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Saudi Round-Up: Innovation Promises a Bright Future in the Kingdom

Weekly Roundups

19 Mar 2024

AstroLabs Team

Welcome to another edition of our Saudi Round-Up, where we present a summary of main highlights in various industries across the Kingdom. In addition to news about general business and the economy, this week’s round-up looks at the latest developments in fintech, real estate, technology, and tourism.

From Tuesday, March 12th, to Monday, March 18th, 2024

General Business and Economy

Non-Oil Activity in the Kingdom Has Reached 50% of GDP

The Saudi non-oil economy has grown to a record-breaking $255 billion in 2023, accounting for 50% of the country’s total GDP.

This growth is driven by arts and entertainment, which doubled in value from 2021 to 2022. Accommodation, food, transport, and storage services were also major contributors. Furthermore, tourists’ spending increased 319% over the last two years, reflecting the impact of the Kingdom’s positioning as a global tourism and entertainment destination.

Saudi’s PIF Now Stands at $925.2 Billion

Saudi’s Public Investment Fund is now the fifth-largest state-owned investment organization in the world. This follows its acquisition of a further 8% of shares in the primarily state-owned Saudi energy firm Aramco. The Saudi PIF now has more than $860 billion of assets under management, up from $700 billion at the close of 2022.

The PIF is poised to use this bolstered investment capability to drive the Vision 2030 agenda.

Saudi PIF Establishes $1 Billion Venture Debt Subsidiary

The Saudi Public Investment Fund is supporting the venture debt ecosystem through its subsidiary Jada Fund of Funds (JFF). JFF has entered the venture debt market with a $1 billion investment in Partners for Growth (PFG).

PFG’s collaboration with Jada is set to accelerate Saudi’s private credit sector and drive technological innovation. The partnership demonstrates both organizations’ commitment to attracting foreign direct investment and solutions to support Vision 2030.


Gulf Capital to Invest $100 Million in Saudi Tech

Private equity firm Gulf Capital will invest $100 million in the Kingdom’s Research, Development, and Innovation Authority over a period of five years.

The investment is spurred by Gulf Capital’s wishes to help the Kingdom establish itself as a global center for innovation. Co-founder and CEO Karim El-Solh expressed contentment with the opportunity to contribute to the Kingdom’s growth and Vision 2030. His firm has invested more than $586 million dollars in Saudi over an 18-year period.


PIF Considers Buying Saudia Airline to Grow Tourism

The Kingdom’s Public Investment Fund is poised to buy Saudia, the Kingdom’s largest airline, as early as 2025. The move would increase the sector’s profitability and efficiency, contribute to the growing role of Saudi as a global business hub, and bolster the country’s initiatives to attract 150 million tourists per year by 2030.

Princess Haifa Al-Saud, Vice Minister of Tourism, noted that the Kingdom's existing $13 billion-worth of investments in the private sector will help increase the number of hotel rooms by as much as 200,000 within two years and raise tourism revenue to $85 billion this year (4.5% contribution to GDP) from about $66 billion in 2023.

Saudi Could Double Hotel Rooms Within a Decade

According to Elie Maalouf, CEO of IHG Hotels and Resorts, the Kingdom’s trajectory as a global tourism destination necessitates doubling the number of hotel rooms over the next ten years.

Beginning in 2027, IHG intends to construct some of the most luxurious hotels in Riyadh along with facilities in giga-projects and megacities across the country to support Vision 2030.

Saudi Highlights New Murabba Development at MIPIM 2024 Event

New Murabba Development Company showcased its Mukaab project at MIPIM 2024, the 3-day global real estate event held in France this month.

Mukaab will lead in innovative technology and is to be among the world’s largest structures at 400 meters in height, length, and width. The project is expected to attract significant foreign investment, create 334,000 jobs, and contribute $50 billion to the economy.

This week’s Saudi Round-Up demonstrated more of the dedicated individuals, leaders, and organizations driving economic transformation throughout the Kingdom with an emphasis on Vision 2030’s objectives for developing Saudi Arabia as an economic, technological, and tourism hub. Bookmark us and come back next week for another overview of Saudi business developments amid rapid economic transformation.

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