Are you aware that Saudi Arabia is rapidly transforming into a leading global investment hub? In 2023, China emerged as the top greenfield foreign direct investor in the Kingdom, channeling an impressive $16.8 billion into various sectors—a staggering 1,020 percent increase from the previous year.
The Rise of Greenfield Investments
Following China’s lead, the United States and the United Arab Emirates have also made significant contributions, with greenfield FDI figures reaching $2.7 billion and $2.67 billion, respectively. Kuwait and Hong Kong secured the fourth and fifth positions, with investments of $937 million and $796 million.
Greenfield FDI, where companies establish new operations in a foreign country, is at the heart of Saudi Arabia’s strategy to diversify its economy away from oil dependency. The Kingdom is ambitiously aiming for over $100 billion in foreign direct investment by 2030.
Sectoral Expansion and Strategic Partnerships
A significant portion of Chinese investment, amounting to $5.6 billion, was directed towards the automotive sector. This development was catalyzed by a strategic agreement between Human Horizons and Saudi Arabia’s Ministry of Investment, signed during the Arab-China business conference in June 2023. This partnership will see the establishment of a comprehensive automotive research, development, manufacturing, and sales facility in the Kingdom.
In addition, China invested $5.26 billion in the metals sector and $4.26 billion in semiconductors. Overall, Saudi Arabia witnessed a 110 percent year-on-year increase in total greenfield FDI, reaching $28.78 billion. Although this figure surpasses the 2018 peak of $17.57 billion, it still falls short of the 2008 record of $34.26 billion.
Regional Development and Tourism Growth
Riyadh attracted the largest share of greenfield FDI, securing $8.18 billion, followed by Ras Al-Khair with $4.23 billion and Dammam with $772 million. The tourism sector also saw notable investments, garnering $227 million. A key highlight in this sector was the opening of a 223-room hotel by US-based Radisson Hospitality at the Riyadh Convention and Exhibition Center, costing approximately $112 million.
Additionally, Liechtenstein-based Olayan Investment Co. Establishment is investing another $112 million to develop The Mondrian Riyadh Al-Malga Hotel and Residences. Expected to open in 2026, this 200-room facility will be operated by the UK-based hospitality developer Ennismore, further enhancing Saudi Arabia’s burgeoning tourism landscape.
With such dynamic growth and strategic international partnerships, Saudi Arabia is not only diversifying its economy but also positioning itself as a prime destination for global investors seeking lucrative opportunities.
