A national taskforce empowered to unite private and public sector initiatives is needed to drive further downstream diversification of the Saudi Arabian economy, said an expert.

Speaking to an audience of 600 ministers, government officials and industry leaders at the 2014 Saudi Downstream Forum in Yanbu, Mohamed Al-Mady, vice chairman and CEO of Sabic, called for a step change in the kingdom’s approach to downstream based on the Royal Commission model that drove the development of the petrochemical industry.

He pointed out the need for many initiatives required to drive further downstream development, including improved infrastructure, free-trade zones to support investment inflows and government investment in early training of employees.

“These imperatives cannot be achieved if every company, every industry, every ministry, is following its own agenda, no matter how well-meaning the agenda may be,” said Al-Mady.

“Downstream diversification extends beyond the interests of a single industry. It requires a co-ordinated and consolidated approach from business, government, ministries and entrepreneurial enterprises.”

The growth of the petrochemical industry in just four decades from a standing start to a world-class pillar of the economy worth $354 billion is evidence for the success of the model, he said.

Growth in the petrochemical industry continues to outstrip the economy as a whole, averaging nine to 10 per cent over past years against GDP growth of four to five per cent, said Al-Mady.

The industry has also been the catalyst for growth in other areas of the economy, including banking, construction and insurance, he added.

Sabic, along with Saudi Aramco and the Public Investment Fund began the establishment of the Industrial Investment Company to attract resources into the maritime, automotive, power, water and electrical equipment sectors.

The company has also expanded its own operations into performance chemicals and engineering thermoplastics and made significant additions to its global innovation network, including the opening of the Sabic Plastic Applications Development Center in Riyadh’s Techno Valley last year.

These initiatives are specifically focused on building downstream opportunities in key industries including automotive, construction, consumer electronics and packaging, said Al-Mady.

“Business and government are each doing their part. But I do not believe we can go much further within the limits of the current structure.” said Al-Mady.

“Now is the time for a bold initiative to drive us toward the success we all believe is possible.” - TradeArabia News Service