According to The General Authority for Statistics (GASTAT), total FDI inflows into Saudi Arabia decreased by 14.4 percent in Q3, amounting to SAR17 billion ($4.53 billion), compared to the second quarter of 2023.
Similarly, total FDI outflows dipped by 22.5 percent to SAR5 billion. Despite this decrease, the net flows of FDI in Saudi Arabia remained robust at over SAR11 billion, though showing a 10 percent decline compared to the previous quarter.
Meanwhile, the total FDI in Saudi Arabia reached SAR762 billion at the close of 2022, showcasing significant growth from SAR659 billion in 2021.
This marks the first application of GASTAT’s recalibrated calculation methodology, initiated in October 2023.
Improving quality and transparency standards
GASTAT president, Dr. Fahad bin Abdullah Aldossari, said that Saudi Arabia’s announcement of FDI for the first time adds a new global standard of quality and transparency. With the new methodology for calculating FDI statistics, Saudi Arabia aims to provide globally leading levels of transparency and governance.
He also highlighted that GASTAT, the International Monetary Fund (IMF), the Central Bank, and the Ministry of Investment helped reach the methodology used to calculate the statistics. Hence, those statistics will help investors make decisions based on reliable results. In addition, they will aid the country in designing investment policies that attract more FDI and inform investors about the best investment opportunities in Saudi Arabia.
Read: Saudi Arabia’s non-oil sector grew 4.6 percent in 2023
New methodology
The new methodology was adopted after its alignment with the IMF and the approval from the United Nations Conference on Trade and Development (UNCTAD). This way, Saudi Arabia ensures that it is applying international best practices and standards as given in the IMF Balance of Payments Manual. Moreover, the World Bank supported the IMF recommendations in its recent report on Saudi Arabia, which forms the basis of the new methodology.
The new methodology will contribute to enhancing governance levels and improving the quality of transparency in FDI data and information indicators. Hence, it includes 19 new indicators approved by the IMF, including the balance and inflows of FDI by economic activity, investing countries, and regions of Saudi Arabia, for the period from 2007 to 2022.
For more news on the economy, click here.
