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December 19, 2018 10:39 am

Minister: Foreign Investment in Saudi Arabia More Than Doubled in 2018

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avatar by Reuters and Algemeiner Staff

Cars drive past the King Abdullah Financial District in Riyadh, Saudi Arabia, Dec. 18, 2018. Photo: Reuters / Faisal Al Nasser.

Foreign investment in Saudi Arabia more than doubled in 2018 to 13 billion riyals ($3.5 billion), its economy and planning minister said on Wednesday, despite a global furor following the murder of journalist Jamal Khashoggi in October.

Foreign investors have been rattled in recent weeks by the kingdom’s deteriorating relations with Western governments after the killing in the Saudi consulate in Istanbul of Khashoggi, a Washington Post columnist and critic of Crown Prince Mohammed bin Salman.

Economy and planning minister Mohammed al-Tuwaijri made no mention of the Khashoggi murder.

He said foreign investment in 2018 rose 110 percent from the previous year. He was speaking at a news conference a day after Riyadh unveiled plans to increase state spending by 7 percent next year to bolster growth crimped by low oil prices.

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Foreigners sold billions of riyals in Saudi stocks in October, one of the biggest selloffs since the market opened to direct foreign buying in mid-2015. But the outflow has since eased.

The government has made attracting greater foreign investment a cornerstone of its Vision 2030 plan to diversify the economy of the world’s top oil exporter away from a reliance on crude revenues.

Five sectors of the economy are prepared for privatization in the first quarter of 2019, said Tuwaijri.

In April, the government said it aimed to generate 35 billion to 40 billion riyals in non-oil revenues from its privatization program by 2020 and create up to 12,000 jobs. Prince Mohammed has also insisted that the stalled plan to sell shares in oil giant Saudi Aramco will go ahead.

Saudi officials include public-private partnerships to build and operate infrastructure as well as asset sales in their definition of privatization.


Tuwaijri said unemployment is expected to decline starting in 2019 from the current level of 12.9 percent, which is the highest in the kingdom’s history.

“The number is 12.9 [percent]… we expect it start to decline starting 2019,” he said.

There are 300,000 to 400,000 new entrants to the job market each year, he said, adding that Saudi nationals’ participation in the labor market is currently 42 percent.

Saudi Arabia has no intention of changing its policy on expatriate fees, Finance Minister Mohammed al-Jadaan said at the same conference.

The government charges fees for hiring foreign workers and obtaining visas for their dependents. The levies are due to rise next year as part of a policy to encourage hiring of local citizens. The private sector has lobbied for the fee rises to be delayed.

A budget document showed that the levies are expected to generate revenue of 56.4 billion riyals in 2019, up from 28 billion this year.

Fuel prices are reviewed regularly but there is no intention to increase other energy prices in 2019, Jadaan added without elaborating. Under previously announced policy, domestic prices of fuels including gasoline, diesel and kerosene may be raised in 2019.

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