Saudi Arabia issues more than 500 investment licences to companies in first half

Government’s response to the pandemic has helped to support the economy, the kingdom’s minister of investment said

Saudi Arabia on Thursday said the number of licences issued in June rose 23 pre cent compared to the same month last year . Reuters

The Ministry of Investment of Saudi Arabia (MISA) granted 506 new licences to international companies during the first six months of the year, with companies from the US, India and the UK among the most active investors.

Some 54 companies who received licences were from the US, 49 were from India and 47 from the UK, according to the Ministry.

Entrepreneurship, education, financial services, and housing were the sectors that attracted the highest number of new foreign investment projects during the second quarter.

“We are encouraged by the resilience demonstrated by the Saudi economy in the first half of 2020,” Khalid Al Falih, minister of investment of Saudi Arabia, said. “This has undoubtedly been a year of unprecedented challenges – and the path of the economy in the near term will depend on the virus. However, we have seen clearly that the government’s decisive response to the pandemic has helped to support investors through this difficult time.”

Since the outbreak of the coronavirus, Saudi Arabia rolled out 142 stimulus initiatives with a total value of 214 billion Saudi riyals ($57bn/Dh210bn) to support individuals, private sector businesses and investors, the Saudi Press Agency reported in July. Measures ranged from tax exemptions and discounts to the postponement of payments on utility bills.

“The positive economic data for June give us confidence that the Saudi economy is rebounding from the impact of Covid-19 and that growth in foreign investment will begin to regain the strong momentum we have seen in recent years,” he said.

The ministry also said the kingdom's new mining law will bring the regulatory environment to the mining sector in line with international standards, "helping to unlock a market which has an estimated $1.3 trillion (Dh4.8tn) in untapped minerals".

The kingdom approved a new mining law in June to attract more local and foreign investment into its mining sector.

The number of investor licences issued to international companies in Saudi Arabia dropped 14 per cent in the first half of this year as movement restrictions to reduce the spread of the coronavirus hampered foreign investment.

However, the pace picked up at the end of the the period with the number of investor licences issued in June accounting for nearly half of all licences issued in the second quarter.

The number of licences issued in June were 23 per cent higher than in the same month last year, MISA said, without providing numbers.