This quarterly growth is primarily attributed to a significant reduction in FDI outflows, which decreased by 74% to SR2 billion in Q3 from SR7.8 billion in Q2.
Despite the quarter-on-quarter improvement, year-on-year comparisons reveal a 24% decline in net FDI inflows from SR21.1 billion in Q3 2023.
FDI inflows into the Saudi economy totaled approximately SR17.95 billion in Q3 2024, a 21% decrease compared to SR22.6 billion in the same period last year, and an 8% drop from SR19.4 billion in Q2 2024.
The Kingdom has set ambitious targets to boost FDI as part of its Vision 2030 economic diversification plan, aiming to attract SR375 billion annually by 2030.
However, the cumulative FDI inflows for the first nine months of 2024 stand at SR54.4 billion, just halfway to the annual target of SR108 billion, indicating the need for substantial inflows in the final quarter to meet this year's goal.
Economists suggest that the year-on-year decline may reflect investor caution amid global economic uncertainties, fluctuating oil prices, and geopolitical considerations.
Nevertheless, Saudi Arabia's long-term investment appeal remains robust, bolstered by strategic initiatives and substantial government investments in mega-projects like NEOM.
In November 2024, Saudi Arabia signed investment deals worth over SR35 billion ($9.32 billion) with foreign companies, including India's Vedanta and China's Zijin Group, as part of its Global Supply Chain Resilience Initiative under the National Investment Strategy.
These agreements aim to enhance global supply chains and reflect the Kingdom's ongoing efforts to attract international investments.
Saudi Arabia's evolving partnership with China has led to increased investments in green technology sectors, aligning with the Kingdom's Vision 2030 objectives to diversify its economy and reduce dependence on oil revenues.