Saudi Arabia stands out as a top destination for FDI in West Asia.
Saudi Arabia has emerged as a significant recipient of foreign direct investment (FDI), attracting $65.1 billion in the years following the pandemic up to 2023. This places the Kingdom among the top destinations for FDI in West Asia, according to the latest report from the UN Conference on Trade and Development.
In addition to attracting substantial FDI, Saudi Arabia also saw significant outflows totaling $73.1 billion during the same period. In 2023 alone, the Kingdom recorded FDI outflows amounting to $16 billion. This performance positions Saudi Arabia 16th among the top 20 global economies for FDI outflows, underscoring its growing role in international investment flows.
The data highlights Saudi Arabia’s increasing attractiveness as both a destination for foreign investment and as a source of outward investment. This dual role reflects the Kingdom’s efforts to diversify its economy and strengthen its position in the global market, signaling robust economic activity despite global challenges.
Reforms in legal, economic, and social domains aimed at boosting foreign direct investment (FDI).
To encourage greater foreign direct investment, Saudi Arabia has implemented extensive legal, economic, and social reforms aligned with the objectives of the National Investment Strategy (NIS) and Vision 2030 targets. Launched in 2021, the NIS aims to develop comprehensive investment plans across sectors such as manufacturing, renewable energy, transportation and logistics, tourism, digital infrastructure, and healthcare.
The strategy sets ambitious goals to increase annual FDI inflows to more than $103 billion and raise annual domestic investments to over $453 billion by 2030. In 2023, the UN report highlighted a 55 percent annual rise in the value of international project finance transactions in Saudi Arabia, amounting to $22 billion. The country also witnessed a 90 percent increase in the number of such deals, totaling 19 compared to the previous year. Additionally, Saudi Arabia recorded 389 newly announced greenfield projects in 2023, valued at $29 billion, reflecting a significant 108 percent increase in project value compared to earlier periods.
These developments underscore Saudi Arabia’s proactive approach in attracting and nurturing investments, driven by robust growth across various economic sectors. The reforms and strategic initiatives outlined in the NIS are pivotal in positioning the Kingdom as a dynamic hub for global investments and economic diversification, in alignment with its long-term development goals under Vision 2030.
FDI Global trends
In 2023, global foreign direct investment (FDI) saw a slight annual decrease of 2 percent, totaling $1.3 trillion. The analysis noted that this overall figure was notably affected by substantial financial flows passing through several key European intermediary economies.