https://arab.news/rtaye
RIYADH: Saudi Arabia’s construction sector saw significant growth in 2024, with 3,800 new licenses added in just one year, bringing the total to 8,900, according to a top official.
During a panel discussion at the Public Investment Fund Private Sector Forum in Riyadh, Fahad Al-Hashem, assistant deputy minister at the Ministry of Investment, stated that the surge reflects increasing foreign investment and regulatory reforms aimed at streamlining market entry.
“In the number of licenses, we had 8,900 construction companies licensed in the Kingdom, last year alone we had 3,800 companies licensed in the Kingdom,” Al-Hashem stated.
The deputy minister highlighted the broader impact of these reforms, noting that real estate developers also saw a rise in licenses — addiing 244 in 2024 to the 446 already issued.
“This is just to showcase the uptake from foreign investors into the market, and we hope to see an increase with these upcoming reforms,” he said.
Al-Hashem emphasized the Kingdom’s efforts to enhance its regulatory framework, with 800 improvements identified since the launch of Vision 2030, 80 percent of which have already been implemented.
One major shift was the replacement of the licensing regime with a registration system to simplify market entry.
“We are working continuously with our colleagues across the government to really reduce the timeframe from being really interested to entering the market to being fully operational,” he added.
Addressing cost challenges in the sector, Al-Hashem pointed to initiatives such as the establishment of an international contractor office within the ministry.
“We collaborate with stakeholders to streamline such service-wide journey into the market, to ensure ample supply comes into the market, in order to also add competition and ensure that project owners and investors have good returns with their capital,” he said.
He underscored the government’s commitment to fostering a dynamic and competitive market, stating: “I can go on and on and on about many examples that we’re seeking to liberate, add supply into the market, and constantly develop value chains to ensure that the Kingdom, as it has high ambitions, has the most conducive, the most dynamic, and most competitive market out there.”
Saud Al-Sulaimani, country head of Saudi Arabia at JLL, highlighted the dual nature of the Kingdom’s construction boom.
“What makes the Saudi market interesting is that there are two things happening at the same time: the redevelopment of projects as well as the development of new cities and projects,” he said.