Saudi Arabia Unveils Business Reforms to Attract Foreign Investment and Diversify Economy

Saudi Arabia has announced a series of new business regulations aimed at increasing transparency and streamlining the investment process in the kingdom, in an effort to attract more foreign capital to support economic diversification, Bloomberg reports

According to the Ministry of Investment, the updated investment law will enhance investor rights by guaranteeing the rule of law, equal treatment, and the freedom to transfer funds without delay. Foreign investor licenses will be eliminated and replaced with a “simplified” registration process, while dedicated service centers will be opened to expedite the investment process. The reforms will take effect at the beginning of next year.

“The legislation reaffirms Saudi Arabia’s commitment to creating a friendly and safe environment for investors”, said Minister of Investment Khalid Al-Falih.

In recent years, Saudi Arabia has implemented several measures to attract foreign investors, including issuing special visas for investors and creating special economic zones with reduced tax rates. The main goal is to attract over $100 billion in foreign direct investment (FDI) annually by 2030, as part of efforts to develop new industries that will create jobs and generate new revenue streams beyond the oil industry.

In 2023, foreign direct investment exceeded $19 billion, up from the annual average of $17 billion during the 2017-2022 period, but below the 2023 target of $22 billion. In the first quarter of 2024, FDI reached $4.5 billion, and it is expected to reach $29 billion for the entire year.