Saudi to double tech spending after Moody's upgrade

Saudi Tech Spending

Rating agency Moody's on Monday upgraded Saudi Arabia to its second-highest level as oil earnings and a recovering economy push the government's budget back into the black this year. In the light of this news Saudi Arabia's King Abdulaziz City for Science and Technology will double spending on technology research over the next five years to SR16 billion (US$4.27 billion), a senior official at KACST said, according to a Bloomberg newswire report on Tuesday.

Moody's Investors Service hiked Saudi government foreign and local currency debt to A3 from the previous rating of A1 even as Riyadh powers ahead with its massive state spending programme on schools, infrastructure and the military.

"Small deficit in 2009"

"The upgrade was prompted by the continued strong state of government finances, which have largely withstood oil price volatility and the global economic crisis," Moody's said in a statement.

"A return in the budget to a moderate surplus - from an estimated small deficit in 2009 - will restore the Kingdom's debt trajectory back on its former improving trend, even with continued large-scale infrastructure spending."

After such a strong economic performance so soon after the global economic crisis, the Kingdom has just highlighted 11 areas of technology including oil and gas, water, and nanotechnology as part of its strategic plan, Prince Turki Bin Saud Bin Mohammed Al Saud, vice president for research institutes at KACST, the national science agency, told a conference in Jeddah, Saudi Arabia.

Saudi Arabia have already started construction of a solar-powered water desalination plant, the first step in a three-part program to introduce solar energy into the Kingdom with a view to eventually become a member of the International Renewable Energy Agency, otherwise known as IRENA.

Additional heavy spending

There are also some rather far out plans to construct a sustainable petroleum research centre.

The Kingdom's solar desalination programme, launched by KACST aims to help stabilise future power and water supplies inside Saudi Arabia through the creation of solar-powered desalination facilities.

Saudi Arabia is also spending around US$400 billion dollars over the 2008-2013 period to massively expand educational and health facilities, build new infrastructure like trains, and expand its oil and petrochemical industry.

Additional heavy spending is also going into the military sector.

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Daniel Jones

Daniel is a Politics and Philosophy graduate from Cardiff University where he also worked as a section editor on the award winning student newspaper. After university he joined an IT support company where he was a B2B online writer. He loves anything to do with sport and joined GDS in July 2009.

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