INTERVIEW: Saudi Arabia is open for business despite the pandemic 

Illustration by Luis Grañena
Short Url
Updated 04 May 2020

INTERVIEW: Saudi Arabia is open for business despite the pandemic 

  • Deputy for Investor Services at Saudi Arabia’s Ministry of Investment says that Saudi Aramco IPO was ‘tip of the iceberg’ for opportunities
  • The Kingdom has embarked on a huge shake-up of its investment infrastructure

DUBAI: Attracting foreign investment into Saudi Arabia is one of the key components of the Vision 2030 strategy to move away from oil dependency and encourage the non-oil economy. But it has been a challenging task for a variety of reasons.

It is the job of Ibrahim Al-Suwail — Deputy for Investor Services at Saudi Arabia’s Ministry of Investment — to help change that reality in a world made even more uncertain by the coronavirus pandemic and all that means for global capital flows.

“The government sees the importance of foreign direct investment (FDI) as one of the main pillars of the strategy,” Al-Suwail told Arab News. “The coronavirus comes at a very challenging time for Saudi Arabia, but we have mobilized quickly to ‘future-proof’ the economy.”

In such a fast-changing global financial and economic scene it is difficult to see how any single economy can be entirely “future-proofed,” but that is a challenge policy makers across the world face not just in Saudi Arabia.

In some ways the Kingdom’s capacity to attract foreign investment had been enabled for the pandemic challenge, as far as anybody could be prepared for an event that could lead to the biggest global economic downturn in nearly a century.

In February, before the true implications of the pandemic had really hit home, the Kingdom embarked on a shake-up of its investment infrastructure. The role of the Saudi Arabian General Investment Authority (SAGIA) — the government agency in charge of attracting FDI — was enhanced with the creation of a new ministry-level body, the Ministry of Investment of Saudi Arabia, or MISA.

The government picked one of its best-known and internationally respected policymakers — Khalid Al-Falih, the former minister of energy and chairman of Saudi Aramco — to lead the body. Commentators at the time said that the appointment of such a heavy-hitter, well known in the global investment community, was a sign that attracting FDI had been prioritized on the government’s strategic agenda.



  • MBA from INSEEC Business School, Paris
  • MBA from Al-Yamamah University, Riyadh 


  • Joannou & Paraskevaides, Executive
  • Silki LA Silki National Telecommunication Co, Development and Logistics Executive
  • Saudi Telecom, Executive
  • Saudi Arabian General Investment Authority, Deputy Governor
  • Deputy for Investor Services at Saudi Arabia’s Ministry of Investment

“FDI is one of the main pillars towards achieving the Vision 2030 goal. Saudi Arabia has a lot of potential for direct investment in many sectors, like tourism, the giga-projects like the Red Sea Development, mining and minerals. The Kingdom can be a logistics hub connecting three continents — Asia, Africa and Europe, which is not so far away,” Al-Suwail said.
“It was a good sign, to build on the work of SAGIA in the past in terms of attracting the attention of the international investor community. We are responsible for governing and safeguarding the Kingdom’s entire investment ecosystem,” he said.

The extent of the challenge is shown by official figures from the UN’s Conference on Trade and Development. Just before the global financial crisis hit in 2008, Saudi Arabia was attracting FDI of around $40 billion per year, but since then it has struggled to get back to those levels. Last year it reached around $4.6 billion, which was an improvement on the previous two years.

SAGIA used a different metric to assess FDI, which showed some promising results. In 2019, there was a 54 percent increase in the number of foreign companies setting up in the Kingdom, with 1,131 international firms choosing Saudi Arabia as a place to do business, compared with 736 the previous year. It was a record year.

The figures for the first quarter of 2020 are being prepared. Al-Suwail said they will show a “solid uptick” over the final quarter of 2019, despite the fact that the serious economic effects of the pandemic kicked in during March.

The onset of the virus prompted a shift of gear at the new ministry. Its program of outward-reaching conferences, seminars and presentations, scheduled for the rest of the year in some of the world’s great financial centers, moved online with the creation of the MISA COVID-19 Response Center (MCRC) a few days after the sickness was declared a global pandemic by the World Health Organization.

“Many countries around the world, because of the global health crisis, are looking inward, but we want to continue to look outward to the rest of the world, as far as we can,” Al-Suwail said.

The MCRC has, in cooperation with other government agencies, acted as a central hub for information on the business effects of the crisis, telling investors of the initiatives and services available during the emergency, giving notice of curfew regulations and exemptions for essential businesses, and providing round the clock support for businesses.

It has also organized a series of international webinars for current and potential investors in order to keep the FDI momentum going during the pandemic. The most recent took place last week with participation from US companies and institutions.

The webinar series will continue over the next few months, and will be both geography and sector-specific. “We are in touch with investors to seek their current needs, and to let them know of the various stimulus packages the government is offering during the pandemic,” he said.

So which sectors are potential foreign investors in Saudi Arabia looking at most enthusiastically? “There is no one single sector. Our message is that Saudi Arabia is open for business, and that we have increased the number of investment opportunities,” Al-Suwail said.

“It is no longer just about oil. There has been big diversification since 2017, and the country is full of other resources and opportunities.”

The mega projects launched as part of the Vision 2030 reform plan are obvious targets for FDI and, before the pandemic crisis, authorities were involved in talks with potential investors in construction, infrastructure, utilities, hospitality and other areas the big projects will need.

Al-Suwail highlighted new opportunities in the Saudi healthcare sector, where a recent change of laws has allowed full ownership by non-Saudi companies. He also sees big opportunities in information technology, tourism and leisure, with the new tourist visa facilitating visits to the Kingdom at an unprecedented level.

Traditionally, trade and investment from the US has been the dominant feature of the Saudi economic scene, but that is changing with the rise of the fast growing economies in Asia. Al-Suwail said the forthcoming figures for the first quarter of 2020 would show big investment from China and India, as well as other partners in more traditional places like the UK and Europe.

One core aspect of the FDI initiative was the privatization program of initial public offerings (IPOs) and trade sales that Saudi policymakers have promoted to attract foreign investors, but this has been slow to get off the ground. The biggest IPO in history, the listing of shares in Saudi Aramco at the end of last year, turned into an event largely focused at Saudi and other Gulf Cooperation Council investors, rather than the rest of the world.

“Privatisation is at the heart of Vision 2030, and we have made remarkable progress. There will be more IPOs, I am sure. We will see that Aramco was just the tip of the iceberg,” Al-Suwail said.

When the new ministry was launched, some commentators were confused as to the relationship between it and the Public Investment Fund, the Kingdom’s big sovereign wealth fund. Since the fall in global asset values brought on by the economic slowdown as a result of the pandemic, the PIF has been actively seeking what it regards as under-valued opportunities in the global cruise industry, leisure and entertainment, and in Western oil companies.

MISA’s focus is on investment into the Kingdom, rather than outward, and, as Al-Suwail explained, it is not itself an investor. “MISA is a facilitator for investment, rather than an investor itself. We manage inward investment end-to-end in the Kingdom. But of course we talk to PIF all the time and work closely with them,” he said.
The overarching aim of the Vision 2030 strategy is to increase the role and importance of the private sector in the Kingdom’s economy, and that chimes well with Al-Suwail’s approach. “I come from the private sector, and the idea there was to achieve the targets set by the company. Now my target is also the country’s target,” he said.

INTERVIEW: Real estate exec Fabrice Susini confident Saudi Arabia’s coronavirus-hit mortgage demand will return

Updated 49 min 7 sec ago

INTERVIEW: Real estate exec Fabrice Susini confident Saudi Arabia’s coronavirus-hit mortgage demand will return

  • "There seems little prospect of a cascade of mortgage defaults as long as the current policy of government support continues," Saudi Real Estate Refinance Company CEO Fabrice Susini tells Arab News

What a difference a pandemic makes. At the turn of 2020, Fabrice Susini, CEO of Saudi Real Estate Refinance Company (SRC), could look back on two years of significant progress toward the provision of affordable home ownership for the Kingdom’s aspirational young population.

Increased property ownership was one of the main aims of the plan to diversify the Saudi economy away from oil dependency, setting a target of 70 percent home ownership by 2030.

It was all going to plan. New mortgage issuance had been “staggering,” Susini said, and SRC had reached its target of facilitating 60 percent home ownership with months to spare.

“It was a very positive story,” he said, allowing him to work on the next phase of Saudi Arabia’s move toward being a home-owning economy — buying more mortgage portfolios from banks and other mortgage originators, injecting more liquidity into the housing market via domestic and international sukuk issuance, and offering new long-term fixed-rate mortgages to potential and actual home owners.

The economic lockdown that took increasing effect from March has changed the figures on which those plans were based. New mortgage applications, which has been running between SR20 million ($5.3 million) to SR50 million per week, dropped into single-digit millions as potential buyers were forced to stay at home rather than go viewing properties and took stock of their spending plans in light of the economic downturn that followed the pandemic outbreak.

“We expect to report a sharp drop for April and May. I would be surprised if the numbers remain the same,” Susini said. “But the fundamentals remain the same. It is still an underserved market, compared with the demands and needs of the young, dynamic population aspiring to home ownership. The process may be slowed by a couple of months, but the demographic is still there. There will be a slowdown but I’m sure a catch-up is coming and the forward movement will resume.”

One reason for his optimism is the action taken by the financial authorities to support the economy in its hour of need, especially the stimulus packages unveiled by the Saudi Arabian Monetary Authority (SAMA) and the Finance Ministry.

“There has been a lot of support coming through for small to medium businesses and private companies, and that will balance and smooth out the process. I don’t see a big hit coming,” he said.

Effective monitoring and control of SAMA liquidity injections would ensure they reached the SME and private sector organizations they are mainly intended to help, he added.

“I’d be very surprised if any significant proportion was not properly channeled to the private sector and SMEs,” he said.


BORN: Rome, 1964


  • Law degree, Paris X Nanterre University, France
  • Banking and finance degree, Sciences Po, Paris
  • Master’s degree, finance, Dauphine University, Paris
  • MBA, London Business School


  • Relationship manager, Societe Generale
  • Analyst, Bayerische Landesbank
  • Global head of securitization, BNP
  • CEO, Saudi Real Estate Refinance Company

The mortgage industry in Saudi Arabia enjoys significant subsidies from the government for its products, and while some of these have been changed in recent week, reducing subsidies to mortgages for military and some civilian personnel, he does not see this as the beginning of a trend to remove subsidies for mortgages in the broader scope of SRC’s business.

“There is no danger to mortgage subsidies that I am aware of. The budget has been carried out, the resources are there. But of course we want to make sure that every riyal of subsidy is used to its most effective extent,” Susini said.

“When we saw the situation was becoming more challenging, the SAMA package was a great help by injecting liquidity into the financial system, but we also wanted to be more proactive ourselves in the relationship we have with our borrowers and our partners. We didn’t just want to wait until people were actually in difficulties before we acted,” he added.

The result was the “forbearance” plan for borrowers, by which SRC asked its mortgage partners to offer a three-month mortgage holiday to those who felt the need, and many took up the offer. “A big majority has gone for it. We see ourselves as a ‘citizen’ company and we do not just want to rely on the authorities. We asked ourselves what we can do in terms of citizenship and public policy initiatives,” Susini said.

There seems little prospect of a cascade of mortgage defaults as long as the current policy of government support continues, and SRC and mortgage originators persist with the policy of showing patience and understanding in difficult economic circumstances.

Nonetheless, prospective home owners are facing big challenges. Not only has the lockdown made the market mechanics of home-buying more difficult, with viewings almost impossible in the light of curfews and travel restrictions, but there is also the question of whether people will hesitate over such a life-changing decision. Will they want to buy a house or apartment while the pandemic continues to rage?

Susini thinks customers will learn to prioritize their financial decisions more carefully. “You might defer the purchase of a new car, but still want to buy a home. You would direct your choice toward those things you regard as more important. Home ownership is probably regarded as more essential,” he said.

The appetite of Saudi citizens for house purchase in the new circumstances will be better judged when SAMA and other financial bodies publish official figures in the near future, he said.

With regard to the overall health of the real estate market, Susini said that he has not seen a significant fall in property prices, but underlines the fact that SRC caters mainly for the affordable segment of the market, where big falls in value are less likely. He noted that apartments have been holding their value “quite well” in comparison with bigger units like townhouses and villas.

In an era when global interest rates are falling toward zero in many parts of the world, there could be an incentive for customers to go for the long-term fixed-rate deals SRC is offering.

“We’re seeing the need for more awareness of the benefits of fixed rates. Borrowers can grasp the benefit of remortgaging at rates that are significantly lower now than they were before. It is a choice for the borrower really. They can either own their home more quickly than before, or maintain their payments on more sensible terms. It can be beneficial for them whether rates are subsidized or not,” he said.

SRC reduced its lending rates for long-term fixed mortgages last month, is first cut this year following two rate reductions in 2019. Borrowers could now take advantage of a 5 percent rate on a 25-year mortgage, Susini said.

SRC is also working hard on the digital space, with online facilitators becoming more crucial to home purchase. The company is in the early stages of a study on fintech and digital mortgage origination, and some initiative could be forthcoming by the summer, he said.

“If you can talk of a silver lining from the current situation, it is that it is accelerating the digitization of financial processes. The payment processes are already quite well developed, but the sale of processes presents more of a challenge. The health ministry has organized some innovative processes around the digital market place, and the justice ministry has done good work on the digital origination of contracts.”

The strategy of including mortgage originators in the SRC set-up will continue, and Susini is holding talks with financial and corporate firms to bring more products under its portfolio. 

SRC is owned by the Public Investment Fund, the Kingdom’s $325 billion sovereign wealth fund, so it has access to finance at the highest level. But under Susini’s stewardship there has also been a willingness to raise money in local markets via domestic sukuk issues. Two have already been launched, and a third is lined up to take place in the summer.

After that, the company will be work on an international bond offering toward the end of the year, though he declined to say how much would be raised.

“We want to ensure we can continue to finance mortgages, to have sufficient tools and channels so that no bank or finance company is stopped from offering mortgages because of issues to do with capital ratios of liquidity,” Susini said.

He viewed recent downgrades by ratings agencies of banks’ creditworthiness or prospects as a “gray cloud” over liquidity.

“We want to be ready so that primary originators of mortgages have all the tools necessary to keep operating regardless of the problems they might face,” he added.