Khalid Al-Falih, Saudi Arabia's minister of investment, and board chairman of Economic Cities and Special Zones Authority, addresses the Saudi Special Economic Zones Investment Forum, which was held in Riyadh on May 29.  (PHOTO / PROVIDED TO CHINA DAILY)

Saudi Arabia’s four new special economic zones (SEZs) that were launched in April have attracted $12.6 billion from investors across the maritime, mining, manufacturing and logistics, and tech sectors, while an additional $31 billion in investments are in the works.

The latest development was unveiled at a Saudi Special Economic Zones Investment Forum, which was held in Riyadh on May 29, and hosted by the Economic Cities and Special Zones Authority (ECZA), in partnership with the Saudi Program for Attracting Regional Headquarters of International Companies.

The forum also saw the awarding of licenses to the four SEZs —  King Abdullah Economic City SEZ, Ras Al-Khair SEZ , Jazan SEZ, and Cloud Computing SEZ — and recognition of initial investors. All these events are in line with the country’s Vision 2030 which sets specific economic targets as the country diversifies from its traditional reliance on oil.

According to the Organisation for Economic Co-operation and Development (OECD), Saudi Arabia recorded the highest annual growth of GDP in 2022 at 8.7%, among the G20 countries. This was followed by India at 6.7%, Türkiye at 5.6%, and Indonesia at 5.3%. Japan recorded the lowest growth at 1.0%

In his opening speech, Khalid A. Al-Falih, Saudi Arabia’s minister of investment, and chairman of ECZA board, told the forum that in 2022, Saudi Arabia's capital formation, which is the total investment from all sources, “grew by an amazing 31 percent”, exceeding 1 trillion Saudi riyals ($266 billion) for the first time, and was exhibiting a ratio of total capital formation to GDP of 25 percent. 

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“This is already well above the OECD average of 22 percent and positions as well to achieve our bold target of 30 percent of GDP by 2030,” said Al-Falih, adding that one of Saudi Arabia’s goals is to be among the top 15 nations globally in gross domestic product.

According to the Organisation for Economic Co-operation and Development (OECD), Saudi Arabia recorded the highest annual growth of GDP in 2022 at 8.7 percent, among the G20 countries. This was followed by India at 6.7 percent, Türkiye at 5.6 percent, and Indonesia at 5.3 percent. Japan recorded the lowest growth at 1.0 percent.

“Furthermore, capital formation is being driven by the private sector, not by government projects as in the past. And it’s across enterprises of all sizes and all within the key targeted sectors,” said Al-Falih.

The minister noted that large-scale investment projects by the private sector amounted to around $76 billion last year, covering information and communication technologies, agriculture, airspace, petrochemicals, mining and renewable energy.

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He added that at a time when the global venture capital sector was shrinking, VC funding in Saudi Arabia rose more than 70 percent last year to nearly $1 billion, the highest growth rate in the region with the number of VC investments doubling year-on-year.

Representatives from Saudi Arabia's four new Special Economic Zones receive their license during the Saudi Special Economic Zones Investment Forum in Riyadh on May 29. (PHOTO / PROVIDED TO CHINA DAILY)

According to Magnitt, a leading data platform for investors, founders and corporates in the Emerging Venture Markets, Saudi Arabia’s VC ecosystem hit 72 percent, aggregating $987 million in funding across 144 deals in 2022.

Nabil Khojah, ECZA’s secretary general, said that the four SEZs “are brand new”, but have already attracted billions of Saudi riyals in investment. 

“This is an exciting moment for the Kingdom and for all of us at ECZA, as we unveil new opportunities for global investors to capitalize on Saudi Arabia’s position as an economic powerhouse at the heart of global trade routes,” said Khojah. 

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Some of the companies recognized as “anchor investors” or early investors include Lucid Motors, CEER, both involved in the electronic vehicles business,  the International Maritime Industries, the Al Hadi Group, which will be involved in enhancing food production and food security in the region, and the Saudi Coffee Company.

Other new investors include Siac construction, McDermott in engineering, Chinese firms Baosteel, which will be involved in steel plate manufacturing in the Ras Al-Khair SEZ, and the WangKang group, which will produce glass products of 1 million tons a year in the Jazan SEZ. 

jan@chinadailyapac.com