Expanding from the UK to Saudi Arabia: What are the Growth Opportunities in Construction, Tourism, and R&D?
In its march towards a diversified economy, Saudi Arabia firmly established itself as an attractive haven for international businesses, particularly UK-based firms. Find out the top Saudi sectors where UK companies are active the most and the future prospects within these sectors.
Saudi Arabia is the UK’s largest trade and investment partner in the Middle East. The trade volume between the two nations surpassed £79 billion ( $102.7 billion) from 2018 to 2023; the strong bilateral relationships underscore the deepening economic ties and increased strategic synergies that align with the broader goals of both nations' societal and economic goals.
Vision 2030-linked initiatives are an accelerator of UK business expansion into Saudi Arabia. In 2022 alone, UK investors contributed over £4.3 billion ($5.59 billion) to the Saudi economy, reflecting growing confidence in the Kingdom's economic prospects amid its ongoing economic transformation.
The recent announcement that Saudi Arabia and the United Kingdom have initiated over 60 collaborative projects across 13 sectors is poised to provide a boost in UK business expansion activity in the Kingdom. It comes at a time when UK businesses are actively making their indelible mark in key sectors of the economy, including construction, research and development (R&D) tourism, and aviation.
A Heightened UK Business Activity is Seen Across Construction and its Subsegments
The construction and urban development sectors in the Kingdom are in the spotlight due to the growing demand coming from Saudi Arabia’s giga-projects, such as the Red Sea Global, which created lucrative business opportunities for UK companies. This has been reflected in the mirror in the growing number of UK investors participating in the Kingdom’s giga projects; recent industry reports showed that more than 1,100 active licenses were granted to British investors in the thriving Saudi Arabia market.
The UK-Saudi Sustainable Infrastructure Forum held in June 2024 in London served as an example of the growing collaboration opportunities between construction businesses from both nations, with a focus on areas like sustainable city development and green energy technologies.
The forum further emphasized business opportunities in these sectors, providing a platform for English companies to engage directly with a diverse array of infrastructure projects, whether through financing or hands-on involvement.
Within construction, architecture, and infrastructure are subsectors that offer expanding avenues for cooperation, paving the way for joint ventures and projects that feed into both countries' sustainable development goals.
One notable development is the awarding of contracts to British firms for the ambitious King Salman International Airport project in Riyadh. Foster + Partners, a renowned British architecture company, has been selected to design the airport's master plan, which spans 57 square kilometers.
Research and Development (R&D) Unlocks Fresh Investment Opportunities for UK Firms
Architecture has been the focus of impactful educational and research collaborations. In May 2024, the Royal College of Art in the UK signed a Memorandum of Understanding (MoU) with Saudi Arabia's Architecture and Design Commission to promote entrepreneurship in the field of architecture and design, which in turn will help in developing the skills of future Saudi architects.
Architecture, technology, and science also open the door for more opportunities for collaboration between companies on both ends of the corridor. The ever-expanding opportunities in Saudi Arabia are amplified by significant partnerships and MOUs, such as the ones unveiled under a joint plan aimed at strengthening research links.
The anticipated result is to facilitate collaboration on deep science and technological breakthroughs, addressing some of the most pressing global challenges such as food security and clean energy, allowing both nations to advance research and development (R&D) efforts.
There was a flurry of activity witnessed in the Saudi aviation sector, as evidenced by Cranfield University’s civil aviation partnership with Prince Sultan University and Saudi Arabia's General Authority of Civil Aviation (GACA). This partnership resulted in the signing of a deal that aims to increase cooperation in aviation research and development, as well as training and development across various aviation fields.
English companies with expertise across the board can find a receptive market eager to adopt advanced technologies and benefit from collaborative research and development projects, contributing to Saudi Arabia's ambitious goals of becoming a global leader in research, development, and innovation.
Business Opportunities on the Rise for UK Firms in the Saudi Growing Tourism Sector
As Saudi Arabia continues to peg itself as a haven for innovation, business, and investments, the country remains an attractive region for UK firms looking to tap into the booming tourism market. This trajectory is shaped by ambitious national projects and a vision to become a global tourism and entertainment hub.
The robust demand to construct, design, and fit out new developments in tourism and hospitality remains a catalyst for subnational business and investment opportunities as well as enhanced cooperation.
The recent Declaration of Intent signed between Visit Britain and the Saudi Tourism Authority demonstrated the growing bilateral ties in tourism. This underscores the Saudi sector’s rising appeal and attractiveness to investors across international markets, including the UK.
This bullish momentum for opportunities was aptly emphasized during the UK Creative Industries Trade Mission to the Kingdom of Saudi Arabia event, organized by the Department for Business and Trade (DBT) and Commercial Interiors UK (CIUK). This event focused on promoting UK design and interiors, as well as supply chain expertise associated with the hospitality, entertainment, and leisure sectors.
The initiative’s goal was to connect UK companies with Saudi stakeholders, facilitating partnerships that can contribute to Saudi transformative projects. With the Kingdom's transformation in full swing, conditions are ripe for increased UK business expansion to Saudi Arabia as the country transforms into an economic powerhouse.
