China is becoming one of the most active foreign investors in Saudi Arabia, with a flurry of activity in non-oil economic growth sectors. Chinese investments accounted for over 58 per cent of the new business investments in the region. These were focused on – semiconductor, automotive, and metal investments.
China pumped in $16.8 billion in the kingdom as opposed to the $1.5 billion it had pumped in during 2022, stated data from Emirates NBD. The kingdom is targeting over $100 billion in foreign direct investment by 2030, all to diversify the economy.
Overall, the FDI investments in Saudi doubled to $28.9 billion. EmiratesNBD report added that this surpassed the previous peak of $17.6 billion in 2018 but didn’t touch the exuberance of 2008 of $34.3 billion.
The report added that the influx of foreign capital is increasingly turning to India and China. However, the report added, apart from China, the next biggest investor in the region was the US with $2.7 billion, a whopping 238 per cent increase.
The bulk of the American investments were focused on tech and software.
The UAE was the third largest source of greenfield FDI into Saudi Arabia last year with USD 2.67bn of investment, a 225 per cent increase year-on-year. The UAE investments were mainly in the renewable energy sector, which saw USD 1bn in greenfield FDI, followed by the communications sector with $444 million, and food and beverages with $237 million. Kuwait came in fourth with $949 million, an increase of 189 per cent year on year.
The real estate sector received the largest share of Kuwaiti investments with $639 million, followed by metals with $228 million, and food and beverages with $83 million.
Hong Kong came fifth with $796 million in greenfield FDI inflows, mainly from a $763 million investment by GCL Technology Hsoldings in a manufacturing project in the chemicals sector.
Oracle had the biggest share of the investments with $950 million deployed into two projects. Oracle has signed a memorandum of understanding with the Ministry of Communications and Information Technology (MCIT) in Saudi Arabia to open a new public cloud region in Riyadh for an estimated cost of $750 million. Oracle is also expanding the capacity of its cloud region in Jeddah at an estimated cost of $200 million.
