MBSC EMBA · ECN 511 Economics for Managers
Construction and Infrastructure · Topic B: the multiplier effect of public capital spending, and where the money leaks
Group 8Abdulmajeed AlajlanAbdulrahman AldahlawiSalman AlfarisMohammed AlghamdiAbdulaziz AlweheabNada AlyahyaHaifa Binnafisah
Shown before the timed talk. Twelve content slides, about eight minutes. Click, or press →, to drive in.01 · Construction and Infrastructure
92,760 planned seats · King Salman Stadium, Riyadh
A stadium buys civil works, materials, building systems and specialist expertise.
Sources: FIFA 2034 bid evaluation; GASTAT Supply and Use Tables 2023; Ministry of Sport; Populous [R01, R05, R02–R03, R53].
Part 1 · The sector
| Stadium | Seats | Who buys | Who supplies | Published value |
|---|---|---|---|---|
| Prince Mohammed bin Salman Stadium, Qiddiya | 45,000 | Qiddiya Investment Co. | FCC (Spain) – Nesma (KSA); Elegancia: mechanical SAR 829m; IKK Fangda: facade SAR 997m ex-VAT | about SAR 4.0bn |
| Aramco Stadium, Al Khobar | 46,096 | Saudi Aramco | Besix (Belgium) – Albawani (KSA) | about SAR 3.7bn |
| King Salman Stadium, Riyadh — our case | 92,760 | Ministry of Sport | Main works prequalification notice (Nov 2025); design by Populous | Not published |
International–Saudi joint ventures deliver the main works; specialist imported systems arrive through subcontracts.
Sources: R05 (sheet 6.3), R01, R02–R03, R57, R58, R23–R24. Calculation: construction gross value added 338.3bn ÷ total GVA 4,332.9bn = 7.81% (GASTAT 2023, sheet 6.3).
02 · The spending multiplier, in simple terms
GDP multiplier = extra GDP caused ÷ extra public spending
Illustration: SAR 100m extra spending causes SAR 120m extra GDP. Multiplier = 1.2.
A firm chooses a supplier.
The combined effect on GDP.
The spending multiplier is macroeconomics.
Source: IMF, Fiscal Multipliers, 2014, section II [R69]. Teaching example, not a Saudi estimate.
03 · Construction and Saudi GDP
GDP counts the extra value created at each Saudi stage once. A local supplier’s full invoice also includes inputs bought from other firms.
Academy link: qualified local suppliers can win orders and create extra Saudi value.
Source: GASTAT, Supply and Use Tables 2023, sheets 6.2–6.3 [R05]. Sector share describes scale, not a GDP multiplier.
Part 1 · How import-dependent it is
Metals and electrical machinery are half imported; by amount, chemical products and metals are the largest leaks.
Source: GASTAT, Supply and Use Tables 2023 [R05] — use: sheet 6.2 col. H; import rate: sheet 6.1 Total imports (AA) ÷ Supply at basic prices (AB). National ratios applied to construction purchases; GASTAT does not publish this split directly.
04 · Applying the multiplier to our case
Sources: R57, R58 (benchmarks); GASTAT Supply and Use Tables 2023, sheets 6.1–6.2 [R05]. Group scenario using national ratios; figures are rounded.
05 · The materials behind the import leakage
Grade, quantity, origin, certification and price from supplier schedules.
Examples under each group are illustrative. Each bar retains its whole GASTAT group value. Source: GASTAT, Supply and Use Tables 2023, sheets 6.1–6.2 [R05]. National product ratios applied to construction use; group scenario, not invoices.
06 · Stadium EPP at 20 percent, credit up to 6
Assumption: one main contract with one company, so all SAR 421m counts.
Knowledge transfer / localisation 1–3
Technology transfer / exports 2–4
Qualifying base + approved bonus. Rare technology or other eligible grounds.
Credit differs from cash, GDP and ROI.
Source: LCGPA, Economic Participation Policy Update, consultation text, Articles 6–9 [R63]; DGA Group, April 2026. Imports: group scenario [R05]. Actual tender terms control the applicable version.
07 · London 2012 offers a construction skills lesson
Training connected to real construction jobs.
Encouragement without binding targets made skills objectives harder.
Saudi adaptation: paid practice, independent tests and a return-to-train commitment
Sources: UK DCMS, 2012 Games construction on track, 20 May 2012 [R12]; Crossrail Learning Legacy, 2018 [R13]. Counts do not prove retained jobs.
08 · The controls that make the solution credible
Evidence at three points
Sources: LCGPA consultation Arts. 8(3), 13–16 [R63]; WIPO licensing [R64]; OECD competition safeguards [R68]; UK additionality study [R54].
09 · One academy with three connected functions
Shared EPP proposal: eligible stadium vendors jointly fund ONE academy. Each vendor contributes approved funding, trainers, equipment or licensed know-how.
Licensed manuals and software
HVAC rigs and coating-test kits
Paid practice and Saudi trainers
Evidence: NITI training; WIPO licensing terms
Coatings, sealants and metals
Test specific grades and origin
Material passports for approvals
Evidence: ALUPCO extrusion; Sika Saudi admixture production
Common performance specifications
Competitive framework and call-offs
Verify discounts and full cost
Evidence: OECD purchasing efficiency and competition
One qualified host runs the programme. Sharing trainers, equipment and demand reduces duplicated training and keeps skills available across sites.
LCGPA approves vendor roles and cost allocations. Each vendor keeps its own EP obligation and ledger. Each activity earns credit once.
Later: export Saudi-owned courses, licensed services and qualified products.
Sources: NITI [R42]; official LCGPA draft Arts. 8–9 [R63]; WIPO [R64]; OECD [R65, R68]; ALUPCO [R66]; Sika [R67]. Candidate capabilities, not partner commitments.
10 · Hands-on training first, academy after evidence
Joint agreement first: vendor commitments, LCGPA-approved activities and separate credit records.
Employers identify the skills gap and sign paid site placements. Vendor roles and funding are agreed.
Condition to proceedNext-site work, budget, IP rights, tools and approvals are confirmed. Signed licences and EP cost allocations.
Supplier mentors teach on real equipment. Independent tests and trainer practice. Saudi trainers teach the next cohort.
Condition to proceedVerify practical competence, paid deployment and unit cost. Record extra capability beyond routine duties.
Repeat cohorts build an academy. A permanent facility needs its own case. Use existing facilities where adequate.
Condition to proceedContinuing jobs and orders, proven results and acceptable quality and cost. Track work and trainer return at 6/12 months.
No confirmed paid demand: defer intake. Weak results: redesign or stop.
Suggested start: 24 learners, 6 trainer candidates, 2 eligible sites. Targets for agreement.
Basis: report Sections 5–8 and Appendix F. Sources: NITI [R42], training evaluation [R54], LCGPA draft [R63], WIPO [R64]. Proposed design.
11 · Value now and after the stadium opens
| Value | During construction | After handover |
|---|---|---|
| Skills and academic capability | Paid practice, independent tests, manuals and trainer development | Next-site work, returning trainers and further recognised qualifications |
| Local products and IP | Approved local grades, tooling and usable technical rights | Repeat orders, deeper production and independent Saudi services |
| Buyer value | Joint offers, less duplicated buying and comparable full-cost prices | Reusable specifications and resilient multi-supplier sourcing |
| Export value | Saudi-authored content and rights prepared for later markets | Paid courses, licensed services and qualified products sold abroad |
Illustrative materials opportunity
25% of the SAR 177m basket ≈ SAR 44m more domestic purchases
Source: GASTAT-based group scenario [R05]. Benefits are proposals. No discount or export revenue is assumed. Domestic purchases, savings and credit are separate.
12 · The decision for LCGPA and the buyer
Proposed joint programme for all participating eligible stadium vendors · one academy, agreed vendor contributions and individual compliance records.
Approve extra activities, rights, factors and separate supplier ledgers.
Approve competitive joint procurement and construction gates.
Agree paid placements, material trials, trainer return and follow-up.
Why these factors: LCGPA sets the final factor within each draft range. We start at the minimum and add 1 per condition met: usable licences (2→3), new skills with independent tests (1→2), approved Saudi materials with real orders (1→2). Not the maximum: no manufacturing rights, recognised qualification or new plant.
Proposed start: 24 learners, 6 trainer candidates, 2 confirmed eligible sites
Proposal targets for agreement, not forecasts or observed results. Scale on proven skills, demand, quality, cost and licensed rights. Policy basis: LCGPA [R63].
Group 8 · MBSC EMBA · ECN 511
Questions welcome
King Salman Stadium · Riyadh 2034
Closing. Thank the audience and invite questions. The four source pages follow in the appendix (press M).Sources 1 of 4
Evidence basis: report updated 21 October 2026. Course material: [C1] George, R. E., Assessment Guidelines for ECN 511, MBSC, 30 September 2026; [C2] MBSC, ECN 511 Course Syllabus Modular A1, 2026; [C3] George, R. E., EPP assessment update allowing supporting localisation evidence, email received 20 October 2026. No public URLs. References and backup material sit outside the eight-minute presentation.
Sources 2 of 4
AI use: ChatGPT supported research, calculations, charts and drafting. Claude supported review. No original interviews or field data are claimed. Facts, teaching assumptions and proposals remain labelled. The submitting group remains responsible for source checks and final approval.
Sources 3 of 4
Verification: GASTAT Supply and Use Tables 2023 downloaded 27 October 2026. The supplied ratios reproduce 60.507bn of modelled imported construction inputs by applying each national product import ratio to construction use — an estimate, not an observed industry import-use matrix. BESIX’s official project page confirms the Aramco client and BESIX–ALBAWANI JV (source). Official capacities are approximately 47,000; the retained 46,096 is the FIFA bid design scope. Current public procurement notices do not establish an awarded King Salman main package.
Sources 4 of 4
The primary draft was read directly from the official Istitlaa consultation HTML on 28 October 2026. It is a consultation text, not an adoption notice. The supporting sources establish mechanisms and existing capabilities, not committed project partners or guaranteed performance.
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