Saudi Arabia Attracts Record Foreign Direct Investment in 2023

ABU DHABI (Reuters) – Saudi Arabia, the Arab world's largest economy, has attracted foreign direct investment (FDI) inflows of 96 billion riyals ($25.6 billion) in 2023, surpassing official targets according to government data utilizing a new calculation methodology.

The kingdom adopted a new approach last year to collect and report FDI data aiming to enhance transparency and accuracy in published statistics, resulting in a significant upward revision of total figures for 2022.

The Ministry of Investment reported that actual FDI inflows last year exceeded the targeted 83 billion riyals under the National Investment Strategy (NIS) by 16%, accounting for 2.4% of the nation's nominal GDP.

When excluding a one-off Aramco pipeline deal valued at 55 billion riyals in 2022, inflows increased by 50% compared to the previous year.

Saudi Arabia is undergoing a significant economic transformation led by Crown Prince Mohammed bin Salman under the Vision 2030 plan, which aims to enhance non-oil growth, expand the private sector, and generate jobs.

The NIS is targeting $100 billion in FDI by 2030, nearly 6% of the country's GDP.

By the end of 2023, total FDI stock reached 897 billion riyals, representing 22.5% of GDP and an increase of 13% from the prior year.

Sectors including manufacturing, finance and insurance, construction, and wholesale and retail trade attracted the largest share of FDI in 2023, contributing to 78% of total inflows, as indicated by the report.

The government plans to reform existing investment laws to bolster transparency and ensure equal treatment of local and foreign investors.

> ($1 = 3.7552 riyals)