Saudi Round-Up: Big Moves in Tourism & Logistics Are in Play
This week's Saudi Roundup showcases the Kingdom's remarkable progress in the logistics sector
From 07 September to 14 October 2024
Strategic partnerships and infrastructural advancements are driving significant growth and positioning Saudi Arabia as a global logistics hub. Discover how these initiatives are contributing to the Kingdom's overall economic development.
General Business and Economy
Saudi Job Market Thrives As Unemployment Drops to 7.1% Amid Growth in All Professions
The Saudi labor market is growing across all professions, according to HRSD Deputy Minister Muhannad Al-Essa. The unemployment rate among Saudis fell to 7.1% in Q2 2024, the lowest since 1999, down from 7.6% in Q1 2024.
In addition to this, the targeted professions for Saudization have seen remarkable employment growth.
Saudi Arabia and Oman Sign MoU to Boost Economic Cooperation and Planning
Saudi Arabia and Oman signed a five-year memorandum of understanding (MoU) to enhance economic and planning cooperation. The pact focuses on long-term economic strategies, green and circular economies, and mutual trade, which reached SAR 36.8 billion. The agreement promotes collaboration through information sharing, expert exchanges, and joint events.
Foreign Investments in Saudi Stocks Soar to $1.02 Billion in September, Marking 947% YoY Growth
Foreign investors made net purchases of SR3.84 billion ($1.02 billion) in Saudi stocks in September 2023, a 947% year-on-year increase, while the total foreign ownership reached SR414.9 billion.
These figures demonstrate that Saudi Arabia's initiatives to attract foreign investment are yielding positive results, as the country's stock market continues to grow and solidify its position as a global business hub.
Saudi Arabia Launches Insurance to Safeguard Expat Workers' Financial Dues
Saudi Arabia’s Ministry of Human Resources and Social Development (HRSD) has introduced an insurance product to protect expatriate workers' financial rights in private companies facing financial difficulties. Starting on October 6, 2024, the insurance will cover unpaid wages and provide a return flight home.
This initiative ensures expat workers are supported, even if their employers can't meet payroll, highlighting the Kingdom's commitment to labor welfare amid economic challenges.
SMASCO and Urban Co. Launch SAR 1 Million Domestic Service Platform in Saudi Arabia
Saudi Manpower Solutions Co. (SMASCO) and Urban Co. have established a joint venture, Waed Khadmat Al-Munzal for Marketing Co., with a capital of SAR 1 million.
By combining their expertise and resources, the two companies aim to provide a cutting-edge platform that improves domestic services, likely catering to various needs within households and contributing to the growth of the service sector in the Kingdom.
Construction
Saudi Arabia to Begin $7 Billion Landbridge Project Construction in Early 2025
Saudi Arabia will commence construction of the $7 billion (SAR 26.3 billion) Landbridge project in early 2025, according to MEED. The final arrangements are currently being made.
The project, led by a Chinese consortium of 11 international firms, was confirmed by Transport Minister Saleh Al-Jasser. This major infrastructure project will enhance transport connectivity across the Kingdom, contributing to economic growth and development.
Saudi Arabia Offers Pakistan Share of $200 Billion Annual Construction Contracts
Saudi Investment Minister Khalid Al-Falih announced that Saudi Arabia plans to allocate part of its $200 billion annual construction contracts to Pakistan. During a business forum in Islamabad, Al-Falih sought to finalize $2 billion in business deals.
As Saudi Arabia becomes the world’s largest construction market, projected to reach $181.5 billion in output by 2028, this partnership presents significant economic opportunities for both nations.
Tourism
Saudi Arabia's Eastern Province Launches $3 Billion Tourism Projects
The Kingdom’s Eastern Province is set to undergo a major tourism expansion with the approval of 17 new projects valued at over SR12.7 billion ($3.38 billion), expected to create more than 2,200 hotel rooms and significantly boost the hospitality sector.
An additional 10 projects, totaling over SR10.6 billion, will add another 1,400 hotel rooms. These initiatives are part of the Saudi Tourism Development Fund's efforts to enhance regional tourism infrastructure in line with Vision 2030.
Industry and Manufacturing
Saudi Arabia's Industrial Production Index Rises 1% in August
According to GASTAT, Saudi Arabia’s Industrial Production Index (IPI) increased by 1% year-on-year in August 2024, reaching 105.01 points, which is up from 103.93 in August 2023.
Growth was fueled by the mining, quarrying, and manufacturing sectors, along with increased output in electricity, gas, steam, and air conditioning supply. The IPI tracks changes in production, reflecting the country’s ongoing industrial expansion and diversification efforts.
Saudi Arabia Leads Arab Cement Production, Ranks 10th Globally with Over 80 Million Tons Output
The Minister of Industry and Mineral Resources Bandar Alkhorayef, revealed that Saudi Arabia ranked first in MENA cement production and tenth globally, with an annual capacity exceeding 80 million tons from 20 factories.
In 2023, the Kingdom exported over 8.48 million tons of cement and clinker, while domestic demand reached 47.3 million tons. The conclusion from these remarkable figures is that Saudi Arabia plays a significant role in meeting both local and global construction needs as it expands its industrial capabilities.
Qassim Region's Untapped Mineral Wealth Valued at $32 Billion, Key to Saudi Vision 2030
Saudi Arabia's Qassim region holds over SR122 billion ($32.5 billion) in untapped mineral wealth, including gold, copper, zinc, and other valuable ores. With 35 mineralized belts, Qassim is expected to contribute significantly to the Kingdom's Vision 2030 economic diversification plans.
The region's mineral resources are part of Saudi Arabia's broader strategy to leverage its estimated SR9.4 trillion in national mineral wealth.
Technology
Saudi Arabia's Tech Market Grows 12.3% to Reach SR91 Billion in 2023
Saudi Arabia's technology market surged 12.3% year-on-year in 2023, reaching SR91 billion ($24.2 billion), driven by advancements in digital infrastructure.
Raed Al-Fayez from the Communications, Space, and Technology Commission announced the market's expected growth to SR103 billion by 2025, with the government aiming to increase the sector's GDP contribution from 1% to 5% by 2030.
Logistics & Transportation
Saudi Arabia's Air Freight Sector Experiences 53% Growth in 2024
GACA President Abdulaziz Al-Duailej reported that Saudi Arabia's air freight sector has surged by 53% in 2024 compared to 2023.
The Kingdom's airports are projected to handle over one million tons of freight this year, with an anticipated rise to 1.2 million tons. The National Aviation Strategy aims to elevate air freight capacity from 0.8 million tons in 2023 to 4.5 million tons by 2030, supported by over $100 billion in investments for airport upgrades and digital monitoring.
Saudi Arabia Invests Over SAR 200 Billion in National Transport and Logistics Strategy & Attracts Foreign Investment
Since its launch in mid-2021, Saudi Arabia has invested nearly SAR 200 billion in the National Transport and Logistics Strategy (NTLS), according to the Minister of Transport and Logistic Services, Saleh Al-Jasser. These investments have significantly advanced the transport and logistics sectors, positioning the Kingdom as a global leader.
By 2030, the Kingdom plans to invest an additional SR1 trillion ($267 billion) in its logistics sector.
Real Estate
Saudi Arabia's PIF to Acquire 40% Stake in UK’s Selfridges Group in Strategic Partnership
Saudi Arabia's Public Investment Fund (PIF) is acquiring a 40% stake in the UK department store chain Selfridges Group, in a partnership with Thailand's Central Group, which will retain the remaining 60%.
The financial details of the acquisition were not disclosed, but the agreement involves new investments to strengthen Selfridges Group's market position and support its future growth.
Saudi Housing Market On the Rise: Riyadh’s Residential Transactions Surge 52%
Riyadh's residential market saw a 51.6% increase in transactions by the end of Q2 2024, with 18,500 sales totaling SR26.6 billion ($7.08 billion), according to CBRE. However, Jeddah and Dammam followed closely, reporting transaction growth of 43.2% and 22.4%, respectively.
Driven by population growth and government investments, Saudi Arabia's housing sector aims for a 70% homeownership rate by 2030, supported by initiatives like the Sakani program, which offers tailored housing and financing solutions.
The Kingdom of Saudi Arabia continues to make significant strides in achieving its ambitious Vision 2030 goals. Stay tuned for next week's updates as the Kingdom continues to drive economic growth and foster international partnerships, laying the foundation for a prosperous and resilient future.
