Saudi Arabia has set up a new investment promotion authority as the Arab world’s largest economy aims to boost growth.
The Saudi Investment Promotion Authority (Sipa) was launched at the directive of King Salman and Crown Prince Mohammed bin Salman, who is the president of the Council of Economic and Development Affairs, the Ministry of Investment said on Wednesday.
“The establishment of Sipa will enable an integrated approach to investment between government agencies while enhancing all activities and services related to investment promotion to support partnerships between local and foreign investors,” Khalid Al Falih, Minister of Investment for Saudi Arabia, said.
The move comes as Saudi Arabia, Opec’s top oil exporter, continues to focus on attracting investment into the country to diversify its economy away from oil.
In October, Prince Mohammed launched the National Investment Strategy, which seeks to attract 388 billion riyals ($103.47bn) in foreign direct investments annually, according to the state-run Saudi Press Agency.
The kingdom also expects to increase its domestic investment to about 1.7 trillion riyals by 2030 under the new strategy.
“The launch of Sipa is made possible by the kingdom’s first National Investment Strategy, which seeks to unleash the potential of the kingdom’s strong market fundamentals and the breadth and depth of opportunities created by Vision 2030,” the Ministry of Investment said.
“The strategy aims to increase investment to 30 per cent of GDP [gross domestic product], and catalyse the growth of emerging sectors in the economy.”
In the first quarter of this year, the kingdom signed investment deals worth more than $4bn in sectors including entrepreneurship, advanced manufacturing, defence, information and communications technology, petrochemicals and conversion industries.
Among the big deals announced during the quarter was the $3.4bn investment by US-based Lucid Motors to set up an electric vehicle factory in Saudi Arabia with a production capacity of 155,000 units a year.
Saudi Arabia also signed 13 investment agreements on the sidelines of US President Joe Biden’s visit to the kingdom last month.
The agreements covered sectors including energy, aerospace, defence, textiles, manufacturing, education and tourism, the Ministry of Investment said at the time.
The kingdom's economy in the first quarter of 2022 experienced the highest rate of growth in the last 10 years amid increased activity in the oil sector, government data showed.
The country’s economy is forecast to grow 7.6 per cent in 2022 and 3.7 per cent in 2023, after expanding 3.2 per cent last year, according to the International Monetary Fund.