The Kingdom of Saudi Arabia is the largest economy in the Middle East and North Africa region (MENA) and is an asset owing to the fact that it holds around 25% of the world’s oil reserves. In the recent years, Saudi Arabia has slowly been opening up its economy and is ripe for investment. The Saudi government has taken several steps in this regard in the areas of regulation and compliance which were considered one of the biggest barriers to investment in the country. Though the country is cash rich it is in dire need of investment to bring it on par with other developing and developed countries.
This report aims to enlighten the reader on the future prospect of the Kingdom of Saudi Arabia and the untapped potential of its nascent economy. Even with the government taking a proactive approach in encouraging investment in the country the, fact still remains that any country in the Middle East right now stands at the precipice of a revolution (Arab Spring) which is raging through Syria and Egypt right now and could potentially spread to the rest of the GCC countries. Any company /individuals interested in investing here potentially run the risk of losing that investment. Saudi Arabia has buffered itself against this by building a very strong model of governance with a reformed judiciary and an efficient bureaucracy upon which rests the monarchy which has withstood the test of time for over a century now. These facts emphasize the same:
- Saudi Arabia is ranked 5th in the world for fiscal freedom and it is the 3rd most rewarding tax system in the world.
- Among the world’s 20 largest economies (19th) and the largest economy in the MENA region.
- One of the world’s fastest growing countries.
- It is the largest free market in the MENA.
- Represents roughly 25% of total Arab GDP.
- 22nd out of 185 countries for the overall ease of doing business globally.
- 1st for ease of registering property and it is the largest recipient of Foreign Direct Investment in the Arab world.
Maintaining a stable growth for any country dependent majorly upon only one factor is tricky and very risky as it leaves a country open to vulnerabilities. This being said Saudi Arabia has been looking for investments in different sectors like energy (electricity), infrastructure (ports, roads and airports) and in the Information, communications and technology sectors. As Saudi Arabia’s population continues to expand rapidly and as urbanization continues, millions of new consumers will be added to KSAs existing cities as well as the new Economic Cities. Aided by a large budget surplus, the government is set to make unprecedented investments to support investment provisions and complementary sectors such as scientific research. Such investments will require strong private sector partnerships as well as a strong private sector presence overall, to sustain and capitalize on expected demand. This report will focus on electricity generation and distribution, construction (cities, ports and airports), health, agriculture and water (desalination).Historical data and forecasts with analysis of the sectors along with the regulations and financials of a few companies who are currently in this field is also provided.
Key questions which this report will aim to address:
- What is the current investment climate in KSA now?
- Which sectors can see continued growth?
- What kind of support can they find in the government?
- Is the current regulation framework favorable to investors?
- What kind of demand can these sectors see in the next five years?
- Where to invest in KSA?
Who will benefit from this report?
- Institutional investors
- Companies looking to do business in healthcare, renewable energy, agricultural technologies, infrastructure, ICT etc.
