FDI net inflows hit $2.93bn in Q3 2023, 10% lower than in the second quarter, government data cited by Reuters shows.

However, FDI inflows during Q3 2023 were 58.3% higher on a year-to-year basis compared with the same period in 2022 ($1.92bn). Research from the GlobalData FDI database shows investments in the Tourism sector came out on top during Q3, with 26 FDI projects announced between July and September 2023. Business and Professional Services ranked second, with 13 projects announced during that quarter, followed by Software and IT Services (11) and Communications and Media (5).

Saudi Arabia is quickly becoming an attractive emerging market for investors, with the kingdom’s economy looking to different sectors to diversify its economy away from fossil fuels. According to the Kearney FDI Confidence Index, the country was among the top six most attractive FDI destinations for investors, ranking right below the United Arab Emirates and Qatar.

In October 2017, officials in Riyadh launched Neom, a new 26,500 km² city otherwise known by the general public as ‘The Line’.

Six years later, in October 2023, officials leading the project announced a new investment fund (Neom Investment Fund, or NIF), which will help develop Neom’s 14 priority sectors. Investors want to turn Neom into Saudi Arabia’s new financial and trade hub, competing against other cities such as Riyadh and Jeddah.

“To date, NIF has invested in several technology companies within the 14 priority sectors of Neom that will accelerate technologies critical to the Neom project and have a major impact on the future of living and sustainability,” said NIF CEO Majid Mufi. “Replicated over time, this approach will position Neom as a model for sustainable economic development.”

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By GlobalData