Saudi Arabia is in the pilot phase. The Saudi Central Bank reported that it has been experimenting, and will continue to experiment, with CBDCs. It is therefore considered to be in the pilot phase.

CBDC History and Development

In 2019, the Saudi Central Bank and the Central Bank of the United Arab Emirates experimented with using a CBDC and distributed ledger technology in cross-border transactions. This collaborative project was referred to as “Project Aber.”

The Saudi Central Bank announced in 2023 that it would continue to experiment with CBDCs and that it was “working on a phase of a project that focuses on domestic wholesale CBDC use cases in collaboration with local banks and fintechs.” The central bank said it “seeks to explore CBDC economic impact, market readiness, and potential robust and fast applications of a CBDC-based payment solution.” The central bank also noted that “although no decision has been made regarding the introduction of CBDC in the Kingdom, it continues to focus on exploring the benefits and potential risks of implementing CBDC.”

In 2024, Saudi Central Bank deputy governor Yazeed Al-Nafjan said that the central bank does not believe there is a first mover advantage to launching a wholesale CBDC and will therefore take its time.

Human Rights and Civil Liberties Concerns

Saudi Arabia is one of the worst-ranked countries in Freedom House’s 2023 Freedom in the World report. There are many concerns in the country. However, the most pressing concerns related to CBDCs are the oppressive treatment of dissenting voices and the centralization of power.

According to Amnesty International, “Human rights organizations remained banned under the Law on Associations.” In fact, Amnesty International further reported that human rights “defenders and activists continued to be arbitrarily detained, harassed in detention, or subjected to arbitrary travel bans that restrict their freedom of movement.” Unfortunately, a CBDC could be used as another tool in this effort. Across the world, governments have often turned to freezing and seizing the money of activists, political rivals, and protestors to undermine the opposition. A CBDC would make such initiatives easier by allowing governments to take direct control of each citizen’s finances.

There is also the problem of power being centralized within the monarchy. As reported by Freedom House, “Saudi Arabia’s absolute monarchy restricts almost all political rights and civil liberties. … The regime relies on pervasive surveillance, the criminalization of dissent, appeals to sectarianism and ethnicity, and public spending supported by oil revenues to maintain power.” The programmability and surveillance capability within a CBDC could further concentrate power within the monarchy and further exacerbate problems people face today.

For additional information on concerns regarding violations of human rights and civil liberties, see the following reports by Amnesty International, Financial Tyranny Index, Freedom House, Human Rights Watch, Privacy International, and the U.S. Department of State. For additional information on concerns regarding the risks of CBDCs, see the following webpage and report by the Cato Institute: The Risks of CBDCs and Central Bank Digital Currency: Assessing the Risks and Dispelling the Myths.

For additional information regarding metrics, the methodology page explains each of the data points and provides their respective sources.