RIYADH: Saudi Arabia’s gross fixed capital formation rose to SR1.18 trillion ($313.68 billion) in 2024, marking a 5.3 percent annual increase, recent data showed. 

A report from the Ministry of Investment attributed this growth to rising non-government sector investments, which expanded by 7.6 percent during the year. 

The Kingdom’s GFCF has outperformed expectations, with cumulative investments from 2021 to 2024 reaching SR4.11 trillion — 28 percent above the initial target of SR3.22 trillion for the period. 

By 2030, the National Investment Strategy, a key driver of Vision 2030, aims to push total annual GFCF to SR2 trillion, contributing 30 percent to gross domestic product. The plan also targets SR1.7 trillion in domestic investments within GFCF, reinforcing Saudi Arabia’s commitment to private sector expansion and sustainable economic growth.   

GFCF, which measures the net increase in physical assets within an economy, is a crucial component of GDP as it reflects capital accumulation supporting future production capabilities and economic growth. 

In 2024, the private sector accounted for 88 percent of total GFCF, reaching SR1.03 trillion. Meanwhile, the government sector, which made up 12 percent, saw an 8.3 percent decline to SR144.3 billion, signaling a strategic shift toward private sector-led growth. 

Foreign direct investment has also exceeded projections, with total inflows from 2021 to the third quarter of 2024 reaching SR391 billion, including SR104 billion from the Aramco deal, according to the ministry. This surpasses the SR295 billion target for the period by 33 percent, reflecting strong investor confidence and Saudi Arabia’s success in attracting capital under Vision 2030. 

The Kingdom has implemented a range of pro-business reforms, including regulatory streamlining, tax incentives, and the Regional Headquarters Program to attract multinational corporations. Giga-projects like NEOM, the Red Sea, and Qiddiya, along with public-private partnerships and sovereign investment initiatives, are also drawing investor interest across sectors.  

In a recent milestone, the Kingdom approved the organization of the Saudi Investment Promotion Authority to enhance its investment ecosystem and attract global capital. Endorsed during a Cabinet meeting chaired by Crown Prince Mohammed bin Salman earlier in March, the authority will promote investment opportunities domestically and internationally while working closely with key stakeholders.   

Investment Minister Khalid Al-Falih noted that the initiative strengthens Saudi Arabia’s position as a premier investment hub, leveraging its strategic location, investor-friendly policies, and world-class infrastructure.