Top Cities for Business Setup in Saudi Arabia in 2025

Saudi Arabia has become a business powerhouse. With 100% foreign ownership, reduced bureaucracy, and improved infrastructure, Saudi Arabia is more business-friendly than ever. However, choosing the right city for your business is crucial for long-term success.

Each city in the KSA offers distinct advantages, depending on your chosen business activity, market reach, and operational needs. In this post, we will look at the top cities that are fitter for a profitable business setup in Saudi Arabia in 2025. We will highlight the strengths, key industries, and the benefits each city has to offer. Let’s begin. 

Top Cities for Business Setup in Saudi Arabia  

1. Riyadh 

Riyadh, the capital of Saudi Arabia, is the economic powerhouse of the country. It is home to the government headquarters, major corporations, and financial institutions. With significant investments in infrastructure and technology parks, Riyadh is a prime destination for businesses looking for a stable and growth-driven environment. 

Key Business Sectors in Riyadh: 

• Finance & Banking: Riyadh hosts the Saudi Central Bank (SAMA) and the Saudi Stock Exchange (Tadawul), making it the financial hub of the Kingdom. 

• Technology: The city is investing heavily in AI, cloud computing, and fintech startups through initiatives like Riyadh Tech Valley and Misk Innovation. 

• Real Estate & Construction: As part of Vision 2030, major urban projects like King Salman Park, Diriyah Gate, and the Riyadh Metro are transforming the city. 

Business Setup Benefits: 

- Presence of major multinational corporations and government support
- Well-developed banking and financial ecosystem
- Access to skilled professionals and talent pool
- Advanced digital and smart city infrastructure 

2. Jeddah  

Jeddah is Saudi Arabia’s gateway to global trade, thanks to its strategic location on the Red Sea and its massive seaport, Jeddah Islamic Port—one of the busiest in the Middle East. The city is also a vibrant commercial center with a dynamic business culture, making it ideal for trade, tourism, and logistics. 

Key Business Sectors in Jeddah: 

• Trade & Logistics: With the Jeddah Islamic Port handling around 65% of Saudi Arabia’s imports, Jeddah is an ideal base for import/export businesses and logistics companies. 

• Tourism & Hospitality: As the entry point for millions of pilgrims visiting Mecca and Medina, Jeddah has a booming hospitality and tourism industry. 

• Manufacturing: The nearby King Abdullah Economic City (KAEC) offers special incentives for industries, making Jeddah attractive for manufacturing. 

Business Setup Benefits: 

- Strong infrastructure for trade, logistics, and port-based businesses
- Access to international markets via shipping and air transport
- Thriving tourism sector with continuous government investments
- Emerging startup and e-commerce ecosystem 

3. Dammam 

Located in Saudi Arabia’s Eastern Province, Dammam is the heart of the Kingdom’s oil and gas industry. It is home to Saudi Aramco, the world’s largest oil company, and several industrial zones catering to manufacturing, petrochemicals, and heavy industries. 

Key Business Sectors in Dammam: 

• Oil & Gas: As the headquarters of Saudi Aramco, Dammam is the best city for energy-related businesses, including petroleum services, drilling, and engineering. 

• Manufacturing & Petrochemicals: Industrial zones like MODON’s Dammam Industrial City and Jubail Industrial City support businesses in chemicals, plastics, and metal industries. 

• Logistics & Transportation: Proximity to King Abdulaziz Port makes Dammam a key hub for freight, transport, and supply chain companies. 

Business Setup Benefits: 

- Access to major industrial and petrochemical zones
- Well-developed port and logistics infrastructure
- Strong demand for construction and engineering services
- High government spending on energy and industrial projects 

4. NEOM  

NEOM is Saudi Arabia’s most ambitious megaproject, designed to be a smart, sustainable, and high-tech city covering 26,500 square kilometers. Positioned as a hub for futuristic industries, NEOM is attracting global investors in technology, green energy, biotech, and artificial intelligence. 

Key Business Sectors in NEOM: 

• Artificial Intelligence: NEOM aims to be an AI-driven city with automation, smart factories, and next-generation technology. 

• Renewable Energy & Sustainability: With projects like The Line and Oxagon, NEOM is pioneering clean energy, green hydrogen, and sustainable urban development. 

• Tourism & Entertainment: The city is designed to be a futuristic tourist destination, offering luxury resorts, adventure tourism, and world-class attractions. 

Business Setup Benefits: 

- Government-backed incentives and tax benefits for investors
- Cutting-edge infrastructure with smart city technologies
- Access to global investors and talent in future-focused industries
- Environmentally sustainable business ecosystem 

5. Medina  

Medina is one of the holiest cities in Islam, attracting millions of visitors every year. Beyond its religious significance, the city is also emerging as a center for finance, education, and technology-driven tourism. 

Key Business Sectors in Medina: 

• Religious Tourism & Hospitality: With increasing government investment in tourism infrastructure, Medina offers excellent opportunities in hotels, restaurants, and pilgrimage services. 

• Education & Research: Home to Islamic University of Medina and several research centers, the city is growing as an education and research hub. 

• Healthcare & Wellness: The city is witnessing growth in medical tourism, hospitals, and wellness centers catering to international visitors. 

Business Setup Benefits: 

- Strong government focus on religious tourism and hospitality
- Growing fintech and Islamic finance ecosystem
- Expanding healthcare and wellness sector
- Opportunities in education and research industries

Where Should You Set Up Your Business in Saudi Arabia? 

The best city for your business depends on your industry, target market, and growth plans. Here are a few things to consider before finalizing your pick. 

• Choose Riyadh if you want access to finance, tech, and government-backed industries. 

• Choose Jeddah for trade, logistics, and tourism-related businesses. 

• Choose Dammam if you’re in oil, gas, or heavy industries. 

• Choose NEOM if you want to be part of a futuristic, high-tech, and sustainable city. 

• Choose Medina for religious tourism, education, and healthcare. 

Saudi Arabia is one of the best places to invest in 2025. If you're ready to expand, choosing the right city is the first step toward success.