The world's largest economies by 2050: who will build Saudi Arabia's reactors
Saudi Arabia has yet to pick a builder for its planned reactors, with Rosatom, Westinghouse, KEPCO and CNNC in contention — and it has let the 1974 petrodollar pact with Washington lapse.
“The world’s largest economies by 2050” (Saudi Arabia’s nuclear programme)
Saudi Arabia has decided to build 16 reactors over 15–17 years under its National Atomic Energy Project, but the kingdom has yet to choose which country’s company will build the plants. At the end of 2022, prequalification was completed for the tender to build Saudi Arabia’s first two-reactor plant, with a capacity of 1.4 GW. The companies that passed prequalification have not been named. Most likely they are the American corporation Westinghouse, the Russian state corporation Rosatom, the Korean company KEPCO (which built the plant in the UAE) and the Chinese corporation China National Nuclear Corporation.
“The world’s largest economies by 2050” (Saudi Arabia’s nuclear programme)
Of those bidders, Rosatom has the most experience and the greatest capabilities: it is currently building the Akkuyu plant in Türkiye, El Dabaa in Egypt and the second stage of Bushehr — ten units in three countries in all. Rosatom has the technology and infrastructure for the full nuclear cycle, including uranium mining and processing, nuclear fuel production, plant construction and maintenance, disposal of spent fuel and the training of nuclear specialists. Saudi Arabia also wants to keep good relations with Russia and uses the OPEC+ framework so that the two sides can manage world oil prices together.
“The world’s largest economies by 2050” (Saudi Arabia’s nuclear programme)
The Chinese corporation CNNC has a serious chance of winning the plant-construction programme, as Saudi–Chinese relations are strengthening markedly. In 2022 Saudi Arabia exported more crude oil to China than to anyone else, worth $56 billion, up from $39 billion in 2021. The national oil company Aramco is expanding its presence in the Chinese market by buying stakes in a number of Chinese refineries.
“The world’s largest economies by 2050” (Saudi Arabia’s nuclear programme)
Saudi Arabia also declined to renew a very important security agreement with the United States, signed on 8 June 1974 and expired on 9 June 2024, under which oil was sold on the world market exclusively for American dollars. The agreement was signed after the United States abandoned the gold standard under President Richard Nixon and became a significant factor in entrenching the dollar’s position as the world’s reserve currency. The main reason the dollar became the world’s reserve currency was that by the end of the Second World War (1945) the United States accounted for more than 50% of world GDP and held two-thirds of the world’s gold reserves. The agreement suited both countries well. Trading oil internationally in dollars gave the American currency global primacy. Saudi Arabia sold oil for dollars and bought US Treasury bonds, while the Americans provided Saudi Arabia with military protection and built their bases in the kingdom. Saudi Arabia thus became the anchor for the expansion of US influence in the Middle East.