China is now Saudi Arabia’s largest greenfield foreign direct investor, having invested USD 16.8 billion in 2023, a 1,020% increase over the previous year.
China came in second to the United States and the UAE, with Greenfield FDI totalling USD 27 billion and USD 267 billion, respectively, according to Emirates NBD.
Hong Kong ranked fifth with USD 796 million, and Kuwait came in fourth with USD 937 million.
Greenfield FDI is a type of investment in which a parent company builds operational facilities (subsidiary) to launch a new business venture abroad.
Saudi Arabia hopes to attract more than USD 100 billion in foreign direct investment by 2030 as it gradually diversifies its economy and lessens its reliance on oil.
The report claims that USD 5.56 billion of Chinese capital entered the automotive original equipment manufacturing industry, fully supported by an agreement signed in June 2023 during the Arab-China business conference by Human Horizons and the Kingdom’s Ministry of Investment.
As per the agreement, the Chinese enterprise is establishing a research, development, manufacturing, and sales centre for automobiles in Saudi Arabia.
The Asian behemoth also made investments in the semiconductor and metals industries totalling USD 426 billion and USD 526 billion, respectively.
According to the report, Saudi Arabia received USD 28.78 billion in Greenfield FDI, a 110% year-over-year increase.
Despite surpassing the USD 17.57 billion peak in 2018, the inflows in 2023 fell short of the record USD 34.26 billion set in 2008.
With USD 8.18 billion, Riyadh received the largest portion of all Greenfield FDI, followed by Dammam and Ras Al-Khair with USD 772 million and USD 4.23 billion, respectively.
The study made note of the USD 227 million in investments made in the Kingdom’s tourism industry. US-based Radisson Hospitality completed a significant acquisition in the tourism sector, opening a 223-room hotel at the Riyadh Convention and Exhibition Centre at an estimated cost of USD 112 million.