Saudi Arabia is trying to attract more international investors by creating a new investment agency in a move aimed at changing its disappointing record of attracting foreign investments, according to the magazine.Forbes“.
On Tuesday, the Saudi Cabinet announced the approval of the establishment of the Investment Promotion Authority headed by Minister of Investment Khalid Al-Falih, who said in a statement that the new authority will enable the country to follow an integrated approach between government agencies to encourage more investment and support partnerships between local and foreign investors.
Foreign investment is an important part of Saudi Crown Prince Mohammed bin Salman’s plans to transform the Saudi economy.
The magazine says that the amount of investment that the Saudi government wants to attract is very large, for example, the authorities hope to obtain investments worth $160 billion to build the future city of NEOM, which is being built in the sparsely populated northwest of the country.
The Saudi government plans to get most of this money from investing in sovereign wealth funds and investor money, as well as by listing some assets on the local stock market.
The magazine adds that the country’s ambitions may go far beyond that, under the National Investment Strategy launched in October aimed at attracting $103 billion annually in foreign direct investment by 2030.
The magazine notes that Saudi Arabia has struggled in recent years to attract needed investments, amid investor concerns regarding human rights issues as well as the preference of multinational companies to establish their Gulf operations in Dubai.
According to the latest data issued by the Saudi Central Bank, the volume of internal investment amounted to regarding two billion dollars during the first quarter of this year.
Forbes asserts that this is the country’s second-best quarterly performance since late 2016.
She believes that if the Saudi government is to achieve its goal, it needs the average quarterly investment to be regarding $25 billion, more than 12 times the current rate.
Saudi Arabia, the largest economy in the Arab world, is striving to attract foreign investment, which is the cornerstone of the development plan set by the Crown Prince to diversify the kingdom’s economy, which depends mainly on oil, by 2030.
The mega projects launched by the Crown Prince, such as the future city of NEOM, in which the investment cost is estimated at $500 billion, and the development of Diriyah, the capital of the first Saudi state, are an essential part of this plan.
