Saudi Round-Up: Construction & Renewable Energy Sectors Attract Investments
In this week’s edition, we highlight Saudi Arabia’s milestones and impressive results from investments in renewable energy, initiatives in the entertainment sector, and cutting-edge technological solutions.
From 12 August to 19 August 2024
General Business and Economy
Saudi Arabia Eyes FDI Inflows from Asia and Europe: Assistant Minister
Saudi Arabia is actively seeking to draw in more foreign investments from Asian and European countries as it transitions its economy.
According to a government official, the nation aims to secure $100 billion in foreign direct investment by the year 2030.
Saudi Arabia Launches Unified Employment Portal
Saudi Arabia has introduced a new online platform called Jadarat to reduce unemployment among its citizens.
The portal, unveiled by the Minister of Human Resources and Social Development, offers job opportunities in both government and private sectors. This initiative comes as the country's unemployment rate among Saudi nationals slightly decreased to 7.6% in the first quarter of 2024.
Saudi Arabia’s Reserves Grow 6% to $452.8bn in July
Saudi Arabia's Central Bank (SAMA) has announced a considerable growth in its reserve assets during the second quarter of 2024. Total reserves surged to $467.4 billion, marking a 2.7% quarterly increase.
The increase represents a significant boost from the previous quarter and solidifies the Kingdom’s strong financial position. The central bank attributed the growth to the country’s robust economic performance, which resulted in an increase in foreign exchange reserves.
More Global Firms Eligible for Saudi Contracts After Setting Up HQs at KAFD
Ten global firms, including Alstom, Alibaba Cloud, and Pfizer, have become eligible for Saudi government contracts after establishing regional headquarters at Riyadh's King Abdullah Financial District (KAFD).
KAFD, now a key business hub, continues to expand, with only 50% of the district completed. The initiative offers firms tax exemptions and mandates that companies with state contracts establish regional headquarters in the Kingdom by 2024 to boost investment and job creation.
Saudi Insurance Sector Earnings Surge 25% to $585m in H1 2024
Driven by strong performances from major players like Bupa Arabia and Tawuniya, Saudi Arabia's insurance sector saw a 25% increase in earnings, reaching $585 million in the first half of 2024.
With these numbers, we see the sector's resilience despite economic challenges.
The health and motor insurance segments remain dominant, and due to rising healthcare demand and vehicle sales, continued expansion is expected. The industry's projected growth rate is 5.2% annually through 2028, reinforcing Saudi Arabia's key role in the regional insurance market.
Construction
Red Sea Signs Deal With Italian Firm to Build Staff Camp for Tojena Dam Project
Red Sea International Co. has secured a SAR 658 million ($175 million) contract with Italian firm Webuild SpA to design, manufacture, and install prefabricated buildings for the Tojena Dam project in NEOM.
The 12-month contract includes the construction of residential units and various support facilities like a mosque, dining halls, a health clinic, and a gym.
The project, using high-quality local products and modular units, aligns with Red Sea's strategic goals and supports Saudi Arabia's Vision 2030.
Saudi Arabia’s Construction Contracts Soar to $32bn in Q1 2024: USSBC
In Q1 2024, Saudi Arabia's construction sector witnessed a remarkable 79% increase in contract values, totalling $32 billion. This surge, the second-highest on record, was driven by significant investments in the oil and gas, real estate, and water sectors, aligned with Vision 2030's ambitious projects.
The growth reflects Saudi Arabia's strategic push toward becoming a global infrastructure hub, bolstered by increased foreign investment and partnerships, despite broader economic challenges.
Tourism
International Visitors to Saudi Arabia’s Events Reached 16 Million in Q2: GEA
Saudi Arabia's General Entertainment Authority (GEA) reported over 16 million visitors in Q2 2024, marking a 130% increase compared to the same period last year.
This remarkable growth is a direct result of the Kingdom's ambitious Vision 2030 plan, which has fueled the expansion of the entertainment industry through a multitude of events and festivals.
The GEA's efforts to enrich the Kingdom's entertainment landscape have undeniably contributed to a surge in tourism and economic prosperity.
STA, Visa Join Hands to Launch Tourism Data Lab in Saudi Arabia
The Saudi Tourism Authority (STA) and Visa have launched the region's first Tourism Data Lab in Saudi Arabia.
Hopefully, the data lab will deepen businesses’ understanding of tourist behaviors by analyzing travel patterns and spending data.
In the future, the insights gained will empower the Kingdom to fine-tune its tourism strategies, aligning with Vision 2030’s objectives to significantly boost tourism and enhance visitor experiences.
Aviation
Saudia Leads the World In On-time Flights Again
Saudi Arabia’s airline, Saudia, once again leads the global airline industry in on-time flight performance, achieving the highest punctuality rate among international carriers.
The consistent excellence highlights the airline's dedication to operational efficiency and customer satisfaction. By prioritizing punctuality, a crucial factor in passenger experience, Saudia reinforces its reputation as a top-tier airline and strengthens its competitive edge in the global market.
Entertainment
Saudi Arabia Launches Digital Platform to Boost Entertainment Sector Growth
Saudi Arabia has launched a new digital platform managed by the General Entertainment Authority (GEA) to enhance the entertainment sector's growth.
The platform, integrated with the Saudi Business Center, provides key services such as licensing for entertainment facilities, talent management, and crowd control, aiming to streamline processes for entrepreneurs and investors. The platform aims to help businesses operate efficiently and adapt to the Kingdom’s evolving entertainment landscape.
Populous Releases Visuals of Aramco Stadium Planned for Saudi World Cup
Populous has unveiled designs for the Aramco Stadium, which is planned to be a key venue for Saudi Arabia's 2034 World Cup bid.
The stadium will be located in Riyadh and feature a dynamic, modern design inspired by the Kingdom's rich cultural heritage. With a capacity of 60,000, the stadium is designed to host major international events while integrating sustainable technologies and fan-centric amenities, showcasing Saudi Arabia's ambitions in global sports.
Hospitality
Saudi Arabia’s Restaurant Sector Growth Attracts Global Investment
Saudi Arabia's restaurant sector is experiencing rapid growth, which in turn is attracting large global investments. Driven by strong consumer demand, particularly from the younger generation, the sector has seen a 13.6% annual increase in spending.
This makes it a lucrative market for international brands. The strong consumer demand coupled with supportive government regulations has created a favorable investment climate which is further strengthened by the upcoming events like the 2034 FIFA World Cup.
The market is projected to reach $44.8 billion by 2030.
Industry and Manufacturing
Saudi Arabia Extends Waiver on Expat Fees for Industrial Sector Employees
Saudi Arabia has extended the waiver on fees for expatriate workers in the industrial sector until December 31, 2024.
The policy, first introduced in 2019, is part of the Kingdom's strategy to stimulate growth and investment in the industrial sector. With this extension, Saudi Arabia expects to further enhance job creation, boost local workforce integration, and attract higher levels of investment, contributing to the sector's expansion and an increase in non-oil exports.
Logistics
Saudi Arabia’s Logistics and Delivery Sectors Show an Increase in Precision Navigation, Says What3Words CEO
What3words, a global location technology company, has identified Saudi Arabia as a key market for its services. The company has seen significant growth in the Kingdom since its launch in 2018 and has partnered with numerous local businesses in the past year.
The surge in online shopping and rising consumer expectations for efficient deliveries has spurred a need for more accurate navigation solutions—precisely what what3words capitalizes on.
What3word’s example highlights the growing competitiveness of the Saudi logistics industry and the importance of technology in enhancing customer satisfaction.
Sustainability
ACWA Power Commissions 700MW Solar PV Plant in Saudi Arabia
ACWA Power has commissioned the 700MW AlRass1 Solar Photovoltaic Project in Saudi Arabia—a notable milestone in the Kingdom's renewable energy ambitions.
Located in Al Qassim province, the plant is now generating power and is expected to supply energy to around 132,000 homes.
The project is part of Saudi Arabia's broader goal to generate 130 gigawatts of renewable energy by 2030, reflecting the country's commitment to diversifying its energy mix and reducing carbon emissions.
China Energy Engineering Inks $972 Million Solar Agreement with Saudi Partners
China Energy Engineering has won a $972 million contract to build a massive 2-gigawatt solar power plant in Saudi Arabia. This project is part of a growing energy cooperation between the two countries, with Saudi Arabia seeking to diversify its economy away from oil.
The Chinese company will partner with Saudi entities, including the Public Investment Fund, ACWA Power, and Saudi Aramco Power Company, to develop the solar plant. This deal follows recent investments by other Chinese companies in Saudi Arabia's renewable energy sector, including TCL Zhonghuan and JinkoSolar.
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