Nations all across the world are struggling to achieve sustainable, positive growth in the stormy economic waters of the epidemic recovery, particularly due to geopolitical tensions and an unclear global economic future.
GCC nations are, nonetheless, ideally positioned to surf this tsunami of uncertainty. They have maintained a level of security and stability in the region thanks to the general success of their COVID-19 responses as well as the power and fluidity of their extensive transformation projects and diversification programmes.
Most importantly, Saudi Arabia is on track to become the fastest-growing major economy in the world by 2022 thanks to its efforts to modernise its business environment and establish itself as a global business leader. Everyone can clearly perceive the kingdom’s momentum.
The highest rate of growth for the country’s GDP in more than a decade, 7.6%, is predicted by the International Monetary Fund for 2022. In contrast, in 2023, when the going is expected to turn rough for many developed nations, the Kingdom is predicted to see only 3.7% growth. Given its promising economic prospects, it is not unusual that Saudi Arabia has attracted the interest of investors from a variety of markets.
The country’s central bank, Sama, which has reinforced the financial sector and lowered systemic risks through a number of astute monetary policy decisions, is largely responsible for this expansion. Even stricter regulations for the financial sector are also being planned, which will help restrict potential risks in the future.
Additionally, the Public Investment Fund, Saudi Arabia’s sovereign wealth fund, has taken steps to speed up private sector growth, which one cannot ignore. It will host the sixth iteration of the Future Investment Initiative, or FII, later in October. The FII Institute organises the yearly event to bring together regional and international specialists in order to unleash and catalyse the next stage of corporate expansion and leadership in the area.
This year’s FII subject is Investing in Humanity: Enabling a New Global Order, and it will discuss a number of topical issues, as well as their best approaches in a world that is in the midst of a meta-industrial revolution. Supply-chain shocks, super applications, AI, sustainability, and harnessing technology for equity are a few of the topics that stand out.
This platform demonstrates Saudi Arabia’s dedication to solving world problems and its innovative mindset. In addition to keeping the country in the public eye on a worldwide scale, it will also benefit the area and create opportunities for expansion and involvement. The FII’s activities will also aid in attracting foreign direct investment, a crucial and effective step towards the next stage of regional economic development, which will contribute to broader regional goals.
The GCC countries have traditionally had access to domestic capital, so there hasn’t been an urgent need to prioritise FDI. However, there has never been a better time to invite FDI into the region, demonstrate how far the countries have come while continuing to support their objectives, and discuss long-term national visions.
Incoming FDI can increase across the board in the upcoming years. In addition to providing a promising and stable socio-economic climate that will entice investments from outside parties, it is also strategically located.
Higher employment rates, more resources, increased local rivalry, and a rise in cross-border activity are just a few of the many advantages of increased FDI inflows from which the Gulf countries stand to benefit.
At this point, Saudi Arabia has a unique position in the world of business, and elements like stability, security, and the ability to quickly deal with crises have not gone ignored by prospective investors from around the world. This is their chance to shine, but to do so, they must use all of their abilities to increase investor trust and position the region as a profitable and exciting investment opportunity.
Because of the significant advancements they have made in the ease of setting up a business, Saudi Arabia and the United Arab Emirates are shining examples for other countries looking to create an environment that encourages entrepreneurship.
In order to provide global players with the most seamless market entry possible and to offer them incentives such as packages, synergistic partnerships with regional players, and access to local resources that might not be as easily obtainable in other markets, one must ask how it can be done.
To achieve regional investment agreements with foreign organisations and offer a variety of options that will attract foreign participants in the region, nations in the region can also cooperate with one another. An outstanding skill pool is crucial for luring FDI. The GCC is home to a dedicated and educated workforce, but it will help to foster a culture of ongoing skill development so that the staff is on top of the game and prepared to support new participants in the market.
Gulf countries must also keep coming up with new ideas for expanding non-oil sectors and approaching international investors in the plethora of industries in the regions that provide tremendous growth potential. These include manufacturing, logistics, tourism, R&D, education, and health care. The whole globe is on a road to recovery after a long period of uncertainty but there is no great moment than now to capitalize on the strengths and focus the resources on creating a more affluent and secure future.
Investors, notably those in the US and Europe, have took note of not just the economic prosperity of GCC countries but of their great administration and successful practices in achieving security and societal progress. The FII is driving this space and they must build on its initiatives so that the world can get a truer image of the region’s ability, dedication and potential.