Saudi foreign direct investment inflows down 85% in second quarter compared to 2021

FDI inflows to Saudi Arabia were at $2.1 billion in the second quarter (Shutterstock)
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Updated 16 November 2022
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Saudi foreign direct investment inflows down 85% in second quarter compared to 2021

RIYADH: Saudi Arabia recorded second quarter foreign direct investment flows are down 85 percent year on year, an investment ministry report showed on Tuesday. 

The FDI inflows were at SR7.9 billion ($2.1 billion) in the second quarter, compared with about SR51.9 billion in the same period last year. 

The ministry attributed the plunge in FDI inflows to closing the deal of The Saudi Arabian Oil Company, also known as Saudi Aramco, in the second quarter of 2021 which amounted to SR47 billion.

When Aramco’s initial public offering deal is excluded, the Kingdom’s foreign direct investment grew 46.5 percent year on year.

Indeed, the second quarter of 2022 saw FDI levels rise 6.6 percent compared to the previous three months.

This is in contrast to global trends, which saw inflows drop 35.1 percent in the second quarter of 2022 compared to the previous quarter.

Year-on-year, global FDI funding fell 19.5 percent.

FDI inflows of countries belonging to the Organization for Economic Co-operation and Development experienced a decrease in growth rates.

While the euro area’s FDI inflows growth rate plunged 9 percent, those of the US, China, and India, fell 59.9 percent, 4.4 percent, and 5.5 percent respectively.

On the other hand, the investment inflows growth rate in Japan surged 100.1 percent in the same period.

Nominal gross fixed capital formation, or GFCFC, surged 36.2 percent year on year to reach SR248 million in the second quarter.

The ministry attributed the jump to the growth in fixed capital formation in the government sector by 75.6 percent – representing 14 percent of the GFCF – and in the private sector by 31.4 percent – accounting for 86 percent of the GFCF.

This came amid efforts to boost the role of the private sector in the Kingdom’s economic development process.

As a percentage of nominal gross domestic product, the GFCF dropped 23.6 percent in the second quarter of 2022, compared to 24.7 percent in the corresponding period a year earlier.

When it comes to FDI stocks, these grew in the Kingdom by 0.8 percent in the second quarter to hit SR 994 billion.

The increase in FDI stocks is mainly ascribed to the recent policies implemented by Saudi Arabia in an attempt to lure and support international investments via diverse facilities and incentives. In return, this raised the confidence levels of foreign investors in the country’s investment environment. 

Moreover, closed deals jumped over 178 percent in the third quarter of 2022 to reach 53 deals, up from 19 deals in the same quarter of 2021.

A total number of 203 closed deals have been recorded up until the third quarter of 2022 reflecting an increase of 133.3 percent, compared to a total of 87 deals in the corresponding period a year ago.

Looking at the distribution of the deals by sector reveals that the entrepreneurship and innovation sector was in the lead with 47 out of the 53 closed deals. Other sectors included biotech, healthcare, advanced manufacturing, and education and training, all with a similar number of deals.

As for the distribution of deals by country, the UAE was in the lead with a total of ten closed deals during the third quarter. Cayman Islands followed with four deals, and the US’s British Virgin Islands followed with 3 deals each.

All the previous falls under enabling investment and enhancing the attractiveness of its environment in Saudi Arabia.

“Our nation holds strong investment capabilities, which we will harness to stimulate our economy and diversify our revenues,” the report said, citing the Kingdom’s Crown Prince Mohammed bin Salman.


Over 3k flights cancelled across the Middle East after attack on Iran by the US, Israel

Updated 01 March 2026
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Over 3k flights cancelled across the Middle East after attack on Iran by the US, Israel

RIYADH: US and Israeli strikes on Iran led to widespread airspace shutdowns in the Middle East, canceling and rerouting thousands of flights and paralyzing key international travel corridors.

Flight cancellations affected seven airports across the Middle East, including Dubai and Abu Dhabi in the UAE, Doha in Qatar, and Manama in Bahrain.

Emirates Airlines said in a statement: “Due to multiple regional airspace closures, Emirates has temporarily suspended all operations to and from Dubai, up until 1500 hrs UAE time on Monday, 2 March.”

A flydubai spokesperson said the situation is evolving, and the airline is closely monitoring developments while coordinating with authorities to adjust its flight schedule.

“Our teams are working diligently to implement comprehensive welfare for all affected customers. The safety of our passengers and crew remains our highest priority,” the spokesperson said.

He added: “We are currently experiencing a high volume of calls and appreciate our customers’ patience while our teams work to assist everyone as quickly as possible.”

Qatar Airways announced that the airport will remain closed until at least the morning of March 2.

“Qatar Airways flights to, and from, Doha have been temporarily suspended due to the closure of Qatari airspace,” the airline said.

It added: “Qatar Airways will resume operations once the Qatar Civil Aviation Authority announces the safe reopening of Qatari airspace.”

Saudia also said in an official statement that it had canceled a number of flights due to developments in the region and the closure of airspace.

The organization said the decision was taken in line with aviation safety and security standards, noting that its Emergency Coordination Center is closely monitoring developments with relevant authorities.

Saudia urged passengers to verify the status of their flights before heading to the airport and said guests would be notified of updates through the contact details associated with their bookings.

The carrier added that further information would be announced in a subsequent statement if available.

Air Arabia also said its flights were experiencing cancellations, delays, or rerouting as a result of the evolving situation and airspace closures.

Airlines cited airspace closures and safety concerns as the main reasons for flight disruptions, urging passengers to check official channels for updates as the situation develops.

Israeli airspace also remained closed on March 1st. Israeli airline El Al said it was preparing a recovery effort to bring home Israelis stranded abroad once the airspace reopened.

Travelers were either stranded or diverted to other airports on Feb. 28 after Israel, Qatar, Syria, and Iran as well as Iraq, Kuwait and Bahrain, closed their airspace.

After the UAE announced a temporary partial airspace closure, FlightRadar24 recorded no flights over the country.

The closures affected key hub airports in Dubai, Abu Dhabi, and Doha. Emirates, Qatar Airways, and Etihad, airlines that operate from these hubs, normally handle around 90,000 passengers daily, with even more traveling to other Middle Eastern destinations, according to aviation analytics firm Cirium.

Airports hit by attacks

Two airports in the UAE reported incidents as the government there condemned what it called a “blatant attack involving Iranian ballistic missiles” on Feb.28.

Dubai International Airport, the UAE’s largest and one of the world’s busiest, reported four injuries, while Abu Dhabi’s Zayed International Airport said a drone attack killed one person and injured seven others. Strikes were also reported at Kuwait International Airport.

Though Iran did not publicly claim responsibility, the scope of retaliatory strikes that Gulf nations attributed to Iran extended beyond the US bases that it previously said it would target.

Flight delays, cancellations are likely to continue

“For travelers, there’s no way to sugarcoat this,” said Henry Harteveldt, an airline industry analyst and president of Atmosphere Research Group.

“You should prepare for delays or cancellations for the next few days as these attacks evolve and hopefully end,” he added.

To avoid conflict zones, airlines are rerouting Middle East flights over Saudi Arabia, adding hours and fuel costs, which could push ticket prices higher if the tensions persist.

The extra flights will strain air traffic controllers in the Kingdom, who may need to slow traffic for safety. Meanwhile, countries that closed their airspace will lose out on overflight fees from passing airlines.

Mike McCormick, former head of air traffic control at the FAA and now a professor at Embry-Riddle Aeronautical University, said some countries may reopen parts of their airspace in the coming days once US and Israeli officials provide airlines with details on military flight zones and Iran’s missile capabilities.

“Those countries then will be able to go through and say, ok, we can reopen this portion of our space but we’ll keep this portion of our airspace closed,” McCormick said.

“So, I think what we’ll see in the next 24 to 36 hours is how the use of airspace evolves as the kinetic activity gets more well-defined and as the capability of Iran to actually shoot missiles and create additional risk is diminished due to the attacks,” he added.

But it is unclear how long the disruption to flight operations could last. For comparison, the Israeli and US attack on Iran in June 2025 lasted 12 days.