RIYADH: The number of government tenders launched in Saudi Arabia that were subject to local content mechanisms reached around 8,600, with a total value of SR63 billion ($16.8 billion) in the second quarter of this year, according to official government data. 

The data, obtained by Al-Eqtisadiah, showed that the Local Content and Government Procurement Authority signed five agreements during the same period under the industrial localization and knowledge transfer contracting mechanism, with a combined value exceeding SR1 billion. 

The authority also signed three agreements under the Economic Participation Program, valued at SR350 million. 

During the second quarter, the authority expanded the mandatory list of national products, adding 79 new products and bringing the total number of products on the list to 1,752. 

$80bn under local content 

Abdulrahman Al-Samari, CEO of the Local Content and Government Procurement Authority, previously told Al-Eqtisadiah that “the number of government tenders launched last year exceeded 82,000, with a total value estimated at around SR324 billion.” 

The value of tenders subject to local content policies and mechanisms reached around SR300 billion, highlighting the expanding use of tools aimed at directing government purchasing power toward national products and services. 

In terms of actual project implementation, Al-Samari said the number of government tenders awarded last year exceeded 63,000, with a total value of more than SR178 billion. 

He emphasized that the figures reflect the scale of projects actually awarded and their role in stimulating economic activity and strengthening private-sector participation in government projects. 

According to a previous report by the LCGPA, the value of government tenders issued through the Etimad platform reached SR336 billion in 2024. 

Mandatory list expands 

Government tenders represent one of the main channels through which local content development tools are applied, leveraging government purchasing power to support national products and services and increase the participation of local businesses. 

The mandatory list has expanded steadily in recent years, covering products across several vital sectors, and helping enable domestic manufacturers to benefit more from government procurement. 

The implementation of local content policies has also increased its share of government procurement, with the proportion rising from 28 percent in 2018, the baseline year, to more than 51 percent last year. 

The increase in local content reflects efforts to raise the contribution of national components to government spending, including through the workforce, goods and services, and productive and technological assets. 

80 localization deals signed 

The number of industrial localization and knowledge transfer agreements has reached 80 since the mechanism was introduced, with total investments exceeding SR19 billion, while the compliance rate reached 85.9 percent, according to official authority data. 

These agreements are considered a strategic tool for developing local content, as they aim to attract advanced technologies, localize specialized industries, and strengthen domestic supply chains, as well as supporting self-sufficiency and creating high-quality employment opportunities across several sectors. 

Through these mechanisms, the authority seeks to increase the share of the domestic economy in government spending and turn government procurement into a catalyst for national industrial and service capabilities, while strengthening the private sector’s role in economic activity. 

Local content is considered a national agenda involving different segments of the economy, from individuals and the private sector to the public sector. 

Under the definition set out in the regulations governing the LCGPA, issued by the Council of Ministers, local content refers to total spending in Saudi Arabia resulting from the participation of Saudi elements in the workforce, goods and services, and productive and technological assets.