Expanding from the US to Saudi Arabia: Sector-Specific Opportunities for Global Companies
Saudi Arabia maintains its reputation as a prime destination for American companies. Find out sector opportunities for your business in this article.
Saudi Arabia's economic transformation has created a golden opportunity for American businesses. In recent years, the country has emerged as the investment destination of choice for US companies expanding to Saudi Arabia.
In the first quarter of 2024 alone, the Kingdom saw a remarkable 79% increase in the value of contracts awarded, reaching $31.65 billion. According to the latest US-Saudi Business Council report, this milestone marks the second-highest on record since the third quarter of 2015.
These figures highlight the increased interest of global American giants to expand to the Kingdom. This growing appetite is driven by Vision 2030's push for non-oil economic growth, business-friendly regulations, and government support of the private sector.
The past few years have witnessed an uptick in Memorandums of Understanding (MOUs) and investment agreements signed between Saudi Arabia and US firms, marking another strong period of enhanced collaboration at both private and state levels.
Energy and Renewables Create Growth Avenues for US Clean Technology Companies
With decades-long collaborations, US companies in Saudi Arabia have long been key players in the Kingdom’s energy landscape.
In early 2023, Saudi Arabia signed several high-profile agreements at the World Economic Forum (WEF). The agreements included partnerships with US companies in clean energy, civil nuclear energy, and climate action.
Moreover, the recent emphasis on renewable energy offers fresh opportunities.
In May 2024, Saudi Aramco signed MOUs with Aeroseal, Spiritus, and Rondo. These partnerships focus on developing innovative technologies to improve energy efficiency, reduce emissions, and support Saudi Arabia’s broader goals of achieving carbon neutrality.
Another notable collaboration comes from Baker Hughes, which marked a major milestone in Saudi Arabia by expanding its facility in Dammam.
The expansion will support the Kingdom’s growing demand for advanced energy technologies and services, particularly in the fields of carbon capture and hydrogen production.
Saudi Technology Sector Attracts a Steady Influx of US Companies
The digital economy is another area that attracts a flurry of US tech giants to Saudi Arabia.
In early 2024, Saudi Arabia announced nearly $13 billion in new tech investments at the LEAP Tech Conference. This move attracted global industry giants like Amazon Web Services (AWS), IBM, DataVolt, and ServiceNow.
AWS is expanding its cloud services in the region, enabling local businesses to scale and innovate. Meanwhile, IBM is playing a crucial role in upskilling the local workforce. Collaborating with the Saudi government, IBM is set to train 100,000 Saudis in advanced technologies such as AI, cybersecurity, and cloud computing.
The initiatives highlight Saudi Arabia’s rising influence in the global tech landscape. The focus on innovation, combined with substantial government support, makes Saudi Arabia a prime destination for tech firms looking to expand.
Giga Projects Provide Evergreen Opportunities for US Construction and Infrastructure Companies
Within Saudi Arabia’s giga-projects, the construction and infrastructure sector continues to pull in investments from US companies.
The Kingdom’s focus on building smart cities and state-of-the-art infrastructure aligns well with the capabilities of US firms, especially those specializing in large-scale, high-tech construction solutions.
A prime example is the New Murabba development, a transformative project aimed at creating one of the world’s largest modern urban centers.
In 2023, the project signed an agreement with Bechtel, a leading American engineering and construction company, to provide project management services and site-wide infrastructure. Bechtel’s expertise in managing complex, high-tech infrastructure projects makes them an ideal partner for this visionary initiative.
Looking ahead, the construction sector remains a key draw for US companies, particularly those with expertise in areas like digital infrastructure, renewable energy, and urban planning.
US Firms in Saudi Arabia Capitalize on Growing Tourism and Entertainment Economy
US entertainment companies find an attractive field for their operations in Saudi Arabia. One of the earliest American entertainment brands to break into the Saudi entertainment market was AMC Entertainment.
Six years ago, they opened the first cinema in Saudi Arabia in over 35 years. Since then, the company has steadily expanded its presence across the Kingdom.
In 2024, AMC restructured its joint venture with Saudi Entertainment Ventures (SEVEN) to further strengthen its foothold in the Saudi market. The partnership will further increase the number of cinema locations in the country and pave the way for other entertainment ventures in Saudi Arabia.
As a key development in entertainment, Qiddiya is set to build the region’s largest water theme park in a joint venture with the US-based amusement park corporation, Six Flags.
The scope of the Qiddiya development, which plans to attract millions of visitors, offers vast potential for international companies specializing in theme park design, construction, and operations. Foreign firms can also tap into related sectors such as hospitality, event management, and logistics to support this massive undertaking.
However, the key to reaching the Kingdom’s ambitious target of hosting 150 million visitors by 2030 is increasing air connectivity and making the country easily reachable. To that end, Riyadh Air and Delta Air Lines signed an MoU in 2024 to enhance connectivity between Saudi Arabia and the US.
With the increased flow of tourists and business travelers to the Kingdom, opportunities for American companies in transportation, travel services, and entertainment will continue to rise.
