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The Ministry of Investment issued 9,018 investment licenses in the second quarter of 2026, compared to 2,561 licenses in the same period of 2025, an increase of 252%. This is the highest quarterly number in the available data series, coming in a quarter where the macroeconomy witnessed a contraction due to the decline in oil.
The figures were stated in the “Economy and Investment Monitor – Q2 2026” report issued by the Ministry in August. In this article, we explain what this jump means, where it was concentrated, and how it should be read realistically.
Key Figures at a Glance
- Total licenses: 9,018 licenses in Q2 2026.
- Annual growth: 252% compared to 2,561 licenses in Q2 2025.
- Quarterly growth: About 18% above Q1 2026.
- Previous record: 8,379 licenses in Q4 2025.
- Sectoral concentration: Three sectors accounted for about 66% of the total.
Where Were the New Licenses Concentrated?
The construction sector led the growth, followed by wholesale and retail trade, then manufacturing industries.
| Sector | Licenses in Q2 2026 | Annual Growth |
|---|---|---|
| Construction | About 2,600 | +218% |
| Wholesale and Retail Trade | About 2,300 | +285% |
| Manufacturing Industries | More than 1,000 | +284% |
This distribution is logical in the context of the current Saudi economy. The construction sector benefits from ongoing work in mega-projects and infrastructure. Wholesale and retail trade are linked to domestic demand, population growth, and the expansion of the services sector. As for manufacturing industries, they are supported by the National Industrial Strategy, which aims to raise the number of factories to about 36,000 by 2035.
Why Did the Jump Come in a Difficult Quarter?
It might seem strange that licenses hit a record in a quarter when the GDP contracted by about 4.7%. The explanation lies in the nature of both matters.
The contraction was primarily oil-related, resulting from the disruption of exports through the Strait of Hormuz. In contrast, licensing decisions reflect medium- and long-term investment plans made by companies based on market size, regulatory reforms, and expectations for the coming years, not on a single quarter. Moreover, non-oil activities continued to grow in the second quarter, albeit at a slower pace.
There is also a regulatory factor. The Ministry of Investment significantly simplified licensing procedures, providing during the second quarter more than 26,000 services via the comprehensive service center, over 83,000 services via communication centers, and more than 70,000 electronic services. Simplifying procedures raises the number of registered licenses, even if the volume of investment does not change by the same degree.
How Do You Read This Number Realistically?
An investment license is permission to practice an activity, not an executed investment. A company that obtains a license may start its project within months, postpone it, or start at a smaller scale than planned.
Therefore, the real impact of this jump will appear later in other indicators, the most important of which are:
- Actual Foreign Direct Investment (FDI) inflows, not just the number of licenses.
- Gross Fixed Capital Formation, which measures actual spending on productive assets. This rose in the second quarter by 2.7% on an annual basis.
- New job opportunities in the sectors where licenses were concentrated.
- Non-oil exports, as an indicator of successful diversification.
Important methodological note: Q1 2026 figures appeared in media reports with two different values (7,627 and 7,742 licenses), and it seems the difference is related to the method of calculating licenses issued as part of the corrective campaign for violators of the Anti-Concealment Law. When comparing quarters, it is best to refer to the Ministry’s report itself and check the footnotes.
The Jump in the Context of Vision 2030 Targets
These figures fall within the National Investment Strategy, which targets:
- Tripling investment levels between 2019 and 2030.
- Raising FDI by more than 20 times to reach 388 billion Riyals annually by 2030.
- Increasing the investment contribution to GDP from 22% in 2019 to 30% by 2030.
The road to these targets is still long, especially the FDI goal. However, the acceleration in licenses gives a positive indication of domestic and foreign investors’ interest in the market, an interest that intersects with the economic diversification path.
What Does This Mean for the Stock Market Investor?
The growth of licenses in construction, retail, and industry implies growing demand for the services and products of listed sectors in the market, such as building materials, logistics, and financing. But directly linking the number of licenses to the performance of a specific stock is not accurate. It is better for an investor to view these numbers as an indicator of a general trend in the economy, and then study the results of each company individually.
Next appointment: Q3 2026 data is expected around November, and will clarify whether this jump is a sustainable shift or a one-quarter spike.
This article is for informational purposes only and is not considered investment advice.
