Saudi Arabia’s move to waive fees for expatriate workers in the industrial sector has driven a significant 14.7% rise in GDP, climbing from SR392 billion ($104.5 billion) in 2019 to SR592 billion in 2023.
A report by the Economic Studies Center at the Federation of Saudi Chambers highlights that this policy has not only boosted GDP but also increased non-oil exports to around SR208 billion, a 12% growth since 2019.
This fee waiver, effective until Dec. 31, is part of Saudi Arabia’s broader strategy to stimulate the industrial sector and attract investments. The report credits new market openings and trade agreements for the positive trend, noting that local content value in non-oil sectors hit SR1.14 trillion by the end of 2023.
Over 8,000 industrial firms have benefited from the SR5 billion fee elimination. This policy has encouraged innovation, technology localization, and the attraction of skilled professionals, increasing the availability of local products.
The number of products with Saudi quality marks has risen, indicating improved product quality. The Saudi Press Agency’s analysis, based on seven economic indicators including GDP contribution and investment volumes, confirms the policy’s positive impact.
Key findings show the industrial sector’s GDP grew from SR392 billion in 2019 to SR592 billion in 2023, with industrial establishments increasing from 7,625 to 11,868 by 2024, a 55.6% growth. Sector investments rose by 54%, reaching SR1.5 trillion from SR992 billion.
Foreign investments surged due to government support, with foreign factories increasing from 622 to 1,067, a 71.5% rise, and invested capital jumping from SR43 billion to SR93 billion, a 116.2% increase.
By the first quarter of 2024, the industrial sector employed about 1.2 million workers, including 358,000 Saudi nationals, achieving a 28% Saudization rate. Industrial workers comprised 12.9% of all nationals employed in the private sector.
Government incentives have spurred the private sector to boost Saudization, creating more job opportunities for citizens. From January 1, 2023, to March 31, the industrial sector added over 82,000 new jobs, a 59% increase, making it the largest contributor to job creation for Saudis.