and 89 were oil and gas
wells respectively, and drilled 23
exploratory gas and oil wells.
The number of discovered oil and gas
fields by Saudi Aramco by the end of
1430/1431 (2009) reached 105 fields as
14 new fields were discovered (6 oil
and 8 gas fields) during the period
1424/1425 (2004) to 1430/1431 (2009).
Exploration and prospection activities
focused on deposits containing nonassociated natural gas.
of 49 production and exploration wells.
By the end of 2009 Chevron's reserves
amounted to 1.861 million barrels of
crude oil and 684 billion cubic feet of
gas.
By the end of 2009 the Kingdom's
remaining crude oil reserves amounted
to 264.590 million barrels, and the
remaining natural gas 279.67 billion
cubic feet distributed as follows:
Company
Saudi Aramco
Aramco for Gulf
Works Co.
Chevron
Saudi
Arabian Co.
Total
On the other hand, Aramco for Gulf
Works Ltd. continued its work in the
areas of exploration and development.
During 2009 the company drilled 8
production and developmental wells in
AlKhafji field. By the end of that year,
the company's reserve reached 2.663
million barrels of crude oil and 3.809
billion cubic feet of gas.
Chevron Saudi Arabia conducted
studies using two- and threedimensional seismic data on some
fields of the concession area. During
2009, the company completed drilling
100
Remaining
gas reserve
(billion
cubic feet)
257,177
3,809
Remaining oil
reserve
(million
barrels)
260.066
2,663
Remaining gas
reserve (billion
cubic feet)
684
1,861
338
279,67
264,590
257,954
Production
Oil companies operating in the
Kingdom made use of innovated
technologies to increase oil production
and transport it to all parts of the world.
In 2009 Saudi Aramco maintained its
distinguished position as the largest oil
producing company in the world: its
average production reached 8.2 million
barrels per day and its production
capacity of 12.0 million barrels per day
was maintained throughout the year.
Production of natural gas continued to
increase
during
the
Eighth
253,789
3,827
Development Plan, reflecting its
growing role in the economy: from
68.9 billion cubic feet in 1424/1425
(2004), it increased to 89.61 billion
cubic feet in 1430/1431 (2009), an
average annual growth rate of 5.4%.
The annual production of Chevron
Saudi Arabia in the neutral zone
amounted to 46.2 million barrels of
crude oil and 15 billion cubic feet of
gas, representing 50% of total
production.
Refining and Distribution:
In 1430/1431 (2009), the overall
refining capacity of the seven refineries
in the Kingdom amounted to 2.1
million
barrels/day
with
Saudi
Aramco's share amounting to 1.7
million barrels/day, including the
company's share in refineries of joint
local projects. The average quantity of
crude oil refined in local refineries,
including Saudi Aramco's share in local
joint refining projects, increased to
1.149 million barrels/day.
Box (4.2): Main Operators in Oil and Natural Gas
1. Saudi Aramco:
The story of Saudi Arabian Oil Company (Saudi Aramco) dates back more than 76 years, to 4 th Safar
1352H corresponding to 29th May 1933, i.e. less than one year after the unification of the Kingdom by
the late King Abdul Aziz. The Government of Saudi Arabia and Standard Oil of California (then
SOCAL and presently Chevron) signed the basic concession agreement for oil exploration in the
Kingdom. SOCAL transferred the concession to one of its affiliated companies, California Arabian
Standard Oil (ASOC), and later on its name was changed to Arabian American Oil Company
(Aramco). In 1973, the Saudi Government acquired a share of 25% which was increased to 60% in
the following year. In 1980 the Kingdom retroactively gained full ownership of ARAMCO back to
1976 by purchasing all its remaining assets. In Rabi II 1409 (November 1988), the Arabian Saudi Oil
Company (Saudi Aramco) was established by royal decree to undertake the administrative and
operational functions carried out earlier by Aramco.
2. Aramco for Gulf Works Ltd.
Saudi Aramco established Aramco for Gulf Works Ltd. at the beginning of 2000 with its head office
in Riyadh to replace the Arabian Oil Company Ltd. whose concession ended on 27th February 2000.
3. Chevron Saudi Arabian Company:
Chevron Saudi Arabian Company operates in the neutral zone between the Kingdom and the State of
Kuwait under a concession agreement concluded with the Kingdom.
101
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
Box (4.3): Saudi Aramco’s Oil and Gas Joint Ventures
Operating Within the Kingdom:
1. Saudi Aramco-Shell Refinery Company (SASRIF):
The company is located in Jubail, and both Saudi Aramco and Shell enjoy equal ownership.
Operation started in 1985 with a total production capacity of 305 thousand barrels/day. The
refinery comprises two crude oil distillation units, an aromatic benzene unit, a platinum
purification unit and lately the gas oil production unit by thermal crashing.
2. Saudi Aramco-Mobil Company Ltd.:
The company is located in Yanbu Industrial City. Saudi Aramco and Exxon Mobil share equal
ownership. The company started operation in 1984 and refines 400 thousand barrels of light
Arabian oil per day. The major operations include the purification of naphtha to improve benzene,
the transformation of heavy materials into benzene and diesel, and the production of ether tri-butyl
methyl for the production of additional olefins from liquefied petroleum gas to be mixed with
benzene in addition to lessening heavy fuel oil viscosity.
3. PETRO Rabigh:
The company was established in 2005 as a joint project between Saudi Aramco and Somitomo
Chemical with (50:50) ownership and a capital of SR 8.76 billion. PETRO Rabigh is located on the
Red Sea covering an area of 3 thousand acres and has a production capacity of 400 thousand
barrels of crude oil per day in addition to 95 million cubic feet of Ethane and 15 thousand barrels
of butane. The PETRO Rabigh project consists of 23 units which annually produce 18.8 million
tons of petroleum-based products along with 2.4 million tons of ethylene and propylene derivatives
per year.
4. Saudi Aramco Lubricating Oil Refining Company (Luberif):
Under a royal decree, Luberif was established in 1975 as a joint project between Petromin (70%)
and Exxon Mobil (30%). In 1996 Petromin's share was transferred to Saudi Aramco. In 2007,
Exxon Mobil sold its share in Luberif to Jadwa Company for Industrial Investment. Luberif
produces four base oils which are mixed and transformed into lubricating oil. Base oils produced
by Luberif are used in various lubricating oils made in the Kingdom.
Operating Outside the Kingdom:
In 1428/1429 (2008), the number of international refining and marketing projects in which the
Kingdom participated reached four, with an overall refining capacity of 1.9 million barrels/day and
the Kingdom's average share amounting to 35%, i.e. 665 million barrels per day:
- Motiva Enterprise (USA), Kingdom’s share: 50%, refining capacity: 740,000 b/day
- S. Oil (South Korea), Kingdom’s share: 35%, refining capacity: 565,000 b/day
- Showa Shell (Japan), Kingdom’s share: 15%, refining capacity: 515,000 b/day
- Fujian (China), Kingdom’s share: 25%, refining capacity: 80,000 b/day
102
Gas Projects:
The Ministry of Petroleum & Mineral
Resources, in collaboration with Saudi
Aramco, concluded agreements with
international petroleum companies for
the exploration, prospection and
production of non-associated gas in the
Empty Quarter area. In addition to
signing an agreement with each of Shell
Exploration Company and Total
Fincher Saudi Arabian Company in the
southern part of the Empty Quarter on
21st Ramadan 1424H (15th November
2003), three other agreements were
signed on 16/1/1425H (7th March 2004)
with Russian, Chinese, Italian and
Spanish companies for each area in the
Northern part of the Empty.
4.4.3 Saudi Arabian Mining
Company (MA'ADEN)
The Saudi Arabian Mining Company
(MA'ADEN) was established as a jointstock company by the Royal Decree
No. M-17 dated 14/11/1417H (March
23, 1997). The company's capital was
increased to SR 9,250 million as per the
resolution of the Council of Ministers'
No. 49 dated 25/2/1429H, distributed
over about 925 million shares at a value
of SR 10 per share. Government
agencies representing the State own 64
percent of total shares, distributed
between the Public Investment Fund
which owns 50 percent, the General
Organization of Social Insurance which
owns 8 percent, and the Public
Pensions Fund which owns around 6
percent. The remaining 36 percent of
the shares are owned by the public.
MA'ADEN aims at establishing a
world-class company that carries out
different mining activities related to all
mining
stages
including
the
development and improvement of
mining industry and its products and
derivatives together with all related
industries. In order to successfully
achieve its goals, the company gives
utmost care to human resources, health,
safety and environmental issues.
To date, Ma'aden’s focus has been on
gold. The company's gold assets
include five operating mines, the latest
of which went into production in
January 2008. Gold production of the
four operating mines in 2009 amounted
to 156,200 ounces and production of
silver amounted to about 242,000
ounces. Ma'aden also produced limited
commercial quantities of copper and
zinc concentrates, which amounted to
about 1,700 tons of copper percentages
and 5,900 tons of Zinc concentrates.
In 1998, Ma'aden obtained an
exploration license in Ad Duwaiyhi, a
site with mineralization prospects.
103
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
Intensive exploration was carried out
under the license, leading to discovery
of a significant gold deposit by the end
of 2003.
Over the past few years, Ma'aden has
identified six advanced exploration
projects involving Ad Duwayhi, Zulim,
Mansourah and Masarrah. Initial
estimates of material carried out so far
point to the availability of some 7.93
million ounces in these areas. Ma'aden
intends to allocate significant resources
(including capital) over the next few
years in order to conduct technical and
economic feasibility studies. The
objective is to assess economic and
technical feasibility in order to exploit
resources of the middle gold sector, and
to achieve the company's strategic
objective of achieving a significant
increase in its gold production.
Ma'aden expects to make significant
progress in gold trade. In addition,
successful development of aluminum
and phosphate projects will move the
company from being a minor gold
producer to becoming a world-class
mineral resources company.
All activities of Ma'aden are carried out
within the Kingdom. With the
exception of new projects, Ma'aden
104
does not intend to make any substantial
change in the type of activities it
currently undertakes, which (in addition
to gold) focus on three major projects:
the
phosphate,
aluminum
and
infrastructure projects.
Phosphate Project:
This project aims at exploiting
phosphate deposits located in Al
Jalamid site and utilize local natural gas
and sulphur resources to manufacture
Di-ammonium
Phosphate
(DAP).
Processing facilities at the Ras Az Zawr
have also been designed with the
flexibility
to
produce
MonoAmmonium Phosphate (MAP), should
production of MAP be considered more
economically viable. DAP produced by
this project will be sold primarily in
international markets. It is anticipated
that the project will also produce
quantities of ammonia and phosphoric
acid not required in the production
process, which can be exported or sold
domestically.
The phosphate project comprises
operation of mining facilities at Hazm
Aljalameed and phosphate complex
facilities at Ras Az Zawr on the
Arabian Gulf.
Aluminum Project:
This project aims at exploiting Saudi
Arabia's bauxite resources in Al Zabira
to produce aluminum for domestic and
world markets. The project involves
development, design, construction and
subsequent operation of two integrated
sites:

Al Zabira site, which consists of a
bauxite mine, ore cracking and ore
handling facility.

Ras Az Zawr aluminum complex,
which includes an alumina
refinery, an aluminum smelter and
a power generation plant.
Infrastructure project:
For a successful development and
operation of the phosphate and
aluminum projects, a railway and sea
port are planned: A railway,
approximately 1,486 km long, will link
phosphate mines at Al Jalamid and the
bauxite mine at Az Zebaira to the
processing facilities at Ras Az Zawr.
The railway development is being
undertaken by the Public Investment
Fund. Saudi Ports Authority will
construct a deep water port that can
receive vessels of up to 70,000 DWT.
The port will be used for import of ore
as well as for export of DAP, additional
ammonia and aluminum which will be
produced by the company's facilities at
Ras Az Zawr.
4.5
Other Dimensions of
Industrial Development
4.5.1 Saudi Geological Survey
(SGS)
The Saudi Geological Survey (SGS)
was established by the council of
Ministers' Resolution No. 115 dated
16/7/1420H. Attached to the Ministry
of Petroleum and Mineral Resources,
SGS is an autonomous body enjoying
full authority to attain its objectives. It
provides advice to the government and
the community through specialized
staff who are well trained in all areas of
earth sciences, application of advanced
technology, provision of sufficient
national mineral and water resources, as
well as protection of the environment
and control of all natural risks. SGS
carries out the following tasks:
- Conduct geological, geo-chemical,
geophysical, hydrological research
and exploration of mineral sources.
- Use of best practices in exploration
of mineral sources.
- Conduct pre-feasibility studies on
promising ores that support the
mining industry.
- Classification and evaluation of
geological information related to
mining sources, preparation of
reports and various geological maps
as well as other related maps to be
105
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
-
-
-
printed along with storage of
relevant data on computers.
Conduct research and studies,
provide consulting services related
to its tasks and activities to
government and private agencies.
Conduct survey and exploration
tasks to determine water sources,
identify water stock and define
quality and quantity of water which
could be extracted and determine
their validity for various purposes
in consultation with the Ministry of
Water and Electricity.
Conduct studies and research
necessary for monitoring potential
seismic and volcanic activities in
the Kingdom, investigate floods
resulting from storm water and sites
of landfalls, prepare maps regarding
risk levels of all types of disasters,
and prepare relevant historical
records.
During the Eighth Development Plan,
SGS made significant progress in many
areas, among them: geological surveys,
geochemical surveys, marine geology,
land surveys, metallic minerals
exploration,
industrial
minerals
exploration,
hydrogeology,
environmental geology, engineering
geology, geological hazards, and
earthquakes and volcanoes. Among the
most notable achievements are the
following:
106
 Completion of geological maps for
sedimentary rocks in the Kingdom's
continental shelf
 Issuance of the first version of the
Kingdom's digital map at the scale
of 1:1,000,000, and commencement
of work on the preparation of the
Kingdom's metallogenic map.
 Exploration and study of vertebrate
fossils and preparation of the
vertebrate fossils museum in the
Kingdom.
 Finalization of marine, geological,
geographical, hydrological and
environmental surveys for 7 coastal
areas along the Red Sea coast.
 Study of 50 sites for nickel at the
Arabian Shield and selection of 6
sites
representing
adequate
geological data about the existence
of nickel containing mass sulphate
deposits.
 Updating the manual of Costs of
Mining Industry Services in the
Kingdom.
 Re-evaluation of global existence
areas at AlJosan which include
about 280 sites at the Arabian
Shield.
 Evaluation of two sites for lime rock
and clay at Hail region (Aabar Al
Khadraa and Mushash Giwaimid),
study of one site for building rocks
at Harat Rahat (Jabal Banaa) and
economic
evaluation
of
the








sediments of silica and (sand rock)
at Jabal Al Shahiya.
Study of the mining and industrial
residues of quarries at Najran, Assir,
Al Madinah and Hail, and study of
industrial residues at Jubail and
Yanbu as well as residues of power
generation plants at Rabigh and
shuailbah.
Studying kaolin clay ore at Taniat,
feldsbar at Wadi Yaba and dolomite
at Arar.
Issuing a statistical yearbook.
Assessing
the
environmental
impacts of 8 sites in the Kingdom.
Studying desertification in the
south-western
region
and
identifying
desertification
indicators.
Preparing 6 multi-purpose geological engineering maps for the
cities of Dammam, Khobar,
Dhahran, Jubail, Jazan and Madinah
with a scale of 1:50,000; the solid
waste dumps in Riyadh area, in
collaboration
with
the
environmental geology agency and
Riyadh Municipality; the unstable
soil was studied in each of Butain
and Modraj in Qassem region.
Studying dangers of rain-water
floods of Wadi Laya (Jazan),
Damad (Jazan) and Atoub (Darb)
and Wadi Khulays.
Updating integration, installation,
re-orientation and reception of








seismic data in the main center of
43 seismic monitoring stations
affiliated with KACST, KSU,
KAAU, as well as identifying
locations
for
installing
and
operating 12 more stations affiliated
with SGS.
Studying the unstable soil in Al
Batin and Mudraj at Qassim region.
Monitoring volcanic activity by
measuring the gravity along two
lines with a length of 55 kilometers
at Harat Rahat.
Monitoring volcanic and thermal
activity at the vicinity of Harat
Rahat and Lunir.
Designing and establishing a
seismic database for the Kingdom
and neighboring countries.
Developing electronic applications
of climate database.
Preparing the geophysical atlas of
the Kingdom.
Preparing the aeromagnetic map of
the Kingdom.
Preparation of the Arabian Shield
geology book and the manual of
topography in the Kingdom.
Furthermore a book has been
published about the Saudi islands at
the Red Sea and the Arabian Gulf, a
book about the Empty Quarter and a
book
about
the
geological
development of the Kingdom in
English.
107
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
Figure 4.5
Distribution of Mineral Sites in the Kingdom
Source: Ministry of Petroleum and Mineral Resources.
108
4.5.2 King Abdul Aziz
City for Science and
Technology (KACST)
Planning Development of the
National Science, Technology and
Innovation System
The role of science and technology has
grown in the process of socio-economic
development, particularly in light of the
growing importance of service and
production
activities.
Production
technologies, for example, have
become a key factor in the achievement
of industrial competitiveness. From
early on, the Kingdom has emphasized
this role by establishing KACST during
its industrial renaissance. In its move
towards a knowledge-based economy,
the Kingdom gave further attention to
science and technology. Thus, the
development
plans
encompassed
objectives, policies and programs
advancing science and technology
activities in the country.
While implementing the National
Science and Technology Plan, KACST
developed a Plan for technologies and
innovation related to: water, gas,
petrochemicals, nano-technology, biotechnology,
genetic
engineering,
electronic
information,
telecommunications, optics, space,
aviation, energy, advanced materials,
environment, mathematics and physics.
KACST worked in many areas during
1430/31 (2009) including: research;
planning development of the national
science, technology and innovation
system; building national human
capacity; and transformation of
scientific research products into
commercial products. What follows
describes achievements in these areas.
Transformation of Scientific
Research Products into
Commercial Products
In association with the Ministry of
Economy and Planning (MOEP) and
other competent authorities, KACST
finalized development of the first
extensive five-year plan for the second
phase of the National Policy for
Science and Technology.
The approach adopted by KACST is to
establish technology incubators and
innovation centers to transform
scientific research outcomes into
commercial products and services. This
was done by collaborating with the
private
sector
in
establishing
companies to undertake production and
marketing of the new products. Two
such incubators were established:
109
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
 Badir CIT incubator, established in
cooperation with STC
 Biotechnology
incubator,
established in agreement with the
Ministry of Health.
Scientific Research
 KACST supported some 400
research projects in universities and
research institutes, through a budget
of more than SR. 500 million during
1430/31 (2009).
 KACST continued efforts to
encourage
applied
scientific
research through different research
grant programs. A total of 239
research projects were funded
costing about SR. 89.2 million
during 1430/31 (2009).
 KACST institutes and centers
undertook
advance
strategic
technology research, with an
allocation of SR 605.4 million in its
budget during 1430/31 (2009).
 These efforts led to the development
of more than 200 technology
products in five major technology
sectors.
In addition, KACST researchers have
designed and built an electrostatic
particles accelerator to be used in
several areas such as food preservation
by radiation, manufacturing of cables,
110
disinfection of medical products, and
manufacturing of carbon and fiberglass
enforced vehicles.
The National Laboratory for Quality
Assurance and Calibration of Radiation
Measurement Systems received an
accreditation from the International
Atomic Energy Agency and has been
recognized as a secondary regional
laboratory within the international
network of Secondary Standard
Dosimeters Laboratories.
KACST has also established a joint
center in space and aviation technology
with Stanford University.
National Capacity Building
KACST increased its contribution to
international scientific activity through
its staff participation in scientific
conferences, symposia and fairs
organized inside the Kingdom and
abroad. The number of participants in
these activities reached 270 employees
in 1430/31 (2009) compared with 251
employees in 1428/29 (2008).
KACST recognizes the critical role
played by intellectual property rights in
furthering
scientific
activities.
Accordingly, it has applied for 3,788
patents and was granted 1,782. It has
also applied for 1,860 industrial design
drawings and was granted 830
certificates.
4.5.3 PRESIDENCY OF
METEOROLOGY AND
ENVIRONMENTAL
PROTECTION
The Kingdom took a quantum leap in
meteorology
and
environmental
protection. This should come as no
surprise since the issue of environment
and its protection was endorsed in the
Basic System of Governance, as per
Article 32, which stipulates that the
government
is
committed
to
maintaining
and
protecting
the
environment.
The unlimited support of the
government to the agency responsible
for the environment (The Presidency of
Meteorology
and
Environmental
Protection) had a clear and palpable
impact in recognizing the importance of
the environment and the need to
maintain it.
The
Kingdom
established
the
Meteorology General Directorate in
1370 (1950), then restructured it in
1401 (1981) under the designation of
the Meteorology and Environment
Protection Department. In 1422 (2001)
it
became
the
Presidency of
Meteorology
Protection.
and
Environmental
Since
then,
environmental
and
meteorological activities witnessed a
significant rise and acquired continued
attention as evidenced by the issuance
of the general environmental law and
its executive regulations.
One of the foremost tasks given to the
Presidency was to ensure the optimal
benefit to the Kingdom from its natural
resources, balancing the
needs of
present and future generations against
the harmful effects of environmental
pollution. Such objective may be
realized through development of
environmental
management,
achievement of parallel development,
identification of the basic resources of
natural environment throughout the
Kingdom, improvement of the means
and
procedures
guaranteeing
conservation of natural resources. This
cannot be done without effective
coordination with relevant agencies.
The Presidency also assumes the role of
representing the Kingdom and keeping
pace with developments in the field of
environmental
protection
and
meteorology at the regional and
international levels.
111
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
The Presidency plays a leading role in
spreading environmental awareness
among members of society, which is
consistent with Islamic teachings of not
harming the planet.
3.
Following are some of the major
achievements of the Presidency in
1430/31 (2009).
4.
A. Manpower Development
The Presidency has achieved 100%
Saudization in civil service jobs ever
since 1420/1421(2000). The total
number of approved jobs in fiscal year
1430/31 (2009) reached 986.
B. Meteorology Programs for Armed
Forces
 Surveying air bases to identify
existing networks and systems
required
for
installing
and
operating the weather forecast
briefing system for air force pilots.
 Offering financial support to install
the weather forecast briefing
system for air force pilots,
including terminals, servers and
communication circuits.
C. Environmental Protection Program
1. Procurement of equipment for
environmental inspection and audit.
2. The quality office has been set in
112
5.
6.
operation, and ISO Certification
was obtained. Training was also
conducted
on
Environmental
Quality Standard 14000.
Environmental
inspection
of
factories was further developed and
upgraded, together with training
and knowledge transfer to national
labor force.
A consulting study is underway to
map out a national strategy for
environmental awareness.
Implementation of infrastructure
networks to support environmental
applications.
Implementation of a study on sites
of the national air quality
monitoring network.
4.5.4 SAUDI COMMISSION
FOR TOURISM AND
ANTIQUITIES (SCTA)
The Saudi Commission for Tourism
and Antiquities serves as a center for
promotion of tourism and operates in
close partnership with stakeholders.
SCTA also acts as the key pillar for
bringing about sustainable tourism
development in conformity with
Islamic principles and the Kingdom’s
social, cultural and environmental
values. The commission provides clear
guidance to the tourism industry, and
acts in close partnership with pioneers
of this industry to create and prepare an
adequate environment that enables it to
grow.

During 1430/31 (2009), SCTA realized
several achievements, foremost among
them are the following:
4.5.4.A. General Accomplishments
 Participation in a number of
meetings of the Arab Ministerial
Council for Tourism, under the
Arab League, as well as meetings of
the UN International Tourism
Organization.
 Signature of a number of
Memorandums of Understanding in
the fields of tourism and antiquities.
 Participation in meetings of joint
Saudi-foreign committees.
 Supervision of 12 projects for
repairing and developing heritage
sites and buildings.
 Supervision of 13 projects for
maintenance and cleaning, currently
being implemented in the regions
and sites.
 Delineation of 165 sites slated for
protection.
 Participation in "Leave no trace"
program conducted in five regions.
 Signature of support agreements
with a number of government
agencies (Saudi Credit and Saving
Bank, Council of Chambers of









Commerce,
Saudi
Industrial
Development Fund, Millennium
Fund).
7 workshops for activity organizers
in the following regions (East
region- Al Ahsa – Medina – Riyadh
– Qassim - Tabuk and Al Jouf) in
cooperation with the Australian
expert Mr.Bill Ottol.
The "Desert Festival" in Hail and
Najran.
Support of 65 activities all over the
Kingdom.
Implementation of printed calendar,
1430H, in both Arabic and English.
Implementation of Okaz Market in
Taif.
Implementation of Kleja project for
productive households
Restoration of Raoum Castle in
Najran, Ibrahim Palace, Al Souq
Castle in Al Wajeh, Duba Castle in
Tabuk, Marid Castle in Dawmat Al
Jandal, King Abdulaziz Palace in
Badee'ah.
Establishment
of
permanent
locations for craftsmen in 4 regions:
Al Baha, Qassim, Najran and Al
Jouf.
Implementation of
phase 1 of
preparation of Madain Saleh
project.
Lectures and workshops on
antiquities and museums at the
National Museum.
113
ACHIEVEMENTS OF THE
DEVELOPMENT PLANS
FACTS AND FIGURES
 Finalization
of
the
Activity
Development manual.
 Preparation of the Activity and
Folklore Arts Organizers' manual.
 Assistance in qualification of 26
new activity organizers in 2009.
 Support for design and marketing of
50 tourist programs.
 Feeding of the electronic activity
calendar (1360 activities).
 Documentation of coordinates of
borders of 398 public tourist sites.
 45 training courses for development
of artisan and handicraft products
(including 13 courses for men and
32 courses for women).
4.5.4.B Human Resources
Development
 Scholarships for 118 secondary
school graduates to study tourism
disciplines, in addition to 32 postgraduate scholarships.
 24 training programs on handicrafts
and traditional industries. In the
context of these programs, 404
artisans, both male and female, were
trained and two training courses on
small scale tourist projects were
conducted.
 Training 7,408 trainees within the
context of awareness promotion
programs designed to develop
114
communication skills in dealing
with tourists .
 40 workshops to raise awareness of
local community leaders through
"Tourism Enriches" program.
4.5.4.C Raising living standards,
improving quality of life, and
creation of job opportunities
 Three thousand direct employment
opportunities were created in the
travel, tourism and hotel sectors.
 Over 4000 job opportunities were
identified in the hotel sector.
 504 jobs were Saudized in the
tourism and travel sectors.
 Training was offered to 39 teaching
staff and tourist guides to qualify for
regional trainer licenses - WFTGA.
 Supported 6 small and medium size
tourist projects
 Licensing of 111 general, local and
site tourist guides.
 Licensing of 95 primary and
secondary tour operators.
 Licensing of 10 time-share real
estate
units
(operation
and
marketing).
 Issuance of tourist visa permits for
tourist groups coming from outside
the Kingdom.
 Licensing of 201 hotel facilities
(hotels and furnished apartment
units).