Saudi Arabia’s Vision 2030 economic diversification initiatives are generating opportunities for U.S. companies across industry sectors.
Saudi Arabia’s Vision 2030 economic diversification initiatives are generating opportunities for U.S. companies across industry sectors.
Saudi Arabia’s evolution from the country it was when President Roosevelt and King Abdulaziz met aboard the U.S.S. Quincy 77 years ago to the vibrant G20 economy and important U.S. defense and trade partner it is today is truly remarkable.
Today, the $47 billion U.S.-Saudi Arabia trade relationship creates thousands of jobs in both countries. In 2022, U.S. goods and services exports to Saudi Arabia exceeded $22.1 billion, and U.S. imports were just over $25 billion according to the U.S. Commerce Department’s Bureau of Economic Analysis (BEA). U.S. services exports were around $10.2 billion, and imports were $1.67 billion. According to BEA, U.S. foreign direct investment stock (FDI) in Saudi Arabia increased from $11.1 billion in 2019 to $12.2 billion in 2022. In that same period, Saudi Arabia’s FDI stock in the United States decreased from $7.7 billion to around $6.8 billion. Saudi Arabia is the largest country in the Gulf region with a population of 32.2 million, and the largest economy in the Arab World with a GDP of $1.1 trillion in 2022. According to the International Monetary Fund (IMF), Saudi Arabia was the fastest growing G20 economy in 2022 with overall growth of 8.7%, driven by strong oil sector performance. However, robust private consumption and non-oil private investment, including in giga projects, spurred strong 4.8% growth in the non-oil economy. Saudi Arabia has foreign reserves of approximately $402 billion. Its sovereign wealth fund, the Public Investment Fund (PIF), has approximately $7 billion in assets.
The Saudi Arabian Government exercises control over the main economic activities of the country’s oil-based economy. Saudi Arabia has almost 17 percent of the world’s proven petroleum reserves, plays a principal role in OPEC, is one of the world’s largest producers and exporters of crude oil, and is a large-scale oil refiner and producer of petrochemicals and natural gas. According to the U.S. Department of Energy’s U.S. Energy Information Administration, petroleum exports accounted for nearly 70 percent of the country’s total exports in terms of value in 2020, and about 53 percent of the Saudi government’s revenues were oil based.
Saudi Arabia’s Vision 2030 economic diversification initiative, launched in 2016, aims to reduce the country’s dependence on oil by developing various sectors, including services and industrial sectors. Vision 2030 political, institutional, and financial reforms, coupled with significant investment by Saudi Arabia’s Public Investment Fund, are generating opportunities for foreign companies across industry sectors including renewable energy, transportation, healthcare, advanced technology, and aerospace, as well as across a series of “giga-projects” that include the $500 billion NEOM cognitive and smart city development in northwestern Saudi Arabia, the Qiddiya entertainment and sports megaproject in Riyadh, and The Red Sea Project – a sustainable luxury tourist destination.
Political & Economic Environment: State Department’s website for background on the country’s political environment.