After years of estrangement caused primarily by political reasons, Saudi Arabia is returning to Iraq and looking to invest in its neighbor. This will likely have significant positive impacts on both countries’ economies at a time when Baghdad and Riyadh alike are hoping to diversify away from oil. But the Kingdom will have to first navigate Iraqi opposition to its investments. 

Crown Prince Mohammed bin Salman Al Saud (MbS) announced in October that Iraq was one of five countries for which the Saudi Public Investment Fund had established regional companies to ease the investing process, adding to one previously established in Egypt. Planned Saudi investments in the projects are expected to amount to 90B SAR (24B USD) and will target multiple strategic sectors—including infrastructure, real estate, healthcare, financial services, manufacturing, and technology. 

Such efforts in a range of sectors are needed in both Iraq and Saudi Arabia, as Baghdad and Riyadh currently rely heavily on oil for their export revenues and overall economic health. 

Saudi Arabia is considered to be the leader of OPEC+, a group of leading oil-producing countries. The latest statistics show that...