Economy

Saudi Arabia, a conventional energy powerhouse, has made significant progress in diversifying its economy under Vision 2030. The digital economy, especially in sectors like education and health care, now contributes 14% of GDP, with artificial intelligence expected to add $135bn to the economy in 2030. While large-scale infrastructure projects progress more slowly, the Kingdom’s positive economic outlook is bolstered by improving global conditions and the potential easing of interest rates. Saudi Arabia aims to attract $100bn in annual foreign direct investment by 2030. With strong financial reserves and expanding digital infrastructure, the Kingdom is well-positioned to meet its Vision 2030 goals, ensuring sustainable economic growth and diversification. This chapter also contains interviews with Nabil Khojah, Secretary-General, Economic Cities and Special Zones Authority; and Hussein Fares, CEO, Abdulla Fouad Group.

Articles from this Chapter

Overview

Expanding infrastructure: Implementing prudent fiscal management strategies and aligning digital resources is ensuring progress towards Vision 2030 goals
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Saudi Arabia remains a conventional energy powerhouse as non-oil activities make up more than half of national output. As the Kingdom hits the halfway point of Vision 2030, a wide-ranging economic diversification strategy launched in 2016, the subsectors in which success is being achieved and those that require additional work are becoming clear. The digital economy is driving diversification gains, particularly in service-focused sectors like education and health care, and contributed 14% of the…

Analysis

Dynamic environment: Large-scale development projects and strategic partnerships position the Kingdom as an attractive investment destination
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Beginning in January 2024 multinational companies intending to do business in Saudi Arabia with government entities will now be required to incorporate their regional headquarters in the Kingdom. Multinationals that fail to do so will find themselves unable to negotiate agreements with Saudi governmental bodies, which face restrictions from the Ministry of Finance on their ability to contract or do business with foreign companies that have not shifted their regional headquarters. Qualifying multinationals,…

Interview

Investment attraction: Nabil Khojah, Secretary-General, Economic Cities and Special Zones Authority, on how economic zones streamline supply chains and enhance integration into the global economy
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Interview:Nabil Khojah, Secretary-General, Economic Cities and Special Zones Authority How does the establishment of economic zones contribute to diversification, and what role do these zones play in attracting foreign investment? NABIL KHOJAH: The creation of special economic zones (SEZs) is a key component of Saudi Arabia’s economic diversification strategy under Vision 2030. These zones are designed to spur growth in targeted sectors beyond oil, including logistics, manufacturing, maritime…

Analysis

Encouraging results: Localisation policies across the GCC are critical in creating sustainable employment opportunities for nationals
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GCC countries have been actively pursuing workforce nationalisation policies to reduce their reliance on expatriate workers and create sustainable employment opportunities for their growing local populations. Notably, Saudi Arabia has set ambitious workforce nationalisation targets as part of Vision 2030 and for socio-economic transformation. By the first quarter of 2022 the Kingdom had achieved a localisation level of 23%, with the goal of reaching 30% by 2025. To meet these numbers, the country…

Interview

Raising funding: Hussein Fares, CEO, Abdulla Fouad Group, on attracting investment into new technologies as well as emerging sectors
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Interview:Hussein Fares, CEO, Abdulla Fouad Group How do you see Saudi Arabia’s current infrastructure development contributing to Vision 2030? HUSSEIN FARES: The pace of infrastructure development in the Kingdom has been remarkable. We have made significant strides across multiple sectors – from transport and logistics, to housing and utilities – all of which are critical to long-term economic diversification and job creation. Urbanisation, particularly in major cities, is driving…