Here’s what to expect in Saudi Arabia’s sky in the near future

Special Here’s what to expect in Saudi Arabia’s sky in the near future
Saudi Arabia is targeting handling 330 million passengers annually by 2030. Getty
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Updated 10 May 2025
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Here’s what to expect in Saudi Arabia’s sky in the near future

Here’s what to expect in Saudi Arabia’s sky in the near future

RIYADH: Increased technology integration and greater connectivity over the next five years will see Saudi Arabia cement its position as a global aviation hub, experts have told Arab News.

In a comprehensive assessment of the Kingdom’s air sector, analysts and industry insiders have set out how investment in infrastructure, the roll out of new airlines, and a focus on sustainability will see Saudi Arabia reach its Vision 2030 goals.

The Kingdom is targeting handling 330 million passengers annually across 250 destinations by the end of the decade, as well as  transporting 4.5 million tonnes of cargo.

The industry laid the groundwork for this growth in 2024, achieving record-breaking results with the 94 million passengers transported representing  a 15 percent year-on-year increase, alongside a 10 percent rise in flight activity, and a 52 percent boost in air cargo, to reach nearly 1 million tonnes.

The International Air Transport Association’s Regional Vice President for Africa and the Middle East, Kamil Al-Awadhi told Arab News that the Kingdom is preparing for the aviation sector to play an even bigger role in its future. 

“Over the next five years, we expect continued development in digitalization and connectivity, and for Saudi Arabia to be in an even stronger position as a global hub, driving economic and social growth for the Kingdom,” he said.

Al-Awadhi also emphasized that the nation’s regulatory reforms and commitment to sustainability will be key factors in attracting international airline partnerships and investment. 

He added: “GACA’s (the General Authority of Civil Aviation) revision of its charging scheme, to make Saudi airports more competitive in the region, is a positive step, now and for the future. As is its establishment of an independent economic regulatory framework.”

The top official noted that Saudi Arabia is the first country in the Middle East and North Africa to do this, and encouraged others to follow.

Riyadh Air — a portal to the Kingdom

A key development in the sector is the highly anticipated debut of Riyadh Air, Saudi Arabia’s new full-service airline, set to launch in 2025. 

The company has made significant strides in preparation for its release, including major aircraft acquisitions, strategic alliances, and technological investments.

Mark Bothorn, principal of innovation practice at Arthur D. Little Middle East, highlighted that the launch of Riyadh Air is a “watershed moment for Saudi Arabia’s aviation sector — an event of this scale and significance happens perhaps once a decade.”

He added: “As a full-service national flag carrier, Riyadh Air will not only enhance domestic connectivity but also position the Kingdom’s capital as a major global aviation hub.”

Bothorn further anticipated that the new national carrier would serve as an ambassador for Saudi Arabia, embodying the nation’s vision through cutting-edge design, unparalleled guest experience, and world-class connectivity. “The way the world perceives Riyadh will, in many ways, be shaped by the experiences this airline delivers,” he added.




Mark Bothorn, principal of innovation practice at Arthur D. Little Middle East. Supplied

The airline has ordered 60 Airbus A321neo jets, with plans for additional wide-body aircraft this year. It has secured agreements with Singapore Airlines, Air China, and Delta Air Lines to enhance interline connectivity, codeshare operations, and frequent flyer benefits.

Riyadh Air is collaborating with Artefact to develop an advanced data analytics platform that aims to offer hyper-personalized services and seamless digital-first experiences. Its initial routes will connect Saudi Arabia to major cities in Europe, North America, and Asia, enhancing its international connectivity.




Riyadh Air plans to connect with more than 100 cities by 2030. Shutterstock

The Kingdom’s existing airlines are also undergoing significant transformations to cater to the growing demand and enhance international reach. 

Saudia has placed a historic $19 billion order for 105 Airbus A320neo aircraft to expand its fleet, set for delivery starting in 2026.

Additionally, the airline is enhancing its maintenance and repair capabilities through a partnership with Air France-KLM. Flyadeal, Saudia’s budget airline, aims to double its fleet to 100 aircraft by 2030, offering affordable travel options across domestic and regional routes.

Flynas, the region’s top low-cost airline, secured a 280-aircraft deal, including Airbus A320neo and A330neo models, to support its aggressive expansion strategy. The airline also introduced new routes connecting Saudi Arabia to Africa and Europe.

Bothorn commented on the impact of heightened market contenders, saying: “Increased competition is always a catalyst for innovation and improvement, and in Saudi Arabia’s aviation sector, it will lead to two transformative outcomes.”

First, enhanced connectivity will strengthen Riyadh’s position as a global business hub by providing seamless access to international markets through more flights and improved routing.

Second, Riyadh Air, unburdened by legacy systems, has the potential to redefine air travel, setting new benchmarks in passenger experience and efficiency, according to Bothorn.

Airport infrastructure soars 

To handle the volume that new airlines will be attracting, Saudi Arabia is investing heavily in airport infrastructure. 

King Salman International Airport in Riyadh is set to become one of the world’s largest airports, with ongoing developments led by global firms including Foster & Partners and Jacobs Engineering. The airport will increase its capacity to accommodate 120 million passengers by 2030.

King Khalid International Airport’s expansion includes upgrades to Terminals 1 and 2, increasing capacity to 14 million passengers annually. Saudia’s deal with German aerospace company Lilium NV will introduce 50 electric vertical takeoff and landing jets, making it the first airline in the region to invest in sustainable air travel.

Bothorn emphasized the impact of airport infrastructure advancements. “For many travelers, the airport experience is often the most stressful part of a journey — navigating terminals, dealing with security bottlenecks, and enduring long waits.”

He added: “A seamless integration between the airport and airlines can dramatically transform this, replacing frustration with efficiency and even moments of delight.”

Bothorn envisioned airports that proactively anticipate passenger needs, with real-time updates enabling travelers to relax in lounges or dine rather than wait at gates.




An impression of how King Salman International Airport will look when construction is completed. File

Investment turbines spin

Saudi Arabia’s business aviation sector is thriving, driven by an influx of high-net-worth individuals and economic expansion. The sector, valued at $1.2 billion in 2023, is expected to grow at an annual rate of 8.88 percent from 2025 to 2029.

GACA is further boosting this sector by removing restrictions on foreign on-demand charter flights, allowing international operators to enter the domestic private aviation market starting in May.

Infrastructure and transportation developments outlined in the 2025 Saudi budget report reinforce these aviation ambitions. The gross domestic product of the transportation and logistics sector grew by 6.4 percent in the first half of 2024.

Total investment contracts signed in this sector amounted to over SR200 billion ($53.3 billion). Saudi Arabia has also strengthened its global presence by securing key positions in international aviation organizations, including hosting the UNCTAD Global Supply Chain Forum in 2026 and chairing the Executive Council of the Arab Civil Aviation Organization.

To enhance aviation services, the Kingdom has looked to implement modern and eco-friendly transportation initiatives during the Hajj season, including self-driving taxis, smart delivery vehicles, and increased aircraft seat capacity for pilgrims. Performance-based operations and maintenance contracts have been executed to enhance asset management efficiency.

Plans for 2025 include SR42 billion allocated for the infrastructure and transportation sector, which will witness the launch of several travel lounges across international airports, licensing new national air carriers, and expanding public bus networks to improve intercity and regional connectivity.

Al-Awadhi of IATA further elaborated on the nation’s role in shaping global aviation policies. “Many countries in the region look to Saudi Arabia for developing their aviation sectors, so the Kingdom plays an important role in shaping regional policies.”

Recent work revamping economic regulation related to consumer protection, safety and security has been followed by other countries in the region, according to the top official.

“We’re stronger as an industry when standards are aligned, not just regionally but globally,” he added.

Private jets and Saudi Arabia’s aviation roadmap

Saudi Arabia has made developing the private aviation market a key part of its roadmap for the sector, with the charter and corporate jet segments being supported by infrastructure upgrades such as six new general aviation airports.

The sector’s growth aligns with Vision 2030’s diversification efforts, particularly in tourism and entertainment, with destinations like AlUla and the Red Sea International Airport, capable of handling 1 million tourists annually, driving demand. 

During 2024’s Future Aviation Forum, GACA unveiled a roadmap aimed at increasing the general aviation sector’s contribution to GDP, targeting a tenfold growth to reach $2 billion by 2030. The plan encompassed the business aircraft sector, including private charter flights and corporate aviation.

Sustainability is another focus, with GACA’s plan targeting net-zero emissions by 2060 through initiatives such as sustainable aviation fuel and AI-driven efficiency optimizations. However, challenges, including limited sustainable aviation fuel supply, remain. 




The International Air Transport Association’s Regional Vice President for Africa and the Middle East Kamil Al-Awadhi. Supplied

Sustainable skies ahead

IATA’s Al-Awadhi highlighted the recent deal between Red Sea Global and daa International to introduce sustainable aviation fuel at Red Sea International Airport as “a positive step for Saudi Arabia and the region” when it comes to developing a more ecologically friendly sector.

The 35 percent SAF blend, supplied by Arabian Petroleum Supply Co., reduces aircraft emissions by up to 35 percent per flight, aligning with RSG’s broader sustainability efforts, including 400 megawatt-peak of solar installations and plans to plant 50 million mangroves by 2030.

The airport, operational from 2023 and with international flights beginning in 2024, serves the growing Red Sea destination, set to feature 50 resorts by 2030.

The next five years will bring transformative benefits for travelers flying to and from Saudi Arabia. Expanded airline networks will improve connectivity, reduce layovers, and increase travel convenience.

The rise of low-cost carriers like flyadeal and flynas means more budget-friendly flights for domestic and international routes. AI-driven services, biometric security checks, and world-class airport infrastructure will streamline travel, making it more efficient and comfortable.

“Expect nothing short of a revolution in the way people travel,” Bothorn said. He explained that long queues at security and immigration, endless gate waits, and the anxiety of either rushing through the airport or arriving far too early “will become relics of the past.” He projected air travel to become more intuitive and enjoyable.

Al-Awadhi added that Saudi Arabia is investing heavily in digital processing of passengers and integrating latest technologies at airports. 

“We can certainly expect better passenger experience and customer service,” he said, adding: “Airlines are also updating their fleets so travelers will be flying on the latest aircrafts, enjoying what new technologies have to offer. Improved connectivity will provide travelers with more choices, enhancing the overall customer experience.”

Investments in eVTOL aircraft and eco-friendly practices signal a shift toward greener aviation. Saudi Arabia is undergoing a historic transformation in its aviation sector, with massive investments, strategic expansions, and cutting-edge innovations that will redefine the travel experience.

By 2030, the Kingdom aims to be a premier global aviation hub, offering world-class connectivity, seamless air travel, and state-of-the-art airport facilities.


Manufacturing, mining sectors drive Saudi industrial growth to 3.1 percent: GASTAT

Manufacturing, mining sectors drive Saudi industrial growth to 3.1 percent: GASTAT
Updated 7 sec ago
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Manufacturing, mining sectors drive Saudi industrial growth to 3.1 percent: GASTAT

Manufacturing, mining sectors drive Saudi industrial growth to 3.1 percent: GASTAT

RIYADH: Saudi Arabia’s Industrial Production Index expanded by 3.1 percent year on year in April, driven by strong growth in the manufacturing, mining, and quarrying industries, official data showed. 

According to preliminary data from the General Authority for Statistics, the Kingdom’s IPI advanced to 108.6 in April, representing a 0.6 percent rise compared to the previous month. 

The latest IPI figures reinforce the progress of Saudi Arabia’s economic diversification journey, which aims to reduce the Kingdom’s decades-long dependence on crude revenues. 

“Preliminary results indicated a 3.1 percent increase in the IPI in April 2025 compared to the same month of the previous year, supported by the rise in mining and quarrying activity, manufacturing activity and water supply, sewerage and waste management and remediation activities,” the analysis stated.

GASTAT revealed that the sub-index of manufacturing activities advanced by 7.4 percent in April compared to the same month in 2024. 

The authority added that the index of oil activities saw an annual rise of 4.3 percent in the fourth month of the year, while non-oil activities edged up by 0.1 percent. Compared with March, oil activities rose by 1.6 percent, whereas non-oil activities declined by 2 percent.

GASTAT added that the growth in the manufacturing sector was driven by an increase in the production of coke and refined petroleum products, which grew by 22.6 percent year on year in April. 

The chemical manufacturing sector also contributed to the rise, increasing 9.1 percent annually. 

On a monthly basis, the sub-index of manufacturing activity witnessed a rise of 0.5 percent, driven by a 5.8 percent increase in the production of coke and refined petroleum products. 

The expansion of the manufacturing sector highlights the evolving structural transformation of the Saudi economy, with the Kingdom positioning itself as a key player in the global industrial landscape. 

In April, the sub-index of mining and quarrying activities increased by 0.2 percent compared to the same month in 2024. 

“Saudi Arabia increased its oil production to 9.01 million barrels per day in April 2025 compared to 8.99 million barrels per day in April 2024,” said GASTAT. 

On a monthly basis, the sub-index of mining and quarrying activity increased by 0.5 percent in April. 

According to the report, the electricity, gas, steam, and air conditioning supply sector registered an annual decrease of 0.2 percent but saw a monthly rise of 4.3 percent. 

GASTAT further said that water supply, sewerage, and waste management activities increased by 8.8 percent year on year in April, while it declined by 0.7 percent compared to the previous month. 

Compared to March, the index for oil activities increased by 1.6 percent in April, while non-oil activities dropped by 2 percent. 

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.


Strategic reforms and cultural depth are driving Uzbekistan’s tourism boom, says official 

Strategic reforms and cultural depth are driving Uzbekistan’s tourism boom, says official 
Updated 19 min 58 sec ago
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Strategic reforms and cultural depth are driving Uzbekistan’s tourism boom, says official 

Strategic reforms and cultural depth are driving Uzbekistan’s tourism boom, says official 

TASHKENT: As Uzbekistan undergoes an economic transformation, tourism has emerged as both a cultural ambassador and a powerful growth engine.

At the forefront is Umid Rustamovich Shadiyev, chairman of the Tourism Committee under the Ministry of Ecology. 

Formerly Uzbekistan’s Permanent Representative to UNESCO, Shadiyev brings both diplomatic experience and a deep understanding of the nation’s rich heritage. 

Arab News spoke with Shadiyev during the Tashkent International Investment Forum 2025, a flagship platform bringing together global investors, policymakers, and innovators to explore Uzbekistan’s investment landscape. 

Now in its fourth edition, the forum has become a cornerstone of the country’s reform agenda, highlighting strategic sectors such as energy, infrastructure, agriculture, and tourism. 

This year’s event welcomed over 2,500 delegates from 70 countries, with tourism receiving special focus as a driver of inclusive and sustainable development. 

Saudi-Uzbek tourism ties deepen 

The conversation turned to Saudi Arabia, where tourism is undergoing a historic transformation under Vision 2030. Shadiyev praised the Kingdom’s diversification efforts, calling it “a new center of global tourism.” 

Uzbekistan sees an opportunity for synergy, and a memorandum of cooperation in tourism was signed in 2022, followed by joint forums and high-level meetings in 2023 and 2024. 

“Our relationship with Saudi Arabia is growing stronger each year,” said the official. 

The results are visible. Saudi tourist arrivals in Uzbekistan rose from 1,731 in 2022 to over 4,100 in 2024, reflecting growing interest in cultural, gastronomic, and mountain tourism. 

“There’s huge potential in developing family-oriented tours, heritage trails, and collaborative media campaigns,” Shadiyev noted.

Tourism university exchanges, journalist visits, and influencer collaborations are also being explored. 

In 2025, Uzbekistan is emphasizing sustainable tourism and aims to increase the average stay of foreign visitors to 10 to 12 days. Strategic partnerships — such as with Saudi Arabia — are seen as central to achieving this goal. 

Tourism emerges as economic pillar 

“Tourism is currently one of the key sectors of Uzbekistan’s economy,” Shadiyev noted. “In 2024, we saw a significant leap forward: the export of tourism services increased by 1.6 times, reaching $3.5 billion.”  

This performance is backed by a rise in entrepreneurship, with more than 2,000 new tourism businesses launched in the past year alone. From boutique hotels to eco-lodges and cultural tour operators, a new generation of investors is responding to supportive government policies and the sector’s strong profitability. 

The transformation is evident across the country. Over the past eight years, Uzbekistan has attracted $6.5 billion in tourism-related investments and added 130,000 new hotel beds. 

“These achievements reflect our commitment to building a world-class tourism ecosystem,” Shadiyev said. 

A major milestone came in April, when over 1 million foreign tourists visited Uzbekistan in a single month — a national record. 

Shadiyev attributes this growth to visa policy reforms, infrastructure upgrades, and active global engagement. “We’re not only opening our doors wider; we’re creating lasting experiences for visitors,” he said. 

Looking ahead, Uzbekistan aims to further increase both international arrivals and tourism export volumes in 2025. The government is systematically working toward these goals by investing in digital transformation, human capital, and diversified tourism offerings. 

Four seasons, one destination 

Positioned at the crossroads of the Great Silk Road, Uzbekistan has long served as a bridge between East and West. Shadiyev highlighted the country’s unique geographic and cultural positioning: “We’re the heart of Central Asia — no regional tour is complete without including Uzbekistan.”  

What makes Uzbekistan truly special, he said, is its year-round appeal. In spring, visitors celebrate Navruz, the festival of renewal, and explore blooming gardens, vibrant bazaars, and the historic cities of Tashkent, Samarkand, Bukhara, and Khiva.

Summer brings tourists to mountain resorts and natural lakes, rich fruit harvests, and traditional crafts festivals. 

Winter offers skiing and tranquil nature retreats, while autumn is ideal for cultural immersion and warm Uzbek hospitality.

“Every season offers a new story, a new flavor,” Shadiyev said.  

The country’s legacy is underscored by its many UNESCO World Heritage Sites, including Samarkand, Bukhara, and Khiva. Uzbekistan is also witnessing a boom in niche tourism markets, including ziyarat, or pilgrimage tourism, ecotourism, domestic travel, and culinary tours. 

Uzbekistan’s rise on the global travel radar is also backed by international accolades.

The country was named the Most Desirable Emerging Destination by Wanderlust, UK; won the tourism in the CIS award from Russian Traveler; and was featured among the Top 25 Destinations of 2025 by both BBC Travel and The New York Times.  

Gulf travelers drawn to shared culture 

When asked about Uzbekistan’s appeal to Arab travelers, particularly from the Gulf region, Shadiyev emphasized deep-rooted cultural and spiritual ties. 

“Our shared Islamic heritage and atmosphere of religious respect make Uzbekistan especially attractive to Gulf visitors,” he said. 

Khiva’s designation as the 2024 Tourism Capital of the Organization of Islamic Cooperation reflects this connection. 

Other key events include the Economic Cooperation Organization’s tourism forum in Shakhrisabz, which spotlighted opportunities in religious and cultural travel. 

Uzbekistan is enhancing its appeal through substance and strategy. 

A 30-day visa-free regime now applies to citizens of Saudi Arabia, the UAE, and Qatar, as well as those of Oman, Bahrain, and Kuwait.

Direct flights from Gulf capitals are expanding, and tour operators are curating experiences tailored to Arab travelers. 

The country offers a rich mix of gastronomy — including signature dishes like plov, manti, and shurpa — as well as ethno-tourism experiences in traditional villages, and a vibrant calendar of music, art, and food festivals.

Uzbekistan is also rolling out a UN tourism platform and a unified tourist card integrating visa services, tickets, and discounts. 

“We’re not just promoting Uzbekistan; we’re building a seamless visitor experience,” Shadiyev added. 

Vision rooted in heritage and openness 

As the interview concluded, Shadiyev returned to a theme central to Uzbekistan’s tourism push: openness. “We are a country that welcomes the world — with history in our stones and hospitality in our hearts,” he said. 

The Tashkent International Investment Forum served as the perfect setting for this conversation, reflecting Uzbekistan’s economic momentum and its growing network of global partnerships — none more vibrant than those flourishing through tourism. 

As Shadiyev put it, quoting an old proverb: “It’s better to see something once than hear about it a hundred times.”


Oil Updates — prices rise as US-China talks counter OPEC supply worries

Oil Updates — prices rise as US-China talks counter OPEC supply worries
Updated 34 min 55 sec ago
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Oil Updates — prices rise as US-China talks counter OPEC supply worries

Oil Updates — prices rise as US-China talks counter OPEC supply worries

SINGAPORE: Oil prices climbed on Tuesday as investors awaited the outcome of US-China talks that could pave the way for easing trade tensions and improve fuel demand.

Brent crude futures rose 22 cents, or 0.3 percent, to $67.26 a barrel by 09:45 a.m. Saudi time. US West Texas Intermediate crude was up 18 cents, or 0.3 percent, at $65.47.

On Monday, Brent had risen to $67.19, the highest since April 28, buoyed by the prospect of a US-China trade deal.

US-China trade talks were set to continue for a second day in London as top officials aimed to ease tensions that have expanded from tariffs to rare earth curbs, risking global supply chain disruptions and slower growth.

Prices have recovered as demand concerns have faded with the trade talks between Washington and Beijing and a favourable US jobs report, while there are risks to North American supply due to wildfires in Canada, Goldman Sachs analysts said.

US President Donald Trump said on Monday that the talks with China were going well and he was “only getting good reports” from his team in London.

A trade deal between the US and China could support the global economic outlook and boost demand for commodities including oil.

Elsewhere, Iran said it would soon hand a counter-proposal for a nuclear deal to the US in response to a US offer that Tehran deems “unacceptable,” while Trump made clear that the two sides remained at odds over whether the country would be allowed to continue enriching uranium on Iranian soil.

Iran is the third-largest producer among members of the Organization of the Petroleum Exporting Countries and any easing of US sanctions on Iran would allow it to export more oil, weighing on global crude prices.

Meanwhile, a Reuters survey found that OPEC oil output rose in May, although the increase was limited as Iraq pumped below target to compensate for earlier overproduction and Saudi Arabia and the UAE made smaller hikes than allowed.

OPEC+, which pumps about half of the world’s oil and includes OPEC members and allies such as Russia, is accelerating its plan to unwind its most recent layer of output cuts.

“The prospect of further hikes in OPEC supply continues to hang over the market,” Daniel Hynes, senior commodity strategist at ANZ, said in a note.

“A permanent shift to a market driven strategy (in OPEC) would push the oil market into a sizeable surplus in H2 2025 and almost surely lead to lower oil prices.”


UAE shares end higher as outcome of US-China trade talks awaited

UAE shares end higher as outcome of US-China trade talks awaited
Updated 09 June 2025
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UAE shares end higher as outcome of US-China trade talks awaited

UAE shares end higher as outcome of US-China trade talks awaited

LONDON: Stock markets in the UAE ended higher on Monday, in step with Asian peers, as investors awaited the outcome of US-China trade talks in London in the hope that a deal could boost the global economic outlook.

Top US and Chinese officials will sit down in London on Monday for talks aimed at defusing the high-stakes trade dispute between the two super powers that has widened to export controls over goods and components critical to global supply chains.

Dubai’s benchmark index hit its highest levels since 2008 and settled up 1 percent, with almost all sectors in positive territory.

Tolls operator Salik Company gained 2.3 percent and Deyaar Development surged 14.6 percent.

In Abu Dhabi, the index was up for a third straight session and gained 0.1 percent, lifted by a 1.6 percent rise in blue-chip developer Aldar Properties and a 1.8 percent advance in Abu Dhabi’s flagship energy firm Abu Dhabi National Energy Company.

Most stock markets in the Gulf and Egypt including Saudi, Qatar, Kuwait are closed on Monday due to a public holiday.


Saudi commercial bank profits jump 16% in April, topping $2bn before zakat, tax

Saudi commercial bank profits jump 16% in April, topping $2bn before zakat, tax
Updated 09 June 2025
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Saudi commercial bank profits jump 16% in April, topping $2bn before zakat, tax

Saudi commercial bank profits jump 16% in April, topping $2bn before zakat, tax
  • Year-to-date earnings reached SR32.97 billion, an annual rise of 20%
  • Banks getting balance sheets ready for next investment wave

RIYADH: Saudi Arabia’s banking sector extended its winning streak in April, posting SR7.77 billion ($2.07 billion) in pre-zakat and tax profits, a 16 percent increase compared to the same month last year.

According to the Saudi Central Bank, also known as SAMA, this brought year-to-date earnings to SR32.97 billion, an annual rise of 20 percent, keeping the Kingdom firmly on course for another record-breaking period.

The sustained momentum is attributed to a robust mix of state spending on giga-projects, resilient consumer demand, and still-elevated interest rates.

Financing volumes continue to climb, driven primarily by corporate borrowers across a growing range of industries, including manufacturing, utilities, insurance, and private education. 

Speaking at the inaugural 24 Fintech conference in September, Finance Minister Mohammed Al-Jadaan said the Kingdom had licensed 224 fintech firms by the second quarter of 2024. File/SPA

Contractors are also racing to secure long-term credit for giga-projects such as NEOM, Diriyah, and the Jafurah gas field.

A wider Gulf picture

Strong as those local figures are, the broader region is also gaining momentum. A Kamco Invest report released in May showed that Gulf banks collectively earned a record $15.6 billion in the first quarter of 2025, an 8.6 percent increase from a year earlier.

Financial institutions in the UAE posted the largest absolute increase, adding $639.6 million, while Saudi lenders recorded the fastest annual growth at 17.2 percent.

Kamco added that fee income is rising, costs are under control, and loan-loss provisions fell sharply during the period, cushioning a small dip in net interest income.

Investor appetite is visible in market valuations. Forbes Middle East’s “30 Most Valuable Banks 2025” March list includes 10 Saudi lenders with a combined market cap of about $269 billion— roughly one-third of the entire ranking.

Al Rajhi Bank led the pack at $105.6 billion, with Saudi National Bank following at $54.7 billion.

Contractors are racing to secure long-term credit for giga-projects such as NEOM, Diriyah, and the Jafurah gas field. NEOM

Global Finance named Saudi Awwal Bank the Kingdom’s best lender in its May “World’s Best Banks in the Middle East 2025” release, highlighting its HSBC-backed mobile app upgrades, Visa Direct payments, and one-stop small and medium-sized enterprises lending platform.

Cleaning the books and raising cash

Banks are also getting balance sheets ready for the next investment wave.

Bloomberg reported in March that lenders are exploring sales of older non-performing loans to specialist investors to free up capital for upcoming mega project drawdowns.

They’re also tapping capital markets. By June, they had issued over $5.6 billion in Additional Tier-1 bonds, already a full-year record and the world’s second-largest AT1 issuance in 2025, according to Bloomberg.

The spree includes Al Rajhi Bank’s $1.25 billion deal in April, Banque Saudi Fransi’s $650 million perpetual at 6.375 percent in May, Saudi Awwal Bank’s $650 million inaugural issue, and Alinma Bank’s $500 million of sustainable sukuk, all heavily oversubscribed.

Saudi National Bank was ranked in the Forbes Middle East’s “30 Most Valuable Banks 2025” March list. Shutterstock

By tapping eager investors now, while margins remain healthy and global demand for Gulf paper is strong, lenders are bulking up capital buffers and keeping loan-to-deposit ratios in check. That leaves them better prepared to fund the fast-rising credit needs of projects like NEOM and Diriyah without tripping liquidity alarms later in the year.

Fintech role

Fintech is reshaping Saudi banking from the ground up. The Saudi Central Bank’s Open Banking Framework — most recently updated in September to cover payment-initiation services — sets common technical rules that let lenders and start-ups plug their systems together safely and at speed.

Speaking at the inaugural 24 Fintech conference in September, Finance Minister Mohammed Al-Jadaan revealed that the Kingdom had licensed 224 fintech firms by the second quarter of 2024, up from fewer than 100 just three years earlier.

One of the newest players is Riyadh-based Stitch, which closed a $10 million seed round on May 28. The company offers a single set of application-programming interfaces that lets banks, fintechs and even non-financial brands bolt on real-time payments and open-banking functions far faster than older systems.

Early adopters already include Lulu Exchange and point-of-sale platform Foodics. The founders say the fresh cash will go toward doubling the engineering team and expanding the product suite.

Saudi Arabia’s sustained momentum is attributed to a robust mix of state spending on giga-projects, resilient consumer demand, and still-elevated interest rates. File/AFP

Looking ahead

Riyad Capital’s first-quarter preview, released in April, expects another double-digit profit rise this year, about SR19 billion for the listed banks it tracks, as loan growth stays strong and rate cuts arrive slowly.

S&P Global, in its Saudi Arabia Banking Sector Outlook 2025 report, says a 10 percent increase in lending should outweigh a 20- to 30-basis-point dip in margins, keeping sector returns on assets near 2.1 percent to 2.2 percent.

Funding is the main watchpoint. Moody’s shifted its system outlook to stable on Feb. 25, saying strong credit growth is tightening liquidity, but capital buffers remain solid.

For now, asset-quality risks remain low. S&P expects non-performing loans to edge up to just 1.7 percent by the end of 2025, while loan-loss provisions are projected to stay around 50 to 60 basis points. Banks’ total capital ratios, hovering near 19 percent, provide a solid buffer to absorb potential shocks from falling oil prices or rising private-sector leverage.

Saudi lenders are still the region’s earnings workhorse. Profits are rising, market values are high, and fresh money — from bond buyers to venture capitalists — is flowing in. If they can keep gathering deposits quickly enough to fund a fast-growing loan book, the Kingdom’s banks look set to stay ahead of their Gulf neighbors in both profit and ambition well into next year.