Industrial Policy: Making It Work for All Saudis

Industrial policy has always been a big part of how Gulf countries try to grow their economies. But now, with even countries like the United States taking a more hands-on approach, the Gulf is stepping up its efforts to reduce its reliance on oil.

At a recent meeting hosted by the Arab Gulf States Institute in Washington (AGSIW), experts discussed whether these new strategies will really work. They looked at research from Steffen Hertog and Fuad Hasanov, who pointed out that while industrial policies industrial policies can help diversify the economy, they also come with risks — like wasting resources or creating inefficiencies. For Saudi Arabia, the challenge is to make these policies practical and inclusive, ensuring they feel relevant to people’s lives rather than being imposed from the top down.

To truly succeed, it must be woven into the social fabric, not just handed down from above. Saudi Arabia's industrial policy, driven by Vision 2030, aims to diversify the economy beyond oil, focusing on key sectors like mining, industry, logistics, and energy, with the National Industrial Development and Logistics Program (NIDLP) as a key component.

The problem with grand visions is that they often look spectacular from a distance but feel detached up close. In the past, state-led initiatives often seemed like distant ambitions dreamed up in Riyadh, far removed from the lives of ordinary Saudis. Decisions felt like they were made behind closed doors, without considering how they would play out on the ground.

As a result, many people saw these projects as “not for us, but for them.” Today, there’s a shift happening. The heady rush of reforms, once dizzying and disorienting, has settled into something more balanced. People are slowly finding their footing as new norms emerge, and there’s a growing sense of inclusion that didn’t exist before. It’s no longer just about high-profile announcements or sleek presentations. Instead, there’s more space for people to speak up and be heard. This sense of belonging — of being part of something bigger — is crucial for building public trust and enthusiasm.

But Saudi industrial policy needs to keep up with this new reality. It can’t just be imposed from the top down, expecting people to fall in line. Instead, it should grow from the ground up, rooted in local needs and aspirations. Bringing communities into the conversation would do wonders for replacing skepticism with enthusiasm. After all, not everyone fits neatly into high-tech ambitions. There’s a difference between building a society of digital innovators and nurturing a community of skilled, proud workers.

From Degrees to Skills: A Changing Mindset

Education and skills training are crucial to Saudi Arabia’s transformation — but they must be more than just buzzwords. Launching ambitious programs is easy; making them fit the realities of the Saudi job market is much harder. The Human Capability Development Program is a prime example: it’s ambitious and well-intentioned, but success hinges on whether it prepares people for real jobs, not just polished presentations. It’s about creating a workforce that’s not just qualified on paper but genuinely equipped to meet the challenges of modern industry.

In the past, success often seemed reserved for those with university degrees, leaving others feeling excluded or left behind. There was a sense that if you didn’t have the right diploma, you were out of the game. It was almost like a secret club — no degree, no entry.

Today, though, the narrative is changing. Success stories now come from all walks of life, whether it’s a craftsman excelling in traditional skills or a tech-savvy entrepreneur without a formal degree. The focus has shifted from pure academic achievement to practical skills and proven success, reflecting a more inclusive economic transformation where talent and hard work matter more than credentials.

This shift is crucial because not everyone dreams of coding in a co-working space or managing a tech startup. Many young Saudis still feel drawn to traditional crafts, family businesses, or hands-on skills that are rooted in local culture. Creating opportunities that speak to both modernity and tradition is key to building a balanced economy — one that values a carpenter just as much as a coder.

Bridging the Regional Divide

Then there’s the issue of regional inequality. The glittering skyline of Riyadh tells one story, but the dusty outskirts of smaller towns tell another. An industrial policy that leaves out the heartlands risks widening gaps and fueling resentment.

Investing beyond the big cities is not just about fairness — it’s about common sense. Talent doesn’t just sprout in the capital. Rural areas and smaller cities have a rich potential that just needs the right support to flourish. The idea isn’t to force modernity on traditional communities, but to build on what they already have — craftsmanship, agriculture, local enterprises — while offering pathways to modern skills and industries.

Transparency and Accountability: Building Trust

Finally, there’s the matter of governance and accountability. People aren’t naïve. They know that big state-driven projects can sometimes end up as monuments to wasted ambition. Without clear, measurable goals and real accountability, even the most well-intentioned policies can fall flat.

Performance metrics need to be more than just glossy reports — they need to have teeth, and they need to bite when goals aren’t met. Public trust is crucial, and it hinges on knowing that government support is not just about throwing money at problems but about building resilient solutions.

A Collective Transformation

In the end, the success of Saudi industrial policy will not just be measured by the number of factories built or the number of jobs created. It will be measured by how well it resonates with ordinary Saudis. Real diversification means more than shifting from oil to tourism or technology — it means creating a sense of ownership and pride among citizens.

Saudi Arabia’s transformation must feel like a collective project, not a technocratic experiment. Only by bridging the gap between policy ambitions and social realities can Saudi Arabia build an economy that is both resilient and inclusive — one that belongs to all Saudis, not just a select few.

Industrial policy in Saudi Arabia is nothing new: the state has long been the Kingdom’s most enthusiastic entrepreneur, pouring resources into ambitious projects to modernize and diversify the economy. But as global winds shift toward more hands-on economic management, Saudi Arabia finds itself facing a familiar challenge: making sure industrial policy isn’t just a grand vision on paper but a practical reality that benefits everyone. To truly succeed, it must be woven into the social fabric, not just handed down from above. Saudi Arabia's industrial policy, driven by Vision 2030, aims to diversify the economy beyond oil, focusing on key sectors like mining, industry, logistics, and energy, with the National Industrial Development and Logistics Program (NIDLP) as a key component.

The problem with grand visions is that they often look spectacular from a distance but feel detached up close. In the past, state-led initiatives often seemed like distant ambitions dreamed up in Riyadh, far removed from the lives of ordinary Saudis. Decisions felt like they were made behind closed doors, without considering how they would play out on the ground.

As a result, many people saw these projects as “not for us, but for them.” Today, there’s a shift happening. The heady rush of reforms, once dizzying and disorienting, has settled into something more balanced. People are slowly finding their footing as new norms emerge, and there’s a growing sense of inclusion that didn’t exist before. It’s no longer just about high-profile announcements or sleek presentations. Instead, there’s more space for people to speak up and be heard. This sense of belonging, of being part of something bigger, is crucial for building public trust and enthusiasm.

But Saudi industrial policy needs to keep up with this new reality. It can’t just be imposed from the top down, expecting people to fall in line. Instead, it should grow from the ground up, rooted in local needs and aspirations. Bringing communities into the conversation would do wonders for replacing skepticism with enthusiasm. After all, not everyone fits neatly into high-tech ambitions. There’s a difference between building a society of digital innovators and nurturing a community of skilled, proud workers.

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