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Saudi venture capital space records unprecedented growth in 2023

The Kingdom’s robust entrepreneurial environment positions the country as a key player in the region’s startup scene. (SPA)
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Updated 30 December 2023
Nour El Shaeri
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Saudi venture capital space records unprecedented growth in 2023

Updated 30 December 2023
Nour El Shaeri

CAIRO: Saudi Arabia’s startup ecosystem flourished in 2023 with the venture capital sector reaching new heights.
The entrepreneurial environment in the Kingdom charted a new course for economic prosperity, positioning Saudi Arabia as a leading country in the region’s burgeoning startup scene. 
The year was marked by robust participation from startups, venture capitalists, government bodies, and various stakeholders, all contributing significantly to the enhancement of the Kingdom’s startup ecosystem. 
This collective effort was characterized by a surge in investments and a range of initiatives aimed at fostering growth and innovation across the sector.

A record-breaking year 
In an interview with Arab News, Philip Bahoshy, founder of venture data platform MAGNiTT, shed light on the remarkable growth trajectory of Saudi Arabia’s venture ecosystem. 
He highlighted the advancements the Kingdom has made over the years and expressed optimism that the momentum would continue in 2024 and investments are likely to surpass 2023 figures.
Reflecting on the evolution of the sector, Bahoshy remarked: “If you go back to 2018, only $50 million were invested in local tech companies. This year, we’re on track to exceed last year’s investment total of $1 billion. This phenomenal growth is a direct result of the active involvement at the government level.” 
Bahoshy stated that the Kingdom is expected to be the only country to see an increase in funding year on year.

National alignment 
He credited the Kingdom’s Ministry of Communications and Information Technology with the phenomenal growth of the ecosystem. 
Bahoshy also highlighted key initiatives such as LEAP, the Saudi Unicorns program, and the National Technology Development Program. These initiatives have been pivotal in encouraging startups to establish their presence in the Kingdom. 
The top executive noted that entities like Saudi Venture Capital and Jada Funds of Funds have made significant strides this year, contributing to the growth of the ecosystem. 
“There is clearly a national push toward tech venture as an asset class,” Bahoshy stated. He concluded by asserting that the Kingdom is poised to end the year as the leading venture ecosystem in the Middle East and North Africa region, underscoring the national commitment to nurturing and expanding the tech venture sector.

Rising talent 
The evolution of venture capital in the Kingdom has had a profound impact not only on the nation’s economic stature but also on the cultivation of its talent pool. 
The year 2023’s growth in venture capital investment has created a fertile environment for innovation and entrepreneurship, enabling local talent to thrive and contribute significantly to the diversification and dynamism of the Saudi economy. 
Bahoshy noted that Saudi Arabia’s talent pool is experiencing organic growth, further enhanced by the influx of international talent. 
This increase is attributed to the expansion and relocation of more companies to the Kingdom, attracting a diverse range of skills and expertise.

A year ahead 
Saudi Arabia’s venture capital sector in 2023 has surpassed expectations, demonstrating resilience and growth even amid global economic challenges. 
Bahoshy, analyzing the Kingdom’s venture ecosystem, anticipates that this upward trajectory will extend into 2024. 
He commented: “Considering the Saudi ecosystem’s robust performance in a turbulent economic climate, there’s a strong indication that 2024 could mirror, if not exceed, the success of 2023.” 
He highlighted the importance of interest rates as a key factor influencing venture capital performance. 
With predictions pointing toward a potential decline in US interest rates in 2024, Bahoshy believes such a scenario will significantly enhance the investment environment. 
A decrease in interest rates, according to Bahoshy, could lead to not just an uptick in regional investments but also a resurgence in international funding. This would mark a notable shift from the slowdown observed in 2023. 
He also foresees that while both Saudi Arabia and the UAE are likely to experience concurrent growth in 2024, a broader upward trend across MENA nations is expected by 2025, signaling a region-wide boost in the venture capital sector.

The Kingdom’s firm position 
Talking to Arab News, Mohammed Al-Zubi, founder of Saudi-based Nama Ventures, emphasized Saudi Arabia’s role as a key player in the MENA region’s startup ecosystem. 
Al-Zubi stated: “Saudi Arabia has consistently been a pivotal market in the MENA region, which is why Nama Ventures chose Riyadh as its base. This year, however, has truly cemented the Kingdom’s status as the prime location for launching entrepreneurial ventures targeting the MENA market.” 
He further highlighted the strength and progress of Saudi Arabia’s entrepreneurial landscape, particularly in the face of challenging economic conditions. 
The entrepreneur elaborated: “The Kingdom’s entrepreneurial scene has demonstrated remarkable resilience amid the broader macroeconomic downturn. More impressively, it has shown substantial growth and maturity, which is clearly evident in the performance figures and investment trends we’ve seen.” 
Echoing Bahoshy’s views, Al-Zubi described 2023 as a challenging yet transformative period for entrepreneurs in the Kingdom. He noted that the beginning of the year saw a tightening in funding, compelling entrepreneurs to adopt drastic measures for survival. 
“2023 has been a rollercoaster for MENA entrepreneurs. We’ve shifted from a pre-2023 mindset of prioritizing growth at all costs to adopting strategies focused on surviving to fight another day,” Al-Zubi said. 
“With funding becoming scarce, entrepreneurs had to downsize to sustain and remain competitive. Our advice to our portfolio companies was to prioritize sustainability over aggressive growth,” Al-Zubi explained. 
As the year draws to a close, Al-Zubi observed an upturn in the market. “As we approach the year’s end, there are emerging signs of improved liquidity in the market. This change indicates that entrepreneurs should now start focusing on achieving sustainable growth as we move into 2024,” he added. 
This shift marks a crucial turning point for the Kingdom’s entrepreneurial landscape, signaling a move toward more balanced and sustainable business strategies.

Sectoral outlook 
The projected growth trajectory of Saudi Arabia is expected to encompass a broad range of sectors, with a particular emphasis on those experiencing high demand. 
Bahoshy views the continuing expansion of e-commerce and logistics as a given. However, he also foresees a significant surge in the fintech sector, indicating a diverse growth pattern across various industries. 
Concurrently, Al-Zubi offered a different perspective. “At Nama, we see the potential to disrupt traditional businesses in many areas, particularly in the MENA region and Saudi Arabia. That’s why, we maintain a sector-agnostic approach.” 
“We believe technology will act as a major disruptor across all sectors. In 2023, our investments spanned logistics, and food tech, among others, and we plan to stick to our strategy in 2024, positioning ourselves as the go-to early-stage, sector-agnostic fund,” he stated.

Topics: Saudi Venture Capital

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First Saudi-made THAAD system parts completed in Jeddah

Updated 11 May 2025
MOHAMMED AL-KINANI
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First Saudi-made THAAD system parts completed in Jeddah

Updated 11 May 2025
MOHAMMED AL-KINANI

JEDDAH: Saudi Arabia has completed the first domestically manufactured components for the Terminal High Altitude Area Defense system launcher in Jeddah, marking a significant step forward in the Kingdom’s ongoing efforts to localize its defense industry.

The milestone was highlighted during a recent meeting at Arabian International Co. for Steel Structures in Jeddah, attended by senior defense officials and industry leaders.

Among those present were Tim Cahill, president of missiles and fire control at Lockheed Martin; Nawaf Al-Bawardi, assistant deputy of the General Authority for Military Industries; and Wasim Attieh, president of AIC.

The meeting focused on reviewing progress in the local production of THAAD system components, following a partnership between Saudi Arabia and Lockheed Martin aimed at strengthening local manufacturing capabilities.

The achievement follows two contracts signed during the 2024 World Defense Show in Riyadh, as part of a broader strategy to localize key THAAD components. It builds on previous efforts announced at the 2022 edition of the show, including initiatives to domestically produce missile containers and launch platforms.

In a statement, Lockheed Martin emphasized the significance of the development, noting AIC’s advanced manufacturing capabilities and precision welding expertise.

“It is particularly significant as it demonstrates how the two companies successfully worked to bolster manufacturing expertise, strengthening the country’s defense industrial base while establishing a second source and building resilience for the US supply chain,” the statement said.

Cahill lauded the achievement as a major milestone for both countries. It is a tremendous milestone for the US and Saudi Arabia as both nations work to fulfill the Kingdom’s THAAD procurement, he said.

“Through this program, we’re not only supporting Saudi Vision 2030 and enhancing regional defense capacity, but we’re also generating high-quality manufacturing jobs in the US and strengthening the American defense industrial base, a testament to the value of our partnership with AIC Steel and the Kingdom of Saudi Arabia.”

Attieh praised Lockheed Martin for its cooperation and commitment to the project.

Lockheed Martin has been “an excellent partner,” providing the necessary tools and training to support and advance the localized production of a key component of the THAAD weapon system, he said.

“I look forward to working together to ensure a more secure future for the Kingdom of Saudi Arabia.” He also expressed gratitude to GAMI for its support throughout the project.

Saudi Arabia has steadily increased its defense manufacturing capabilities, with military spending localization reaching 19.35 percent in recent years — up from just 4 percent in 2018. The Kingdom aims to surpass 50 percent by 2030, in line with its Vision 2030 goal to establish a self-sufficient defense sector.

The THAAD system, developed by Lockheed Martin, is a state-of-the-art missile defense platform capable of intercepting and destroying ballistic missiles at both endo- and exo-atmospheric altitudes. It is designed to provide protection against short-, medium-, and intermediate-range threats and is widely regarded for its high success rate in flight tests and operational use.

The continued collaboration between Saudi Arabia and Lockheed Martin underscores the Kingdom’s commitment to building a robust and independent military industrial base while reinforcing its strategic defense alliances.

Topics: THAAD GAMI SaudiVision2030

Egypt’s annual inflation rises to 13.5% in April: CAPMAS 

Updated 50 min 29 sec ago
Mohammed Al-Kinani 
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Egypt’s annual inflation rises to 13.5% in April: CAPMAS 

Updated 50 min 29 sec ago
Mohammed Al-Kinani 

JEDDAH: Egypt’s annual inflation rose to 13.5 percent in April from 13.1 percent the previous month, driven by higher prices across key sectors including healthcare, transport, and housing, official data showed.  

According to data released by the Central Agency for Public Mobilization and Statistics, or CAPMAS, the monthly consumer price index rose 1.3 percent to 253.8 points, up from 250.6 in March.  

The data indicates continued inflationary pressures across essential sectors, affecting households nationwide, as Egypt grapples with the compounded impact of currency devaluations, ongoing subsidy reforms, and external shocks to global food and fuel prices. 

The healthcare sector recorded the sharpest monthly gains, rising 7.7 percent, with prices of medical products and equipment surging 11.4 percent. Outpatient services rose 2.1 percent, while hospital services increased 1.6 percent, according to CAMPAS data. 

Transport costs climbed 7.5 percent on the month, led by an 8.6 percent jump in private transport spending and an 8.2 percent increase in transport services. The cost of purchasing vehicles rose 1.3 percent. 

Housing, water, electricity, gas, and fuel prices increased 2.8 percent. Electricity, gas, and fuel prices alone climbed 6.7 percent, while actual rent increased by 1.1 percent and home maintenance and related services rose by 1.0 percent. 

Food and beverage prices declined 1.2 percent on a monthly basis, providing some relief to consumers. The decline was led by a 3.5 percent drop in meat and poultry, a 0.6 percent fall in dairy, cheese, and eggs, a 0.1 percent decrease in oils and fats, and a steep 5.1 percent drop in fruit prices.  

However, prices in several other categories within the food segment increased. Cereal and bread prices rose 0.5 percent, fish and seafood increased by 1.7 percent, vegetables gained 1.2 percent, sugar and sugary foods edged up 0.4 percent, and other food products rose 1.2 percent.  

Coffee, tea, and cocoa prices rose 0.4 percent, while mineral water, carbonated beverages, and natural juices were up 1.5 percent. 

The restaurants and hotels category posted a 4.1 percent increase in April, as ready meal prices climbed 4.2 percent and hotel services rose 1.5 percent. Cultural and entertainment services prices rose 0.7 percent, including a 15.6 percent increase in costs tied to leisure and recreational services. The clothing and footwear division saw a 1.7 percent increase, with prices of garments, accessories, and cleaning services all moving higher.  

Furniture and household equipment prices increased by 1.1 percent, while miscellaneous goods and services climbed 2.2 percent, driven largely by a 2.4 percent rise in personal care expenses and a 4.3 percent increase in prices of personal luggage items.

Topics: CAMPAS Egypt Inflation

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Jordan’s exports to GAFTA countries rise 12.2%

Updated 11 May 2025
Reem Walid
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Jordan’s exports to GAFTA countries rise 12.2%

Updated 11 May 2025
Reem Walid

RIYADH: Jordan’s exports to countries in the Greater Arab Free Trade Area rose 12.2 percent year on year to 515 million Jordanian dinars ($726 million) by the end of February, amid strong demand for key goods.

According to official statistics reported by the Jordan News Agency, or Petra, the rise from 459 million dinars in the same period of 2024 was driven by increased shipments of fertilizers, medicines, and fresh and frozen agricultural products. Additional contributors included skincare items, food preparations, and furniture, as well as fabrics, garments, and other goods.

The latest trade data aligns with broader optimism about Jordan’s economic outlook, with Central Bank Governor Adel Sharkas saying in March that the country's economy is projected to grow 2.7 percent in 2025, accelerating to 3.5 percent in the medium term.

“Foreign trade data from the Department of Statistics (DoS), monitored by ‘Petra,’ showed a decline in the Kingdom’s (Jordan’s) trade deficit with the GAFTA countries for the same period, reaching JD348 million, compared to JD369 million against last year,” the Petra report stated.

Established in January 2005, GAFTA operates as an economic alliance with the objective of promoting trade and economic unity among Arab nations. Comprising 18 member states, GAFTA is dedicated to bolstering regional trade by lowering customs tariffs.

GAFTA imports into Jordan also climbed, rising 4.2 percent to 863 million dinars from 828 million dinars, bringing the total trade volume to 1.37 billion dinars—up from 1.28 billion dinars a year earlier.

Jordan’s imports primarily include crude oil and its derivatives, jewelry, and food products. Other major import categories are plastic items, titanium dioxide, and polyethylene, as well as polystyrene, iron, and various other goods.

Saudi Arabia remained Jordan’s top regional trade partner, accounting for 141 million dinars in exports — a 6.8 percent rise—and 519 million dinars in imports, resulting in a bilateral deficit of 378 million dinars.

Iraq followed with 136 million dinars in Jordanian exports, up 15.3 percent, while trade with Syria surged to 35 million dinars — a 483.3 percent jump from the previous year.

In March, Sharkas shed light on how inflation in Jordan reached 2.2 percent in the first two months of this year and is expected to stabilize at 2 percent for 2025.

Topics: Jordan exports

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Saudi industrial output rises 2% in March on strong manufacturing gains 

Updated 48 min 56 sec ago
MIGUEL HADCHITY 
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Saudi industrial output rises 2% in March on strong manufacturing gains 

Updated 48 min 56 sec ago
MIGUEL HADCHITY 

RIYADH: Saudi Arabia’s industrial production index rose 2 percent year on year in March 2025, driven by strong growth in manufacturing, particularly in the chemical and food industries, official data showed. 

The IPI increased to 106.5 in March from 105.4 in February, reflecting a 1.1 percent rise on a monthly basis, according to preliminary data from the General Authority for Statistics. 

The manufacturing sub-index registered a 5.1 percent annual increase in March compared to the same month in 2024. This growth was supported by a 14.3 percent uptick in the manufacture of chemicals and chemical products and the manufacture of food products, which increased by 6.9 percent. 

The data underscores continued momentum in the Kingdom’s non-oil industrial base, a key pillar of the Vision 2030 economic diversification strategy. 

In a release, GASTAT stated: “On a monthly basis, the sub-index of manufacturing activity showed an increase of 2.9 percent, supported by the rise in the activity of the manufacture of chemicals and chemical products, which increased by 7.2 percent, and the manufacture of food products which increased by 12.4 percent.” 

Mining and quarrying activity, which includes crude oil extraction, slipped 0.2 percent year on year in March. Saudi Arabia produced 8.96 million barrels of oil per day during the month, slightly down from 8.97 million bpd a year earlier. On a monthly basis, mining activity ticked up 0.1 percent. 

Other sectors showed mixed performance. The output of non-metallic mineral products increased 6.1 percent year on year, while the basic metals segment fell 6.6 percent but edged up 1.4 percent from February. 

The production of electrical devices grew 4 percent year on year but declined 1.1 percent month on month. 

The paper and paper products segment saw a 1 percent annual increase and a 0.6 percent rise from the previous month. Furniture output contracted 15.7 percent year on year but rose marginally, by 0.2 percent, on a monthly basis. 

Other economic activities within the manufacturing sector grew by 0.4 percent year on year and 0.3 percent month on month. 

Meanwhile, the electricity, gas, steam, and air conditioning supply sub-index dropped 0.9 percent year on year and 7.7 percent month on month. In contrast, water supply, sewerage, and waste management activities surged 15 percent annually and 3.7 percent from February. 

Overall, oil-related industrial activities rose 0.5 percent annually and 0.1 percent monthly in March. Non-oil activities, which encompass manufacturing and utilities, expanded 5.6 percent year-on-year and 3.3 percent month on month. 

The Industrial Production Index measures changes in industrial output based on the International Standard Industrial Classification framework, covering mining, manufacturing, utilities, and waste management sectors. 

Topics: GASTAT manufacutring ipi

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Saudi Aramco profit rises to $26bn in Q1 amid strategic growth push 

Updated 11 May 2025
Nirmal Narayanan 
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Saudi Aramco profit rises to $26bn in Q1 amid strategic growth push 

Updated 11 May 2025
Nirmal Narayanan 

RIYADH: Energy giant Saudi Aramco reported a stronger-than-expected first-quarter net profit of SR97.54 billion ($26 billion), highlighting resilience amid weaker oil prices and reinforcing its focus on efficiency and diversified strategic growth. 

The net income marked a 16.42 percent increase in the first three months of 2025 from $22.34 billion in the previous quarter, although it was down from $27.27 billion a year earlier. The company’s overall revenue in the first quarter stood at SR405.65 billion, marking a 3.23 percent quarter-on-quarter increase. 

The oil giant cited disciplined capital spending, robust operations, and continued downstream expansion as key drivers of its performance. 

In a statement, Amin H. Nasser, CEO of Saudi Aramco, said: “Global trade dynamics affected energy markets in the first quarter of 2025, with economic uncertainty impacting oil prices.”  

He added: “In this context, Aramco’s robust financial performance once again demonstrated the company’s unique scale, its reliability and flexibility, the value of its low-cost operations, and its emphasis on efficiency and advanced technology.”  

The company’s operating cash flow reached $31.7 billion, down from $33.6 billion in the first quarter of 2024, while free cash flow stood at $19.2 billion.  

Aramco’s capital expenditures rose to $12.5 billion as the company continued to invest in long-term strategic projects, including lower-carbon initiatives. 

Nasser said Aramco will continue working to meet global energy demand by advancing growth across its upstream, downstream and new energy segments, while also focusing on reducing emissions. 

“Our ambition is reflected in milestones already announced in 2025, including progress toward our gas production growth target, our global retail expansion, the advancement of our petrochemicals strategy, headway in blue hydrogen business development, and further innovation in carbon capture,” he added.  

Aramco’s board declared a base dividend of $21.1 billion for the first quarter, up 4.2 percent from the same period a year earlier. It also announced a performance-linked dividend of $219 million, to be paid in the second quarter. 

“In volatile times, Aramco’s resilience underpins both our financial performance and our sustainable and progressive base dividend,” added Nasser.  

Aramco also highlighted progress on several fronts in line with its long-term diversification strategy. The company finalized the acquisition of a 50 percent stake in Blue Hydrogen Industrial Gases Co. and signed definitive agreements to acquire a 25 percent interest in Unioil Petroleum Philippines, strengthening its position in blue hydrogen and downstream retail, respectively. 

In addition, Aramco launched a pilot facility for direct air capture of CO2, a move aimed at scaling up its carbon capture technology and supporting the Kingdom’s emissions-reduction goals.

In an interview with Al-Ekhbariya, Ziad Al-Murshed, chief financial officer and executive vice president of Saudi Aramco, said that the refining and chemicals sector accounted for 56 percent of crude oil production during the first quarter. 

He further said the company will continue to implement growth plans in refining and chemicals, while promoting integration with the retail and lubrication network. 

According to Al-Murshed, Aramco aims to raise gas production capacity to more than 60 percent by 2030, which could add SR38 billion in annual inflows. 

The CFO added that the company has a spare production capacity of 3 million bpd with relatively low operating costs, with every million bpd of this capacity could add SR43 billion in net income annually. 

He further said that Aramco’s oil and gas projects are progressing as per plans, with the completion of the Marjan and Berri projects and the first phase of the Dammam field will boost production capacity by the end of this year. 

He added that the production at the Jafurah field will also begin operations in the next few months. 

Topics: Aramco Oil energy

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