Here are key Saudi economic events in H1 2023

The Kingdom of Saudi Arabia's flag

The Saudi economy witnessed several major events during the first half of 2023.

These include raising the reverse repo rate from 450 basis points (bps) to 525 bps and increasing the repo rate from 500 bps to 575 bps in three meetings.

Crown Prince Mohammed bin Salman announced a number of projects, including the inclusion of Diriyah project as the fifth major project owned by the Public Investment Fund (PIF), the launch of the New Square Development Company to develop the largest downtown in Riyadh, as well as the launch of four special economic zones in the Kingdom for investors from all over the world. In addition, the Crown Prince launched the Riyadh Air Co.

Moreover, a new target for the production of OPEC + members was agreed upon at 40.5 million barrels per day (bpd) during 2024. The Kingdom announced the extension of its voluntary reduction of 500,000 bpd, in addition to its decision to implement an additional voluntary cut of one million bpd until the end of December 2024.

In June, the Kingdom submitted its official bid to host Expo 2030 in Paris. The decisions during the first half included the return of the numbers of pilgrims to pre-COVID levels and the start of implementing the new Companies Law.

Below is a list of key events in chronological order:

1- Inclusion of Diriyah project as the fifth major project owned by the PIF

Crown Prince Mohammed bin Salman announced the inclusion of Diriyah project as the fifth major project owned by the Saudi sovereign fund.

2- Return of the numbers of Hajj pilgrims to pre-COVID pandemic levels

Minister of Hajj and Umrah Tawfiq Al-Rabiah announced the return of the numbers of pilgrims to pre-COVID levels, with no age restrictions for pilgrims.

3- Launch of the Events Investment Fund, with an investment capital of SAR 14 billion

Crown Prince Mohammed bin Salman launched the Events Investment Fund, under his chairmanship, with the aim of developing sustainable infrastructure to support four promising sectors: culture, tourism, entertainment, and sports. This is in addition to building strategic partnerships to maximize impact in target sectors and increase opportunities to attract foreign investment.

4- The new Companies Law takes effect in Saudi Arabia

The new Companies Law and its Executive Regulations in Saudi Arabia took effect as of January 19, 2023, allowing the division of the stock nominal value.

5- Launch of transit visa for air visitors

The Saudi Ministry of Foreign Affairs has launched the electronic issuance of a transit visa for visitors arriving by air. This visa allows the beneficiary to reside in Saudi Arabia for a period of four days (96 hours), with a validity of three months.

6- Appointment of Ayman Al-Sayari as Governor of Saudi Central Bank (SAMA)

The Custodian of the Two Holy Mosques issued a royal order to relieve Dr. Fahd bin Abdullah bin Abdul Latif Al-Mubarak, former SAMA Governor, from his post, and to appoint Ayman bin Mohammed bin Saud Al-Sayari in his place.

7- Licensing the first branch of a foreign insurance firm in the Kingdom

SAMA announced licensing the first branch of a foreign insurance firm in the Kingdom, the US-based Cigna Worldwide Insurance, specialized in health insurance.

8- A directive to grant 100 million square meters (sqm) of land in Riyadh and other cities witnessing a rise in prices

The Minister of Municipal, Rural Affairs and Housing Majid Al-Hogail announced that the Crown Prince directed granting the residential sector 100 million sqm of land in Riyadh and other cities that are witnessing a rise in land and real estate prices.

9- PIF invests SAR 5 billion in new shares in four national companies in the construction sector

PIF invested SAR 5 billion by subscribing to new shares in Nesma & Partners Contracting Co., ElSeif Engineering Contracting Co., AlBawani Holding Co., and Almabani General Contractors Co.

10- Launch of New Square Development Co. to develop the largest modern downtown in the world in Riyadh

Crown Prince Mohammed bin Salman announced the launch of the New Square Development Co., with the aim of developing the world's largest modern downtown in Riyadh, which contributes to developing the capital's future in line with the goals of Vision 2030.

11- Establishing the Strategic Office for the Development of the Northern Borders Province

Crown Prince Mohammed bin Salman announced the establishment of the Strategic Office for the Development of the Northern Borders Province, with the aim of raising the level of development in the cities and governorates of that region.

12- Announcing new features and solutions for the updated housing subsidy program

The Sakani program announced the launch of the updated housing subsidy program, which comes to meet the needs of the beneficiaries in line with their various financing capabilities and their need to own adequate housing.

13- CMA board reshuffle

King Salman issued a royal order on the formation of a new board for the market regulator.

14- Shareek announces first bundle of projects worth SAR 192.4 mln

The Private Sector Partnership Reinforcement Center (Shareek) announced the first wave of supported projects for large companies joining the program. The projects were announced for eight national companies in four strategic sectors at a total value of SAR 192.4 million.

15- March 11 announced as Flag Day

King Salman bin Abdulaziz Al Saud issued a royal decree to mark “Flag Day” annually on March 11.

16- Salman Al-Dossary appointed as Minister of Media

King Salman bin Abdulaziz Al Saud issued a royal order on appointing Salman Al-Dossary as Minister of Media.

17- Tourist visa allowed for all GCC residents of any profession

Minister of Tourism, Ahmed Al Khateeb, said Saudi Arabia scrapped previous conditions for granting tourist visas to GCC residents of certain professions.

18- Crown Prince announces establishment of PIF’s Riyadh Air

Crown Prince Mohammed bin Salman announced the establishment of the new national carrier, Riyadh Air, wholly owned by the sovereign wealth fund.

19- RCRC launches first phase of Riyadh bus service

The Royal Commission for Riyadh City (RCRC) launched the first phase of the Riyadh bus service, as part of King Abdulaziz Project for Riyadh Public Transport in Riyadh.

20- Unemployment rate among Saudis hit lowest level, falling to 8%

The unemployment rate among Saudis in the fourth quarter of 2022 recorded its lowest level, according to data available since 1999, as it fell to 8%.

21- Relieve of Diriyah, GOSI governors and RCRC CEO of posts

King Salman issued Royal Decrees, relieving Prince Ahmed bin Abdullah Al Saud, Governor of Diriyah, of his post, and Fahd bin Abdul Mohsen Al-Rasheed, CEO of RCRC, and appointing Abdulaziz bin Hassan Al Boug as Governor of the General Organization for Social Insurance (GOSI).

22- Announcement of 200 projects' details to offer them to the private sector

The National Center for Privatization, in cooperation with the privatization-targeted sectors, published details of 200 privatization projects in a number of sectors, which allows local and international investors to learn about privatization projects in the Kingdom.

23- Extending Citizen Account Program and additional support

King Salman, based on the proposal of Crown Prince Mohammed bin Salman, ordered to extend the Citizen Account Program, with its current mechanism, while continuing to provide temporary additional support to the beneficiaries of the program until July 2023.

24- Launch of 4 SEZs for investors in the Kingdom

Prince Mohammed bin Salman, Crown Prince, Prime Minister and Chairman of the Council for Economic and Development Affairs, announced the launch of four special economic zones (SEZs) in the Kingdom.

25- Crown Prince announces the 4% transfer of Saudi Aramco shares to Sanabil Investments

The Crown Prince announced the completion of the transfer of 4% of Saudi Aramco’s total shares, from the state ownership to the ownership of Sanabil Investments Co., wholly owned by PIF.

26- Reverse repo and repo rates lifted

SAMA raised reverse repo rate three times within H1 2023, from 450 bps to 525 bps, and the repo rate from 500 bps to 575 bps.

27- The Kingdom’s Q1 Budget: SAR 280.9 bln revenue and SAR 283.8 bln expenses

The budget’s Q1 2023 revenues amounted to SAR 280.94 billion, while general expenditures stood at SAR 283.86 billion, with a budget deficit of SAR 2.91 billion.

28- New production target for OPEC+ members at 40.5 mln b/din 2024

OPEC+ members agreed on a new target level of production at 40.46 million barrels per day (bpd) for 2024, which means reducing the target production level by 1.4 million bpd from the current production targets.

The Kingdom announced the extension of its voluntary reduction of 500,000 bpd, in addition to its decision to implement an additional voluntary reduction of one million bpd until the end of December 2024.

29- Crown Prince launches investment and privatization project for sports clubs

Crown Prince Mohammed bin Salman launched investment and privatization project for sports clubs, after completing the executive procedures for the project first phase.

30- Approving Civil Transactions Law

The Crown Prince announced the Cabinet’s approval on the Civil Transactions Law, after completing the regulatory measures.

31- Saudis allowed to travel abroad without COVID vaccination

Saudi Arabia allowed its citizens to travel outside the Kingdom without taking the COVID vaccination.

The decision is based on what the competent health authorities submitted regarding the stabilization of the epidemiological situation at the local and global levels.

32- Ceer gets license for EV production facility

The Ministry of Industry and Mineral Resources issued an industrial license for Ceer, the first Saudi electric vehicle (EV) brand, to establish an EV manufacturing facility. The plant spans over one million sqm and is located at the Industrial Valley in King Abdullah Economic City.

33- Saudi Arabia submits bid to host Expo 2030 and allocates $7.8 billion to host the exhibition

The Kingdom submitted an official application to organize Expo 2030 in Paris and announced allocating $7.8 billion (SAR 29.3 billion) for hosting the exhibition.

34- Lucid starts EV deliveries in Saudi Arabia

Lucid Motors, partially owned by the PIF, began its EV deliveries to customers in Saudi Arabia, Faisal Sultan, Vice President and Managing Director of Lucid Middle East, said in June. Sultan expected many EVs to soon hit the Kingdom’s roads.

35- Saudi GDP grows 3.8% in Q1 2023

Saudi Arabia’s real gross domestic product (GDP) rose 3.8% year-on-year (YoY) in the first quarter of 2023, data issued by the General Authority for Statistics (GASTAT) showed.