Privatization

Program
2025
Table of Content

Introduction 3

Indirect Level 3 Objectives 11

Privatization Program 2030 Aspirations 13

Current Efforts 18

Privatization Key Achievements 20

Privatization Program Strategy 33

Strategic Considerations 38

Future Initiatives 41

2
Introduction
Introduction
The Privatization Program was launched in 2018. It seeks to identify gov-
ernment assets and services that can be privatized in a number of sec-
tors, develop the privatization system and its mechanisms, define public
and private sector partnership frameworks to enhance the quality and
efficiency of public services, and support contributions to economic de-
velopment.

In the previous stage, the program succeeded in developing general

frameworks for the privatization system through the enactment of the
privatization law and the establishment of the National Center for Privat-
ization. The Center aims to regulate the system project procedures and
to enhance the participation of the private sector in a transparent and
fair manner. It also aims to ensure the integrity of procedures related to
contracts to provide an attractive regulatory and investment environment
that stimulates private sector’s investment and increases participation in
the national economy, in addition to their short and long term contribution
to the GDP. The program has also contributed to activating the sectors’
supervisory committee.

The Privatization Program’s overarching objective is to strengthen the

role of the private sector by unlocking state-owned assets for investment.
Privatizing selected government services will improve the quality of ser-
vices and reduce overall costs by refocusing the government’s efforts on
its legislative and organizational roles. Moreover, the program will attract
foreign direct investments and improve the balance of payments. These
objectives are in full alignment with Vision 2030.

Privatization is the transfer of ownership of specified assets and services

from the government to the private sector. The transfer of ownership can
be done in several forms, e.g. Public Private Partnership (PPP),Build-Op-
erate-Transfer (BOT), Build–Own–Operate–Transfer (BOOT), Build - Own
- Operate (BOO), etc.) and Privatization. The Privatization Program will
continue to enable the private sector through creating new investment
opportunities.

4
The scope of the Privatization Program VRP encompasses the fol-
lowing:
1) Pillar 1: Enhancing the quality and efficiency of public services.
2) Pillar 2: Supporting the contribution to economic development.
3) Key Enabler: Enabling the Public Private Partnership and Privat-
ization ecosystem.
17 sectors and 176 initiatives have been targeted for privatization– 32
initiatives were launched and 18 initiatives have been awarded.
In 2019, privatization initiatives generated SAR 12.68 billion from PPP, in
addition to revenues of SAR 470 million from assets sale. In 2020, PPP in-
vestments generated SAR 13.46 billion and revenues of asset sales were
SAR 2.75 billion. Privatization initiatives provided total daily treated water
of more than 1.12 million m³ and total daily desalinated water of more
than 2.1 million m³. In addition to the construction of 60 schools for all
educational stages in Jeddah and Makkah serving 50,000 students, had
been initiated on a PPP basis. Privatization initiatives had also enhanced
the development and operation of container terminals at King Abdulaziz
Port in Dammam and increasing the terminal’s capacity by more than
120% to reach 7.5 million containers, and in Jeddah Islamic Port, the con-
tainer terminals’ capacity was increased by 70% to reach more than 13
million containers annually.

5
In health, the PPP Program has enabled an increase on the number of

‫نـ ـب ــذة‬
dialysis centers to 63, serving 7000 people in cities and towns across the
Kingdom.

‫تـــاريـخــيــــةلمالية‬
Governance
The Privatization Program is managed through a robust governance
structure. This structure has been developed after studying various inter-
national practices and is in alignment with a number of resolutions of the
Council of Ministers and other regulatory tools.

1) Strategic Management Committee (SMC):

The SMC is a committee formed by the Council of Economic and Devel-
opment Affairs (CEDA), which provides strategic support to CEDA, includ-
ing recommendations on developing the strategies to realize Vision 2030,
transforming the vision into executive programs and overseeing and
monitoring the implementation of such programs.

2) Privatization Program Committee (PPC):

The PPC is a committee appointed by CEDA involving representatives of
Entities related to the scope of the Privatization Program. The PPC is re-
sponsible for managing the program planning, supervising implementa-
tion and ensuring realization of the program’s approved outcomes and
targets.

3) Privatization Program Office (PPO):

The PPO is the PPC executive arm. It is responsible for preparation and
follow-up of the program’s plan, including initiatives, metrics, targets and
timeframe. Moreover, The PPO provides recommendations on the estimated
budget of initiatives and the overall budget of the program to the PPC. The PPO
also coordinates, prepares, implements and follows up the program’s initia-
tives while supporting performance, leading change management efforts,
escalating unresolved issues, and preparing periodic reports on work
progress and submitting such reports to the PPC.

6
4) Privatization Supervisory Committees (PSCs) and Execution
Teams (ETs):
PSCs and ETs are the sector-specific privatization supervisory and execu-
tion bodies responsible for the supervision and implementation of privat-
ization in each sector. PSCs responsibilities include developing the sec-
tors’ privatization strategies in line with National Centre for Privatization
(NCP) guidelines and objectives and submitting them to the NCP Board of
Directors for approval. PSCs responsibilities also include readiness and
enablement (such as: conducting (technical, financial and legal) readiness
assessment, identifying gaps, developing readiness plans and ensuring
their implementation, and obtaining approvals for sector-specific regu-
latory changes). In addition, PSCs responsibilities include supervising ini-
tiatives execution (such as: approving privatization models developed by
ETs and ensuring their alignment with the national strategy, standards
and regulations, reaching out to investors, conducting negotiations and
signing contracts, managing the implementation of the privatization op-
portunities, and periodically reporting to CEDA).

5) National Center for Privatization & PPP (NCP):

NCP is the enabler of privatization for all government sectors. It supports
PSCs and ETs in the execution of their privatization efforts by providing
privatization processes, legal and regulatory expertise. NCP responsi-
bilities include policy making (develop national privatization regulatory
framework, develop PSCs rules and procedures, review sector regula-
tory framework). Responsibilities also include privatization frameworks
(develop sector privatization standards and guidelines to fulfill national
privatization objectives), and monitoring/reporting (review sector privat-
ization strategies and ensure their alignment with the sector privatization
standards and guidelines, review and validate privatization opportunities,
review readiness plans and follow up on their implementation; review
technical, financial and legal analyses during transaction execution; fol-
low up on execution progress and escalate to CEDA where necessary).

7
6) Supporting Entities:
They are a number of Entities that provide specific support to the pro-
gram offices based on their functions during initiatives planning and im-
plementation phases. Key supporting Entities include: Ministry of Finance,
Ministry of Economy and Planning, Ministry of Human Resources and So-
cial Development, Ministry of Investment, Local Content and Government
Procurement Authority, Government Expenditure and Projects Efficiency
Authority, National Center for Performance Measurement “ADAA”, Non-
Oil Revenues Development Center, National Digital Transformation Unit,
Media and Corporate Communication Unit, and the permanent Execution
Team.

8
The Privatization Program scope does not encompass the follow-
ing activities:
• Development and regulation of traditional private sector initiatives with
the public sector – this includes legal and statutory regulations and pro-
cedures for working with the private sector outside the umbrella of “pri-
vatization” and “private sector participation initiatives”.

• Dealing with residential real estate assets which are unlocked for pri-
vate sector usage by contractors and real estate developers, as they are
covered by the Housing Program.

• Investment initiatives of the Public Investment Fund.

Council of Ministers
Council of Economic and Development Affairs (CEDA)

Strategic Board of Directors

Management Of the National
Committee
(SMC) Center for
Privatization &
PPP
Privatization
Program
Committee Privatization Supervisory
Committees (Chaired by the
Minister of the targeted sector)
Privatization
Program Office
National Center
for Privatization
Execution & PPP (NCP)
Execution Entities Entity
Team

9
Vision 2030 identified 96 strategic objectives across its three Pillars
(Vibrant Society, Thriving Economy, Ambitious Nation), and the two
objectives derived from the Vision’s second pillar – “A Thriving Economy”
are directly related to the Privatization Program, which are:

3.1.2 - Unlocking state-owned assets for the private sector.

3.1.3 - Privatizing selected government services.

Privatization Program – 2030 Direct Objectives

Pillar 1: A Vibrant Society Pillar 2: A Vibrant Society Pillar 3: An Ambitious Nation

Level 1 Objectives
Strengthen Grow and Enhance
Islamic values Offer a fulfilling Offer a fulfilling Enable social
diversify the government responsibility
and national and healthy life and healthy life economy effectiveness
identity

Level 2 Objectives
Grow Maximize Grow the Public Further integrate
contribution Position KSA Position KSA
value captured Investment Fund's Saudi Economy Grow non-oil
of the private as a global as a global
sector to the from the assets and role as a regionally and exports
logistic hub logistic hub
economy energy sector growth engine globally

Level 3 Objectives
Unlock state- Privatize Ensure the Enable financial Attract Create special zones
Enhance owned assets selected formation of an institutions to
ease of doing foreign direct and rehabilitate
for the private government advanced capital support private investment economic cities
business sector services market sector growth

10
Indirect Level 3
Objectives
Indirect Level 3 Objectives
The Privatization Program also supports 12 indirect objectives.

2.1.1 Ease the access to healthcare services.

2.1.2 Improve the value of healthcare services (quality of outcomes, expe-

rience and cost).

2.3.1 Improve the quality of services provided in Saudi cities.

3.1.4 Develop an advanced capital market.

3.1.6 Attract foreign direct investment (FDI).

3.5.1 Establish and improve the performance of logistic centers.

4.3.2 Grow SME contribution to the economy.

5.1.1 Enhance effectiveness of financial planning and efficiency of gov-

ernment spending.

5.1.2 Diversify government revenues from state-owned assets (e.g., en-

terprises).

5.2.1 Design a leaner and more effective government structure.

5.2.2 Enhance performance of government Entities.

5.2.5 Improve quality of services provided to citizens.

12
Privatization Program
2030 Aspirations
The Privatization Program aims to enable the improvement of public
sector assets and services efficiencies through improving the quality of
such assets, services, operations and management.

Improve the Increase local and foreign

government spending private sector’s contribution to Saudi
efficiency to achieve the Arabia’s GDP from 40% (2016) to more
maximum return. than 65% by (2030).

Unlock state-owned Improve the quality and

assets to the private sector. comprehensiveness of services.

The Privatization Program aims to strengthen the role of the private sector
in providing services and managing government assets to:

• Improve the quality of service for sectors such as health, education,

municipal affairs and others.

• Reduce costs by leveraging private sector expertise.

• Refocus the government efforts on its legislative and organizational

roles, in addition to enriching the local content and the national economy.

• Create new job opportunities in the private sector across the Kingdom.

• Enable the private sector to access new investment opportunities, which

contributes to increasing the GDP.

The Privatization Program aims to become a key driver in increasing

the local and foreign private sector contribution to the Kingdom’s GDP،
and increasing the local content. The Program will expand its efforts in
working with the private sector to generate greater economic growth in
the Kingdom.

14
The Program will work to achieve the objectives of the government
in engaging the private sector and improving the quality and
comprehensiveness of services in order to effectively participate in
realizing Vision 2030 objectives, by unlocking the state-owned assets
to the private sector in a manner that is beneficial to the government
revenues and the local economy. Furthermore, privatization will have a
positive social and economic impact on the Kingdom. The contribution
of the private sector will help in the participation, implementation and
provision of targeted public services which were previously provided by
the government, as well as decreasing costs, improving service quality
and realizing the desired economic impacts on both public and private
sectors.

The Privatization Program will achieve this by creating and developing

an environment that supports successful and efficient implementation of
privatization initiatives. The Program will also focus on projects that cater
to public needs, taking into account Value for Money (VFM), improved
transparency in project tendering procedures and adopting specific
standards for key studies of these initiatives. These projects shall comply
with the standards, policies and governance of privatization. The success
of the Program will only be achieved when PPPs are enhanced.

The Privatization Program is committed to achieve the below

commitments by the end of 2025

Achieve total government Achieve total financial

revenues (non-oil revenues) of
around SAR 143 billion.
Contribute to the provision of new
job opportunities in the private sector.
value for efficient government
spending through partnership
operations of around SAR 14
billion.

15
Privatization Targets and Metrics:

Metric Description

This metric measures the total revenues

Total value of returns from assets sale (one-time revenue)
from PPPs and assets and non-oil revenues from PPPs based
sale on the actual annual cash flows and the
privatization adopted governance.

This metric measures the total value of

Total value of PPPs
capital investments of PPPs based on the
investments
privatization adopted governance.

This metric measures the financial value

Financial value of
of government spending efficiency of PPPs
government spending
during the initiative period, by calculating
efficiency of PPPs
the difference in VFM.

Number of This metric measures the number of

government government privatized assets (transferring
privatized assets ownership to the private sector).

This metric measures the total number of

Total number of PPPs
PPPs contracts awarded according to the
contracts
privatization approvd governance.

16
 Targets (cumulative)
Date of
Metric * Baseline
Baseline
Unit 2020 2021 2022 2023 2024 2025

Total value
of returns Billion
from PPPs 0.48 2019 3.7 20.3 48.7 97.3 108 143.7
Riyals
and assets
sale

Total value Billion

of PPPs 2.56 2018 19.5 31.6 47 55.3 60.1 62.3
investments Riyals

Financial
value of
Billion
government 0.75 2018 4.8 8.9 10.8 12.3 13.7 14
spending Riyals
efficiency of
PPPs

Number of
government 1 2019 Number 3 7 16 23 24 26
privatized
assets

Total
number
1 2018 Number 14 29 48 55 60 64
of PPPs
contracts

*Targets and dates are subject to change

depending on initiatives› priorities, and
the decisions of the sector’s supervisory
committee.
17
Current Efforts
Current Efforts
• The current Privatization Program plan includes a number of on going
initiatives, which includes two ways of privatization (release of assets
and partnership in providing services between the public and private
sectors). Although the process can be extensive, the program has been
successful in closing PPP initiatives and assets sale.
• Initiate the development of an action plan for developing sectoral
PPP&P strategies, which has begun and as planned it will be completed
in 2021.
• The Council of Ministers approved the Private Sector Participation Law
(PSP) by the Council of Ministers Resolution No. (436) dated 3/8/1442
A.H. (16/3/2021), aiming to enhance PPP, transfer ownership of
government assets and unlock state-owned assets to the private sector,
privatize selected government services, and expand the participation
of the private sector in infrastructure initiatives and public services
provided to citizens and residents. The PSP Law also aims to create
an environment that allows an increase in the volume and level of
services provided to citizens and residents. The law provides the
necessary flexibility in the regulatory and investment environment of
privatization initiatives in the Kingdom, which will enhance and support
the implementation of these initiatives motivating and attracting
investments in the short and long term. The PSP Law will enhance
the private sectors participation in economy and provide investment
opportunities to the private sector by regulating the procedures
of the privatization initiatives and facilitating the provision of such
opportunities to the private sector in a transparent and fair manner,
ensuring the integrity of contract-related procedures. The PSP Law
will also improve the quality and comprehensiveness of services and
assets related to privatization initiatives, and improve the initiatives’
management level.
• The Privatization Program will continue its efforts to enable and
improve the outcomes of privatization and PPP by working with NCP as
a supporting party of privatization targeted sectors in developing the
sectors’ strategies and supporting implementation. The Privatization
initiatives portfolio includes 17 sectors and due to the nature
privatization, privatization opportunities are continuously defined in
various sectors.

19
Privatization
Key Achievements
Privatization Key Achievements
PSCs and ETs of Targeted Sectors:
Since the issuance of Council of Ministers Resolution No. (665), amended
by Resolution No. (55), 17 PSCs have been formed for privatization targeted
sectors. Each committee consists of two members, the Minister of the
concerned sector as Head of committee and the Minister of Finance as a
member. PSCs oversee management, structure and tendering initiatives
related to government assets or services to be privatized and unlock them
for the private sector.

PSCs of privatization targeted sectors are working on 176 initiatives

supported by NCP:

Approved initiatives by sector:

98 Initiatives

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Initiatives under review by sector:

78 Initiatives

“The list of initiatives under review by sectors is continuously updated”

Privatization completed initiatives by targeted sectors the were,

supported by NCP during the period from 2018 till end of 2020:

Name of the Description of Execution

Initiative the Initiative Authority

A PPP initiative with a capacity of

Ministry of
600,000 m³/daily of potable water to
Environment,
Rabigh 3 IWP supply Makkah and serve the regions
Water and
population in addition to Hajj and
Agriculture
Umrah visitors.

22
 Name of the Description of Execution
Initiative the Initiative Authority

An initiative to secure dialysis for

chronic renal failure patients by
contracting with leading international
companies in this field, which will
Dialysis
contribute to increasing the number Ministry of Health
Program
of centers to 63 centers in various
cities and towns of the Kingdom and
will provide services to more than
7,000 beneficiaries.

It is an initiative to treat wastewater

Ministry of
using environment friendly and highly
ISTP West Environment,
efficient technologies, with a design
Dammam Water and
capacity of 350,000 m³/daily serving
Agriculture
100,000 beneficiaries.

The initiative is a privatization

process and PPP and the fifth Ministry of
Al Shuqaiq 3 privatization initiative, which will have Environment,
IWP a design capacity of 450,000 m³/daily Water and
of desalinated water for Jazan and Agriculture
Asir.

The Ministry of Environment, Water

Ministry of
Jeddah and Agriculture worked on a list
Environment,
(Airport2) of stations, including wastewater
Water and
ISTP treatment plant in Jeddah with
Agriculture
capacity of 500,000 m³/daily.

23
 Name of the Description of Execution
Initiative the Initiative Authority

The initiative aims to improve the

Saudi services provided to more than
Airlines 15,000 pilots, hosts, and air crews, Ministry of
Medical in addition to providing health care Transportation
Services and medical services to more than
140,000 beneficiaries.

Second
Cargo The initiative seeks to build a second
Terminal - at cargo terminal station to increase Ministry of
King Khalid the capacity to 600,000 tons through Transportation
International partnership with private sector.
Airport

It contributes to increase the capacity

Container
of container terminals at the port
Terminals Ministry of
by 70%, bringing the number of
at Jeddah Transportation
containers annually to more than 13
Islamic Port
million containers.

Wastewater treatment plant in Taif,

Ministry of
with production capacity of 270,000
Environment,
Taif ISTP m³, serves the city of Taif. The plant
Water and
is environment friendly and uses
Agriculture
alternative energy.

24
 Name of the Description of Execution
Initiative the Initiative Authority

A PPP initiative with capacity of

450,000 m³/daily of potable water,
to supply the regions of Makkah
Ministry of
and Madinah. The initiative will
Environment,
Yanbu-4 IWP include solar energy units to reduce
Water and
electricity consumption from the
Agriculture
grid, in addition to water tanks with
a storage capacity of two operational
days.

It supplies the Eastern Region, Riyadh Ministry of

Jubail Region and Qassim Region with Environment,
3A IWP capacity of 600,000 m³/daily using Water and
the reverse osmosis technology. Agriculture

The initiative will contribute to

Container
increasing the capacity of container
Terminals
terminals by more than 120% to
- at King Ministry of
reach 7.5 million containers. It will
Abulaziz Transportation
also enhance logistics services, raise
Port in
the reliability of supply chains and
Dammam
support internal and external trade.

Selling all
Ministry of
Shares at Sale of all shares to private investors
Environment,
the to raise production efficiency and
Water and
First Milling diversify products in the local market.
Agriculture
Company

25
 Name of the Description of Execution
Initiative the Initiative Authority

Selling All
Ministry of
Shares at Sale of all shares to private investors
Environment,
the to raise production efficiency and
Water and
Third Milling diversify products in the local market.
Agriculture
Company

The initiative
of the first Implementing the initiative of the
group of the first group of partnership initiatives
Program, with the private sector within the
Ministry of
to finance, construction, maintenance and
Education
design, transfer stream to establish 60
establish schools for all stages in Makkah and
and operate Jeddah. It serves 50,000 students.
60 schools

26
Initiatives in advanced stages

1- Expansion of Al Ansar Hospital

Al Ansar hospital is located in Madinah with a capacity of 90 beds. It is
expected to tender an alternative hospital with a capacity of 244 beds
to be built and operated by the private sector. The implementation of
this initiative will lead to increasing the capacity and beds in Al Madinah
region by a new medical facility equipped with modern medical supplies
with high-quality services and operation. The Ministry of Health will be
responsible for supervising and managing the sector, while the private
sector will provide health services. The key target will be to increase the
capacity of Al Ansar Hospital from 90 beds to 244 beds to be in line with
Vision 2030 aiming at increasing the number of Umrah visitors; in addition
to using new financing methods based on long-term financing, which helps
reduce the burden on the state’s capital budget in the initiative building
phase.

2- Social Case Surveying PPP covering the Riyadh and Hail regions
It is an initiative aiming to cover a larger number of beneficiaries when
conducting research, which improves the quality of services provided by the
Ministry of Human Resources and Social Development to its beneficiaries,
in accordance with the best international standards and practices in this
regard and contributes to improving the customer experience.

3- Attracting private investments to finance construction of

educational buildings
The initiative will be established by the Ministry of Education and Tatweer
Building Company (TBC) as a PPP initiative. The initiative includes
designing, building, equipping and managing the facilities in 60 schools
in the Al Madinah region. This initiative will lead to PSP in construction,
maintenance and transfer of ownership of public schools and it will
provide modern educational facilities that contribute to improving the
level of general education in the Kingdom through a typical educational
environment.

27
4- Al Madinah 3 ISTP
The sewage treatment plant in Al Madinah serves the region with a
production capacity of 375,000 m³. This initiative aims to reuse treated
wastewater using eco-friendly technologies and highly efficient designs
to achieve Vision 2030 objectives. As well, it aims to improve the quality
of services and improve the spending efficiency, by using the expertise of
the private sector.
5- Tabuk ISTP (2)
Tabuk Sewage Treatment Plant (2) serves Tabuk region with a production
capacity of 90,000 m³. This initiative aims to reuse treated wastewater
using eco-friendly and highly efficient designs to achieve Vision 2030
objectives. It also aims to improve the quality of services and improve the
spending efficiency, by using the expertise of the private sector.
6- Construction of Buraydah Sewage Treatment Plant (2)
It focuses on increasing the production capacity by 150,000 m³, and serves
the Al Qassim region. This initiative aims to reuse treated wastewater
using eco-friendly and highly efficient designs to achieve Vision 2030
objectives. It also aims to improve the quality of services and the spending
efficiency, by using the expertise of the private sector.
7- Activating joint investment agreements
A partnership initiative between municipalities and the private sector for
the development of municipal lands, which will be launched experimentally
through the conclusion of 5 partnership contracts in 4 municipalities:
(Makkah, Al Madinah, Riyadh and Eastern Province). The model shall be
rolled out to the rest of the Kingdom’s cities, as this initiative seeks to
enhance the utilization of municipality owned lands, through developing
them in partnership with the private sector and making use of state-
owned assets to increase the private sector’s contribution to the local
economy and create quality jobs.

28
8- Establish and manage parking lots
A PPP initiative to establish and manage parking lots across the Kingdom.
Pilot launch of the initiative will in Riyadh, and then the model will be
applied to all cities across the Kingdom to improve the quality of parking
services and solve traffic jam problems, as well as to apply the latest
technologies, specifications and standards to car parking, based on the
best international practices (smart parking) within major cities.
9- Selling all assets of the second and fourth milling companies
The milling companies are considered an attractive investment
opportunity for investment in one of the biggest flour markets in MENA,
which has high growth rates that would appeal to the private sector to
develop the production process of the sector and increase the quality of
products. This initiative aims to sell all assets of the second and fourth
milling companies to investors from the private sector.
10- Activating radiation departments in partnership with the
private sector
Updating and expanding radiology practices across the country in
partnership with the private sector, in order to meet 50% of the estimated
demand that falls under the health sector framework. This is to address
the challenges of operating radiology departments at less than their
real capacity at a higher cost than their international counterparts. This
initiative will have a direct impact on improving access to high quality and
efficiency services and at a lower cost, by reducing current operational
costs.

29
Legislative achievements:

Initiative Overview

Amending some of the provisions regulating

NCP issued by Council of Ministers
General Legislative Resolution No. (355) dated 7/6/1438 AH
Framework for (6/3/2017). Among the most prominent
Privatization - amendments is the restructuring of NCP’s
Council of Ministers Board of Directors and granting NCP the
Resolution No. (512) authority to own and establish companies on
dated 2/9/1440 A.H." behalf of the government for the purposes of
supporting and implementing privatization
initiatives.

In implementation of the directive of

the Council of Ministers pursuant to its
Resolution No. (665) dated 11/8/1438
General Legislative
AH regarding NCP's preparation of a Law
Framework for
initiative that includes all provisions related
Privatization -
to privatization processes, which sums
PSP Law Initiative"
the necessary exceptions from laws and
seeks to benefit from the best international
practices.

Providing support to PPO ETs regarding

preparing an initiative to amend some
General Legislative
provisions of PSCs targeted sectors rules
Framework for
and functions issued pursuant to Council
Privatization - PSCs
of Ministers Resolution No. (665) dated
targeted sectors
11/8/1438 A.H., in line with the proposed
rules and functions
privatization program new governance
framework.

Preparing a regulatory framework initiative

General Legislative
to offer and list assets, sectors and services
Framework for
targeted for privatization on Tadawul as
Privatization – IPO
soon as they are privatized.

30
Initiative Overview

Prepare the
General Legislative
Preparing the general regulatory framework
Framework for
initiative for public transportation initiatives.
public transportation
initiatives
Providing legal support to a number of
privatization targeted sectors regarding
General Legislative their regulatory tools (such as: the Postal
Framework for System Initiative, the Special Zone initiative
Privatization for cloud and information computing,
targeted sectors the Real Estate Brokerage Initiative, the
Specifications and Quality Initiative and the
Product Safety Initiative).
General Legislative Providing support to PPO ETs regarding
Framework for preparing an initiative to amend a number
Privatization - of provisions of PSCs targeted sectors rules
Amended PSCs and functions issued pursuant to Council
targeted sectors of Ministers Resolution No. (55) dated
rules and functions 01/20/1442 A.H.
The PSP Law aims to create an environment
that allows raising the volume and level of
services provided to citizens and residents
and establishing the necessary flexibility in
the regulatory and investment environment
for privatization initiatives in the Kingdom,
in a manner that supports and enhances the
implementation of these initiatives within
Council of Ministers an attractive and stimulating regulatory and
approving PSP Law investment environment for short- and long-
term investments. It also aims at facilitating
the provision of these opportunities
to the private sector in a transparent
and fair manner ensuring integrity of
contracts-related procedures. The PSP
Law shall improve the level of quality and
comprehensiveness of services and assets
related to privatization initiatives.

31
Development of Strategies:
A number of strategies have been developed for some privatization targeted
sectors during 2019 and 2020. The development of other strategies in
other sectors are in progress:

1. Industry and Mineral Resources sector - (Completed in 2019).

2. Environment, Water and Agriculture sector - (Completed in 2020).

3. Municipalities sector - (Completed in 2020).

4. Labor and Social Development sector - (Completed in 2020).

Media and Marketing efforts, and knowledge building:

NCP has created an investors base in which they can be contacted through
several electronic channels and events dedicated to local and international
investors. During the period from 2018 till the beginning of 2021, NCP has:

1. Registered more than 2,000 local and international companies in the

NCP investors database.

2. Held more than 50 workshops with more than 1,400 companies

participating.

3. Held 9 marketing tours in 8 countries.

4. Established 5 local forums with Saudi investors and finance sectors.

5. Participated in more than 55 events and occasions related to aspects of

privatization and partnership.

6. Supported the privatization targeted sectors during the launch, awarding

and closing of initiatives through 32 media campaigns.

7. Launched 3 big awareness campaigns.

8. Launched electronic platforms (investors portal and knowledge portal)

through the NCP website.

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Privatization Program
Strategy
Privatization Program Strategy
a. Strategic Pillars
After identifying the Privatization Program’s aspirations and current
efforts, the strategic pillars of Privatization Program were defined as
two pillars and a single key enabler. Strategic pillars are “Enhancing the
quality and efficiency of public services” and “Supporting the contribution
to economic development”, and these pillars will be achieved through
“Enabling PPP&P ecosystem”.

Unlock state-owned assets to the private sector

and privatize selected government services

Pillar 1 Pillar 2
Enhancing the quality and Supporting the contribution
efficiency of public services to economic development

Key Enabler: Enabling PPP&P ecosystem

Pillar 1: Enhancing the quality and efficiency of public services

Through building PPPs and providing high quality government services,
such as primary health care and extended care initiatives, improving
radiation services, increasing laboratory capacity, and providing dialysis
services to patients in the Kingdom of Saudi Arabia.

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Pillar 2: Supporting the contribution to economic development
This pillar focuses on signing agreements with the private sector aiming
to enhance and develop the economy. This shall include signing contracts
to increase investments, diversify sources of income or decrease OPEX,
such as the construction of the second cargo terminal at King Khalid
International Airport in Riyadh, and privatization of the flour mills
companies.
b. Enablers:
Enabling PPP&P ecosystem.
This enabler is essential for achieving the Privatization Program’s
aspirations. It is very important to design these enablers to suit the local
environment. Therefore, these enablers were designed according to the
following considerations:
• The existence of institutions that focus on stimulating and monitoring
privatization.
• The importance of providing a unified view of initiatives in all sectors.
• Selecting an institutional model in line with the nature of the
environment and challenges.
The achievements of this pillar could be derived from three essential
areas:

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1. Development of general legislative frameworks:
This will enable privatization processes and their governance by setting
clear and specific procedures that increase the level of preparation and
execution privatization, as well as improving the level of commitment to
legislative frameworks. This aspect will also establish unified and specific
procedures for the process of tendering privatization initiatives, which
will increase the level of operations governance. It also includes rules
for building work teams, appointing consultants, and communicating
with the private sector. Hence, this aspect will help solve part of the key
challenges to ensure achieving the desired aspirations and raise the level
of transparency and integrity in privatization; in addition to reviewing the
provisions of a number of regulations, legislation and rules that intersect
with privatization; and analyzing them to identify gaps and legislative
obstacles that may be contained within those regulations, legislations
and rules. Then, proposing solutions and working on addressing those
obstacles which will enable privatization and ensure that it is attractive to
investors, enhances the interests of the government and raises the level
of the desired benefits from privatization.
2. Enable NCP:
NCP will work on developing or proposing frameworks that will enable
and govern privatization transactions. NCP will also ensure that the
preparations and executions are carried out in accordance with the
approved governance frameworks. It will work on setting enablers in
privatization that would help in the execution of privatization as planned,
which will increase the level of efficiency of privatization and ensure the
benefit of its expertise is maximized.

36
3. Development of privatization strategies, metrics and incentive
mechanisms:
After operationalizing the Supervisory Committee for the sector, each PSC
will work on developing the sector’s privatization strategy according to the
specific targets, taking into account the best international practices and
the special circumstances of the sectors in the Kingdom in accordance
with the statutory procedures. Then, privatization metrics and standards
will be developed for that sector alongside elements within the program
which will stimulate interest amongst the stakeholders.

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Strategic Considerations
The Privatization Program will be supported, monitored, and addressed
through specific strategic assumptions, which were used in designing
the delivery plan. The privatization delivery plan defined its strategic
assumptions as critical factors, and in case of non-achievement thereof
may lead to terminating or significant change to the initiative. The
environment specified for categorizing those assumptions are:

• Strategic Objectives

• Market and Private Sector Drivers

• Private Sector Contribution to Build Capabilities and Competencies

• Legal and Regulatory Frameworks

To ensure any defined strategic assumptions are supported, monitored

and addressed, the delivery plan has considered such assumptions among
the risks of the privatization program, in order to reduce or eliminate any
potential issue that may arise and impact the delivery plan.

The matrix below combines the critical success factors and risk identifiers
to ensure the implementation of a successful delivery plan.

Critical factors
for success of Key assumptions
delivery

Strategic 1. Privatization Program objectives

Objectives will remain unchanged.

2. Optimizing liquidity in the

market and the national financial
Market and
system.
Private Sector
3. Ensuring
. national market
Drivers
stability through private
investment policies"

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 Critical factors
for success of Key assumptions
delivery

4. Operationalizing PSCs and ETs.

5. Building talent, technical
Private sector
capabilities and PSP skillsets.
contribution
6. Developing, preparing or
to build
updating PSP Sector Strategies for
capabilities
each sector.
and
7. Designing and developing
competencies
NCP governance framework and
operating model or activating it."

8. Developing, preparing or
amending PPP national regulatory
Legal and
framework.
Regulatory
9. Developing, preparing or
Frameworks
amending PPP regulations for
each sector."

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Future
Initiatives
 Examples of potential future initiatives to be tendered
during the period from 2021 to 2025*

First: PPP Initiatives

Environment, Water and Agriculture Sector:

1. Rabigh Water Desalination Plant Initiative (IWP 4)

2. Buraydah Sewage Treatment Plant Initiative (ISTP 2)

3. Al Madina Sewage Treatment Plant Initiative (ISTP 3)

4. Tabuk Sewage Treatment Plant Initiative (ISTP 2)

5. Ras Muhaisin Water Desalination Plant Initiative (IWP)

6. Al Jubail Water Desalination Plant Initiative (IWP)

7. Makkah Strategic Water Storage Initiative (Al Ju’ranah)

8. Makkah Strategic Water Storage Initiative (Al Maghmes)

9. Eastern Province Strategic Water Storage Initiative

10. Jeddah Province Strategic Water Storage Initiative

11. Jeddah Strategic Water Storage Initiative

12. Rabigh 5 Water desalination Initiative

13. Al Shuqaiq 4 Water desalination Initiative

14. Water treatment Initiative in North Jeddah

15. Al Ahsa Strategic Water Storage Initiative

16. Al Madinah Strategic Water Storage Initiative

17. Al Qassim Strategic Water Storage Initiative

*Initiativesand dates are subject to

change depending on the priorities,
readiness, and the decisions of the
sector’s supervisory committee.
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 18. Asir Strategic Water Storage Initiative

19. East Riyadh Sewage Treatment Plant Initiative (ISTP)

20. Al Haer Sewage Treatment Plant Initiative (ISTP)

21. Khamis Mushait Sewage Treatment Plant Initiative (ISTP)

22. South Najran Sewage Treatment Plant Initiative (ISTP)

23. Abu Arish Sewage Treatment Plant Initiative (ISTP)

24. Al Jubail 6 (Al-Ahsa) Water Desalination Plant Initiative (IWP)

25. Tabuk Water Desalination Plant Initiative (IWP)

26. Jazan Water Desalination Plant Initiative (IWP 1)

27. Ar Rayis Water Desalination Plant

28. Strategic Water Storage Initiative in Riyadh

29. Privatization of small sewage plant initiatives - Phase 1

30. Privatization of small sewage plant initiatives - Phase 2

31. Water Distribution Network Privatization Initiative – Phase 1

Transportation Sector:

1. Revenue from road assets initiative.

2. Riyadh dry port Initative.

3. Prioritized port contracts initiative.

4. Manage and operate King Abdulaziz international airport initiative.

5. Build and operate Taif airport initiative.

6. Build and operate Abha airport initiative.

*Initiativesand dates are subject to

change depending on the priorities,
readiness, and the decisions of the
sector’s supervisory committee.
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 Public transportation sector:

1. Obhur bridge project at Jeddah

2. Highway Bus line at Al Madinah

4. Highway Bus line at Jeddah

Health Sector:

1. Radiology Initiative - Experimental

2. Al Ansaar Hospital Initiative

3. King Faisal Medical City in Abha

4. Prince Mohammed Medical City in Al Jouf

5. Al Iman Hospital Housing Privatization Initiative

6. Primary Health Care – Experimental

7. Laboratories Initiative - Experimental

8. Privatization of Al Ahsa Hospital Initiative

9. Radiology Privatization Initiative – Phase 1

10. Radiology Privatization Initiative – Phase 2

11. Privatization of Al Yamama Hospital Initiative

12. Extended Care Initiative – Phase 1

13. Extended Care Initiative – Phase 2

14. Laboratories Initiative – Phase 1

15. Radiology Initiative – Phase 3

16. Primary Care – Phase 1

17. Primary Health Care – Phase 2

*Initiativesand dates are subject to

change depending on the priorities,
readiness, and the decisions of the
sector’s supervisory committee.
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 Municipalities Sector:

1. Agreements on Joint Investment of Lands

Education Sector:

1. Attracting investments for educational buildings to establish 60 schools

in the city of Riyadh – Phase 3

 Second: Selling Assets Initiatives

Environment, Water and Agriculture Sector:

1. Privatization of the General Grain Corporation: Privatization of the

second and fourth Flour Milling Companies

2. Privatization of Yunbu Water Production Plant Initiative

3. Al Khobar Water Production Plant (IWP)

4. Al Shuaiba Water Production Plant (IWP)

5. Water Transmission and Technologies Company

Media Sector:

1. TV Broadcasting Towers

Finance Sector:

1. Central Cooling Systems

*Initiativesand dates are subject to

change depending on the priorities,
readiness, and the decisions of the
sector’s supervisory committee.
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 Initiatives Timeframe

Initiative 2021
2021 2022 2023 2024 2025
Enablers: Enabling PPP&P
ecosystem

Enable NCP

Pillar 1: Enhancing the quality and efficiency of public services

Interior sector initiatives

Health sector initiatives

Hajj and Umrah sector initiatives

Labor and Social Development

sector initiatives

Housing sector initiatives

Energy sector initiatives

*Initiativesand dates are subject to

change depending on the priorities,
readiness, and the decisions of the
sector’s supervisory committee.
46
 Initiative 2021 2022 2023 2024 2025

Pillar 2: Supporting the contribution to economic development

Education sector initiatives

Communication and IT sector

initiatives
Environment, Water and
Agriculture sector initiatives

Transportation sector initiatives

Public Transportation sector

initiatives

Municipalities sector initiatives

Finance sector initiatives

Sports sector initiatives

Media sector initiatives

Industry and Mineral Resources

sector initiatives

*Initiativesand dates are subject to

change depending on the priorities,
readiness, and the decisions of the
sector’s supervisory committee.
47