Saudi bureaucratic lag will hamper change

Significance

The state is central both in the economy and in the lives of citizens. Government has been the key driver of economic diversification, but it also poses major obstacles to private sector-driven growth. In the latest reform drive, important parts of government have been restructured, but others remain largely untouched -- particularly the lower levels of the bureaucracy charged with implementing policy.

Impacts

• Insufficient attention to bureaucratic reform will constrain planned change in various economic policy areas.
• The performance of some individual agencies may improve, but overall government will remain disjointed and often unpredictable.
• Haphazard public sector reform will undermine the implementation of working-level economic regulations to encourage foreign investment.