Economic Impact of Saudi Vision 2030 on the Real Estate Sector

This report critically examines the economic impact of Saudi Vision 2030 on the real estate sector in Saudi Arabia. It delves into the background of the research, highlighting Saudi Arabia's efforts to diversify its economy and reduce reliance on oil. The report assesses the aims and objectives of Vision 2030, focusing on how funds infused into the real estate sector can generate income-producing assets. Key research questions address the adverse effects of the initiatives, financing approaches, and local perceptions of the visionary mission. The literature review covers topics such as privatization, real estate market growth, and challenges faced by the sector. The research methodology employs a deductive approach, descriptive research design, and secondary data analysis, including thematic analysis. Ethical considerations are addressed to ensure privacy and data integrity. The report also includes findings and analysis related to the themes of Vision 2030 and the future of the real estate business in Saudi Arabia. Desklib provides students with access to this report and many other solved assignments.

Running head: ECONOMICS
Economics
Name of the Student
Name of the University
Author Note

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Table of Content
CHAPTER 1: INTRODUCTION..............................................................................................3
1.1 Introduction......................................................................................................................3
1.2 Background of the research..............................................................................................3
1.3 The aim of the research....................................................................................................4
1.4 Research Objectives:........................................................................................................5
1.5 Research Questions..........................................................................................................5
1.6 Literature Assessment......................................................................................................5
1.7 Research Methodology.....................................................................................................6
1.8 Data..................................................................................................................................6
1.9 Analysis of available data................................................................................................6
1.10 Ethical Consideration.....................................................................................................7
CHAPTER 2: LITERATURE REVIEW...................................................................................8
2.1 Introduction......................................................................................................................8
2.2 Vision 2030 and privatization to boost Saudi office property sector:............................10
2.3 The Saudi-Arabia real estate market shows promising growth from vision 2030:........13
2.4 The revival of the real estate market in Saudi Arabia:...................................................15
2.5 Challenges of the real estate market...............................................................................16
2.6 Revival of the real estate market........................................................................................17
2.7 Impact of Saudi Vision...................................................................................................18
2.8 Future of the real estate market......................................................................................19
2.9 Research Gap.................................................................................................................21

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Chapter 3- Research Methodology...........................................................................................22
3.1 Introduction....................................................................................................................22
3.2 Research Approach........................................................................................................22
3.3 Research Philosophy......................................................................................................23
3.4 Research Design.............................................................................................................25
3.5 Method of Data Collection.............................................................................................27
3.6 Gantt Chart.....................................................................................................................28
3.7 Ethical Considerations...................................................................................................29
Chapter 4: Findings and Analysis...........................................................................................31
4.1 Introduction....................................................................................................................31
4.2 Thematic Analysis..........................................................................................................31
4.3 Analysis..........................................................................................................................37
References................................................................................................................................44

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List of Figures
Figure 1: Research Approach...................................................................................................24
Figure 2: Research Philosophy.................................................................................................25
Figure 3: Research Design.......................................................................................................27
Figure 4: Data Collection Method............................................................................................28
Figure 5: Vision 2030 of Saudi Arabia....................................................................................39
Figure 6: Real Estate Business in 2030....................................................................................40

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CHAPTER 1: INTRODUCTION
1.1 Introduction
The very sole purpose of undertaking this research is to critically
examine the current economic position of Saudi – Arabia and the new
initiative that is being implemented by them. This research aims to
support the real estate sector of the economy regarding the challenges of
the year 2015, the reduction in the price segment of the oil and
subsequent requirement to reduce government expenditure. As per Saudi
– Arabia economic Vision 2030, the real estate sector started with the
government expenses of about $10.6 billion that were provided to
different contractors and consequently SR20 billion was infused within the
banking sector of the economy.
To introduce innovation within the economy and make the real
estate sector available to different small financiers, and investors, the
capital authority has initiated new regulations and act during the year of
2016 and also allowed the formation of real estate investment traded
finances. Therefore the very purpose of undertaking this research is to
critically examine how the funds infused in this real estate sector can help
developers in Saudi Arabia seeking to generate income generating assets.
1.2 Background of the research.
Saudi vision 2030 resembles towards an arrangement to eliminate
the economicreliance on oil, expand the economy, and build up public
service sectors namely, health sector, educational sector, infrastructure

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division, recreation as well as tourism sector. Objectives comprise of
reinforcement of economic as well as investment actions, enhancement of
non-oil business trade between nations, and augmenting government
expenditure on the armed forces, manufacturing tools, and ammunition.
However, there has been a key influence that relies upon the new era of
austerity along with other macroeconomic threats of destabilized
expenditure control, new tax regulation establishment in the kingdom and
commencement of new real estate outlay traded finances on the real
estate sector in Saudi Arabia has certainly pursued in the wake of macro-
economic influences brought about by dynamic prices of oil.
However, the primary objective of the government is to strengthen
the market. For meeting such vision and future development, the
economy has formulated visionary programme such as the Vision 2030.
The new visionary programmeaims to support the real sector economy of
the economy. The visionary programme will help in dealing with the
challenges of diminishing oil prices and consequential requirement to
decrease government spending as per a report.
1.3 The aim of the research
The sole purpose of carrying on this research is to critically examine
the effects of the latest initiatives that have been undertaken by the Saudi
economy, such as the visionary programme 2030. The primary objective
is to critically analyzeeffects of latestinitiatives of Saudi Vision 2030 on
the real estate sector. To depict out whether the real estate market is

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going to expand in terms of development or shrink within the coming
future and its effects on the economy of the country.
Another purpose of conducting this research is to analyze the
positive and negative steps of the economy that can adversely create
huge impact upon the real estate industry in Saudi Arabia. However, the
initiatives are included within the plan that contributes towards the
structural disadvantages of the nation namely, weak institutional powers,
significant powers in the labour market along with inefficient bureaucracy
and many others. Another aim of undertaking this research is to analyze
positive and negative effects because of undertaking this set of initiatives,
addressing structural disadvantages of the nation and subsequently the
real estate segment in particular.
1.4 Research Objectives:
The set of objectives are as follows: they are:
- To critically examine the present scenario of Saudi – Arabia and
their efforts for overcoming from such issues.
- To critically examine the visionary programme 2030, aim and
objectives towards the real state sector.
- To critically examine how the funds infused in this division, which
can generate earning by producing assets within the real estate
sector of Saudi Arabia

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1.5 Research Questions
- The adverse effects of the novel initiatives of Saudi Arabia vision
2030 on the real estate industry?
- Different approaches in which the finance has been carried out
within the real estate sector of Saudi – Arabia?
- To analyze the vision and perceptions of the local citizens regarding
the visionary mission?
1.6 Literature Assessment
Within the last decade, the economy has seen a considerable
amount of growth in terms of oil prices and that of the augmented level of
production. This is the primary reason for which the overall expansion of
the entire workforce and enhanced government expenditure are
undertaken especially in areas of infrastructure section, real estate sector,
education industry, and healthcare, telecommunications as well as retail
division. However, the lack of stability in the oil price segment during the
second half of the year 2014 formulated new economic settings. It is
Saudi – Arabia vision 2030 programme that aims to bring about a change
within the economy and regain the prosperity of the economy. The
visionary programmeis initiated with the objective that it will help the real
estate sector of the economy to deal with the various challenges like
threats in terms of the oil price.

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1.7 Research Methodology
The use of the deductive approach will be undertaken for
undertaking this very research. Taking into consideration the sole purpose
of the study, the motive is to make use of the descriptive research design
such that use of the secondary data is being undertaken along with the
thorough evaluation of facts that were previously acknowledged to great
degree. Making use of the descriptive research, it aims to carry out a
complete investigation of formerly available evidence and subsequently
figuring out interferences by understanding thematic analysis.
1.8 Data
The use of the secondary data is being undertaken,and the
application of qualitative analysis is undertaken. Besides, different kinds
of structured texts entailing survey response, diverse articles/journals as
well as books will be used for the current study. Therefore, this can be
gathered as qualitative data for the current study.
1.9 Analysis of available data
For undertaking this research, the primary method will comprise of
making use of the various case study analysis, thematic data analysis and
analysis of academic literature for evaluation of obtainable data. There
are different groups that concentrate on recognizing a particular pattern
in a specific dataset. Furthermore, there are different classes of thematic
analysis that can be utilized in the present study are necessarily
deductive advances that are directed by different concepts.

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1.10 Ethical Consideration
It is very important to follow the rules and regulations while
undertaking the study. The privacy of the individual has been kept
confidential. In fact, for the current study, requisite secondary information
namely, available reports, periodicals, relevant articles amongst others
are acquired from diverse secondary sources. It is taken care of that the
individual sentiments of the subjects do not get hampered. In addition to
his, the secondary qualitative data can essentially be derived from diverse
restructured as well as reliant sources, so that there is no disagreement
and inconsistency.

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CHAPTER 2: LITERATURE REVIEW
2.1 Introduction
Nurunnabi (2017) says that, Saudi Arabia, for gaining sustainability it has developed a
vision of diversifying its economy. Although oil and gas are the economy’s pillars, the
country has also started with expansion in its investment for the other sectors as well. In order
to overcome the issues which might arise in the path of Saudi towards achievement of
sustainability, it has established certain long-term plans. In the past 25 years, the country has
seen an annual growth of more than 4 per cent, according toArab News (2018). Saudi
possesses several state-owned assets which include aspects such as the properties, other
assets and the leading companies of the country. These state-owned assets are rapidly getting
privatized. Due to such privatization, the revenues of the country would be benefitted with
greater levels of diversification. It would also assist in stabilizing its financial resources as
well as the economy itself. These financial resources are utilized by re-investing them in the
long run. Nurunnabi (2017), in his work talks about the future plans of Saudi Arabia. The
country aims at increasing its overall returns on investment and the efficiency of its funds
management, which would subsequently enable the diversification of its government
resources and the economy. Instead of competing with the private sector, the public sector’s
private fund would rather help in opening the sectors that demands huge amount of capital.
As such, National corporations would be developed and new sectors of the economy would
be established. This assessment has been carried out particularly for focusing upon the real
estate sector of the country, Saudi Arabia, and affect of Saudi Vision 2030 on the real estate
industry of the country. The challenges and issues that the country has been facing
throughout its journey of moving towards being sustainable, have also been discussed.

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According to the author Arabia et al., (2030), the Kingdom of Saudi-Arabia is blessed
because of its possession of the rich assets that stayin favour of the economy. Its geographic,
cultural, social, demographic and economic advantages have enabled the economy to be a
dominator in assets that they possess in comparison to other countries. Because of the
possession of these assets, the region of Saudi-Arabia is at a leading position within the
world.
The Vision 2030, the programme is formulated on a strategic basis. The visionary
programme is a blueprint that acts as a visionary tool for economists within Saudi – Arabia.
The blueprintresembles towards the future for Saudi Arabia based on an economy diversified,
away from a dependency on oil and driven by the establishment and formulation of new
private business units. Public-Private Partnerships, privatisation of many government
services, and a modernisation of the business legal environment to promote entrepreneurship,
local as well as foreign investment. Moreover, the economy has faith in this visionary
programme s they believe that this visionary programme will help in the creation of new job
opportunities and will result in the elimination of poverty level.
Therein Saudi – Arabia, also exists a specific segment of local residents who do not
even have favorable conditions to live in. They do not evenhave a reach to basic services.
They do not have a proper house to live in such that they reside in tents. Some of the
problems as faced by the poor section of the society comprises of sand storms. This visionary
programme will at least help the poor section of the society by creating new job opportunities
for them. On the other hand, the living standard of these specific poor sections of the society
will get improved. This will directly result in the growth of the economy.
However, Vision 2030 programme aims to open the door of hope and put the hand
forward to bring more prosperity by loosening investment rules within the specific regions,