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www.investsaudi.sa
Investment
Highlights
Winter 2020 – A Special Report
by Invest Saudi
2019 in review: the year’s biggest deals, projects,
and transformational reforms
• Opening remarks by Dr. Majid Al Qasabi, Minister
of Commerce and Investment
• Over 150 signed investor deals
• 54% yearly growth in new foreign investor licenses
• Exclusive interviews with Engie, Baker Hughes, and
the General Sports Authority
• Timeline of pro-business reforms
Inside this report:
• New investment figures
• Top deals of 2019
• Exclusive interviews
• Major projects and opportunities
In research partnership with
Winter 2020
OPENING REMARKS
licenses being issued to foreign However, while we are
companies. In fact, more than encouraged by the progress we
1,100 such licenses were issued in have made, we still have work to
2019 – 54% more than in 2018 and do.
three times as many as in 2017.
Every day, we are speaking with
These investors represent a broad investors – in Saudi Arabia and
range of emerging and across the world at events such as
established markets from across the World Economic Forum in
Africa, Asia, Europe, and the Davos. We are listening to their
Americas. They also span a views and learning what more we
Dr. Majid Al Qasabi
number of strategic sectors – from can do and what new
Minister of Commerce
and Investment
construction, to tourism, to opportunities are emerging.
education and healthcare.
2020 is an important year for
It has been nearly four years since But what unites all of these Saudi Arabia – not least because
the launch of Saudi Arabia’s Vision investors is that they recognize an later this year, we will become the
2030, a bold program aimed at exciting opportunity in Saudi first country in the Middle East to
transforming our economy. The Arabia – a G20 economy at the host a G20 Summit, putting the
achievements outlined in this convergence of three continents – Kingdom’s economy in the
report demonstrate that this and they see that reforms have spotlight on the global stage.
transformation is becoming a made it easier than ever to access
reality, and the reforms we have that opportunity. We are confident that over the
introduced are unlocking new next twelve months the economic
opportunities and empowering The pace of these reforms was reforms we have made will
investors – from across the demonstrated clearly when Saudi continue to translate into tangible
Kingdom and around the globe. Arabia rose 30 places in the World results – and we look forward to
Bank’s Doing Business 2020 welcoming more investors from
Once again, we saw sharp growth report – improving more than any around the world to join us on this
in the number of new investment other nation on the list. journey.
Saudi Arabia FDI Inflows (Jan-Sept, $ Billions)
$4.0bn $3.50bn
$3.18bn
$3.5bn
FDI Spotlight $3.0bn
+10.2%
$2.5bn
FDI inflows:
$2.0bn
$1.16bn
$1.5bn
in 2019 vs 2018 (first 9 months) $1.0bn
$0.5bn
Jan-Sept 2017 Jan-Sept 2018 Jan-Sept 2019
Source: SAMA
01 www.investsaudi.sa
Winter 2020
INVESTOR LICENSES
Foreign Investor Licenses Highlights in 2019
A record year for Saudi Arabia’s investors, with 1,131 investor licenses awarded.
New foreign investor licenses:
Of which:
+54 %
31% 69% full foreign
ownership
69% 31% joint venture
partnerships with local
vs 2018 investors
New Foreign Investor Licenses – Annually
259 258 377 736 1131
2015 2016 2017 2018 2019
New Foreign Investor Licenses - Sector Highlights
Information and Professional, Wholesale and
Construction Manufacturing communication scientific and technical retail trade
111 193 133 190 111 178 97 125 65 102
2018 2019 2018 2019 2018 2019 2018 2019 2018 2019
Administrative and Accommodation Transportation Human Financial and
support services and food services and storage health insurance
39 74 32 55 29 35 20 28 19 26
2018 2019 2018 2019 2018 2019 2018 2019 2018 2019
New Foreign Investor Licenses - Country Highlights
140 100 92 82 71 50 47 45 41 39 34 31 30 28 23 22 21 21 20 16
India
UK
USA
Jordan
France
China
Lebanon
Syria
Yemen
UAE
Pakistan
Spain
Cayman
Islands
Italy
Netherlands
Turkey
Singapore
Bahrain
South
Korea
Egypt
www.investsaudi.sa 02
Winter 2020
INVESTOR DEALS
Top deals of 2019
2019 was a banner year for investment in Saudi Arabia
Setting unprecedented momentum in the run up to 2030, Saudi Arabia achieved major
successes in signing new deals across high-priority Vision 2030 target sectors.
From tourism to value-added manufacturing, investors want in. This was underscored
by dozens of new deals signed at high-profile events across the globe in 2019.
1 JANUARY
o1
Pan-Asia (China) $1.06 billion Over 150 deals
China-based Pan-Asia established the first 100%
foreign-owned petrochemical project in Saudi Arabia. signed by SAGIA
in 2019
Upon completion in 2021, the facility will generate 570
new jobs and produce 1.25 million tons of purified
terephthalate acid (PTA) per year, in addition to 500,000
tons of polyethylene terephthalate (PET).
EDF Renewables (France) $500 million
As part of the Renewable Projects Development Office’s
first round of project tenders, a consortium formed by 2 FEBRUARY
the Abu Dhabi Future Energy Company - Masdar - and
EDF Renewables will establish a 400-megawatt wind
o2
farm at Dumat Al Jandal, creating almost 1,000 jobs Saudi-Chinese > $28 billion
during construction and operation. Investment Forum
New deals were concentrated in Vision 2030 target
Wengfu (China) $250 million sectors, including renewable energy applications.
Wengfu will establish an anhydrous hydrogen fluoride Goldwind International Holdings signed an $18 million
(AHF) and poly silicon manufacturing facility. The project agreement to develop wind turbine structures, blades,
will target an initial production capacity of up to 20,000 and wind generation equipment, creating 800 jobs in
Mt/y of AHF and 3000 Mt/y of poly silicon. AHF is a raw the process. Other deals were signed in the IT,
material used to manufacture aluminum fluoride, an infrastructure, and petrochemical sectors.
important input for production at the Ma’aden
Aluminium Company. The project will be located in close Shenyang (China) $400 million
proximity to a phosphates complex in Wa'd Al-Shamal. Shenyang will establish a calcined petroleum coke
manufacturing facility, creating 200 new jobs and
supporting aluminum industry localization.
Saudi-India Forum
3 MARCH SAGIA signed a number of agreements with Indian firms
o3 such as Tata Consultancy, Wipro, Glenmark, and Ion
Exchange in New Delhi.
McDermott (USA) $2.5 billion
McDermott announced plans to create 5,000 new jobs
as part of a project to build an offshore platform
manufacturing site, as well as supporting the
development of the King Salman Global Maritime
Industries Complex in Ras Al-Khair.
03 www.investsaudi.sa
Winter 2020
INVESTOR DEALS
4 APRIL
04
VENTURE by Invest Saudi
More than 20 venture capital firms from the US, UK,
China, and Singapore signed agreements under the
VENTURE by Invest Saudi platform. Launched at the
Financial Sector Conference, the VENTURE by Invest Saudi
6 JUNE
platform provides streamlined licensing procedures for 06
venture capital portfolio companies, including an ‘instant
Saudi-Japan Vision 2030 Business Forum
license’ available in under three hours. SAGIA announced the signing of multiple MoUs and
agreements with public and private sector entities
under the Saudi-Japan Vision 2030 initiative. These
7 JULY deals span a number of strategic sectors including
finance, education, industrial, and manufacturing, and
07 involve major Japanese firms including Mizuho, MUFG
GlaxoSmithKline (UK) Bank, and Yokogawa Electric.
SAGIA signed a manufacturing localization agreement
that will see GSK expand the local manufacturing
capacity of its innovative pharmaceutical portfolio,
doubling its manufacturing output by 2022. 8 AUGUST
08
Unibio (Denmark) $200 million
SAGIA signed an MoU with Danish biotechnology firm
Unibio, as well as its local partner Edhafat, to develop a
new facility that will convert natural gas into
high-protein livestock feed.
9 SEPTEMBER
09
Tourism projects $27 billion
On the same day the kingdom launched a new visitors’ visa scheme, SAGIA and the Saudi Commission for Tourism and
National Heritage signed $27 billion in tourism investment deals:
• Triple 5 (USA) committed to invest $10 billion in a series of mixed-use tourism, hospitality, and entertainment
destinations
• Majid Al Futtaim (UAE) will invest $5.3 billion to develop a mixed-use shopping and entertainment destination,
creating 12,000 new jobs, as well as the region’s largest indoor ski slope and snow park
• FTG Development (Turkey) will invest $1.5 billion in a hotel, waterpark, and retail development in Qiddiya, as well as
a 1500-room hotel in NEOM and a hotel located between Jeddah and Makkah
• Oyo Rooms (India) will invest $1.1 billion to acquire more than 10 premium and luxury hotels in the Kingdom
• Nenking Group (China) & Ajlan Brothers (Saudi Arabia) signed a $400 million joint venture to develop a landmark
lifestyle destination in Riyadh
• Kerten Hospitality (Ireland) will invest $72 million to develop a portfolio of mixed-use projects across the Kingdom
World Energy Congress Deals $240 million
SAGIA awarded six licenses at the World Energy Congress in Abu Dhabi:
• Engie (France) will develop a 30MW solar plant to supply power to Nadec Company.
• Engie Saudi Holding LLC will help to manage all Engie activities in the Kingdom and provide shared services to the
group’s subsidiaries
• EEG (Cyprus) and Lime Energy (USA) will establish an Energy Service Company (ESCO) to executive energy efficiency
projects in the Kingdom
• Roxtec (Sweden) will manufacture high tech cables seals in Saudi Arabia and introduce the technology to industrial
users across multiple sectors
• Orbits (Egypt) plans to develop solar projects worth $173 million across the Kingdom over the next five years
www.investsaudi.sa 04
Winter 2020
INVESTOR DEALS
10 OCTOBER
10
GL Rapha (South Korea) $320 million
GL Rapha, holding company of Hankook Korus
Pharm, plans to establish a local facility to
manufacture 30 biotechnology products in Saudi
Arabia and launch a further five innovative
products over the next five years.
Future Investment Initiative $15 billion
During the third annual Future Investment
Initiative (FII), 23 MoUs totaling $15 billion were
signed. Coordinated under the Invest Saudi
umbrella, these agreements reflect the enormous
potential that Saudi Arabia offers to investors
11 NOVEMBER from across the Kingdom and around the world.
11
Petrochemical investments > $2 billion
More than 80 representatives from 13 government and
private sector entities from Saudi Arabia and across the
globe convened to sign a raft of new petrochemical
investment agreements. SAGIA MoUs signed at the
meeting include:
• BASF (Germany) – Evaluating and assessing
opportunities in Saudi Arabia
• SNF (France) – Evaluating the establishment of a
polyacrylamide plant with a capacity of 50,000 tons
per annum in Jubail, creating 80 new jobs
• Mitsui & Co. (Japan) – Establishing an ammonia
commercial production project in Jubail with an
estimated capacity of 1 million tons per annum, using
a highly-efficient and environmentally-friendly
manufacturing process
12 DECEMBER
• Shell (Netherlands) – Evaluating the building of a 12
state-of-the-art residue upgrading catalyst BRF (Brazil) $120 million
manufacturing facility in Jubail Industrial City,
subject to regulatory approvals SAGIA granted an industrial investment license to
• AMG & Shell (Netherlands) – Assessing the feasibility Brazil’s BRF, one of the world’s largest poultry exporters.
of building a facility to reclaim valuable metals by The deal represents a major step forward for SAGIA’s
recycling spent residue upgrading catalysts efforts to localize the food processing sector and boost
generated by refineries in Saudi Arabia and the regional exports. The company plans to build its first
surrounding region factory in Saudi Arabia in 2020.
Optimum Tracker (France) $53 million
French-based Optimum Tracker signed a joint venture
with Saudi-based Al Rushaid Group with an initial
investment of $53 million to provide design and
engineering services in the field of solar energy, with a
focus on the manufacturing of mounting system
structures for solar PV panels. The plant constructed
under the deal plans to export at least 30% of its
products to countries across the region and create 1,000
direct jobs.
05 www.investsaudi.sa
Winter 2020
INVESTOR DEALS
Future Investment Initiative outcomes and figures
The third annual FII convened in Riyadh in October 2019, to continue
building active, global networks of influential decision makers to
explore the emerging industries that will shape the global economy
and investment landscape over the coming decades.
As the third FII demonstrated, Saudi Arabia holds extremely high
potential for companies and individuals looking to maximize their
ROI. Acting as a vital forum connecting local and international
investors with hundreds of emerging opportunities and projects in
the kingdom, the 2019 FII was a major success. On its opening day,
SAGIA announced it had signed 23 investment agreements valued at $15 billion, including:
Air Products and Chemicals, Inc. (USA) – $11.45 billion. The company signed an MoU with ACWA Power to
develop the massive Air Product Qudra project.
Modular Middle East (Australia) – $700 million. The company will localize its supply chain and develop new
manufacturing facilities in Saudi Arabia.
APQ (UK) – $600 million. APQ entered into a joint venture with Saudi Aramco for an industrial gases project.
Xylem (USA) – $550 million. American water company Xylem aims to establish a manufacturing and service
center in Saudi Arabia for water & wastewater pumps, which would generate 300 jobs locally.
Baker Hughes (USA) – $550 million. The agreement between SABIC and Baker Hughes is aimed at developing
local capacity, creating downstream business opportunities and catalyzing industry diversification.
ForDeal (China) – $300 million. ForDeal will establish a regional distribution hub and localize operations in
Saudi Arabia.
Institutio Butantan (Brazil) – $250 million. Together with Industrial Clusters, Institutio Butantan will conduct
a feasibility study with the aim of investing in local vaccine production.
Baker Hughes (USA) – $230 million. Baker Hughes signed an agreement with Saudi Aramco for co-investment
and co-development of artificial intelligence and digital transformation solutions.
Shiloh Minerals (UK) – $200 million. Shiloh will develop its local production capacity, as well as invest in
potential upstream mining opportunities in Saudi Arabia.
DTDC (India) – $200 million. DTDC’s deal with Zajil will see the creation of a pan-regional packaging
e-commerce company based in Saudi Arabia.
Dassault Systems (France) – $200 million. Dassault will collaborate with Saudi Aramco across diverse sectors
including data analytics, project management, and smart cities.
BRF Brazil Foods (Brazil) – $120 million. BRF plans to develop its local production capabilities in Saudi Arabia.
KME (Germany) – $110 million. KME, one of the world’s largest copper producers, plans to expand its
manufacturing capacity into Saudi Arabia.
Eurofarma (Brazil) – $110 million. Eurofarma signed an MoU with Industrial Clusters to conduct a feasibility
study for a pharmaceutical manufacturing project.
AKER SAS (Norway) – $110 million. AKER SAS signed an agreement with Saudi Aramco to study green energy
solutions.
www.investsaudi.sa 06
Winter 2020
INVESTOR DEALS
AERIS (France) – $100 million. AERIS signed a deal with Industrial Clusters to develop a wind energy project.
BMT (UK) – $74 million. BMT signed an agreement with Saudi Aramco to establish a fittings and valves
manufacturing facility in Saudi Arabia.
Aurora Motors (USA) – $50 million. Aurora’s deal with Alkhorayef Group is intended to introduce cutting-edge
irrigation machinery systems and well-drilling equipment, creating up to 1,000 local jobs.
Extreme International (UK) – $50 million. Extreme International signed a deal with Fast Service to develop
and launch a series of action and adventure sporting events across Saudi Arabia.
SABIC & Taqnia (Saudi Arabia) – $32 million. SABIC will work with Taqnia to develop smart grid solutions, as
well as innovative wastewater and cooling technologies.
Pultron (New Zealand) – $25 million. Pultron signed a deal with Saudi Aramco to invest in developing
manufacturing facilities in Saudi Arabia that will produce high-performance glass fiber-reinforced polymer
(GFRP) pultrusion products.
LT Foods/DAAWAT (India) – $17.5 million. The company signed a deal with SALIC to invest in agricultural and
livestock production.
Tubacex Group (Spain). Tubacex signed a deal with Saudi Aramco to develop CRA pipe threading, weld
overlay, and cladding services manufacturing facilities in the Kingdom.
FII 2019 at a Glance
23 MoUs valued at
$15 billion
6,000+ 275+ 30+
Attendees Speakers International public figures
25+ 30+ 45+
Sectors Countries Partners
07 www.investsaudi.sa
Winter 2020
INVESTOR VIEWS
Interview with
Turki Alshehri
CEO, Saudi Arabia
How would you describe Engie’s investments in How is your investment benefitting from having a
Saudi Arabia? local joint venture partner?
Engie has been in the Kingdom for nearly two decades, The projects we pursue always include a local partner.
and today we have investments worth $5 billion. By the The reason for this is mainly to share the risk on the
first quarter of 2020 we will have 2000 employees in project itself, but also to ensure our work has a local
total. In the upcoming three to five years, however, touch. It helps us speed up hiring, and it helps us work
we’re looking at an additional $5 billion of investments, with partners with an established supply chain in the
and an additional 3000 employees, so that alone says a Kingdom. I can tell you that having a local partner is
lot about our intent for the country. key to working in the Kingdom. Yes, you can do it
without one, but if you really want to become competi-
How do you see Vision 2030 supporting the tive and minimize your imports, a local partner is vital.
investment journey? You need to understand what is available in the
Vision 2030 was a turning point not just for Engie but country, and to do that is much easier when you have
for Saudi Arabia as a whole. We’re seeing significant a local partner helping you.
change in the country: it is moving strictly towards
public-private partnerships (PPPs) and providing more What are your biggest achievements in Saudi
opportunities for the private sector to participate. Arabia and what “next steps” are you planning?
Regulations are changing in favor of the private sector. We just completed a 30-megawatt solar power
As a result of this new Vision, we’re working with a purchase agreement (PPA), which is the first corpo-
clean sheet of paper. There are clear objectives for what rate-financed PPA in Saudi Arabia. This would not have
the government expects to achieve, creating unity been possible prior to Vision 2030, but because the
across both the public and private sectors. private sector is aligning itself with Vision 2030
requirements, it is able to support and participate in
Can you briefly tell us about the role SAGIA played in PPP programs. Moving forward, I would say that what
your investment experience? we’ve achieved is only 10% of Engie’s true potential
SAGIA has been a fundamental and key component to here. I see a lot more involvement in terms of local
us doing business here. They’ve given us a sense of content, not just localization of the workforce or
comfort and support, not just during the preliminary supply chain, but also bringing in new technologies
procedures but throughout the entire chain of process- and new infrastructure. We’re working on energy
es required to set up a business. SAGIA goes above and efficiency measures, smart cities, and infrastructure
beyond to ensure that international companies are projects that comprise a complete city. Finally, we are
properly settled, that they understand the laws, and working on gas storage and green hydrogen, which is
that they have the necessary licenses to do business. I a brand-new energy source, and we believe Saudi
would say SAGIA has been a key player, and this is Arabia can be a global leader in this area.
clearly tied to the Vision, which is encouraging FDI.
www.investsaudi.sa 08
Winter 2020
INVESTOR VIEWS
Interview with
Zaher Ibrahim
Vice President,
Saudi Arabia, North Gulf &
East Mediterranean
Why did Baker Hughes invest in Saudi Arabia? Technology – all of these vocational institutes are
Baker Hughes has been here in Saudi Arabia for 80 helping nurture the Kingdom’s young talent, giving
years. The Kingdom offers a lot of value for us because it them the opportunity to make a difference - this is
has the right people, the right potential for growth, it’s also a great opportunity for Baker Hughes.
well-positioned geographically, and it’s at the right
level of development. We see Saudi Arabia as a hub for We are focused on building the right socioeconomic
us in the region – a hub for all our manufacturing, our ecosystem in Saudi Arabia and for the region. Our
human capital development, and for our key technolo- investments in the non-metallic segment, our
gy collaboration, leveraging the Dhahran Technology turbomachinery compressor facility in MODON, our
Center we have in Dhahran Techno Valley. latest and greatest pressure control facility in MODON
which serves not only Saudi Arabia and the region, but
How have Vision 2030 and SAGIA supported your exports globally as the largest wellhead facility world-
activities in Saudi Arabia? wide - all of these are achievements that we at Baker
Hughes are very proud of.
We’ve had a great experience with what Vision 2030
has brought to Saudi Arabia. I’ve been here for almost But there is definitely more to come, and we believe
20 years now, and I have seen how the Kingdom has everything we do here should benefit Saudi Arabia
been transformed. What impressed me the most was and the wider region. We’re pushing exports as a
how our collaboration with SAGIA helped us drive an company, but we’re also pushing another export -
investment that wasn’t simple to develop, so that it talent. We’re encouraging Saudi talent to go outside
became profitable and offered the right return on of Saudi Arabia, into the wider region and globally,
investment. then we monitor and drive their development, so they
come back here ready to manage and lead the region.
We celebrated breaking the ground at our new chemi-
cal plant in Jubail just a few months ago. It’s a true What’s next for Baker Hughes in Saudi Arabia?
testimony to how we were able to come together as a
multinational company with SAGIA to establish the We just announced a joint venture with Saudi Aramco
right priorities and investment imperatives to make it on the non-metallic front, where we’re seeking to
work, not only for Saudi Arabia but for the region. maximize the hydrocarbon value chain. We’re very
proud of this joint venture and we believe it will give
How is Baker Hughes supporting Vision 2030 Baker Hughes the opportunity to bring the right
objectives? technologies, while Aramco will bring the right
momentum through its hydrocarbon experience and
Today, our partnership with academia – including the domain expertise.
Saudi Arabian Drilling Academy, the Saudi Petroleum
Services Polytechnic, and the National Institute of
09 www.investsaudi.saWinter 2020
BUSINESS REFORMS HIGHLIGHTS
Saudi Arabia ranked as the world's top Doing Business
reformer and improver
Making an impact:
The biggest and best reforms of 2019
Saudi Arabia has implemented a series of sweeping reforms to improve
the business climate in the Kingdom and support new investments in
2019. These efforts have helped the Kingdom improve its ranking in
several high-profile international reports and indices.
09 OCTOBER
01 DECEMBER 2018 05 JULY Saudi Arabia officially opened the
Saudi Arabia opened several key The Ministry of Commerce and publishing sector to 100% foreign
sectors to 100% foreign ownership, ownership. The sector was among the
Investment launched a new law
including manpower recruitment last that still prohibited full
aimed at supporting and developing
services, recruitment agencies and ownership by foreign investors.
e-commerce, enhancing confidence
offices, audio-visual media services,
real estate brokerage services, and
in the sector, and providing
consumer protection against fraud, 10 OCTOBER
road transportation services. In the
deception, or misinformation. The World Bank ranked Saudi Arabia
previous two years, the Kingdom
the world’s top reformer and improver
had already opened the healthcare,
education, wholesale and retail, and 06 JULY in its Doing Business 2020 report. The
engineering services segments to Kingdom rose 30 places, from 92nd to
A landmark reform to the Kingdom’s 62nd, and improved in 9 out of 10
full foreign investment. procurement law was finalized, areas measured in the report.
coming into effect in November. The
02 JANUARY new law introduced a more
11 OCTOBER
competitive, flexible, centralized, and
Saudi Arabia established the National effective system for government A highly anticipated franchise law was
Competitiveness Center as a successor tenders, including equality between approved by the Council of Ministers,
of Tayseer. The NCC has since Saudi and international contractors due to come into effect in April 2020.
partnered with over 50 government (provided local content requirements The new law will enable international
organizations, as well as private sector are met). The government is also now companies to access local markets, as
entities represented by the Council of able to pay sub-contractors and well as develop a regulatory framework
Saudi Chambers. In 2019, 57% of the sub-suppliers directly and allows for for the relationship between
NCC’s 400+ planned pro-business arbitration of disputes via the Saudi franchisors and franchisees. The law
reforms were implemented. Center for Commercial Arbitration. will help both franchise parties make
03 MAY better investment decisions and
07 JULY improve the quality of goods and
Saudi Arabia launched the Premium services on offer in Saudi Arabia.
Residency Scheme for skilled foreign The Saudi Cabinet announced it will
workers. permit commercial activities to 12 OCTOBER
operate for 24 hours a day beginning
04 MAY in January 2020. Saudi Arabia climbed three places in
the World Economic Forum’s 2019
Saudi Arabia jumped 13 places on the
IMD World Competitiveness Yearbook
08 SEPTEMBER Global Competitiveness Report
rankings, becoming the world’s
2019, the biggest gain of any country In a historic moment for the country, 36th most competitive economy of
surveyed. It was ranked the world’s Saudi Arabia launched its first tourist 141 surveyed. The Kingdom
26th most competitive country, and visa scheme for 49 nationalities achieved significant results across
7th among the G20, supported by around the world, opening up a wealth each of the 12 index components,
improvements to government and of business opportunities in the ranking 1st for macroeconomic
business efficiency. Kingdom’s untapped tourism sector. stability, 17th for market size, and
19th for product market.
“With a reformist mindset, the Crown Prince has implemented and promoted a policy of featuring the Kingdom as an open world-class
investment destination. The Kingdom’s “Vision 2030” plan for long-term development encompasses a variety of legal and structural reforms.”
World Bank, October 2019
www.investsaudi.sa 10Winter 2020
BUSINESS REFORMS HIGHLIGHTS
A successful first batch of Premium Residency applicants
In May 2019, the Shura Council officially approved the Premium Residency Scheme for skilled foreign workers. Also referred
to as the “Saudi green card,” the scheme offers two types of permits: Permanent Residence (SP1) and Temporary Residence
(SP2). Premium Residency holders benefit from a host of attractive rights and privileges, including:
Issuing of visitor Recruitment of Access to a geographic information
visas for relatives domestic workers system that simplifies the review of
new electrical connection requests
The ability to own real estate The ability to invest The right to engage in business
for residential, commercial, and in securities listed on activities in accordance with the
industrial purposes the Saudi Stock Market Foreign Investment Law
The right to enter and exit Usufruct rights on Ownership of private means
the Kingdom as desired property located in the of transportation
cities of Mecca and Medina
In November, the Premium Residence Center announced it had approved
applicants of 19 nationalities
The first group was comprised predominantly of doctors, investors, and engineers.
Saudi Arabia launches innovators’ citizenship program
The world’s top talent can now benefit from a groundbreaking new citizenship program open to top innovators and
leading scientific talent. On December 5, a royal decree was issued offering citizenship to experts, innovators, and
talented creatives. Innovators’ citizenship is open to experts in forensic and medical science, technology, agriculture,
nuclear and renewable energy, oil and gas, and artificial intelligence, as well as distinguished scientists in areas such as
desalination.
The new scheme will play an important role in supporting Vision 2030 objectives, including the Kingdom’s
transformation into a knowledge-based economy.
11 www.investsaudi.saWinter 2020
GIGA-PROJECTS UPDATE
NEOM to train workforce of the future
In December, NEOM and the Technical and Vocational Training Corp. (TVTC) formed a partnership
aimed at creating thousands of new jobs in the Tabuk and NEOM regions. Recognizing that NEOM
will require thousands of vocational workers for construction, development, and management, the
partnership seeks to provide training and education to up to 6,000 residents, with a focus on key
industries including energy, construction, operations and maintenance, hospitality, transportation,
and logistics. Following graduation, NEOM will provide students with contractor positions within the
development.
Also in December, NEOM partnered with the University of Prince Mugrin to provide job opportunities
in the hospitality and tourism sector for hundreds of students from the NEOM and Tabuk regions.
Beginning in January, up to 250 students will be selected to participate in a Hospitality
undergraduate degree program at the university, which is offering the program in partnership with
the École Hôtelière de Lausanne (EHL), the world’s most prestigious hospitality school. Successful
graduates will be provided with job opportunities at NEOM after finishing their studies.
Expected to attract up to 5 million visitors annually, NEOM will play a key role in propelling tourism to
become a major economic driver in the coming years.
Qiddiya powers ahead with new site office
and strategic partnership with Samsung
Innovation is accelerating at Qiddiya entertainment city project just outside Riyadh, after the
October announcement that the Qiddiya Investment Company (QIC) and Samsung signed an
MoU establishing Samsung as Qiddiya’s primary technology sponsor, and for collaboration in
the design, engineering, and construction of Qiddiya’s upcoming sports complex. The
wide-ranging agreement also includes co-branding and naming rights for some anchor facilities
at the new sports complex and will support QIC’s work with multiple businesses operating under
the Samsung umbrella. The two companies are seeking to develop one of the world’s most
technologically advanced entertainment, sports, and arts destinations.
On December 11, the Qiddiya Development Company, QIC’s investment arm, announced it had
completed the first of two onsite offices ahead of schedule. The 21,000 sqm office complex will house
150 employees working on phase one of the Qiddiya project, which is expected to open in 2023.
Red Sea Airport contract signed
In an important milestone for the Red Sea Project, the Red Sea Development Company awarded
a design contract for the destination’s planned international airport to leading architecture and
design firm Foster + Partners in late October.
In partnership with its design subconsultant WSP Global, Foster + Partners will design the airport
using eco-friendly and sustainable principles. Its architecture will be informed by the colors and
textures of the Red Sea and its surrounding natural landscape, acting as a calm and luxurious
gateway to one of the world’s most unique resorts.
Construction of the airport is expected to finish in 2022, with capacity to handle 1 million
passengers annually and a peak of 900 per hour. The Red Sea Project itself will come online in the
same year, with its first phase offering 14 hotels and 3000 rooms across five natural islands and
two inland sites.
www.investsaudi.sa 12Winter 2020
INVESTMENT INITIATIVES
Major $17 billion project to restore
Diriyah UNESCO World Heritage Site
The foundation stone for Saudi
Arabia’s $17 billion Diriyah Gate
Project was laid in November. The
project will restore Saudi Arabia’s
ancient and historic city and
UNESCO World Heritage Site, which
was built on the banks of Wadi
Hanifa in 1446, transforming it into
a cultural and lifestyle destination.
On completion, the 7 sqkm project
will comprise 20 luxury hotel
brands including Aman Resorts, as
well as 5 iconic squares, a
15,000-seat arena, and a Formula-E
racetrack. Its construction and
operation will create 55,000 jobs,
15% of which will be for Diriyah
residents.
Riyadh goes green
In November, The Nature Park
project in Riyadh was officially
unveiled. Located in the
southeastern area of Riyadh’s
Diplomatic Quarter, the 200,000
sqm park will feature multiple
elements inspired by the area’s
natural landscape. Works will
include sand and rock features,
illuminated pedestrian pathways,
and integrated irrigation systems
for trees and vegetation beds.
13 www.investsaudi.saWinter 2020
INVESTMENT INITIATIVES
Riyadh becomes the Arab world’s first
digital capital city
On December 19, the Council of Arab Ministers of Communications and
Information Technology named Riyadh the Arab world’s first ever digital
city. The decision came about as a result of the city’s efforts to adopt and
promote the use of digital technology to enhance socioeconomic
development, improve healthcare and education, and boost community
welfare.
Following the launch of Vision 2030, the last few years have seen a
significant acceleration in the proliferation of digital transformation
initiatives. Highlights include:
Saudi Arabia became 2nd among G20 countries for radio spectrum liberalization
Saudi Arabia became the 1st adopter of commercial 5G technology in the Middle East and North
Africa and the third largest globally
Saudi Arabia became the 5th G20 country in internet speed and jumped 91 places from 105th to 14th
in the relevant global rankings, with a 51.8Mbps average speed
These achievements helped the ICT sector boost its GDP contribution to 4%, with the Kingdom also
rising 16 places in the World Economic Forum’s Global Competitive Index “ICT adoption” category.
Today, Saudi Arabia is the region’s largest ICT market and ranks 13th globally, with a value of $28.7
billion in 2019 and strong growth in both the consumer and enterprise segments.
Supported by a young and tech-savvy population, Saudi Arabia is a market of early technology adopters,
with one of the highest social media penetrations in the world. Mobile subscribers stood at 43.8 million
in 2019, representing a 129% penetration of the total population. Earlier this year, the Ministry of
Communications and Information Technology (MCIT) launched a five-year strategy aimed at
accelerating the sector’s growth by 50% and elevating its contribution to GDP by $13.3 billion.
www.investsaudi.sa 14Winter 2020
INVESTMENT INITIATIVES
The world’s largest IPO
Saudi Arabia made history on December 5 with the world’s
largest initial public offering (IPO). Saudi Aramco, the world’s
most profitable company, sold 1.5% of its capital, or $25.6 billion
of shares priced at SAR32 ($8.53) each, the top of the range at
which they are marketed. The company had orders for $119
billion of stock on the day of its IPO, and roughly 4.9 million
investors, 15% of whom are Saudi citizens, applied for shares. As
of January 13, the IPO size further increased to $29.4 billion.
The World's Largest IPOs ($ billion) The World's Most Profitable Companies
by Net Income (2018, $ billion)
SAUDI ARAMCO (2019) 29.4
ALIBABA (2014) 25.0
SOFTBANK CORP. (2018) 23.5 SAUDI ARAMCO 111.1
AGBANK (2010) 22.1
APPLE 59.5
ICBC (2006) 21.9
AIA (2010) SAMSUNG 35.1
20.5
GM (2010) 20.1 JP MORGAN 30.7
NTT DOCOMO (1998) 18.4 ALPHABET 30.7
VISA (2008) 17.4
SHELL 23.4
ENEL (1999) 17.4
FACEBOOK (2012) EXXON MOBIL 20.8
16.0
0.00 5.00 10.00 15.00 20.00 25.00 30.00 0 20 40 60 80 100 120
Source: Statista, Bloomberg Source: Bloomberg, Moody’s Investor Services
The IPO significantly augmented the Tadawul’s market capitalization, which stood at $506 billion
two days before it listed. At closing on January 1, 2020, the Tadawul’s market capitalization was over
$2.4 billion. This means Saudi Arabia’s bourse has the highest market capitalization in the MENA
region and seventh largest in the world.
The World's Largest Capital Markets by Market Cap
(Dec 2019, $ trillion)
40
33.4
35
30
25
20
15
10
6.9 6.4
5.2 3.3
5
2.6 2.4 2.3 2.2 2.1
0
USA CHINA JAPAN HONG UK FRANCE SAUDI CANADA GERMANY INDIA
KONG ARABIA
Source: Bloomberg
15 www.investsaudi.saWinter 2020
STARTUPS
Number of foreign entrepreneurs licensed by
SAGIA keeps growing
Saudi Arabia is already home to a burgeoning startup community, with SAGIA unveiling the
Entrepreneurship License back in late 2017. The license allows start-up founders from all over the world
to launch their business ideas in Saudi Arabia without the need for a local partner.
More than 200 startups have been licensed since then, an average of nine each month. In 2019, we
welcomed 179 innovative foreign entrepreneurs.
50 258% 179
2018 2019
Misk Entrepreneurship World Cup in
partnership with Invest Saudi
The Entrepreneurship World Cup (EWC)
global finals were hosted at the fourth
annual Misk Global Forum in Riyadh in
November.
Featuring 100,000 entrepreneurs from
170 countries, the EWC is the largest
and most diverse startup pitch
competition and support program of its
kind. Winners and finalists are offered
life-changing prizes and support
including training, resources,
networking opportunities, and $5
million in cash prizes. At the close of the
EWC, Invest Saudi announced that all
100 finalists would be granted an
entrepreneurship license.
www.investsaudi.sa 16Winter 2020
SPORTS
Sports sector takes the spotlight in 2019
Saudi Arabia’s sports sector has undergone a complete overhaul since the launch
of Vision 2030, driven by three main objectives:
1. Achieve 40% participation rate by 2030 by inspiring the community
to engage in sports
2. Develop Saudi elite athletes performance at international competitions
3. Grow and empower the sports economy
$1.8B
allocated government
$670M
committed to support sports
$320M
private sector investment
investments in the clubs in achieving financial committed through clubs
next five years maturity and privatization sponsorships until 2023
23% 51 19 25+
mass participation clubs participating internationally- internationally
and activity levels in 10 different recognized sports recognized sports
increase in 2019, up sports, up from 9 events in 2019, up events planned
from 13% in 2015 clubs in 2018 from from 9 in 2018 for 2020
Number of internationally-recognized sports events hosted in Saudi Arabia
2019 major events
Saudi Pro-Golf Championship
WWE Super Showdown
Battle of the Champions (BMX & skateboarding)
Saudi International Championship for Parachuting
9 19
Saudi International Meeting for Disabilities Sport
Fiba 3x3
International Handball Federation Super Globe
Formula - E, E-Prix
Clash of the Dunes
Dirriyah Tennis Cup
major major Dirriyah Equestrian Festival
events events Italian Super Cup
2018 2019
25+ Major Events planned for 2020
17 www.investsaudi.saWinter 2020
SPORTS
Interview with
Prince Abdulaziz bin
Turki Al Faisal
Chairman of General Sports Authority (GSA)
How has the Saudi sports industry evolved in the past 5 years? growing number of large-scale, internationally-recognized
We have set out to completely uplift the industry. events present lucrative partnership and sponsorship
Recently, we have seen a multitude of new federations opportunities. There is a massive youth market in Saudi
established that are now spreading awareness on more Arabia that is energetic and ready to explore new sports.
than 50 different types of sports. As a result, the There is a significant increase in the amateur-level practice
numbers are positive, hinting at the opportunity. In of sports such as motorsport, mixed martial arts, boxing,
simple terms, thanks to new opportunities to engage, and tennis among others. The governance and financial
mass participation and activity levels have increased support strategy of clubs will be rolled out to diversify
from 13% in 2015 to 23% in 2019. sporting interests beyond football.
The sporting ecosystem has also received significant In what ways is Saudi Arabia facilitating business in
financial support to enable a sustainable framework to the sports sector?
help community sport flourish. Under a strategy Facilitating business in the sports sector has many levels.
announced in 2019, 170 clubs in Saudi are benefitting The base level is establishing the framework, regulations,
from direct financial support as well as and the legal pathway for a business to enter this sector.
performance-based support to the value of $650 One of the simplest examples of this is the regulations and
million. Furthermore, the country has proven its ability licensing processes for gyms that were established in 2018.
to learn and adapt quickly and has, in two short years,
An enabling framework and regulation, combined with a
established a proven track record of hosting global
commitment to grow mass and elite sports and host
sporting events, building solid relationships with global
large-scale sports events presents lucrative opportunities
sporting bodies in the process. These partnerships and
for the private sector to play a part. The scale, speed, and
events have also helped us to improve and further
ambition of the Saudi sports journey provides an open
develop the frameworks that support athletes, sports
door to private sector support.
administrators, and the industry as a whole. The
ambitions are clear. Internationally-recognized events What is your 2020 outlook for Saudi Arabia’s sports
in Saudi Arabia more than doubled from 9 in 2018 to 19 industry?
in 2019, with more than 25 events planned for 2020. Robust and rapidly expanding. The world can see
Where do you see the biggest investment potential in the Kingdom and we are quickly earning
opportunities within the sports sector in Saudi Arabia? our place among the major sporting events
destinations in the world, with a growing community
Sports investment opportunities are massive across the
of participants at the grassroots level.
board. Awareness and demand of sports is growing
tremendously. With that growth comes an ecosystem that In 2020, we want to increase our momentum in
must grow in parallel, presenting an opportunity for the developing infrastructure, athletes, leaders, and
private sector to fill in any gaps in the ecosystem. Our administrators. Our goals are to further enable our
direction s to enable the private sector to do exactly that. federations to create more opportunities and to engage
and grow mass participation in sports. We have started to
This presents lucrative opportunities in every part of the
see the return on our investment and will continue to
value chain from sponsorships, clubs, sports professionals,
grow with private sector involvement locally and
facilities, merchandising, and many others. Additionally, a
internationally.
www.investsaudi.sa 18Winter 2020
ENTERTAINMENT
Riyadh Season events generate big returns
Riyadh Season is one of 11 Saudi Seasons that have been shaking up the country’s
tourism and entertainment sector. Seasons feature global entertainment acts,
sporting events, and shows, all of which are set to transform Saudi Arabia into a
leading destination for tourism.
$270M
Revenues
10.3M
Visitors
206k
Tourist visas
issued
34k+
Seasonal jobs
17k+
Indirect jobs
Diriyah Season brings major sporting events to KSA
The General Sports Authority (GSA) opened the Diriyah Season on November 11,
kicking things off with the launch of the sixth season of the ABB Formula-E, the
world's leading electric-only motorsport championship. This was followed by Clash of
Dunes, labelled as the biggest boxing event on the planet, between heavyweight
champions Andy Ruiz Jr. and Anthony Joshua. The season closed with the Diriyah
Tennis Cup, featuring 8 of the world’s top tennis players, and the Equestrian Festival.
In addition, the Diriyah districts included a variety of unique entertainment
experiences, ranging from outdoor concerts to heritage tours.
50k+ 35% 80+ 100M+ 18
Total Nationalities Viewers of International
Tickets sold
international Clash of Dunes artists
attendance performing
MDL Beast Festival - a party to remember
On December 19 to 21, the MDL Beast Festival – the largest music, arts, and culture
festival the Kingdom has ever seen – was hosted for the first time just outside of
Riyadh. Headlined by the biggest DJs from around the world including Martin
Garrix, David Guetta, Tiësto, Afrojack, and Steve Aoki, performing alongside the
best of Saudi Arabia’s EDM DJs including Cosmicat, DJ Baloo, Vinyl Mode, and Dish
Dash – the event featured five stages, dozens of art installations, VIP cabins,
pop-up shops, performance spaces, and restaurants.
400k
Concert-goers
70+
DJs and artists
5
Unique stages
5
Districts
19 www.investsaudi.saWinter 2020
INTERNATIONAL EVENTS
Saudi-Russian
CEO Forum
Riyadh – October 14th
400
business leaders
17
MoUs signed
Saudi-Japan
Vision 2030
Business Forum
Tokyo – October 23rd
300
business leaders
12
MoUs signed
www.investsaudi.sa 20Winter 2020
INTERNATIONAL EVENTS
You can find us at events all over the world.
ASIA
January 2020 February 2020
Guangzhou Municipal SAFE
Government delegation Jeddah- KSA (2-5 Feb)
lead by Guangzhou Mayor
Deal Makers / Endeavor
Riyadh - KSA (17 Jan)
Riyadh (9-19 Feb)
Arab Health Expo
Retail Leaders Circle
UAE (27 - 30 Jan)
MENA Summit 2020
Saudi GOLF Riyadh - KSA (10-11 Feb)
Jeddah - KSA (28 Jan - 2 Feb)
Asia House - Conference
Biban Riaydh 2.0 'The Asia House Middle East
Riyadh - KSA (29 Jan - 1 Feb) Trade Dialogue'
Riyadh - KSA (20 Feb)
Global Educational Supplies
and Solutions - GESS
UAE (25-27 Feb)
FPF 2020
Riyadh (25 Feb)
Energy Solar Conf.)
Riyadh
March 2020 April 2020 June 2020 October 2020
Middle East Electricity Saudi Malaysian Symposium on MENA EXPO 2020
UAE (3-5 Mar) Business Forum Economic Reforms UAE (20 Oct)
Jeddah - KSA (2 April) Riyadh - KSA (Jun)
Foodex Japan 2020
Japan (10-13 Mar) Arabian Travel Market
Gateway Gulf Investor
UAE (20-19 April) September 2020 November 2020
Forum Global FDI Summit IKTVA forum
Bahrain (11-12 Mar) Riyadh - KSA (20 Sep) Dhahran - KSA (25-23 Nov)
SOUTH AFRICA
February 2020
INDABA
South Africa (3-6 Feb)
21 www.investsaudi.saWinter 2020
NORTH AMERICA
March May
Roadshow US OTC 2020
1st City DC USA (4-7 May)
USA (2-3 Mar)
Roadshow US
2nd City LA
USA (4-6 Mar)
EUROPE
January 2020 February 2020 March 2020 May 2020
Davos | World Economic Forum ICIS 24th World Base Oils & MIPIM Transport Logistics
Switzerland (21-24 Jan) Lubricants Conference France (10-13 Mar) 2021 Munich
London - UK (19-21 Feb) Germany (4-7 May)
BETT LogiMat 2020
London - UK (22-25 Jan) Saudi Italian Business Forum Germany (10-13 Mar)
Milan - Italy
www.investsaudi.sa 22www.investsaudi.sa
Invest in Saudi Arabia
Getting an investor license takes just: • Find out more at InvestSaudi.sa
2 3 • Contact the investment team:
Email: InvestorCare@sagia.gov.sa
Local: 800 244 9990
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