Saudi Arabia aims for $3.3 trillion in cumulative investment by 2030, says deputy minister
RIYADH: Saudi Arabia has enacted more than 600 economic reforms since the launch of the Vision 2030 plan to attract SR 12.4 trillion ($3.3 trillion) in cumulative investment and SR 1.8 trillion in foreign inflows. foreign direct investment between 2021 and 2030 as part of the National Investment Strategy, said a deputy minister of the investment ministry.
Speaking to Arab News, Saad Al-Shahrani, the Acting Deputy Minister of Investment Promotion at Saudi Arabia’s Ministry of Investment, said the Kingdom achieved an 18% increase in foreign direct investment in 2020 , although global FDI decreased by 35% due to the pandemic.
FDI inflows in 2021 increased by 257 percent compared to 2020, largely driven by a SR46.5 billion infrastructure deal closed by Aramco with a consortium of global 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 turn the Kingdom into a global business and talent hub.
During the interview, the minister revealed that FDI inflow in the first quarter of 2022 increased by 10 percent to SR 7.4 billion compared to the same period last year.
He further stated that NIS helped MISA secure 49 investment deals valued at SR3.5 billion in the second quarter of 2022, creating 2,000 jobs across all industries.
“These figures are a testament to the good 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 made remarkable progress in many economic and investment indicators, ranking third in the Ease of Protecting Minority Investors Index out of 132 countries, for the year 2021.”
Fastest growth among G-20 countries
The Deputy Minister further 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 is directly affecting the core economy. Along with good 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 gross domestic product growth in the second quarter showed year-on-year growth of 11.8 percent, the highest rate since 2011, supported by growth in real GDP from activities oil companies and non-oil companies of 23.1 percent and 5.4 percent, respectively.
Industrial production on the rise
Commenting on the increase in the industrial production index, Al-Shahrani said: “The IPI expanded by 24% year-on-year in May 2022, with manufacturing growth exceeding 28%. These figures are a consequence directly from the government’s active diversification efforts”.
He also assured that the Kingdom will become one of the most competitive economies in the world and 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 70 percent of all transactions being 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 further conveyed that tourism will soon become one of the main drivers of the Saudi economy as the economic diversification effort continues.
He revealed that the Kingdom has already issued more than 3,500 tourism investment licenses, a crucial leap towards achieving 10 percent of national GDP from tourism by 2030.
Al-Shahrani added that the Kingdom will welcome more than 100 million tourists by 2030 and generate one million jobs in the sector.
“NEOM, The Red Sea Project, AlUla, Soudah, AMAALA and Diriyah Gate are massive opportunities for investors,” he continued.
The Deputy Minister further disclosed that the Kingdom’s flag carrier SAUDIA will add 94 new destinations to bring visitors to the Kingdom by 2030.
Aside from tourism, MISA is also signing agreements with companies in the renewable, logistics and pharmaceutical sectors, added the vice minister.
“It is quite clear that the headwinds buffeting global investor appetite are not blowing in Saudi Arabia’s direction. The government’s strategy, inspired leadership, talent at all levels, well-executed reforms and a vision bright future have combined to make the Kingdom an investment powerhouse,” said Al-Shahrani.