Dubai conglomerate Al-Futtaim is planning to invest 10 billion Saudi riyals ($2.7 billion) in Saudi Arabia over the next three years as the company looks to expand its operations in the kingdom amid diversification of its economy.
The new investment commitments, announced by the company on the first day of the Future Investment Initiative in Riyadh, builds on more than five billion riyals worth of its existing investments in the country, Al-Futtaim said on Wednesday.
“This comprehensive investment strategy is projected to create over 1,000 new jobs in Saudi Arabia to support local talent development and leadership across key sectors."
Al-Futtaim is investing in diverse sectors in the kingdom including mobility, retail, insurance and financial services, and real estate development.
Earlier this year it announced plans to acquire a 49.95 per cent stake in Saudi retail group Cenomi for 2.5 billion riyals to expand in the Arab world’s largest economy.
As part of the deal, it entered into a share purchase agreement with Cenomi’s founding shareholders Fawaz Abdulaziz Alhokair, Abdul Majeed Abdulaziz Alhokair, Salman Abdulaziz Alhokair, Saudi FAS Holding Company and FAS Real Estate Company as part of the deal, the company said in July.
The latest investment commitment “is a tangible expression of our confidence in the kingdom’s potential and our readiness to actively contribute to its economic diversification and innovation agenda”, Marwan Shehahdeh, group director of corporate development at Al-Futtaim, said on Wednesday.
Al-Futtaim, a privately held business group, is active in 20 countries in the Middle East, North Africa and Asia, with interests in automotive, financial services, real estate, retail, and health sectors. It represents a portfolio of more than 200 brands, including Toyota, Lexus, Ikea and Marks & Spencer.
Saudi Arabia aims to attract more foreign direct investment as it focuses to diversify its economy away from oil as part of its Vision 2030 programme.
It is building mega projects such as Neom, Qiddiya entertainment city, outside Riyadh and the Diriyah Gate in a push to support its real estate sector.
In recent years, the kingdom has also introduced laws, including companies law and civil transactions law, to attract more foreign investment.
It also updated its rules to allow foreigners to buy property in specific zones in Riyadh and Jeddah, with “special requirements” for home ownership in Makkah and Madinah.
Saudi Arabia's economy is projected to grow by 4 per cent this year and next as a result of unwinding of Opec+ production cuts.
