Overview
The National Development Fund is a national development institution that provides general supervision over the development funds and banks in the Kingdom. It is organisationally linked to the Prime Minister, and its board of directors is chaired by the Deputy Prime Minister.[2]
The Fund was established by Royal Order No. (A/13) dated 13/01/1439 AH with the aim of raising the performance of the development funds and banks.[1]
Establishment and Supervision Mandate
The Royal Order was issued to establish a fund named the National Development Fund, entrusted with general supervision over the funds and banks in organisational, regulatory and executive terms.[3]
The Fund supervises the six development funds and banks specified in the Royal Order: the Real Estate Development Fund, the Saudi Fund for Development, the Saudi Industrial Development Fund, the Agricultural Development Fund, the Social Development Bank and the Human Resources Development Fund, in addition to the recently established Tourism Development Fund.[2]
Affiliated Entities and Capital
The total capital of the government funds under the Fund's umbrella amounts to 345 billion riyals.[4]
The number of development funds and banks affiliated with the Fund reached 12 development funds and banks. The Fund signed two credit facility agreements with Al Rajhi Bank and the Arab National Bank worth 5 billion riyals, to enhance support for development projects in the Kingdom.[11]
Strategy Targets
His Royal Highness Prince Mohammed bin Salman bin Abdulaziz, Crown Prince and Prime Minister and Chairman of the Board of Directors of the National Development Fund, launched the Fund's strategy on 11 Sha'ban 1443 AH, corresponding to 14 March 2022. The strategy aims to make the Fund a pivotal enabler of the economic and social objectives of Saudi Vision 2030.[7]
Through its affiliated development funds and banks, the Fund aims to inject more than 570 billion riyals into real GDP, double the share of non-oil output to reach 605 billion riyals by 2030, and stimulate the private sector's contribution to more than threefold the development impact on the Kingdom's economy.[7]
The National Infrastructure Fund
The Fund announced the establishment of the National Infrastructure Fund, which received Cabinet approval as one of the development funds and banks affiliated with the Fund, to contribute to the objectives of Saudi Vision 2030 by enhancing the development of infrastructure projects and enabling private-sector participation in investing in them.[8]
The Fund intends to support infrastructure projects with a total value of up to 200 billion riyals over the next ten years, and BlackRock was appointed a strategic partner to contribute to establishing the Fund, in order to apply international best practices in management and governance.[8] The Board of Directors of the National Development Fund, chaired by His Royal Highness the Crown Prince and Prime Minister, selected His Excellency Mr. Faisal bin Fadel Al-Ibrahim as Chairman of the Board of Directors of the National Infrastructure Fund.[9]
Support Programmes During the COVID-19 Pandemic
The Fund announced, building on its role as a development institution that seeks to empower its affiliated development funds and banks in service of development priorities and economic needs, and following the guidance of the wise leadership and within the urgent initiatives to address the effects of the novel coronavirus (COVID-19), programmes valued at up to 22 billion riyals.[5]
The Fund, in integrated coordination with the development funds and banks, provided support exceeding 28 billion riyals during the pandemic to mitigate its economic effects, benefiting more than 326,000 individuals and more than 36,000 small, medium and large enterprises.[6]
Governance and Appointments
The Governor of the National Development Fund is Dr. Stephen Paul Groff, and the Fund aims to enhance development impact, improve productivity, and enable its affiliated entities to achieve their objectives and ensure their financial sustainability.[12]
The Fund announced its Board of Directors' approval of the appointment of Khalid bin Ibrahim Sharif as Deputy Governor of the Fund, within the development of the Fund's administrative structure.[10]
Partnerships and Memoranda of Understanding
The Fund and the Saudi Data and Artificial Intelligence Authority (SDAIA) signed a memorandum of understanding to cooperate in national initiatives seeking to make the most of data and artificial intelligence, thereby adopting this field among the target sectors of the Fund's development strategy.[13]
The Fund also signed memoranda of understanding with Saudi Telecom Company, the Saudi Information Technology Company (SITE) and Cisco Saudi Arabia, to enhance cooperation in the fields of cybersecurity and digital infrastructure.[15] The Fund's Board of Directors approved the new strategy of the Human Resources Development Fund (Hadaf), which came in response to the changes and challenges of the labour market and to improve its efficiency.[14]
Frequently Asked Questions
Q: What is the National Development Fund? A: It is a national development institution that provides general supervision over the development funds and banks in the Kingdom, is organisationally linked to the Prime Minister, and its board of directors is chaired by the Deputy Prime Minister.[1][2]
Q: When was the Fund established and by what regulatory instrument? A: It was established by Royal Order No. (A/13) dated 13/01/1439 AH with the aim of raising the performance of the development funds and banks.[1]
Q: What is the total capital of the funds under its umbrella? A: It amounts to 345 billion riyals.[4]
Q: What are the targets of the Fund's strategy up to 2030? A: Injecting more than 570 billion riyals into real GDP, doubling the share of non-oil output to reach 605 billion riyals, and stimulating the private sector's contribution to more than threefold the development impact on the Kingdom's economy.[7]
Q: How much support was provided during the coronavirus pandemic? A: The Fund provided support exceeding 28 billion riyals, benefiting more than 326,000 individuals and more than 36,000 small, medium and large enterprises.[6]
Conclusion
Since its establishment by Royal Order No. (A/13) dated 13/01/1439 AH, the National Development Fund has combined general supervision over the development funds and banks in the Kingdom with the launch of its strategy on 14 March 2022, making it a pivotal enabler of the economic and social objectives of Saudi Vision 2030.[1][7]
On the platform, the Fund's topics are connected to the Public Investment Fund and the National Transformation Programme.
Related topics
- TopicSaudi Industrial Development FundThe Saudi Industrial Development Fund is a government fund established in 1394 AH (1974) with capital of SAR 500 million to develop the local industrial sector. Its capital increased in stages until it reached SAR 105 billion in January 2019, and today it covers the industry, mining, energy and logistics services sectors.
- TopicAgricultural Development FundThe Agricultural Development Fund is a Saudi government institution with an independent legal personality and financial and administrative autonomy. It is organizationally affiliated with the National Development Fund and headquartered in Riyadh. The Fund supports sustainable agricultural development and food security through concessional loans and credit facilities, and it originated from the Saudi Arabian Agricultural Bank, established in 1382 AH (1963).
- TopicAl Rajhi BankAl Rajhi Bank is a Saudi bank that began operating in 1957. It is among the largest banks in the world by market value and the largest in the Middle East and in the Kingdom of Saudi Arabia, with its head office in the city of Riyadh. It converted into a public Saudi joint-stock company in 1988 and adopted its current name in 2006 [2].
- National visions and programmesSaudi Vision 2030: A Framework for TransformationAn introduction to Saudi Vision 2030, its social, economic and institutional themes, and the relationship between implementation programmes, long-term targets and measured results.
- TopicThe Public Investment FundThe Public Investment Fund is a Saudi fund established in 1971 CE/1391 AH under Royal Decree No. (M/24), and linked in 1436 AH/2015 CE to the Council of Economic and Development Affairs. The assets it manages exceed SAR 3.4 trillion, and its activity spans three investment portfolios and giga-projects including NEOM, Qiddiya, the Red Sea, Roshn, and Diriyah.
- TopicNational Transformation ProgramThe National Transformation Program is the first executive programme of Saudi Vision 2030, launched in June 2016 to be the largest of the Vision's realisation programmes in terms of the strategic objectives assigned to it. The Program works to achieve 34 of the Vision's 96 objectives through more than 313 initiatives led by seven ministries and more than 50 participating entities.
Sources & references
- Saudi Press Agency (SPA) — Establishment of the National Development Fund by Royal Order
- Saudi Press Agency (SPA) — Organisational linkage and supervision of the development funds and banks
- Saudi Press Agency (SPA) — Royal Order establishing the National Development Fund
- Saudi Press Agency (SPA) — Capital of the funds under the Fund's umbrella
- Saudi Press Agency (SPA) — The Fund's programmes to address the effects of the coronavirus
- Saudi Press Agency (SPA) — The Fund's support during the COVID-19 pandemic
- Saudi Press Agency (SPA) — Launch of the National Development Fund's strategy and its targets
- Saudi Press Agency (SPA) — Establishment of the National Infrastructure Fund
- Saudi Press Agency (SPA) — Selection of the Chairman of the National Infrastructure Fund
- Saudi Press Agency (SPA) — Appointment of a Deputy Governor of the National Development Fund
- Saudi Press Agency (SPA) — Credit facilities and the number of affiliated entities
- Saudi Press Agency (SPA) — The Fund's Governor and its development objectives
- Saudi Press Agency (SPA) — Memorandum of understanding between the Fund and SDAIA
- Saudi Press Agency (SPA) — Board approval of the new Hadaf strategy
- Saudi Press Agency (SPA) — Memoranda of understanding in cybersecurity and digital infrastructure