Saudi Arabia’s market regulator said on Monday it would allow foreign investment in listed companies that own real estate within Islam’s two holiest sites of Mecca and Medina, as the Kingdom looks to attract more investment.
Saudi Arabia’s market watchdog, the Capital Market Authority (CMA), said in a statement the move aimed to attract foreign capital and provide liquidity for present and future projects in the two cities.
Saudi Arabia has said it aims to welcome 30 million pilgrimsfor Hajj and the year-round pilgrimage 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 upping the number of pilgrims is an integral part of its Vision 2030 economic reform agenda that aims to wean the economy off oil revenues.
Saudi Arabia’s benchmark index was up 0.2 percent, led by 10 percent increases in both Jabal Omar Development Company and Makkah Construction and Development Company, which have real estate in Mecca.
The CMA said that under Monday’s move foreign investment would be limited to shares, convertible debt instruments, or both, and would exclude “strategic foreign investors.”
The watchdog added that people without Saudi nationality would not be allowed to own more than 49 percent of shares of the firms involved.
In 2021, it allowed non-Saudis to subscribe to real estate funds investing within the boundaries of Mecca and Medina.
