For decades, the main driver of Saudi Arabia’s economy has been the oil sector. However, this will change soon as the country tries to diversify its economy, growing more diverse sectors such as business, tourism, and entertainment. Below, we tell you Saudi business opportunities for foreign businesses and investors.
Overview of Saudi Arabia
Saudi Arabia has a population of over 32 million with almost 60% of its population under 30 years old. It is the largest economy in the MENA region with a GDP per capita of approximately USD 21,000.
Its geographic location provides easy access to Asia, Europe, and Africa.
Saudi Business Opportunities in Healthcare and Life Science
In a few years, the spending of the healthcare sector in Saudi Arabia is estimated to reach 224 billion. This spending includes public healthcare services, private healthcare services, medical devices, medical consumables, digital health, and pharmaceuticals.
Saudi Arabia has a young population that is rapidly aging. As such, over the next decade, the demand for healthcare is expected to triple.
In this sector, opportunities are present as private sector participation in various aspects of healthcare is allowed. From increasing services such as primary healthcare, long-term care, home healthcare, and rehabilitation to improving the effectiveness and efficiency of digital health solutions.
Renewable energy is another sector that provides opportunities for foreign businesses and investors. Saudi Arabia is the 11th largest producer of electricity in the world. Among the world’s top 20 producers, Saudi Arabia ranked 3rd in terms of the highest energy production per capita.
By 2030, Saudi Arabia’s renewable energy production is set to exceed a third of the country’s total energy production.
Opportunities for foreign businesses and investors are present in various aspects. From electrical inverters, PV modules and cells manufacturing and assembly, wind blades, nacelle housing, and tower manufacturing and assembly to various renewable energy projects.
Saudi Arabia’s Food and Beverage sector comprises almost 60% of the GCC market. In 2019, it was estimated that the market was worth 52 billion USD.
Saudi Arabia’s food industry is quite diverse and it competes with the neighboring countries in terms of consumption and production.
Recently, the government of Saudi Arabia has scanned the market for gaps to fill as well as importation replacement opportunities that can be localized with additional incentives for foreign investors to enter the market.
Over the next 7 years, Saudi Arabia plans to build desalination plants that have a total capacity of 10.2 million m3/d. In addition to building desalination plants, the country also planned to increase its wastewater capacity, which currently is at 5.6 million m3/d to 11.1 m3/d by the next decade.
Opportunities for foreign businesses and investors are present in the commercialization of brine, electrical pumps, and motors, as well as smart water meters and valves.
Saudi Arabia experiences fast urbanization and high population growth. These two phenomena, in turn, accelerate waste generation, reaching about 52 million tons of waste per year.
In this sector, foreign businesses and investors can participate in medical, industrial, and waste electrical and electronic equipment (WEEE) waste management, agriculture waste, construction and demolition waste, and municipal solid waste.
In summary, Saudi business opportunities are present in various sectors. Among them are healthcare and life science, renewable energy, food processing, water, and waste management.
For those of you who want to enter the Saudi Arabia market, it would be better if you study the Saudi Market Strategy first. This is to make it easier for the business plan you want to run.