Saudi Arabia is rapidly transforming into a strategic manufacturing base at the heart of global supply chains, a direct result of its ambitious Vision 2030 economic diversification plan. The Kingdom’s manufacturing sector is now a cornerstone of national growth, with the National Logistics and Industrial Development Program (NIDLP) sectors contributing a staggering $262 billion to the GDP in 2024. Drawn by world-class infrastructure and investor-friendly reforms, international manufacturers are racing to establish a footprint in one of the world’s fastest-growing industrial and export hubs.
The Vision 2030 Blueprint For Industrial Growth
At the core of this transformation is a decisive shift toward localized, private-sector-led manufacturing. Initiatives like the “Made in Saudi” program are designed to position the Kingdom as a global industrial powerhouse. Key goals under Vision 2030 include boosting industrial exports to SAR 557 billion, tripling manufacturing’s GDP contribution to SAR 895 billion, and doubling sector employment to 2.1 million jobs. To fuel this growth, the Kingdom has deployed targeted incentives, including the launch of the SAR 10 billion Standard Incentives Program to catalyze private capital investment across the industrial sector.
Pioneering A Green Energy Future
Saudi Arabia is aggressively pursuing a sustainable energy future, aiming to localize 75% of renewable energy components by 2030. The Public Investment Fund (PIF) has established joint ventures with Chinese firms JinkoSolar and TCL Zhonghuan Renewable Energy to create a combined 30 GW of solar PV manufacturing capacity. Other global players are following suit, with Chinese manufacturer SoleFiori establishing a 6 GW solar module factory and US-based GameChange Solar expanding its facility to 6 GW annually. The Kingdom’s ambitions also extend to green hydrogen, with an electrolyzer manufacturing joint venture established with HyGreen Energy.
Driving The Future Of Mobility
The Kingdom has set its sights on becoming a key player in the global automotive industry, aiming to produce over 350,000 passenger vehicles annually by 2030. The electric vehicle (EV) sector is a central focus, with global manufacturer Lucid Motors opening the first-ever car manufacturing facility in King Abdullah Economic City (KAEC) in 2023. Hyundai is also establishing a facility capable of producing 50,000 vehicles, including EVs. Underscoring its commitment, Saudi Arabia launched CEER, its first national EV brand, and the Electric Vehicle Infrastructure Company (EVIQ), which aims to install over 5,000 chargers by 2030.
Building A Hub For Health Innovation
Driven by the National Biotechnology Strategy, Saudi Arabia’s pharmaceutical and biotech sector is experiencing significant growth, with investments reaching SAR 10 billion ($2.6 billion) across 206 factories. The PIF-led Lifera was launched to boost local biopharmaceutical production. Major global firms like Pfizer and Merck have established a significant presence, while regional players like Julphar and Sudair Pharma are developing new facilities. The strategy focuses on localizing production, as seen in the partnership between Gypto Pharma and Roche to transfer biotechnology for a cancer drug.
Securing The Future Of Food
With a growing population and a sharp focus on food security, the Kingdom’s food and beverage sector offers massive opportunities, with a goal to attract $20 billion in investments by 2035. Leading multinationals are expanding their operations, with Nestlé investing $1.86 billion over the next decade and PepsiCo opening a new regional headquarters in Riyadh. The government is also fostering this growth through dedicated hubs like the Jeddah Food Cluster, projected to be the world’s largest food manufacturing hub, and by requiring 40% local content for public contracts.
Unlocking Trillions In Mineral Wealth
Mining has been designated the “third pillar” of Saudi Arabia’s national economy, with an estimated $2.5 trillion in untapped mineral wealth. Since 2020, mining exploration spending has surged by 500%, driven by sweeping regulatory reforms that include slashing the mining tax rate and allowing 100% foreign ownership. This has attracted major international players like India’s Vedanta and China’s Zijin Mining. State champion Ma’aden and the PIF’s Manara Minerals are also spearheading global acquisitions to secure the raw materials needed for advanced domestic manufacturing in sectors like EVs and renewable energy.
About Vision 2030
Saudi Vision 2030 is a strategic framework to reduce Saudi Arabia’s dependence on oil, diversify its economy, and develop public service sectors such as health, education, infrastructure, recreation, and tourism. Launched in 2016, its key goals include increasing non-oil government revenue, raising the private sector’s contribution to GDP, and positioning the Kingdom as a global investment powerhouse connecting three continents.
Source: Insight by AstroLabs
