The final quarter of 2023 witnessed a 16 percent surge in Saudi businesses preparing for growth, a direct outcome of private sector reforms that have been fostering innovation within the Kingdom. Recent data from the Ministry of Commerce highlighted that 2,811 entities reshaped their organizational frameworks to scale up operations, an increase from 2,423 entities at the end of the third quarter.
The government’s report emphasizes the dynamic nature of Saudi Arabia’s business ecosystem, showcasing that 2,722 organizations evolved into formal companies in the last quarter, an uptick from 2,335 in the preceding quarter.
Moreover, there has been a marked rise in joint-stock company listings, with 15 entities making the list in the fourth quarter, more than doubling the six from the third quarter.
Although there was a slight decline in the number of companies transitioning to joint-stock structures—with 59 occurring in the last quarter compared to 75 in the third quarter—the overall trend remains positive. A significant leap was observed in the number of establishments converting to joint-stock companies, with 15 in the fourth quarter, up from seven in the third.
The commerce sector in Saudi Arabia itself expanded robustly in the fourth quarter of 2023, experiencing a 23 percent increase in commercial registrations year-on-year. These registrations are vital legal certifications that validate the official status of businesses in the Kingdom.
A total of 95,863 commercial registrations were issued by the Ministry of Commerce from October to December of 2023. This activity is part of the Kingdom’s broader push towards economic diversification and is indicative of an environment that increasingly attracts foreign investment.
The capital city, Riyadh, led the charge with 33,343 registrations, followed by Makkah with 20,535, and the Eastern Province with 13,546, collectively accounting for 70 percent of the total commercial registrations during this timeframe. Asir and Madinah also made significant contributions, with 5,409 and 4,970 permits respectively.
Remarkably, nearly half of all institutional records issued were to women-owned businesses, which stands at 45 percent. This statistic underscores the growing participation of women in the Kingdom’s commercial sector.
Furthermore, the report brought to light a 21 percent year-on-year increase in land transportation of goods, with registrations totaling 33,447 in the final quarter. The hospitality sector also showed exceptional growth, with boutique hotel registrations skyrocketing by 74 percent compared to the same quarter in the previous year, reaching 1,911 registrations.