The Saudi Ministry of Industry and Mineral Resources (MIMR) issued in August 2022 its Monthly Bulletin for Industry and Mining covering the first half of 2022, highlighting the latest development in the industrial sector. The bulletin states that 501 industrial licenses have been issued since the beginning of 2022, mainly focused on the manufacturing of steel, food, polymers and chemicals. Saudi Arabia has been accelerating its economic diversification efforts since the dual shock of COVID-19 and low oil prices in 2020.

Although the number of new licenses has declined slightly from the 529 registered in the first half of 2021, the number of factories that commenced operations more than doubled, from 303 to 721, during the same period. Additionally, investments into existing factories or manufacturing plants in Saudi Arabia (10,675 factories) has increased by 42% YOY in H1 2022, reaching around SAR 20 billion ($5.3 billion).

The MIMR became one of the main entities involved in diversifying Saudi Arabia’s economy away from the oil sector after its separation from the Ministry of Energy in 2019. Since its establishment, the MIMR has been working on legislation and regulatory changes to improve the investment environment in the industrial sector. One of its accomplishments was a new mining investment law that came into effect in January 2021 to facilitate investors' access to financing, support exploration activities and enhance transparency. Additionally, in line with Vision 2030, the Saudi Industrial Development Fund and the Saudi Export-Import Bank have been offering financing products at competitive prices to enhance the sector’s infrastructure and expand industrial cities.

One of the motivations behind the expansion of the industrial sector is the government’s ambition to increase the visibility of the “Saudi Made” brand, Ahmed Al-Naggar, former adviser to Egypt’s finance minister and current head of a consulting firm in Riyadh, told Al-Monitor. He added that such efforts under the Local Content Partnerships initiative, by the Local Content and Government Procurement Authority and the National Industrial Development and Logistics Program are all focused on motivating Saudi and foreign manufacturers to increase their investments in the industrial sector to promote the Saudi brand. The LCPGA, for instance, provides preferential pricing for manufacturers with high localization rates, such that products with high local content are granted a price preference over products with low or zero local content in government tenders.