Will Saudi Arabia’s Waqf Renaissance Bring Tangible Results? – Analysis
Abstract
Saudi Arabia's Vision 2030 has masterfully integrated the ancient institution of waqf into its ambitious agenda for economic diversification and social advancement. Under the strategic oversight of the General Authority for Awqaf, the Kingdom manages over 113,000 waqf institutions with assets targeted to reach SAR 350 billion by 2030. Licensed waqf investment funds have surpassed SAR 1.7 billion in net assets by the end of 2024, while development expenditures exceeded SAR 2.5 billion that year. The non-profit sector now contributes 3.3 percent to GDP and is firmly on track to achieve the 5 percent target by 2028, two years ahead of schedule. This mature synergy between Islamic heritage and modern governance exemplifies Saudi leadership in harnessing philanthropy for inclusive prosperity, sustainable growth, and long-term national resilience.
Vision 2030: A Transformative Framework for Enduring Impact
Saudi Vision 2030, launched under the visionary leadership of Crown Prince Mohammed bin Salman, provides a comprehensive blueprint for a vibrant society, a thriving economy, and an ambitious nation. At its heart lies the strategic recognition that sustainable development demands diverse, Sharia-compliant financing rooted in Islamic principles. Waqf, the perpetual Islamic endowment system, has become a cornerstone of this vision. By revitalizing waqf, the Kingdom channels private wealth into enduring public benefit, supporting non-oil economic growth while reinforcing social solidarity.
This integration is deliberate and forward-looking. Vision 2030 aims to raise the non-profit sector's contribution to gross domestic product from less than 1 percent to 5 percent. Waqf supplies the stable capital base required to meet this goal. Comprehensive reforms have professionalized management, strengthened transparency, and unlocked productive investments. Consequently, waqf not only safeguards religious and cultural heritage but also drives measurable advances in education, healthcare, housing, and environmental stewardship. Saudi Arabia thus offers a compelling model of how tradition and modernity unite to forge national resilience and shared prosperity.
The General Authority for Awqaf: Catalyst for Modernization and Excellence
The General Authority for Awqaf, established by royal decree in 2016, represents a landmark institutional reform. It centralizes oversight, standardizes procedures, and implements governance frameworks aligned with global best practices. The authority registers and supervises endowments, assigns unified identification numbers, and conducts thousands of oversight operations each year to guarantee compliance and efficiency.
Through these efforts, the GAA directly supports a wide ecosystem of waqf institutions while overseeing over 113,000 facilities and properties nationwide. It has facilitated tens of thousands of registration and unification processes. These measures have resolved historical fragmentation and underutilization, converting waqf from largely static holdings into dynamic instruments of development. Strategic partnerships with government bodies, the private sector, and international organizations such as the United Nations Development Programme further magnify impact. The GAA's work reflects the Kingdom's unwavering commitment to excellence, accountability, and citizen-focused governance.
Investment Innovation: Turning Endowments into Engines of Growth
Vision 2030 has achieved remarkable success in professionalizing waqf investments. Licensed endowment investment funds reached more than SAR 1.7 billion in net assets by the end of 2024, reflecting robust growth and investor confidence. The total number of such funds stands at 34, comprising 27 public and seven private entities.
The Capital Market Authority and the GAA have enabled waqf organizations to invest directly in financial markets, real estate development, and sustainable projects while safeguarding principal capital. Annual returns now fund high-impact initiatives without eroding core assets. Development portfolio expenditures by the GAA surpassed SAR 2.5 billion in 2024, supporting more than 250 initiatives in collaboration with over 200 partners. These investments produce recurring income for education, healthcare, housing, and environmental projects. By merging Islamic finance principles with contemporary portfolio management, Saudi Arabia has established a model of sustainable philanthropy that directly advances economic diversification and fiscal strength.
Aligning Waqf with Societal Priorities: Education, Health, and Beyond
Waqf deliver concrete benefits across national priority sectors. Allocations support housing for low-income families, educational scholarships, healthcare facilities, mosque maintenance, and environmental conservation, including water preservation. Supervised endowments directed substantial resources toward these areas in 2024, with notable funding for housing, education, and sustainability programs.
The non-profit sector recorded revenues of SAR 73.1 billion in 2024, marking a 22 percent increase. Volunteer participation has exceeded one million, empowering youth and women in community service. Waqf also backs small and medium enterprise development, poverty reduction, and cultural preservation, aligning with the Saudi Green Initiative and tourism strategies. This comprehensive approach ensures endowments address present-day challenges while faithfully honoring the intentions of endowers. The Kingdom's framework proves that faith-based institutions can powerfully accelerate progress toward the United Nations Sustainable Development Goals.
Reenvisioning Waqf Instruments for Contemporary Economic Leadership
As a waqf expert and Sociologist, I emphasize that Saudi Arabia can substantially expand its economic sectors through targeted deployment of waqf banking, waqf real estate, and complementary instruments. Waqf banking can be developed by embedding cash waqf products within Islamic banking platforms to provide perpetual, Sharia-compliant microfinance and SME lending, thereby channeling community savings into productive credit and enhancing financial inclusion across the Kingdom. Waqf real estate development offers immediate opportunities by professionally transforming underutilized lands into mixed-use commercial hubs, tourism facilities, and residential projects through public-private partnerships, which generate sustainable rental income and create thousands of high-quality jobs. Additional instruments, including waqf sukuk for large-scale infrastructure and corporate waqfs for private-sector collaboration, will diversify revenue streams and amplify economic multipliers.
Sectors that remain under-tapped yet hold exceptional potential for accelerated growth include renewable energy, where waqf-funded solar parks and green infrastructure can directly support the Saudi Green Initiative; digital innovation and fintech ecosystems to establish the Kingdom as a global technology leader; advanced agriculture and food security systems; creative industries such as esports and entertainment; and specialized research in healthcare and biotechnology. In contemporary Saudi society, waqf can be reenvisioned as dynamic vehicles for impact investing and social enterprise. By incorporating blockchain for transparent governance, artificial intelligence for precise impact measurement, and seamless alignment with national mega-projects, waqf will empower youth, women, and small enterprises while preserving its core Islamic principles of perpetuity and benevolence. This modern orientation will foster inclusive, sustainable prosperity that strengthens the non-oil economy and elevates Saudi Arabia's global standing in Islamic social finance.
Islamic Banking Tools Enhancing Waqf Sustainability
Islamic banking provides essential tools that complement and strengthen waqf operations in Saudi Arabia. Core profit-and-loss-sharing mechanisms such as mudarabah (where one party provides capital and the other expertise) and musharakah (joint venture partnerships) enable waqf funds to participate in productive ventures with shared risks and rewards, generating ethical returns while maintaining Sharia compliance. Sukuk, particularly asset-based or waqf-linked structures, offer scalable financing for infrastructure and development projects, allowing endowments to mobilize larger capital pools without depleting principal assets. These instruments, deeply embedded in the Kingdom's predominantly Sharia-compliant financial system, facilitate greater liquidity, risk diversification, and alignment with Vision 2030 goals, thereby boosting the overall efficiency and impact of waqf as a tool for sustainable economic and social development.
What Other Countries Can Adopt from Saudi Arabia's Waqf Model
Saudi Arabia's waqf management reforms, led by the General Authority for Awqaf and integrated with Vision 2030, offer valuable lessons for other nations, particularly Muslim-majority countries seeking to revitalize endowments for sustainable development. Key elements include establishing a centralized, autonomous regulatory authority to standardize governance, enhance transparency through digital registration and unified oversight, and promote professional investment in productive assets while preserving Sharia principles. Other countries can learn to align waqf with national development agendas, foster public-private partnerships, license innovative investment funds, and adopt international standards such as those from AAOIFI for accountability and impact measurement. By emulating these reforms, nations can transform underutilized waqf assets into engines of social welfare, economic inclusion, and long-term resilience, addressing common challenges like fragmentation, low productivity, and limited alignment with modern priorities.
Advancing Waqf Scholarship and Integrating Expertise Across Saudi Universities
To fully envision and realize its 2030 aspirations, Saudi Arabia should incorporate waqf experts, waqf sociologists, and waqf studies as a formal academic discipline in all its universities. This strategic step will cultivate specialized human capital essential for innovative governance, sociological analysis of community dynamics, Sharia-compliant financial innovation, and evidence-based policy formulation. By embedding waqf studies nationwide, the Kingdom will create a continuous pipeline of qualified professionals ready to manage the expanding endowment ecosystem with excellence and foresight.
Waqf and endowment studies, reinforced by dedicated research, will significantly boost economic growth in Saudi Arabia. Scholarly inquiry generates actionable insights for optimizing asset productivity, designing high-yield Sharia-compliant instruments such as cash waqfs and sukuk, evaluating social and economic impacts, and promoting cross-sector partnerships. These efforts will raise returns on waqf assets, reduce idle properties, amplify contributions to human capital and sustainability pillars, and position the Kingdom as the global hub for Islamic social finance. The resulting intellectual infrastructure will accelerate non-oil GDP expansion and elevate the non-profit sector's role in national prosperity.
Measuring Success: Achievements and the Path to 2030
Saudi Arabia's waqf renaissance will undoubtedly deliver tangible results. The non-profit sector now contributes 3.3 percent to GDP, with total economic impact surpassing SAR 102 billion, and remains firmly on track to reach the 5 percent target by 2028, two years ahead of schedule. Investment funds continue to expand rapidly, governance standards have risen markedly, and public confidence has strengthened through transparent digital platforms. Historical challenges of idle assets and fragmented oversight have been addressed through digitization, capacity building, and performance-driven regulation.
Expert analysis and observation confirms that these reforms have preserved waqf's religious integrity while greatly enhancing its socio-economic multiplier effect. By 2030, waqf will finance an even larger share of national transformation programs, support one million volunteers annually, and empower broader economic participation. The Kingdom's policies have established Saudi Arabia as a global leader in Islamic social finance, providing valuable lessons for nations pursuing ethical and sustainable development.
Conclusion
Saudi Vision 2030 has successfully reimagined waqf as a vital instrument of national progress. Through decisive institutional reforms, innovative financing mechanisms, strategic societal alignment, expanded scholarship, forward-looking instruments for economic leadership, and exemplary governance that inspires globally, the Kingdom has unlocked the full potential of its endowments. With a targeted asset base approaching SAR 350 billion and a professional ecosystem of funds and initiatives, waqf now serves as a pillar of sustainable prosperity. This achievement highlights the wisdom of Saudi leadership in harmonizing cherished Islamic heritage with visionary ambitions. As the Kingdom advances toward 2030 and beyond, waqf will continue to embody the values of generosity, stewardship, and collective excellence, securing a brighter and more resilient future for Saudi citizens and the wider Islamic world.