Saudi Arabia‘s market regulator announced on Monday, January 27, 2025, that it will allow foreign investment in listed companies that own real estate within the boundaries of Mecca and Medina.
Mecca and Medina are the two holiest sites in Islam and have always been a symbol of spirituality and faith.
Saudi Arabia’s Capital Market Authority, in a statement, said that the decision “aims to stimulate investment, enhance the attractiveness and efficiency of the capital market, and strengthen its regional and international competitiveness while supporting the local economy.”
The decision allows foreigners to purchase shares, convertible debt instruments, or both in Saudi-listed companies, with a limit of 49% ownership, the authority added.
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Saudi Arabia is the Middle East’s largest economy and the world’s biggest exporter of crude oil. Over the years, the kingdom has initiated several reform agendas aimed at diversifying the economy with tourism and investment.
Saudi Arabia has set a target to welcome 30 million pilgrims for Haj and the year-round pilgrimage of Umrah annually by 2030. In 2019, it earned about $12 billion from the two pilgrimages, according to official data.
The annual pilgrimage plays a vital role in the country’s economy, and increasing the number of pilgrims is an integral part of its Vision 2030 economic reform agenda that aims to reduce the economy’s dependence on oil revenues.
The king’s decision to open up Mecca and Medina to foreign investors is a move that could have far-reaching implications for Saudi Arabia’s economy. We’ll continue to monitor this story and provide updates as more information becomes available.
