Data released by the Saudi Central Bank (SCB) has revealed that a significant increase in import letters of credit (L/C) helped boost Saudi Arabia's car imports in 2023 by a massive 40 per cent.

The kingdom has imported a total of over 160,000 cars in the last two years, with 66,870 imports recorded in 2022 alone. This makes Saudi Arabia one of the world's largest automobile markets, accounting for more than half of all car sales in the Gulf Cooperation Council countries, and ranking the country amongst the top 20 markets globally.

Surge in L/Cs

The rise in motor vehicle imports has resulted in Saudi banks seeing a nearly 8 per cent surge in L/Cs to the private sector during the first 11 months of 2023, compared with the corresponding period of the previous year.

Data released by the SCB indicates that settled L/Cs and received bills in this sector amounted to 155.19 billion Saudi riyal (SR155.19 billion - US$41.38 billion).

Significant increase

This growth is primarily driven by increased motor vehicle imports, which constitute approximately 75 per cent of the overall rise.

Import values in this category reached SR39.7 billion, reflecting a more than 26 per cent increase, according to the data.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.