On the sidelines of US President Joe Biden’s visit to the kingdom on Friday, Saudi Arabia and the US signed 13 investment agreements, as the Arab world’s largest economy seeks to attract more foreign direct investment for diversification.
The agreements cover sectors including energy, aerospace, defence, textiles, manufacturing, education and tourism, according to a statement from the Ministry of Investment of Saudi Arabia on Saturday.
“The agreements build upon a long-standing economic relationship and illustrate sustained US investor confidence in opportunities in the kingdom,” the ministry said.
In October last year, Saudi Arabia’s Crown Prince Mohammed bin Salman launched the National Investment Strategy, which seeks to net 388 billion riyals ($103.47bn) in foreign direct investments annually according to the state-run Saudi News Agency.
The kingdom also expects to increase its domestic investment to about 1.7 trillion riyals by 2030 under the new strategy.
Saudi Arabia, Opec’s top oil exporter, is focused on diversifying the economy under its Vision 2030 program, which aims to cut its dependence on hydrocarbons and develop local industries and manufacturing capabilities.
The National Investment Strategy, which is one of the main pillars of Vision 2030, is expected to contribute to the growth of the local economy.
Under the strategy, Saudi Arabia aims to increase the contribution of the private sector to its gross domestic product by 65 percent and increase FDI’s share to 5.7 percent of its GDP.
The strategy also aims to increase the proportion of non-oil exports from 16 percent to 50 percent, reduce the unemployment rate to 7 percent and advance the kingdom to one of the top 10 positions in the Global Competitiveness Index by 2030.
US investment in Saudi Arabia has continued to grow over recent years, with 743 companies present in the kingdom and nearly 70,000 Saudis employed by US companies, the Ministry of Investment said.
The US and Saudi Arabia signed four memorandums of understanding concerning health care, according to the statement.
Other agreements include a partnership between the Ministry of Investment and aerospace company Boeing in areas relating to aircraft manufacturing, and an agreement between an investment holding company Ajlan & Bros, and US smart energy firm SolarEdge to explore investment in renewable energy.
The US entered into an agreement with the Royal Commission for Jubail and Yanbu, while private sector companies, such as Raytheon Defence Industries, Medtronic, Digital Diagnostics and IQVIA, also signed investment deals with firms in Saudi Arabia, according to state news agency SPA.
