How is manufacturing sector in Saudi Arabia, its growth and future opportunities

Saudi Arabia’s manufacturing sector is growing rapidly as part of Vision 2030, aiming to diversify the economy beyond oil. Key industries like petrochemicals, pharmaceuticals, food processing, and defense are expanding with strong government support. Major investments in smart factories, logistics hubs, and industrial zones are boosting production and global competitiveness. Emerging sectors such as electric vehicles, renewable energy equipment, and aerospace present new opportunities. Read more to find out.

Government Initiatives to Boost Growth in the Manufacturing Sector

The manufacturing sector in Saudi Arabia is growing rapidly. In 2023, it is projected to contribute 15.6% to the country’s GDP, and is expected to grow at a CAGR of 2.78% from 2023 to 2028. The sector is dominated by the petrochemicals, metals, and food and beverage industries.

The government of Saudi Arabia is supporting the growth of the manufacturing sector through a number of initiatives, including:

• The National Industrial Development and Logistics Program (NIDLP), which aims to increase the share of manufacturing in GDP to 20% by 2030.
• The Saudi Aramco Downstream Integration Program, which will invest $70 billion in the development of downstream industries, such as refining, chemicals, and plastics.
• The Made in Saudi Arabia program, which aims to promote locally manufactured goods and services.

These initiatives are expected to create new opportunities for the manufacturing sector in Saudi Arabia. Some of the key opportunities include:

• The growth of the automotive industry, as Saudi Arabia plans to localize the production of 60% of its vehicles by 2030.
• The development of the renewable energy sector, as Saudi Arabia seeks to increase its use of renewable energy to 50% by 2030.
• The growth of the medical device’s industry, as Saudi Arabia is investing heavily in healthcare.

The manufacturing sector in Saudi Arabia is poised for growth in the coming years. The government’s initiatives are creating new opportunities for the sector, and the country’s strong economic fundamentals are supporting its growth.

Here are some specific examples of government initiatives that are supporting the manufacturing sector in Saudi Arabia:

• The Saudi Industrial Development Fund (SIDF) provides loans and guarantees to manufacturing businesses.
• The Ministry of Industry and Mineral Resources offers a number of incentives to manufacturing businesses, such as tax breaks and land grants.
• The King Salman Advanced Manufacturing Program (KSAMP) is a research and development initiative that is helping to develop new manufacturing technologies.

These initiatives are helping to make Saudi Arabia a more attractive destination for manufacturing businesses. As a result, the manufacturing sector is expected to continue to grow in the coming years. This is in line with the broader investment drive from the Kingdom.

Conclusion

Saudi Arabia’s manufacturing sector is expanding rapidly, driven by Vision 2030, government investments, and technological advancements. With growing industries like petrochemicals, pharmaceuticals, EVs, and aerospace, the country is becoming a regional industrial hub. Strong infrastructure, strategic partnerships, and innovation create vast opportunities for investors and businesses. The future looks highly promising.

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Arnifi is digital first Corporate service provider helping companies enter the Middle East region, starting with UAE and Saudi Arabia markets. Founded and backed by professionals from Amazon, Souq and other large companies operating in KSA – the team understands what it takes to succeed as a startup in both UAE and Saudi Arabian markets, apart from going through the setup process multiple times.

Arnifi will provide a truly digital experience to entry and scale up of companies both UAE and Saudi Arabia. The Arnifi promise is simple, yet revolutionary, use technology and a great team to provide transparency, efficiency and great customer experience in the whole process.
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Also Read: Significant investments made by Saudi Arabia in various countries