Saudi Arabia’s Vision 2030 driving private equity growth in the GCC

RIYADH: Saudi Arabia has emerged as a transformative force in the private equity landscape within the Gulf Cooperation Council, driven by strategic initiatives, regulatory reforms and the nation’s commitment to Vision 2030.

The Kingdom’s ambitious plans are reshaping the region’s investment ecosystem, setting new benchmarks for growth, diversification and global engagement.

Private equity investments in Saudi Arabia have witnessed unprecedented growth over the past five years.

The total value of PE transactions surged from $523 million in 2019 to an all-time high of $4 billion in 2023 — seeing a compound annual growth rate of 66 percent during this period, according to a report by MAGNiTT and Saudi Venture Capital Co.

This surge highlighted the Kingdom’s success in creating a favorable environment for local and international investors.

Speaking to Arab News, Arjun Singh, partner and global head of fintech at Arthur D. Little, emphasized Saudi Arabia’s economic resilience amid global challenges: “While the world has grappled with rising prices due to inflation, Saudi Arabia has been able to maintain a relatively low inflation rate — 2.1 percent in 2024 and projected 2.3 percent in 2025 — which makes for a stable investment environment.” 

Head of Janus Henderson Investors for Middle East, Africa and Central Asia, Meshal Al-Faras, expanded on this resilience, attributing it to strong domestic liquidity anchored by the Public Investment Fund and family offices, as well as a low debt-to-GDP ratio that ensures continued counter-cyclical investment even during global economic downturns.

He also highlighted Vision 2030’s success in “reducing dependence on oil and fostering resilience to inflationary pressures.”

Key to this growth is the increasing dominance of buyout transactions, which have consistently accounted for about 80 percent of the total PE capital deployed in Saudi Arabia. 

Growth equity investments have also gained traction, reflecting the Kingdom’s strategy to support mid-sized companies poised for expansion.