Saudi Minister of Education launches Action Program to strengthen Public-Private Partnership in line with Vision 2030

Wednesday 11 January 2017

Riyadh – MENA Herald: The Minister of Education, Dr. Ahmed Al-Issa, lunched today morning, the "Investment & Finance in Educational Buildings Conference" at the headquarters of the Ministry of Education (MoE) in Riyadh.

Organized by the Ministry of Education and Tatweer Buildings Company (TBC), this Conference aims to enhance the public-private partnership horizons in the area of educational facilities and buildings. The participants will include H.E. Minister of Commerce and Investment, Dr. Majid bin Abdullah Al Qasabi, and about 35 speakers representing various government entities and the employees of banking and investment sectors, including H.E. Vice
Minister of Finance, Dr. Hamad Al Bazai, universities' presidents and Deputy Ministers.

In his speech during the opening session of the Conference, the Minister of Education extended his gratitude to the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud, HRH Crown Prince and HRH Deputy Crown Prince for their unprecedented patronage to develop the educational system in the Kingdom as part of the belief in better building people and shaping their national consciousness at present and in future. He referred to the allocation of more than SAR 200 billion of the State's budget to support education in the Kingdom, pointing out that the Ministry aspires through this Conference to launch the Action Program for partnership with the private sector, which achieves the Kingdom's Vision 2030 to enhance the public-private partnership horizons in the area of educational facilities and buildings.

Al-Issa added that the "Investment & Finance in Educational Buildings Conference” provides all stakeholders with investment and financing opportunities and options in the educational buildings, aims to create attractive environment for education investors in line with the Kingdom's Vision 2030, confirms the role of education development companies in enhancing the investment environment, in order to open new investment channels to provide the educational buildings, make use of the MoE resources and launch a package of promising investment opportunities in the area of educational buildings.

The Minister of Education called the Kingdom's investment sector, family businesses, and investment companies to enter into a real partnership with the Ministry, represented by TBC, to achieve such objectives in accordance with the applicable laws in the Kingdom. The Minister also pointed out that experience exchange should be utilized through the regional and international experiences and initiatives in the Conference, in order to materialize the partnership with the private sector in the area of educational buildings development and to discuss the investment and financing opportunities in the educational buildings and lands.

In his speech delivered in the opening session, H.E. Minister of Commerce and Investment, Dr. Majid Al Qasabi, said that “the private sector is a strategic partner in education development in line with the Kingdom's Vision 2030," stressing the importance to seriously empower the private sector and provide investment incentives.”

Al Qasabi pointed out that the education sector is of a considerable attention to the Government of the Custodian of the Two Holy Mosques, as the amount of more than SAR 200 billion, representing 22% of the total budget and 5.7% of the Gross Domestic Product (GDP), was allocated this year to cover the education expenses. It is worth mentioning that the education expenses in Britain, Germany and South Korea represent 5.3%, 4.3% and 4.2%% respectively. I hope such expenses optimally contribute to the development of the education sector.

The Ministry of Commerce and Investment, the Saudi Arabian General Investment Authority, the General Authority for Small and Medium-sized Enterprises and the Business Performance Improvement Committee have exerted major efforts to overcome all obstacles for the investment and financing by the private sector in the education sector, Al Qasabi added, calling for forming an integrated workforce to consider the method to activate cooperation between the private and public sectors as well as identify investment opportunities in the development of educational buildings. He thanked all those who contributed to the organization of this Conference.

TBC CEO, Eng. Fahad bin Ibrahim Al Hammad, stated that the MoE has made great efforts in the education sector, as it developed more than five thousand educational buildings throughout the last decade. The MoE further operates and maintains more than twenty-two thousand educational buildings throughout the year, and follows up the restoration, rehabilitation, maintenance and expansion of many educational projects.

Al Hamad added “to ease the burdens of managing and following up such projects and to be in line with the modern management variables, TBC was incorporated as the executive arm of the MoE in managing and executing the educational buildings projects. Its target was that all the Kingdom schools should be established as buildings fit with changes, developments and students' needs in this era. Such main goal was followed by other goals represented in obtaining effective services to quickly and flexibly manage projects, to reduce the supervisory burden of the MoE and to reach the optimal efficiency in delayed projects."

Al Hammad added “The private sector’s contribution has increased from 40% to 65% as per the Kingdom’s 2030 Vision has pushed us to give careful consideration to the mechanisms of increasing the private education and provide facilities to enhance the partnership with the private sector to build, manage and enhance the quality of educational buildings, and to facilitate the educational institutions’ access to land. Hence, we conducted a benchmark study that included the experience of eight countries, and carried out a number of analytical studies with a number of national and international consultants and experts”.

He further added "Such mechanisms which would lead to increased private sector engagement in the education development were subject to analysis and study. Accordingly, we have concluded that the available opportunities include leasing and leasing back buildings with financial institutions, endowments and family businesses, as well as entering into partnership with developers, contractors and maintenance and operation companies to mandate them with building and maintenance projects through long-term contracts extending for thirty years, God willing. These opportunities include entering into partnership with private educational institutions in construction and operation activities according to long-term contracts. The available opportunities also include asset management and investment. Such assets are those which can be disposed of or whose investment sites can be replaced with other sites serving the educational purpose itself.”.

The opening session included displaying a film about TBC and honoring the sponsors participating in the Conference by the Minister of Education. Later, the associated exhibition, with participants of more than 20 local and regional companies, was opened.

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