Four new special economic zones to be established in Saudi Arabia

On Thursday, Crown Prince Mohammed bin Salman announced the establishment of four special economic zones in Saudi Arabia. The aim of these zones, located in Riyadh, Jazan, Ras Al-Khair, and King Abdullah Economic City, is to create new opportunities for international investors, according to the Saudi Press Agency. The crown prince emphasized that the country is “open for business” and welcomes investors from around the world to take advantage of the historic opportunities that the zones have to offer.

The zones will take advantage of the Kingdom’s strategic location to create new hubs for businesses across key growth sectors, such as logistics, advanced manufacturing, technology, and other priority sectors in the Kingdom. They will also support existing national strategies and create new links with international frameworks, building on the competitive advantages of each region of the country.

Companies operating in the zones will benefit from competitive corporate tax rates, exemption from customs duties on imports, production inputs, machinery, and raw materials, 100 percent foreign ownership of companies, and flexibility to attract and hire the best talent worldwide. Officials also said that the zones will provide tremendous opportunities for developing the local economy, generating jobs, and localizing supply chains.

The zones represent a continuation of long-running initiatives aimed at transforming the Kingdom into a global investment destination and a vital hub for global supply chains. Thanks to a detailed program of regulations and incentives, the zones will offer rewarding and attractive benefits to foreign investors, according to officials. They also said that the program will allow for the acceleration of reforms required to facilitate business in all parts of the Kingdom.

The new zones build on previous free-zone initiatives in the Kingdom, including the recent launch of an integrated special zone for logistics at King Salman International Airport in Riyadh. Together, they represent the first phase of a major, long-term program designed to encourage foreign direct investment, attract the most talented professionals from around the world, and promote entrepreneurship and economic development within the Kingdom.

The zones will be regulated by the Economic Cities and Special Zones Authority and will provide fresh solutions to the challenges many global businesses face as they attempt to localize and strengthen supply chains. They will help the Kingdom take advantage of key macroeconomic shifts to create a truly differentiated business environment, activating new sectors and value chains.

Special economic zones are geographically defined areas that facilitate specific economic activities, such as investment, trade, and employment, by providing competitive advantages and legislative frameworks that differ from the base economy. The zones launched today cover a wide range of industries, including advanced manufacturing and logistics, trade with fast-growing markets in Africa and Asia, the maritime industry, and emerging and disruptive technologies.

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