Saudi Arabia targets $3.3 trillion in cumulative investment by 2030, deputy minister says
RIYADH: Saudi Arabia has enacted over 600 economic reforms since the launch of Vision 2030 to generate a total of SR12.4 trillion (US$3.3 trillion) in cumulative investment and SR1.8 trillion in foreign investments between 2021 and 2030 To attract foreign direct investment, the National Investment Strategy said a deputy minister of the Ministry of Investment.
Speaking to Arab News, Saad Al-Shahrani, acting deputy minister for investment promotion at the Ministry of Investment of Saudi Arabia, said the kingdom has achieved an 18 percent increase in foreign direct investment in 2020 even though global FDI fell by 35 percent 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 Aramco’s huge deal, the kingdom attracted SR5.3 billion in the second quarter last year.
Al-Shahrani added that the NIS, launched in 2021, is a blueprint for turning the kingdom into a global hub for business and talent.
During the interview, the minister revealed that FDI flow increased by 10 percent to SR 7.4 billion in the first quarter of 2022 compared to the same period last year.
He further explained that NIS helped MISA to close 49 investment deals worth SR3.5 billion and create 2,000 jobs across all industries in the second quarter of 2022.
“These figures are a testament to the solid implementation of the government’s strategy and the impact of new reforms, initiatives and investment opportunities,” said the Deputy Minister.
He added: “The Kingdom has made remarkable progress on many economic and investment indicators, ranking third out of 132 countries for 2021 in the Ease of Protecting Minority Investors Index.”
Fastest growing among G-20 countries
The Deputy Minister also noted that the Kingdom has ranked first out of 22 countries in Ipsos’ May 2022 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 shift is having a direct impact on the grassroots economy. Along with healthy demand and investor interest in the oil sector, our non-oil economy has shown strong growth,” he added.
The deputy minister said flash estimates of real GDP growth in the second quarter showed year-on-year growth of 11.8 percent, the highest rate since 2011, helped by real GDP growth from oil and non-oil activities March 23 .1 percent and 5.4 percent, respectively.
Industrial production on the up
Commenting on the increase in the industrial production index, Al-Shahrani said: “The IPI grew by 24 percent year-on-year in May 2022, with manufacturing growing by over 28 percent. These numbers are a direct result of the government’s active diversification efforts.”
He also assured that by 2030 the Kingdom will become one of the most competitive economies in the world and an attractive investment destination.
The Deputy Minister also noted that digital transactions are increasing in Saudi Arabia, in line with the government’s goal of having 70 percent of all transactions digital by 2025.
“Policymakers have listened to investors’ needs and responded appropriately to create an investment ecosystem that rivals the best in the world,” he continued.
Saudi Arabia’s future is tourism
The Deputy Minister further shared that tourism will soon become one of the main drivers of the Saudi economy as economic diversification efforts continue.
He revealed that the kingdom has already issued over 3,500 tourism investment licences, a crucial step towards deriving 10 per cent of national GDP from tourism by 2030.
Al-Shahrani added that by 2030 the kingdom will welcome over 100 million tourists and create a million jobs in the sector.
“NEOM, The Red Sea Project, AlUla, Soudah, AMAALA and Diriyah Gate are tremendous opportunities for investors,” he continued.
The Deputy Minister further announced that the Kingdom’s national airline, SAUDIA, will add 94 new destinations by 2030 to bring visitors to the Kingdom.
In addition to tourism, MISA also contracts with companies in the renewable energy, logistics and pharmaceutical sectors, the Deputy Minister added.
“It is very clear that the headwinds feeding global investors’ appetites are not headed towards Saudi Arabia. Government strategy, inspired leadership, talent at all levels, well-executed reforms and a clear vision for the future have made the kingdom an investment powerhouse,” Al-Shahrani said.