Mining

Saudi industry minister tempts investors with funding incentives

May 3, 2024, 12:01 PM

Saudi Arabia’s industry and mineral resources minister Bandar Al-Khorayef. The country is struggling to meet an FDI target of $100bn a year by 2030

Growth in mining industry a priority
Infrastructure and factories in place
Hope to increase low FDI numbers

Saudi Arabia’s ministry of investments and mineral resources is prepared to finance up to 75 percent of industrial projects in the country, as the kingdom tries to boost its low foreign direct investment (FDI) numbers.

Bandar Al-Khorayef, the minister of industry and mineral resourcespointed to well-developed infrastructure across 36 industrial cities, prefabricated factories ready to operate quickly and long-term leases for operating them as attractive elements for potential investors.

The minister’s comments were focused on mining, and were made to Qatari investors in Doha at an event held by the Qatari Businessmen Association.

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Trade between the two Gulf countries, which returned to normal in 2021 after a Saudi boycott in 2017, remains low.

The figure rose from 2.1 billion Qatari riyals in 2022 to 3 billion ($820 million) in 2023, a 35 percent increase, Qatar’s Minister of Commerce and Industry, Mohammed bin Hamad bin Qassim Al Thani, said on 3 May.

The visit resulted in a memorandum of understanding being signed between Qatar Development Bank and Saudi EXIM Bank to help Saudi exports and exchange expertise.

Saudi Arabia is struggling to meet a foreign direct investment target of $100 billion a year by 2030. Data released by the General Authority for Statistics in March put the total net inflow for 2023 at only SAR46 billion ($12.3 billion).

The Saudi government launched a mineral exploration incentives package, valued at about $182 million, earlier this year to encourage investment from domestic and international mining operators.

In March, local and international investors were invited to bid for the latest round of mining licences in Saudi Arabia, including for gold, copper, zinc, lead and silver ore.

Under Vision 2030, Saudi Arabia has made mining a priority industry for growth. The government estimates the kingdom’s untapped mineral wealth at $2.5 trillion, based on exploration of 30 percent of the country’s mineral region.

The government is also trying to improve transport and infrastructure to attract investors and tourists.