The GCC must secure its investment landscape: Report

Saudi Arabia targets $3.3 trillion in cumulative investment by 2030, deputy minister says

RIYADH: Saudi Arabia has enacted more than 600 economic reforms since the launch of its Vision 2030 plan in an effort to attract SR 12.4 trillion ($3.3 trillion) in cumulative investment and SR 1.8 trillion in foreign direct investment inflows between 2021 and 2030 of the National Investment Strategy, said a deputy minister from the Ministry of Investments.

Speaking to Arab News Saad Al-Shahrani, deputy minister for investment promotion at Saudi Arabia’s Ministry of Investment, said the Kingdom achieved an 18% increase in foreign direct investment in 2020, even though global FDI fell by 35% due to the pandemic. .

FDI flow in 2021 increased by 257 percent compared to 2020, mainly due to a SR46.5 billion infrastructure deal that Aramco closed with a global consortium of investors in the second quarter of 2021.

Excluding the huge Aramco deal, the Kingdom attracted SR5.3bn in the second quarter of last year.

Al-Shahrani added that the NIS launched in 2021 is a plan to transform the Kingdom into a global hub for business and talent.

Saad Al-Shahrani

During the interview, the minister revealed that FDI flow in the first quarter of 2022 increased by 10 percent to SR7.4 billion compared to the same period last year.

It also said that NIS helped MISA achieve 49 investment deals worth SR3.5 billion in the second quarter of 2022, creating 2,000 jobs across all industries.

“These figures are a testament to the sound execution of the government’s strategy and the impact of new reforms, initiatives and investment opportunities,” said the deputy minister.

He added: “The Kingdom has achieved remarkable progress in many economic and investment indicators, ranking third in the Minority Investor Protection Ease Index out of 132 countries, for the year 2021.”

Fastest growing among the G-20 countries

The deputy minister also noted that the Kingdom achieved first place among 22 countries in the May 2022 Ipsos Global Consumer Confidence Index.

Citing the International Monetary Fund’s World Economic Outlook 2022, Al-Shahrani said the Kingdom is now the fastest growing nation among the Group of 20 countries, with a growth rate of 7.6 percent.

“Saudi Arabia’s regulatory transformation directly affects the core economy. Alongside healthy demand and investor interest in the oil sector, our non-oil economy has shown strong growth,” he added.

The deputy minister said emergency estimates of real GDP growth in the second quarter showed an 11.8 percent year-on-year increase, the highest pace since 2011, supported by real GDP growth in oil and non-oil activities from 23, 1 percent and 5.4 percent, respectively.

Industrial production on the rise

Commenting on the rise in the Industrial Production Index, Al-Shahrani said: “The IPI expanded by 24% year-on-year in May 2022, with manufacturing growing over 28%. These figures are a direct consequence of the government’s active diversification efforts.”

He also claimed that the Kingdom will become one of the most competitive economies in the world and one of the most attractive investment destinations by 2030.

The deputy minister further noted that digital transactions are increasing in Saudi Arabia, in line with the government’s goal of having 70% of all transactions be digital by 2025.

“Policymakers have listened to the needs of investors and responded appropriately to create an investment ecosystem that rivals the best in the world,” he continued.

The future of Saudi Arabia is tourism

The deputy minister also conveyed that tourism will soon become one of the main drivers of the Saudi Arabian economy as the drive for economic diversification continues.

He revealed that the Kingdom has already issued more than 3,500 tourism investment permits, a critical leap towards achieving 10% of national GDP from tourism by 2030.

Al-Shahrani added that the Kingdom will welcome over 100 million tourists by 2030 and create one million jobs in the sector.

“NEOM, The Red Sea Project, AlUla, Soudah, AMAALA and Diriyah Gate are huge opportunities for investors,” he continued.

The deputy minister further revealed that the Kingdom’s carrier SAUDIA will add 94 new destinations to bring visitors to the Kingdom by 2030.

In addition to tourism, MISA also signs agreements with companies in the fields of renewable energy, logistics and pharmaceuticals, added the deputy minister.

“It is abundantly clear that the headwinds dampening international investor appetite are not blowing in Saudi Arabia’s direction. Government strategy, inspirational leadership, talent at every level, well-executed reforms and a clear vision for the future have combined to make the Kingdom an investment powerhouse,” said Al-Shahrani.

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