Saudi Arabia Upbeat on FDI as 2030 Goal Remains Distant

Saudi Arabia sees recent trends in foreign direct investment moving in the right direction, while conceding the kingdom has a long way to go to meet its 2030 goal of attracting $100 billion a year.

Recent figures are “extremely positive,” Investment Minister Khalid Al-Falih said in an interview with Bloomberg Television at Saudi Arabia’s Future Investment Initiative in Riyadh on Tuesday. “All the leading indicators are pointing upward. All lights are flashing green.”

The path to reaching the 2030 target will be “steep” but “manageable,” he added.

Saudi Arabia’s FDI inflows amounted to about $26 billion last year, above the government’s self-set target but still the lowest level since 2020. The data was recently revised higher, from $19 billion, to reflect what Al-Falih said was a methodology in line with International Monetary Fund standards.

The kingdom aims to quadruple FDI inflows by 2030 in a bid to share some of the financial burden of spending on its economic diversification plan. Crown Prince Mohammed Bin Salman’s government also sees foreign expertise as critical to training the local population in new industries like technology and minerals exploration and catalyzing growth in those sectors.

Overhaul of investment law

Saudi Arabia recently announced an overhaul of its investment law in a bid to cut bureaucratic red tape and make it easier for foreign investors to deploy cash into the country. The new rules are due to take effect next year.

Al-Falih spoke as global heavyweights in banking, finance and investing gathered in Riyadh to discuss Artificial Intelligence, the US election and state of economy, as well as geopolitical tensions in the Middle East. Among the most high-profile guests were Citigroup Inc. Chief Executive Officer Jane Fraser, BlackRock Inc.’s Larry Fink and David Solomon of Goldman Sachs Group Inc.

Goldman announced plans at FII to open an office in Riyadh’s new financial district next year. The US company was the first of the major international banks to obtain its regional headquarters license for Saudi Arabia earlier this year.

The Saudis require firms to establish a so-called RHQ or risk losing out on securing lucrative contracts with the government and its network of related entities.

Saudi Arabia has now granted around 540 RHQ licenses, Al-Falih said.