RIYADH — The value of Saudi Arabia’s Foreign Direct Investment recorded steady increase for nine quarters in a row since the end of the first quarter of 2018, according to a report in Al-Eqtisadiah business newspaper.
The investments jumped to about SR469.7 billion by the end of the first quarter of 2020, posting its highest annual and quarterly levels since 2007.
These investments achieved a quarterly growth of 1.8 percent, equivalent to SR8.13 billion, compared to its value at the end of 2019 amounting to SR461.57 billion.
The figures were based on the most recent data available on the SAMA website, the newspaper reported.
Foreign Direct Investments (FDIs) means the movements of international capital that seek to establish, develop, maintain foreign subsidiaries, or foreign ownership in any economy of productive assets such as factories, mines, and land.
The rise in foreign investment ratios globally can be considered as an indicator of increasing economic globalization and global economic integration.
The annual performance of the value of Saudi FDIs includes investments in all sectors during the period extending from the end of the first quarter of 2019 to the end of the first quarter of 2020, and these investments increased by about 9.5 percent, equivalent to SR40.92 billion.
These investments amounted to SR428.78 billion at the end of the first quarter of 2019.
The FDIs comes as one of the ten main items for Saudi assets, namely FDIs and portfolio investments classified into property rights, shares of investment funds and debt securities, in addition to other investments divided into four sections — commercial credit, loans, currency, deposits and other accounts.
Among these, the largest in terms of value was reserve assets with a value of SR1.775 trillion by the end of the first quarter 2020, followed by portfolio investments with a value of SR1.081 trillion; other investments with a value of SR927.85 billion; and FDI with a value of SR469.70.
Meanwhile, foreign direct investment flows to Saudi Arabia saw a seven percent increase to $4.6 billion due to the country’s reform initiatives directed towards diversifying the economy and improving the overall investment climate, according to the annual report by the UN Conference on Trade and Development (UNCTAD).
The UN agency’s findings align with the Ministry of Investment’s quarterly report, which disclosed that 348 foreign licenses were issued in Q1 2020, a 19 percent increase compared to the same period last year and 20 percent increase compared to the last quarter.
The report also evaluated countries’ performance and response plans to the COVID-19 pandemic and identified policy recommendations based on best practices by investment promotion agencies, in which COVID-19 Response Center, formed by the Ministry of Investment, was labeled as an example of best practices in minimizing the economic impact of the pandemic.
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© The Saudi Gazette 2020