The Saudi government has approved a new law designed to improve the process of procuring contracts and services by saving money and boosting local bidders, according to a statement from the kingdom’s Ministry of Finance.
According to the Ministry, the law is “an important measure” within the kingdom’s wider Vision 2030 reforms.
“The new law facilitates the achievement of fiscal balance by enhancing the effectiveness of financial planning, resource management, and elevates government procurement procedures…comprehensively bridging the shortcomings of the current law and maximising the spending efficiency of new and existing development projects,” the statement noted.
Minister of Finance Mohammed Al-Jadaan said that the law “seeks to allocate and manage financial resources effectively, provides more transparency in all tenders and procurement procedures.”
Among the changes stipulated in the law are newly introduced flexibility in the price of contracts and compensations in cases in which raw materials prices, custom duties and taxes have changed.
The move is also aimed at increasing the participation of SMEs in the kingdom by giving them priority over large competitors and exempting them from having to give initial guarantees.
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