Saudi Arabia’s Capital Market Authority (CMA) announced on Monday that foreign investors can now invest in listed companies that own real estate in Makkah and Medina. This initiative aims to attract more foreign capital as the kingdom seeks to enhance investment opportunities.
The decision allows foreigners to invest in firms whose income is tied to pilgrimage activities, a significant revenue stream for Saudi Arabia. The CMA stated that the move would help provide liquidity for ongoing and future projects in the two holy cities.
As part of its Vision 2030 plan, Saudi Arabia aims to host 30 million pilgrims annually for Hajj and Umrah by 2030. In 2019, pilgrimage activities generated approximately $12 billion, according to official figures.
The annual pilgrimage significantly contributes to the economy, and increasing the number of pilgrims is a key component of the kingdom’s economic reform strategy to reduce reliance on oil revenues.
Saudi Arabia’s stock market, the largest in the Gulf region with a market capitalization of 10.2 trillion riyals ($2.72 trillion), opened to foreign investors in 2015 and has witnessed increased activity in recent years.
Under the new guidelines, foreign investments will be restricted to shares and convertible debt instruments, excluding “strategic foreign investors.” Additionally, non-Saudis cannot hold more than 49% of shares in these companies.
In 2021, Saudi Arabia had already permitted non-Saudis to invest in real estate funds operating within the boundaries of Makkah and Medina.
