Saudi Arabia is the new Unlimited-money hub for private equity and consultants. But it’s still early and it may have the highest returns on the planet right now.
Everyone has heard of Saudi mega-projects like “The Line”, “Trojena” or the “Oxagon”. But billions of dollars that are being spent there is just a cherry on top. The real deal is the fact that the country is liberalizing and trying to diversify its revenue streams away from oil.
In other words- investments into a 💰 very rich country are being opened right now.
And the keyword is: hashtag#Agenda2030.
📌First of all, Kingdom is pushing to privatize the state-owned assets, such as airports, water, sports and energy services. Huge M&A, PPP activity incoming- recent deals are already surpassing $50 billion (PwC data). But the largest deals are scheduled to be in the years 2025-2030 when agenda implementation gets to speed.
📌Also, mega projects (and other) won’t build themselves. Total value of awarded construction projects are expected to reach $569 billion between 2021 and 2025 (PwC data). I could not find the 2025-2030 projections.
📌One notable deal in particular- Amazon Web Services announced a $5.3 billion investment to establish data centers in Saudi Arabia by 2026. This comes as a $40 Billion AI investment fund is set to be soon announced.
But the most realistic business right now?
📌Consultancy. A country that has an infinite supply of money and is trying to build world class cities, diversify its revenue streams but lacks professionals is the perfect environment for consultants. This is why all of the big 4, others, are rushing in to build a footprint in Riyadh.
So is Riyadh becoming the Dubai 2.0?
No. Nature is too harsh.
Contrary to Dubai, it’s not all about tourism.
The aim is to become a financial hub. In order to attract financial firms, government has mandated that foreign companies need to set up regional HQs in Saudi to secure public contracts. And the contracts are worth the effort.
Lots of relocation and even more investment opportunities.
Leave a Reply