meed-logo

line1 line2 line3
SIGN IN / REGISTER

Riyadh steps up the Vision 2030 tempo

22 March 2023

 

Riyadh has begun pushing ahead with many of its Vision 2030 initiatives at a faster pace and in a much more tangible manner in the past six months, with the go-ahead given for several infrastructure packages on the kingdom’s flagship Neom project.

More than $13bn-worth of work has been awarded on Neom-linked projects since the start of 2022, including initial piling and tunnel blasting and drilling work for the Line development. More than $7bn has also been awarded in just the past five months, including $4.5bn across community housing schemes.

There has been equally robust activity on the other four official Public Investment Fund (PIF) gigaprojects. Projects worth another $1.8bn have been awarded since 2021 on the Diriyah Gate project, alongside $1.5bn-worth on the Roshn housing programme and $1.1bn each on the Red Sea Project and Qiddiya entertainment city.

Investment uptick

The shift in project tempo has also been matched by a step-up in other Vision 2030 initiatives, including the Shareek investment programme, which is aimed at supporting large Saudi companies in boosting the economic contribution of the kingdom’s private sector.

On 1 March, Saudi Arabia announced $51bn-worth of investments across eight Saudi companies as part of the programme. By 2030, Riyadh wants to increase the private sector GDP contribution to 65 per cent, while increasing the country’s non-oil exports from 16 to 50 per cent.

For external investors too, Saudi Arabia’s Vision 2030 plans are the top opportunity in the region, according to a recent poll by Egyptian financial services firm EFG Hermes. The survey showed that 34 per cent of respondents viewed Vision 2030 as the most important source of current investment opportunities.

There are meanwhile 23 companies waiting to list on the Saudi stock exchange. Those companies “are essentially on the runway waiting for the appropriate time, and obviously market conditions”, according to Mohammed ElKuwaiz, the chairman of the Capital Market Authority.

Last year was a record-breaking year for Saudi Arabia’s capital markets, with companies raising about $10.7bn (SR40bn) from initial public offerings (IPOs). The country also led regional IPO activity, with 34 out of the 48 GCC IPOs debuting on either the Tadawul or the Nomu.

Looking ahead, the Saudi market regulator is reviewing a further 77 IPO applications. It is also formulating a framework for dual listings, following the example of Americana, the first company to be dually listed in the kingdom and the UAE.

More broadly, the business confidence in the non-oil private sector continues to swell. In February, Saudi Arabia’s non-oil business activity reached its highest level in eight years due to a surge in demand, according to the Riyad Bank–S&P Saudi Arabia Purchasing Managers’ Index.

The index – in which a figure above 50 indicates expansion – increased from 58.2 to 59.8 in the fastest rate of increase since March 2015. The new orders component of the index rose to a record high of 68.7, with over 42 per cent of surveyed companies reporting a rise in new orders. The overall higher output also saw further employment and purchasing expansion.

Despite tighter monetary conditions, Naif al-Ghaith, Riyad Bank’s chief economist, noted the robust demand and supply balance spurred by the ongoing projects in the kingdom, which has caused “sharper uplifts in output and new orders for firms, as well as rising demand for labour”.

He added that while “prices have responded to the surge in demand, with the increase in input costs evident especially in the services and construction sectors”, business confidence remains high amid expectations for strong ongoing activity over the next 12 months.

Growth forecast

Despite the positive economic signs, the IMF reduced its 2023 GDP projection for Saudi Arabia to 2.6 per cent in January. This is in response to Opec+ agreements to restrict oil production 1.3 percentage points below the projection of 3.9 per cent growth in its October outlook.

Though non-oil growth remains strong, the reduction in oil output will unavoidably impact Saudi Arabia’s topline GDP. At the same time, the toll on oil revenue should be relatively contained and not unduly affect the kingdom’s capital spending, which is at this point being backed by a diverse pool of both sovereign and private assets.

According to a late February forecast by Riyad Capital, Saudi Arabia’s economy could grow by 3 per cent in 2023, driven principally by a pick-up in the non-oil sector, which it predicts will see a growth rate of 5 per cent this year.

In 2022, Saudi Arabia witnessed its strongest growth in the third quarter, when the GDP rate hit 8.8 per cent, according to the IMF, boosted by a 6.2 per cent growth rate for non-oil activity.

Riyad Capital also expects the weaker oil prices during the first half of 2023 to recover in the second half of the year, with Brent crude expected to end 2023 at a level above $100 a barrel.

MEED's April 2023 special report on Saudi Arabia includes:

> CONSTRUCTION: Saudi construction project ramp-up accelerates

> UPSTREAM: Aramco slated to escalate upstream spending

> DOWNSTREAM: Petchems ambitions define Saudi downstream

> POWER: Saudi Arabia reinvigorates power sector

> WATER: Saudi water begins next growth phase

> BANKING: Saudi banks bid to keep ahead of the pack

https://image.digitalinsightresearch.in/uploads/NewsArticle/10658249/main.gif
John Bambridge

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Emirates awards $5bn engineering complex deal

    18 May 2026

    Register for MEED’s 14-day trial access 

    Emirates Airline has awarded a AED19bn ($5bn) contract to build one of the world's largest engineering complexes in Dubai South.

    The contract was awarded to Beijing-headquartered China Railway Construction Corporation (CRCC).

    CRCC is being supported by French firm Artelia, as the project consultant.

    The complex will cover over 1 million square metres (sq m).

    It will comprise 77,000 sq m of dedicated workshop space for maintenance and repairs, 380,000 sq m of storage and logistics capacity, a 50,000 sq m administrative building for Emirates Engineering and 15,000 sq m of training facilities.

    It will be the world's only complex with a capacity to service 28 wide-body aircraft simultaneously.

    The airline officially broke ground on the project on 18 May. 

    The groundbreaking ceremony was attended by Sheikh Ahmed Bin Saeed Al-Maktoum, chairman and CEO of Emirates Group; Tim Clark, president of Emirates Airline; Khalifa Al-Zaffin, executive chairman of Dubai Aviation City Corporation and Dubai South; and Dai Hegen, chairman of CRCC.

    The facility will enable large-scale retrofits, cabin redesigns and structural modifications to be performed in-house, thereby reducing turnaround times.

    The engineering complex is scheduled for completion in 2030 and will be located at Al-Maktoum International airport.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16895218/main.jpg
    Yasir Iqbal
  • Contractors submit King Salman Bay project interest

    18 May 2026

     

    Contractors submitted expressions of interest in April for a contract to undertake marine infrastructure works at King Salman Bay, on the Red Sea coast north of Jeddah.

    The scope includes dredging and earthworks, as well as quay wall and edge protection works spanning about 11 kilometres (km).

    The project client is gigaproject developer Red Sea Global (RSG).

    The invited firms include:

    • Archirodon (Greece)
    • Boskalis (Netherlands)
    • China Harbour Engineering Company (China)
    • Jan de Nul (Netherlands)
    • Modern Building Leaders (local)
    • Nesma & Partners (local)
    • NMDC Group (UAE)

    King Salman Bay is expected to be a waterfront development aimed at reshaping the city’s northern Red Sea frontage into a mixed-use destination anchored by public realm improvements and leisure-led development.

    The update follows RSG’s award of an estimated SR100m ($27m) contract to construct a solid waste management centre at its Red Sea Project. The scope includes four buildings: a material recycling facility, a transfer station, an administration building and a vehicle maintenance building.

    In October last year, MEED reported that RSG had secured a SR6.5bn ($1.7bn) credit facility to further develop Amaala, its luxury tourism destination on Saudi Arabia’s northwestern Red Sea coast.

    According to an official statement, “The funding is led by Riyad Bank as the sole underwriter, along with Saudi Investment Bank and Bank Al-Bilad as mandated lead arrangers.

    “The loan arrangement comprises a mix of conventional and Islamic financing and adheres to RSG’s Green Loan Framework, which was first established when it secured private funding from a consortium of four banks for the Red Sea destination in 2021,” the statement added.

    The announcement followed RSG’s opening of its first properties for sale at Amaala, including branded residential communities and a five-bedroom villa on a private island.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16894122/main.jpg
    Yasir Iqbal
  • Saudi Arabia tenders Mecca metro design

    18 May 2026

     

    The Royal Commission for Makkah City & Holy Sites (RCMC) has tendered a contract inviting firms to undertake initial design studies for its long-planned metro network in the holy city.

    The scope includes the review of existing studies, preparing a concept design, land acquisition studies, future phases integration concept and other related studies.

    The notice was issued earlier this month, with a submission deadline of 5 August.

    The latest development follows RCMC’s invitation to contractors to attend an early market engagement meeting for the project in September last year, as MEED reported.

    In an explanatory document inviting companies to attend the event, the RCMC’s General Transport Centre said it was seeking to gauge market interest in the multibillion-dollar project and obtain feedback on its proposed procurement approach.

    MEED exclusively reported in June last year that the project was restarting. Current plans envisage a four-line network, named lines A-D, with 89 stations and three depots, to be implemented over three phases between 2032 and 2045.

    Project scope

    Stage 1 focuses on lines B and C, involving 2.4 kilometres of tunnelling under the Masar project and integration with the existing Mashaer line.

    The network will run just over 62km and comprise 31 stations, 21 of which will be underground, including three iconic stations. A total of 19.5km will run through tunnels, while 41.2km will be elevated, with the remainder at grade.

    The 66 required trainsets are projected to provide a daily passenger capacity of about 450,000, equating to annual ridership of 171 million.

    The 84.7km-long second phase, due to be operational by 2038, will extend the two lines towards the outskirts of Mecca and includes construction of the initial inner and central segments of lines A and D.

    Comprising 61.1km elevated and 18.6km underground, Phase 2 is planned to add 45 stations serving the two new lines, as well as two depots and a potential interconnection with the planned Saudi Landbridge. The 59 trainsets for Phase 2 will increase the network’s projected total annual passenger capacity to more than 500 million.

    Phase 3 covers the elevated 36km extension of lines A and D and involves procurement of a further 72 trainsets, increasing the network’s ultimate passenger capacity to 1.2 million daily and 642 million annually by completion in 2045.

    Associated development

    The metro plan also envisages several transit-oriented developments (TODs) at different points on the route. These will typically comprise commercial, residential and retail elements to maximise the investment case.

    The client’s proposed procurement approach involves three distinct packages: civil and systems works, TODs, and operations and maintenance.

    The initial concept calls for some of the project to be delivered on a public-private partnership (PPP) basis, wherein the private sector, through special purpose vehicles, will part-finance, build, operate and then transfer commercially viable elements of the scheme.

    The then-called Mecca Mass Rail Transit Company (MMRTC) first launched the metro project in 2013; however, the scheme has faltered for more than a decade due to funding issues, land acquisition challenges and scope changes.

    The relaunch of the procurement process raises hopes that the project will now come to fruition, although it is likely to be at least 18 months before any definitive works are expected to start.

    Mecca is home to Saudi Arabia’s first metro, the nine-station, 18km-long Mashaer line, which opened in 2010. It operates only seven days a year during Hajj, but carries more than 2 million pilgrims during that time.

    Some 30 million pilgrims visit the city each year, with this number set to grow. The presence of a known, quantifiable and growing demand base will help facilitate the use of a PPP mechanism should the framework be adopted.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16893520/main.jpg
    Yasir Iqbal
  • Montage launches Ras El-Hekma hotel and residences project

    18 May 2026

    Abu Dhabi-listed Modon Holding has partnered with US-based hotel operator Montage Hotels & Resorts to launch Montage Ras El-Hekma, a new project within the Ras El-Hekma master development on Egypt’s Mediterranean coast.

    The Montage development will be situated in Wadi Yemm, the first of 17 planned precincts to move into active delivery.

    Wadi Yemm is a mixed-use cultural and hospitality district, anchored by the Ras El-Hekma Lighthouse and a 10,000-seat amphitheatre designed to host cultural and entertainment programming.

    Montage Ras El-Hekma is expected to feature approximately 200 guestrooms and suites, along with 96 branded villas.

    The villas will range from three to six bedrooms and will mark the first branded residences available for purchase at Ras El-Hekma, according to Modon.

    No construction budget or project handover timeline was provided.

    Ras El-Hekma is on a spur of land on Egypt’s northern Mediterranean coastline, about 240 kilometres west of Alexandria.

    Abu Dhabi-based holding company ADQ appointed Modon Holding as the master developer for the Ras El-Hekma project in 2024.

    Modon will act as the master developer for the entire development, covering more than 170 million sq m. 

    Modon Holding will develop the first phase of the project, which will cover 50 million sq m.

    The remaining 120 million sq m will be developed in partnership with private developers under the supervision of the recently established ADQ subsidiary Ras El-Hekma Urban Development Project Company and Modon Holding.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16893415/main.jpg
    Yasir Iqbal
  • Bahrain completes repairs to chemical plant after Iran strike

    18 May 2026

    Repair and remediation work has been completed at the Gulf Petrochemical Industries Company (GPIC) facility in Bahrain, according to a statement from the country’s Ministry of Interior.

    The repairs and clean-up operation were focused on damage caused by an Iranian drone strike on 5 April, the ministry said.

    It also said that the strike was an act of aggression that constituted a war crime.

    Prior to the repair works, an Iranian drone was lodged inside an ammonia storage tank at the facility, which had become a “grave and ongoing risk”, according to the ministry statement.

    The ministry noted that, were it not for the swift pre-emptive measures taken by Bahrain’s government as part of its broader efforts to strengthen civil protection, the consequences could have been catastrophic.

    It said that an ammonia leak would have spread across several kilometres, causing mass casualties and threatening the lives of civilians in the surrounding areas.

    The ministry commended GPIC for its proactive decision to drain the ammonia tank prior to intervention — a critical step given the tank’s location in a densely populated area.

    All residents evacuated from the surrounding area have now returned to their homes.

    The evacuation, which covered a two-kilometre radius, was carried out on a voluntary basis, with temporary alternative housing provided as a precautionary measure.

    GPIC manufactures ammonia, methanol and urea.

    It operates as a joint venture equally owned by Bapco Energies of Bahrain, Saudi Basic Industries Corporation (Sabic) of Saudi Arabia and Kuwait’s Petrochemical Industries Company (PIC).

    The facility that was attacked is located in the Sitra region of Bahrain.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16892300/main.png
    Wil Crisp