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May 2023

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ECONOMIC TRENDS



 

Post-pandemic recovery continues unabated for the kingdom, with non-oil activities rallying ahead of the traditional oil sector.


OIL AND GAS



 

Strong market demand, especially following huge post-COVID-19 recovery for domestic and international travel, has given the oil market a room for optimism.

ESG



 

Thinking outside the box, the country seeks to prove that it is possible to pursue economic expansion without sacrificing the environment.

NIDLP



 

Authorities are investing in modern infrastructure and technologies to develop the sector and bolster the country’s profile as a global gateway.


 

 

REAL ESTATE


 

Government schemes that encourage homeownership and a growing trend towards sustainable living have contributed to the real estate sector’s strong momentum.

 

 

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 IN THIS EDITION

Saudi Arabia is among the top five countries leading foreign direct investment (FDI) in the Middle East and Africa region. The Middle East has emerged as the fastest growing FDI region since 2019, rising 13.6% in 2022 compared to the previous year, with the kingdom’s business-friendly policies and fiscal strength making it an investment magnet, according to the new report released by Investment Monitor, which provides data, insights, and analysis on FDI.

Separately, FDI Intelligence ranked Saudi Arabia sixth in the inaugural FDI Standouts Watchlist 2023. The kingdom benefitted from strong investment in tourism and manufacturing. The number of FDI projects in the kingdom grew by 201, the second highest in the region after the UAE’s 792 projects. 

“In second place is Saudi Arabia, which has in recent years been on a charm oensive to become an alternative Middle Eastern headquarters hub. In the three years since COVID-19 started, the country attracted 479 FDI projects, 72.3% more than the corresponding period before the pandemic,” FDI Intelligence reported.

 To further attract investors, the kingdom offered 50 investment opportunities valued at USD 25 billion in the machinery and equipment sector as part of its strategy to promote private and foreign sector participation. The strategy aims to establish a strong industrial base in the country, cut imports by as much as 50%, and work towards exporting products to regional and global markets. The machinery and equipment sector is crucial for all industries, including oil and gas, petrochemicals, mining, food, and construction. In 2019, Saudi’s machinery and equipment sector generated revenues of about USD 32 billion.

The growth of the non-oil sector is paying o as it led economic growth in the first quarter, generating strong revenues and momentum, which also led to the creation of new jobs. Unemployment rate in the kingdom fell to 4.8% at the end of last year, compared to 6.9% during the same period in 2021. Female unemployment also dropped by an impressive 7.1 percentage points to 15.4% by the end of 2022 (compared to 2021), amid a massive expansion in labour markets.

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