Major tourist groups plan to invest more than $100 billion before 2017 in the establishment and development of commercial centres in Saudi Arabia, reports CNBC.
The retail sector, in general, is expected to grow by at least nine per cent per year. However, this growth is threatened by many obstacles that hinder investment in this sector, according to Mohammad Alawi, CEO of the Red Sea Markets Company and head of commercial centres in the Jeddah Chamber of Commerce.
The Kingdom was able to achieve high grades in retail sector global indicators, encouraging growth in commercial centres in general.
The $100bn investment over the next three years is considered too meagre, given that the Kingdom is listed in the top ten destinations for foreign direct investment in the world.
This is attributed to the difficulties that present themselves during the establishment of new commercial centres, including high land prices, coupled with licensing regulations that have delayed the provision of additional business units.
The retail sector in Saudi Arabia, excluding the food industry, recorded more than $23bn last year, according to official reports.
Alpen Capital’s report states that the Saudi retail sector is the biggest retail market in the GCC region.
Saudi Arabia’s retail sales growth in 2013 is estimated at 5.7 per cent to $92.6bn, compared with $87.6bn in 2012.