Saudi Arabia and Bahrain lead FDI inflow in Gulf region

Saudi Arabia and Bahrain headed the list of foreign direct investment (FDI) in the Gulf region with FDI inflows of US$3.2 billion and US$1.5 billion respectively, according to the World Investment Report (WIR) for 2019 compiled by the United Nations Conference on Trade and Development (UNCTAD).

FDI across the world dropped by 13% during 2018 to US$1.3 trillion. UNCTAD said this represents the lowest level since the global financial crisis and underlines the lack of growth in international investment this decade. However flows to developing countries remained stable, rising by 2%, while their share of global FDI increased to 54%, a record.

FDI flows to Saudi Arabia rose from $1.4 billion in 2017 to $3.2 billion in 2018. Recent efforts aimed at economic diversification in the Kingdom have identified FDI as a key priority, however. Some new projects outside the oil and gas sector have been generated. In 2018, Aubin Group (UK) invested $743 million to establish a chemical manufacturing facility in Saudi Arabia. DuPont (US) opened a reverse osmosis water treatment facility, its first outside the US, and Alphabet (US) started building multiple data centres in the country.

Inflows to Bahrain rose by 6% to $1.5 billion, mainly due to growing interest in manufacturing activities. In 2018, Mondelez International (US) and Ariston Thermo Group (Italy) set up manufacturing facilities in the Bahrain International Investment Park, a special economic zone.

The two countries are closely tied – quite literally by a 25-kilometre causeway. Non-oil trade between the two countries has developed as Bahrain’s exports to Saudi Arabia ranked top with 24% of total non-oil exports. Construction on a second causeway is also due to begin in 2021.

FDI is crucial in the economic development and prosperity of countries and the Middle East region is becoming even more attractive to international companies looking for growth outside of their local markets.

Sovereign Corporate Services has strategic offices in Bahrain and we will shortly launch in the Kingdom of Saudi Arabia. From a Saudi perspective, we currently have the ability to provide a full range of in-country consulting, commercial and corporate support and manpower supply services.

For further information or a ‘no obligation’ discussion on our Saudi Arabia offering, please contact Sovereign Corporate Services in Dubai on +971 4 270 3400 or by email to, or Sovereign Trust Consultancy in Bahrain on +973 17 1515 71 or by email to

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