MANAMA: Gulf countries’ success in attracting foreign investments is a win-win for the region, a senior business strategy expert has told Arab News.

In an interview on the second day of the Bahrain International Airshow, Nada Al-Saeed, chief of strategy at the Bahrain Economic Development Board, described the Middle East’s growing ability to attract funding as “fantastic,” noting that it brings greater attention to the region.

In 2023, Saudi Arabia secured foreign direct investment inflows of SR96 billion ($25.6 billion), 16 percent higher than its target amount, while Bahrain received a record $1.7 billion over the same period, marking an 55 percent annual increase.

“When Saudi Arabia or the UAE does very well, it means that we could also benefit from that. I think that we often see the region as very competitive. I like to see it as a very collaborative and I think that everybody could benefit. If the pie gets larger, each individual’s share will also get larger.” she said. 

Reflecting on Bahrain’s FDI increase, Al-Saeed said that figure relates to the Economic Development Board’s achievements.

“If we are looking at the foreign direct investments’ statistics and results, we will see Bahrain actually attracted a much larger number than that, but this represents a record number for the EDB,” she said.

Al-Saeed noted that funding secured in 2023 went to investment projects across all of Bahrain’s priority sectors, which include financial services, communication and technology, and manufacturing, as well as logistics and tourism,

“These are the key priority non-oil sectors identified by the government, and they are the focus of the EDB. The board has dedicated teams for each sector to promote and attract investments in these areas,” she said.

She also said that these projects have contributed to job creation in the country, and she expected this investment trend to continue.

Explaining how her organization’s strategy aligns with the country’s economic vision for 2030, Al-Saeed said that the EDB, as the nation’s investment promotion agency, works very closely with a wider ecosystem of stakeholders known as “Team Bahrain.” 

This group has tailored its investment promotion strategies to mirror the government’s national economic plans.

“Back in October 2021, the government launched the economic recovery plan where it identified key priority sectors, and the EDB aligned to that in order to ensure that we operate as a cohesive unit, and we are able to attract the right investments that will further stimulate the development and growth of our country,” the chief officer said.

Discussing the unique advantages Bahrain offers, Al-Saeed highlighted the country’s success over the past decades in attracting regional investors that now play a vital role in the nation’s economy.

“If we look at our foreign direct investment statistics, we will see the majority of our foreign investments come from the GCC region, and that is predominantly in the financial services sector, and this is a trend that we have seen since the 70s, where Bahrain managed to attract a lot of regional capital in the financial services sector from Saudi Arabia, Kuwait, the UAE, and others, of course.” she said.

“There are many advantages because we treat GCC investors like Bahrainis when it comes to the processes of establishing business activities,” Al-Saeed added.

In addition, Bahrain has a wide range of incentives that are offered to investors.

One of these is the work of the country's labor fund, Tamkeen, which offers businesses the opportunity to support hiring local talent, as well as training and upskilling them to meet the needs of those companies.

Al-Saeed highlighted recent regulatory changes aimed at making Bahrain more attractive to global businesses and startups, and emphasized that significant efforts have been made to ensure the state remains both competitive and conducive to investments and business growth.

“Maybe one of the key, or most recent initiatives that is worth highlighting, is the Golden License program that was launched back in April 2023, which aims to provide streamlined services to strategic investment projects that are valued at $50 million or that creates 500 jobs here in Bahrain,” she said.

The chief officer added that through this initiative, projects and companies can benefit from expedited services when it comes to getting approvals, licenses or even access to decision makers. 

“This has been very instrumental in terms of ensuring that we provide high-class services to investors,” said Al-Saeed, noting that nine projects have been granted Golden License status since the initiative was launched.

She further said that the total of those projects is valued at $2.4 billion, with investors coming from various sectors and different regional and global countries, including Bahrain.

In response to a question about the role of the aviation sector in the EDB’s investment strategy,  Al-Saeed stated that it helps create a conducive investment environment, as it is what connects Bahrain with the rest of the world.

“This is not just in terms of the movement of people but also in transporting goods and service through air cargo. So, it is very important; as we do not target just the market that is within our geographic boundaries, but we aim to serve a much wider area and catchment area,” she said.

RIYADH: Saudi Arabia’s official reserve assets reached SR1.71 trillion ($456.97 billion) in September, marking a 4 percent increase year-on-year, according to new data.

Figures released by the Saudi Central Bank, known as SAMA, show these holdings include monetary gold, special drawing rights, the International Monetary Fund’s reserve position, and foreign reserves.

The latter, comprising currency and deposits abroad as well as investments in foreign securities, made up 94.5 percent of the total, amounting to SR1.62 trillion in September. This category grew 4.11 percent during this period.

September data indicated that special drawing rights rose to SR79.86 billion, marking a 4.18 percent increase and reaching the highest level in two and a half years. SDRs now account for 4.66 percent of Saudi Arabia’s total reserves.

Created by the IMF to supplement member countries’ official reserves, SDRs derive their value from a basket of major currencies, including the US dollar, euro, Chinese yuan, Japanese yen, and British pound sterling. They can be exchanged among governments for freely usable currencies when needed.

SDRs provide additional liquidity, stabilize exchange rates, act as a unit of account, and facilitate international trade and financial stability.

The IMF reserve position totaled around SR12.64 billion, but decreased by 11.45 percent during this period. This category represents the amount a country can draw from the IMF without conditions.

Saudi Arabia’s official reserves have been a fundamental pillar of the nation’s economic stability and are closely tied to its strategic investments in foreign securities.

The Kingdom’s reserves include an extensive portfolio of foreign assets, diversified across currencies and geographies, ensuring the country has a robust financial buffer against global economic uncertainties.

This prudent reserve management has helped Saudi Arabia maintain a resilient fiscal position and a strong credit rating, affirmed at “A/A-1” by S&P Global, which recently upgraded the Kingdom’s outlook to positive due to its sustained reform momentum.

In alignment with Vision 2030, Saudi Arabia has adopted an expansionary fiscal policy to support transformative projects aimed at reducing its economic dependence on oil.

This ambitious agenda has led to budget deficits and prompted the country to tap into debt markets to finance key infrastructure and social initiatives.

Despite the uptick in debt, the Kingdom remains fiscally well-positioned, with ample reserves and substantial net assets, projected to stay above 40 percent of GDP through 2027 according to S&P Global.

This buffer underscores Saudi Arabia’s capacity to absorb potential economic shocks while continuing to pursue its development goals.

The nation’s significant reserve base not only underpins its economic stability but also provides the flexibility to recalibrate spending on large infrastructure projects as needed, maintaining a balance between growth and fiscal discipline.

This strategy is essential as Saudi Arabia seeks to nurture its non-oil sectors, supported by the Public Investment Fund and other governmental entities.

The PIF’s role in fostering a diversified economy is central to Vision 2030’s objectives, from investment in renewable energy to technology and healthcare, creating a more resilient and diversified economic base.

With the positive outlook and strategic focus on sustainable growth, Saudi Arabia’s economic reforms are expected to drive strong non-oil growth over the medium term, further cementing the Kingdom’s fiscal stability and enhancing investor confidence in its long-term economic vision.