Saudi Arabia Ranks Among Top 10 Most Attractive Countries in the World for FDI
According to the World Investment Report 2010 that was recently released by the United Nations Conference on Trade and Development (UNCTAD), Saudi Arabia was the eighth largest recipient of foreign direct investment (FDI) in the world in 2009, moving up six spots from its rank of 14th in 2008. The report states that $35.5 billion (SR133 billion) worth of FDI flowed into the Kingdom, bringing the country’s FDI stock to $147 billion (SR551 billion). While Saudi Arabia’s annual FDI declined nearly 6 percent from 2008 as a result of the global downturn, both UNCTAD and Saudi economists are optimistic that 2010 will witness growth that will continue into the future.
Sectors that received the most FDI include information and communications technology, real estate, infrastructure, banking and insurance, mining, oil and gas, and transportation. Saudi Arabia accounts for 70 percent of FDI in the Gulf Cooperation Council (GCC) region, which declined to $50.8 billion (SR190.5 billion) from $60 billion in 2008 (SR225 billion).
In 2009, the U.S. remained Saudi Arabia’s top exporter, accounting for 14 percent of all imports, followed by China with 11 percent, and Germany with 8 percent. Machinery and transportation equipment holds a large share of the import market, accounting for 46 percent. Chemical and base metals were the next largest imports followed by foodstuffs, representing 19.7 percent and 15 percent of imports, respectively.
Global FDI inflows for 2009 were $1.1 trillion (SR4.1 trillion) and UNCTAD expects this will increase to more than $1.2 trillion (SR4.5 trillion) in 2010 and rise to $1.6 trillion (SR6 trillion) to $2 trillion (SR7.5 trillion) by 2012. The top 10 global recipients of investment in 2009, in order of FDI, are the U.S., China, France, Hong Kong, the U.K., Russia, Germany, Saudi Arabia, India, and Belgium.