With economic growth projected at 4.7%, the Kingdom pursues a steadfast commitment to becoming a global corporate center.
In the last year alone, Saudi Arabia’s Ministry of Commerce issued around 521,969 commercial registrations, a 60% increase from the year prior. This largely demonstrates Saudi Arabia’s continued attractiveness to global businesses in diverse sectors – a trend that’s set to play out in 2025 and beyond.
This article provides an overview of the evolving growth trends in Saudi Arabia that are expected to unfold this year while reflecting on the notable achievements made over the past eight years.
Key Vision 2030 Milestones
- Non-Oil Sector: It currently accounts for 53% of real GDP, marking a significant milestone
- Tourism: The Kingdom welcomed 106 million tourists in 2023 and aims for 150 million by 2030
- Riyadh Metro Launch: The world’s largest self-driving public transportation project launched in December of 2024
- RHQ: A total of 571 companies have moved their regional headquarters (RHQ) to Riyadh so far
Fiscal and Regulatory Reforms Promotes Robust Business Expansion Activity
Last year concluded with the announcement that over 571 multinational corporations (MNCs) chose the Kingdom as the home of their regional headquarters (RHQs). This represents a key milestone checked off for Vision 2030, which originally aimed to attract 500 RHQs by 2030.
Continuous efforts to improve the Kingdom’s business environment were a factor contributing to this achievement. Over the past years, the Kingdom has implemented over 800 regulatory reforms. Most important of which include the Civil Transactions Law, Bankruptcy Law, Public-Private Partnership Program, and the Government Tenders and Procurement Law.
These efforts helped propel the country to rank 16th globally on the IMD World Competitiveness Index, accelerating economic growth in Saudi Arabia.
The rising appeal of Saudi Arabia as an ideal expansion destination is getting stronger by the day. Saudi is now considered the second-best country in the world for expats, ahead of countries like the US, Belgium, and the UK. This advanced ranking solidifies its status as a preferred destination for living, working, and doing business.
At a time when global growth is expected to stand at 3.3%, Saudi Arabia’s powerful industrial base and solid economic fundamentals make a convincing case for the country’s outstanding performance on the global economic landscape.
From 2016 to 2023, the ratio of non-oil revenues to oil revenues surged by 35%, setting the stage for the non-oil economy to make up 54% of the GDP for the first time at the end of last year.
This remarkable achievement highlights the success of the Kingdom’s quest for an economy capable of opening up new business avenues and creating sustainable, private-sector-led economic growth in Saudi Arabia in 2025.
Tourism Expansion Solidifies 2025 Economic Growth in Saudi Arabia
Historically, religious tourism has been the most popular form of tourism in Saudi Arabia. While it stands as one of the Kingdom’s large sources of income, entertainment, and leisure (E&L) tourism is rapidly gaining momentum. The end result was an astounding surge in total visits to Saudi Arabia, which amounted to 606 million over the period from 2016-2023.
Reports from The World Travel and Tourism Council’s 2024 Economic Impact Research reveal that the sector contributed a whopping $118.4 billion to the country’s GDP in 2023. This roughly constitutes 11.5% of the total economy.
In the same year, the Kingdom recorded the highest-ever inbound spending of $35.95 billion, with a 56% increase in tourist arrivals compared to 2019.
The introduction of over 1,500 tourist activities helped satiate the local demand for diverse entertainment offerings and attract more inbound visitors to the Kingdom. Growing investments in the Kingdom’s (E&L) sector have led to an incredible 656% increase in the number of tourists arriving specifically for leisure purposes in the first 7 months of 2024.
The added excitement of the Riyadh Expo 2030 and FIFA World Cup 2034 will act both as the cause and the effect of the growth of tourism. The Expo, for example, will bring in 40 million visitors and contribute $94.6 billion to the economy.
The number of in-person visitors expected to arrive in the country to watch the FIFA World matches is anticipated to surpass 3.5 million. The estimated economic impact of the global tournament is $35 billion.
Riyadh Expo 2023 and FIFA World Cup 2034 Boost the Saudi Construction Sector
Hosting world events can significantly benefit the Saudi construction sector, as it requires extensive infrastructure development. This creates immediate and lucrative investment opportunities for both domestic and international construction companies across numerous industry segments, including hospitality.
As the tourism industry continues to expand, the sheer breadth of opportunities associated with franchising and hotel inventory management becomes magnified. By 2030, Saudi Arabia’s hotel room pipeline is projected to reach 320,000 rooms, with a total development cost of $104 billion.
As we progress into 2025, the wider construction sector is poised for significant advancements with the launch of new development projects across various Saudi regions, including giga projects. For instance, the Red Sea Project is set to open 19 luxury hotels this year, while Amaala will debut eight locations.
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