Saudi National Transformation Program setting pace for Vision 2030

Saudi National Transformation Program setting pace for Vision 2030
Riyadh became a valuable investment destination for global investors, whereby more than 180 companies obtained permits in 2023 to open a regional office. (Shutterstock)
Short Url
Updated 09 March 2024
Follow

Saudi National Transformation Program setting pace for Vision 2030

Saudi National Transformation Program setting pace for Vision 2030
  • The initiative has soared past its initial targets and created tangible growth for nation's citizens, residents and investors

RIYADH: Saudi Arabia’s ambitious National Transformation Program, which sought to develop the necessary infrastructure for the realization of the Kingdom’s Vision 2030 goals, has soared past its initial targets and created tangible growth for the nation’s citizens, residents and investors.

Launching the economic diversification plan in 2016, Crown Prince Mohammed Bin Salman vowed to improve the Kingdom’s business environment, allowing the economy to flourish and drive employment opportunities for citizens and long-term prosperity for the nation, a task which the NTP undertook. 

Within the framework of the Vision, the NTP was tasked with the fulfilment of 34 out of the 96 objectives, thus encompassing more than 35 percent of its goals. 

From increasing foreign direct investments, growing the number of small and medium enterprises and improving working conditions for expatriates, the 2023 annual progress report for the program outlines an umbrella of success stories, exceeding beyond their initial key performance indicators. 

In a statement, Thamir Al-Sadoun, NTP CEO, said: “We at the National Transformation Program are immensely proud of these inspiring achievements. The Program was launched in 2016 with Saudi Vision 2030, and we have since worked diligently and with greater ambition. We established new initiatives, monitored the impact’s sustainability, and collaborated with all our stakeholders.”

Transforming the business ecosystem

Equipped with a strategic geographic location at the crossroads of three continents, a strong industrial infrastructure and specialized incentives for the private sector, Saudi Arabia currently stands as the second-best economy globally for business, according to the Global Entrepreneurship Monitor Report for 2022. 

This is as a testament to the Kingdom’s ongoing economic reforms which seek to empower the private sector and attract local and foreign investments.

In 2023, more than 8,500 foreign investment licenses were issued, an increase of more than 96 percent compared to the previous year, the NTP report outlined. 

Riyadh became a valuable investment destination for global investors, whereby more than 180 companies obtained permits in 2023 to open a regional office.

Re-affirming this notion, the country also saw upwards of $32.5 billion in FDI inflows in 2022, the report highlighted. 

Similarly, the Kingdom ranked first in the Middle East and North Africa region for Venture Capital Investment in 2023, capturing 52 percent of the total capital deployed in the region with a value of $1.4 billion.

This has led to Saudi Arabia emerging as an “optimal investment destination,” according to the report, with the nation advancing in the International Institute for Management Development’s World Competitiveness Booklet.

The country now ranks third in the G20, and 17th among 64 nations. 

This was driven by the fact that in 2022, the Saudi economy recorded the highest growth among G20 countries despite global economic challenges.

The National Transformation Program’s initiatives contributed to this achievement by empowering the private sector and improving the investment environment, hence making the Kingdom an attractive and strong investment destination, the report highlighted. 

In the main indices of the ranking, Saudi Arabia has secured third place in economic performance, 11th in government efficiency, and 13th in business efficiency. 

Demonstrating this, the report outlines that it merely takes one business day and two documents to obtain an investment license in the Kingdom.

Some of the driving forces behind the rise in rankings also include upwards of 148 agreements and memorandums of understanding signed with global and regional partners, 32 large national companies whose global presence has been strengthened and 70.6 percent of promising companies progressing to become leading companies regionally and globally. 

Major benchmarks were similarly surpassed within the Saudi labor market, with the nation’s unemployment rate decreasing to 8.6 percent percent in the third quarter of 2023, compared to 12.8 percent in 2017. 

Expatriate working conditions also saw drastic improvement, marking a 33.3 percent growth from 39.7 percent in 2020 to 73 percent in 2023. Similarly, the compliance rate with the expatriate workers wage protection system also saw a major jump from 50 percent in 2017 to 86.9 percent in the third quarter of 2023. 

Women’s involvement in the business witnessed similar improvements, with the economic participation rate of Saudi females surging to 35.9 percent in the third quarter of 2023, from 17 percent in 2017. 

The ratio of females in managerial positions grew 15.1 percent from 28.6 percent in 2017, to 43.7 percent in the third three-month period of 2023, while women’s share in the labor market stood at 34.2 percent, compared to 21.2 percent in 2017. 

The small and medium enterprises boom

The Kingdom has recorded over a 200 percent growth in SMEs since the launch of Vision 2030, boasting 1.3 million of these firms by the end of the third quarter of 2023, the NTP report outlined. 

This growth encapsulated SR10 billion ($2.67 billion) in financial aid for SMEs and 6.7 million employees in the sector by the end of September 2023. 

In 2022, the Small and Medium Enterprises Bank was established by the Council of Ministers as one of several development funds and financial institutions affiliated with the National Development Fund. 

The SME Bank aims to increase financing provided to the sector, and enhance the contribution of institutions in providing innovative funding solutions that help achieve stability for this sector. 

SMEs are being positioned to become a vital part of economic development in the Kingdom and an enabler to achieve Saudi Vision 2030.

Therefore, the National Transformation Program’s initiatives supported several programs, centers, and services provided by the Small and Medium Enterprises General Authority, also known as Monsha’at.

Among them is the “Tomoh” program, a community for fast-growing SMEs, aiming to stimulate their growth through services and programs. Tomoh contributed to listing 18 enterprises in the Saudi Stock Exchange parallel market “Nomu.” 

Reflecting on the program’s accomplishments, Chairman of the NTP Committee Mohammed Al-Tuwaijri said: “The National Transformation Program’s 2023 achievements report sheds light on its impact after seven years since its launch. 

“Through this Program, the Vision continues to develop the infrastructure for the benefit of citizens and residents, investors (looking) to capitalize on the enormous opportunity, and tourists visiting Saudi Arabia.”

He added: “At the National Transformation Program, we are proud to have been part of this promising journey from the start, and we look forward to continuing to build a sustainable infrastructure to attain world-class work and living environments.”


Saudi Venture Capital invests in VC fund by Global Ventures

Saudi Venture Capital invests in VC fund by Global Ventures
Updated 01 January 2025
Follow

Saudi Venture Capital invests in VC fund by Global Ventures

Saudi Venture Capital invests in VC fund by Global Ventures
  • Fund will include supply chain technology, agritech, enterprise software as a service, and emerging technologies
  • Partnership underscores growing commitment to innovation and entrepreneurship

RIYADH: Startups in Saudi Arabia’s technology sector are poised to benefit from a new investment announcement by Saudi Venture Capital, which has committed funds to Global Ventures III, according to a press release.

The early-stage venture capital fund managed by Global Ventures exceeds $150 million in size and will primarily target investments in technology and tech-enabled sectors across Saudi Arabia, the Middle East and North Africa, and Sub-Saharan Africa. 

The focus areas for the VC fund will include supply chain technology, agritech, enterprise software as a service, and emerging technologies such as artificial intelligence and deep-tech.

Established in 2018, SVC is a subsidiary of the Small and Medium Enterprises Bank, which is part of Saudi Arabia’s National Development Fund. 

The investment is in line with SVC’s broader goal of boosting venture capital activity in the Kingdom and supporting the growth of startups and small and medium-sized enterprises in the region.

Nabeel Koshak, the CEO and board member at SVC, highlighted the strategic importance of this investment, saying: “Our investment in the venture capital fund by Global Ventures is part of SVC’s Investment in Funds Program, in alignment with our strategy to catalyze venture investments by fund managers investing in Saudi-based startups, especially during their early stage.”

Noor Sweid, founder and managing partner at Global Ventures, emphasized the significance of the investment in strengthening Saudi Arabia’s startup ecosystem. 

“The market opportunity continues to be immense, with emerging technologies across platforms being built by exceptional founders continuing to shine through,” Sweid said.

The partnership underscores the growing commitment to innovation and entrepreneurship in Saudi Arabia’s rapidly evolving tech landscape.


Saudi Arabia allocates 5 sites for mining complexes to boost investments

Saudi Arabia allocates 5 sites for mining complexes to boost investments
Updated 01 January 2025
Follow

Saudi Arabia allocates 5 sites for mining complexes to boost investments

Saudi Arabia allocates 5 sites for mining complexes to boost investments

RIYADH:  Saudi Arabia has allocated five sites for establishing mining complexes in the Makkah and Asir regions as part of its strategy to attract quality investments, enhance transparency, and support local communities. 

The initiative, led by the Ministry of Industry and Mineral Resources, aims to position mining as a cornerstone of the Kingdom’s industrial base.

The designated sites include four in Taif Governorate — North Nimran Mining Complex No. 1, covering 3.47 sq. km, North Nimran Mining Complex No. 2, covering 2.77 sq. km, South Nimran Mining Complex, covering 5.12 sq. km, and East Nimran Mining Complex, covering 15.76 sq. km. 

Additionally, South Wadi Ya’ra Mining Complex in Khamis Mushait Governorate spans 15.08 sq. km.

This allocation is part of the Kingdom’s efforts to establish mining as the third pillar of its industrial economy, alongside oil and petrochemicals, the Ministry said in a post on X.

This initiative seeks to capitalize on the Kingdom’s mineral wealth, valued at approximately SR9.4 trillion ($2.5 trillion) and distributed across more than 5,300 identified sites. By safeguarding resources and ensuring regulatory compliance, the ministry aims to foster sustainable investment and deter unauthorized mining activities.

In November 2024, Saudi Arabia awarded 11 exploration licenses for six sites spanning a total of 850 sq. km across Riyadh, Makkah, and Asir. These permits, issued under the Accelerated Exploration Program, are part of a competitive initiative to unlock underutilized resources and attract domestic and international investors.

Earlier this week, the ministry launched the Innovative Industrial and Mining Products Program, described as a significant step toward enhancing development and supporting the digital transformation of these sectors.

The program “represents a key step toward fostering innovation in the industrial and mining sectors,” the ministry said on X, adding that it reflects its commitment to “developing innovative solutions that support the Kingdom’s industrial transformation and stimulate the growth and sustainability of the mining sector.”

Saudi Arabia’s measures highlight its ambition to diversify the economy, leverage untapped resources, and solidify its position as a global leader in mining and industrial development.


Closing Bell: Saudi Arabia’s key benchmark index begins 2025 with gains

Closing Bell: Saudi Arabia’s key benchmark index begins 2025 with gains
Updated 01 January 2025
Follow

Closing Bell: Saudi Arabia’s key benchmark index begins 2025 with gains

Closing Bell: Saudi Arabia’s key benchmark index begins 2025 with gains

RIYADH: Saudi Arabia’s Tadawul All Share Index began the year on a positive note, gaining 0.34 percent or 40.81 points to close at 12,077.31 points on Wednesday.

The total trading turnover for the benchmark index reached SR3.3 billion ($882.8 million), with 152 stocks advancing and 71 declining. The MSCI Tadawul Index also saw a slight increase, rising 5.30 points (0.35 percent) to finish at 1,514.61 points.

Meanwhile, the Kingdom's parallel market, Nomu, experienced a decline, falling 481.86 points (1.53 percent) to close at 30,993.86 points. The market saw 24 stocks gain, while 45 retreated.

Salama Cooperative Insurance Co. led the day’s gains, with its share price climbing 9.54 percent to SR19.98. Other top performers included Wataniya Insurance Co., which saw a 6.04 percent increase to SR26, and Allied Cooperative Insurance Group, which rose 5.65 percent to SR14.22. Fawaz Abdulaziz Alhokair Co. saw a 4.54 percent rise to SR13.82, while Shatirah House Restaurant Co. gained 3.44 percent, closing at SR21.68.

On the other side, Nayifat Finance Co. was TASI’s worst performer, with a 3.75 percent drop to SR14.88. Riyad REIT Fund fell 2.79 percent to SR6.61, and Al-Babtain Power and Telecommunication Co. saw a decline of 2.31 percent, settling at SR38.10. Savola Group and Gulf Insurance Group also posted losses, with their share prices falling by 1.91 percent to SR36 and 1.58 percent to SR31.20, respectively.

On the announcements front, the General Authority for Competition approved the economic concentration process for BinDawood Holding’s acquisition of 100 percent of Zahret Al Rawda Pharmacies Co. Ltd.

The decision, dated December 31, 2024, marks a significant step in the acquisition process. BinDawood has announced it will provide updates on the completion of the transaction and any material developments as they arise. By Wednesday’s close, BinDawood’s share price had risen 1.08 percent to SR6.54.

Separately, First Avenue for Real Estate Development Co. disclosed the signing of a non-binding Letter of Intent with Awj Real Estate Development and Investment Co. to establish a real estate fund focused on commercial, office, and hospitality projects.

The fund will invest in four key assets: West La Perle, East La Perle, La Perle Residential Land, and La Perle Hotel Land. First Avenue is expected to hold between 40 percent and 50 percent of the fund, with Awj holding between 50 percent and 60 percent. First Avenue’s shares dropped 1.71 percent, closing at SR8.60.


Egypt signs $120m deal to establish pharmaceutical industrial zone

Egypt signs $120m deal to establish pharmaceutical industrial zone
Updated 01 January 2025
Follow

Egypt signs $120m deal to establish pharmaceutical industrial zone

Egypt signs $120m deal to establish pharmaceutical industrial zone

RIYADH: Egypt is set to establish a $120 million pharmaceutical industrial hub in the Suez Canal Economic Zone, marking a significant move toward localizing medicine production and bolstering its regional manufacturing position.

The agreement was finalized between SCZONE’s investment arm, SCZONE Istithmar, and the Arab Pharmaceutical Materials Co., or Arab API, which will oversee the new facility. The deal was signed in the presence of Khaled Abdel Ghafar, Egypt's minister of health, alongside other high-ranking officials.

The deal outlines plans for a new facility in Sokhna Industrial Area, spanning 96,828 sq. meters. It will focus on producing key raw materials for the pharmaceutical industry, further strengthening Egypt's self-sufficiency in medicines. The site will produce active and inactive ingredients, intermediate materials, and chemicals essential for drug manufacturing.

“This project reflects SCZONE’s commitment to localizing the pharmaceutical industries in Egypt and strengthening its position in this field to become a regional hub for this industry based on the capabilities of SCZONE,” said Waleid Gamal El-Dien, chairman of SCZONE.

He added that SCZONE is dedicated to fostering an attractive investment environment with the infrastructure needed to ensure the success of such projects. “This project marks a significant shift in Egypt's pharmaceutical industry sector,” he continued.

“It is not just an industrial project, but it is an implementation of Egypt’s vision based on integration between all concerned parties to achieve self-sufficiency in essential medicines, and reduce the gap between supply and demand in the local market,” Gamal El-Dien said.

The partnership will see SCZONE Istithmar collaborate with Arab API to build, manage, and operate the plant. The contract was signed by Ahmed Saeed Kilani, chairman of Arab API, and Mohamed Abdel Gawad, SCZONE’s vice chairman for investment and promotion affairs, on behalf of their organizations.

The facility aims to meet local pharmaceutical needs while positioning Egypt as an exporter, strengthening the country’s manufacturing capacity.

Ghafar noted that the investment in the facility is a vital step in enhancing public health services and contributing to the national economy. He emphasized the government’s focus on achieving self-sufficiency and reducing pharmaceutical imports.

The new plant will support Egypt’s rapidly growing pharmaceutical industry, meeting rising domestic demand and positioning the country as a key player in the global market.

The $120 million investment is part of a broader pharmaceutical initiative within SCZONE, which includes other factories such as Ateco Pharma and Genavex Egypt, further strengthening local production capabilities.

In addition, SCZONE has earmarked 4 million sq. meters for the creation of a larger pharmaceutical industrial zone in partnership with the Egyptian Authority for Unified Procurement. This initiative underscores the government’s push for collaboration across stakeholders to achieve long-term self-sufficiency in medicine production.

The new plant is expected to reduce Egypt's reliance on imported pharmaceuticals, boost local production, and expand exports. It is part of the government’s broader strategy to modernize and expand the pharmaceutical sector, improve health services, and contribute to Egypt’s economic development.

SCZONE has played a key role in attracting investment to Egypt’s pharmaceutical sector, leveraging its strategic location and competitive advantages. The Sokhna Industrial Zone, where the new plant will be located, already hosts successful pharmaceutical projects, including Ateco Pharma’s intravenous injection drugs factory and Genavex’s vaccine manufacturing facility.


Saudi weekly PoS transactions close 2024 with $3.6bn in value: SAMA  

Saudi weekly PoS transactions close 2024 with $3.6bn in value: SAMA  
Updated 01 January 2025
Follow

Saudi weekly PoS transactions close 2024 with $3.6bn in value: SAMA  

Saudi weekly PoS transactions close 2024 with $3.6bn in value: SAMA  

RIYADH: Saudi Arabia’s consumer spending soared in the final week of 2024, with point-of-sale transactions climbing 17.2 percent week-on-week to SR13.8 billion ($3.6 billion), official data showed.  

Figures from the Saudi Central Bank, also known as SAMA, revealed significant growth across all sectors between Dec. 22 and Dec. 28, with the total number of transactions hitting 211.97 million during the week. 

The telecommunications sector led the growth in transaction value, reporting a 29.6 percent week-on-week increase to SR132.5 million.   

The recreation and culture sector followed closely, with a 27.7 percent rise, amounting to SR286.3 million. Seasonal gifting trends also contributed to a 26.1 percent increase in the jewelry sector, which recorded SR315 million in transactions.   

The food and beverage sector posted a 22.9 percent jump, reaching SR2 billion.  

Other sectors also saw substantial increases in transaction values. The education sector rose 20.7 percent, while health and furniture reported growth of 16.4 percent and 16.2 percent, respectively.   

Miscellaneous goods and services, as well as clothing and footwear, recorded similar growth at 16.2 percent and 16 percent. The restaurants and cafes sector grew by 14.4 percent, with transportation close behind at 14.2 percent.  

In terms of transaction volume, the jewelry sector led with a 25.4 percent week-on-week increase, reaching 231,000 deals.   

Telecommunications saw a 13.9 percent rise, followed by recreation and culture with a 13.3 percent increase, and transportation with an 11.8 percent growth.   

Clothing and footwear transactions rose by 11.5 percent, furniture by 10.6 percent, and miscellaneous goods and services by 8.9 percent.  

Regionally, Hail reported the highest growth in transaction value, with a 29.1 percent increase to SR218.9 million. The city also saw a 15 percent rise in the number of deals, reaching 3.65 million.   

Tabuk followed, posting a 28.9 percent growth in transaction value to SR270.5 million and an 11.3 percent rise in the number of transactions, totaling 4.57 million.  

Madinah recorded a 23.3 percent increase in value to SR594.8 million, alongside a 9.9 percent growth in the number of transactions.   

Riyadh, however, saw the highest overall transaction value at SR4.7 billion, reflecting a 12.4 percent increase. The capital also recorded a 6.2 percent rise in transaction volume.  

Jeddah followed with a 13.4 percent increase in transaction value and a 5.9 percent rise in transaction volume.