The 4th US-Saudi Business Opportunities Forum held in Riyadh recently brought together government and business leaders from the United States and Saudi Arabia and demonstrated the commitment between our countries and companies to advance the US-Saudi commercial relationship. It is clear that we have a strong foundation to build upon and we are deeply vested in each other’s success.
At the forum, we shared observations, based on experiences around the world, on how investment is facilitated by trade, innovation, competitiveness and government policies.
We have observed that investment follows trade.
When conditions exist for trade to flourish, with low barriers and efficient processes, investments follow.
When companies successfully sell into a market, they want to stay close to their customers and naturally follow on to establish a presence by investing and innovating in the market.
In Saudi Arabia, I saw an excellent example, at the Dhahran Techno Valley Company (DTVC) in Dhahran, of the US and other international companies that have made investments to be close to their customers, in particular Saudi Aramco.
These companies have setup research and development (R&D) operations here to innovate and meet the needs of their customers, tailored to the conditions of Saudi Arabia.
By creating an innovation-friendly ecosystem, including university connections as well as access to research grants, DTVC promotes talent development and capacity building — and enhances the innovation and competitiveness of the companies that invest.
Through hiring local graduates, many of them women with STEM backgrounds, the talent base developed will be a key factor in attracting new investments.
In any market, the business environment, the ease of doing business, is key to attract investment. Companies have choices and gravitate to those countries where the business environment is the most conducive to obtaining returns and managing risk.
Delays and uncertainties in administrative processes are deterrents to investment.
Concrete policy changes that improve the business environment are therefore a significant element in attracting investment.
Toward this end, we find it valuable for policymakers to obtain early input from private sector stakeholders. Such consultation will help create greater understanding of issues that might hinder investment and a sense of greater predictability.
The global competition for attracting FDI is fierce. Saudi Arabia would benefit by using work force development programs to match Saudization labor policies so that the skill-set of the labor force will meet the needs of international firms.
Investment opportunities may be inhibited rather than helped by offset requirements that make foreign investment a requirement of eligibility for major public tenders. Such a requirement may result in keeping many companies away from this market.
We laud Saudi Arabia’s economic reforms and commitment toward ensuring the long-term health of its economy. The Kingdom has demonstrated real leadership in undertaking energy subsidy reforms.
We also recognize the challenges Saudi Arabia faces when rolling out the National Transformation Program (NTP). The US government and its private sector stand ready to support the Kingdom through lessons learned, solutions and technologies, and best practices to attract investment and innovation.
We are already working on coupling Saudi Arabia’s new needs and priorities with leading American solutions. For example, last October, we brought representatives from 15 US firms to Riyadh and Jeddah as part of an architecture and engineering trade mission focused on energy saving and green buildings.
Next month, we will bring 20 leading American health IT, hospital management and training to the Kingdom in a direct response to Health Minister Khalid Al-Falih’s call for a greater role by the private sector to modernize the operational side of Saudi Arabia’s health care system.
These trade missions often result in partnerships, joint ventures and investments as these companies understand the market.
The US is also keen to share its experiences in enabling entrepreneurship with the Kingdom as this country embarks on its NTP.
Supporting entrepreneurs across the Middle East, and indeed around the world, is a top priority for President Barack Obama. He recognizes that opportunity for business creators to thrive around the world is the foundation for a rising middle class, for security and stability, and for broad-based prosperity.
The Department of Commerce leads the administration’s effort to support and empower aspiring entrepreneurs, both in the United States and across the globe. As America’s innovation agency, my department helps connect the world’s next generation of entrepreneurs with the networks, mentors and investors they need to make their businesses successful.
Investment in both directions will enhance the international competitiveness of our respective economies. While we are undertaking efforts to expand our trade and investment relationship, US companies have already invested $11 billion in the Kingdom, and Saudi companies have similarly invested $13 billion in the United States.
We welcome additional Saudi investment in the US companies and find that by investing in the United States and working with its demanding markets and gaining access to the latest technologies, they become more competitive globally.
We will hold our annual SelectUSA Investment Summit from June 19-21 in Washington, with the participation of Commerce Secretary Penny Pritzker and a number of cabinet members.
We welcome a strong Saudi presence at the conference.
We look forward to collaborating with our friends in this great Kingdom to advance our commercial relationships and the successes of our companies and countries.
— Arun M. Kumar is director general of the US and Foreign Commercial Service and Assistant Secretary for Global Markets US Department of Commerce.
Deepening Saudi-US Business partnership through investment
Deepening Saudi-US Business partnership through investment
Boeing focuses on quality management enhancement amidst safety concerns, says top official
RIYADH: Aerospace giant Boeing is enhancing its quality management system to meet regulatory standards, ensuring passenger safety, a top official told Arab News.
Speaking on the sidelines of the Future Aviation Forum in Riyadh, Omar Arakat, vice president of commercial sales and marketing of Boeing in the Middle East and Africa, said that the company is putting “a lot of emphasis” to meet the safety standards proposed by regulators.
The US plane maker is revamping its management in response to increasing pressure from airlines, regulators, and investors as it faces a deepening crisis following a mid-air panel blowout on a 737 MAX plane in January.
An Alaska Airlines Boeing 737-9 MAX experienced a mid-cabin exit door panel blowout shortly after takeoff, triggering multiple investigations, including one by the Federal Aviation Administration in the US.
When asked about safety developments, Arakat said: “I’m assuming you are referring to the quality issues that have made headlines, and I assure you that Boeing’s number one priority is safety and quality. We are doing a lot of plans to strengthen our quality management system.”
He added: “We’re also sharing with our customers all the steps that were taken to make sure that they feel the comfort that Boeing is doing the right thing.”
Detailing Boeing’s initiatives to enhance safety standards, Arakat added that the company is directly engaging with its suppliers and increasing involvement by inspecting various stages in the aircraft production cycle.
He expressed his enthusiasm about the progress in Saudi Arabia’s aviation sector during the discussion.
“We are very optimistic, and we are very excited about what is going on in Saudi Arabia in general, and specifically within the aviation sector. There is a lot of commitment by the leadership of Saudi Arabia to support aviation, and they recognize it as one of the most important pillars of developing infrastructure and moving forward,” said Arakat.
He added: “If you look at the mandates of Vision 2030, it really indicates that aviation has a very bright future because it sets some very real targets that the Kingdom is very serious about achieving. We are very proud to be part of that.”
The executive further noted that Boeing’s relationship with Saudi Arabia spans over seven decades, during which the company has delivered over 240 aircraft to airlines operating in the Kingdom.
Last year, Riyadh Air, owned by the Public Investment Fund, announced ordering up to 72 Boeing 787-9 Dreamliner airplanes in a significant deal. This included 39 confirmed aircraft and an option for an additional 33 wide-body 787-9 Dreamliners, reflecting Saudi Arabia’s ambitions to establish itself as a prominent player in global aviation.
National carriers collectively announced plans to purchase up to 121 787 Dreamliners, marking one of Boeing’s largest commercial orders by value.
Energy security is vital for prosperity among Arab citizens, says top official
RIYADH: A comprehensive and integrated approach is needed to ensure energy security amongst citizens, according to the Assistant Secretary-General and Head of the Economic Affairs Sector at the Arab League, Ali Al-Maliki.
During the 12th celebration of Arab Energy Efficiency Day, Al-Maliki urged the adoption of new measures to address this critical issue.
“Energy security is a fundamental issue due to its direct impact on economic growth, national security, and the well-being of all Arab citizens,” he stated in a speech delivered on his behalf by the Director of the Energy Department at the General Secretariat of the Arab League, Jamila Mattar.
“We are all aware of the challenges we face in terms of energy security and the transition to more sustainable sources,” the speech said.
“To confront these challenges, the world needs to adopt a comprehensive and integrated approach to energy security that takes into account the need to increase energy efficiency, develop renewable energy, protect vital energy infrastructure, and work to reduce harmful carbon emissions,” the text added.
Al-Maliki emphasized that efficiency is one of the basic pillars of energy security, according to a report by Bahrain News Agency.
He noted that achieving energy security involves providing services at the lowest cost without compromising quality and managing demand by introducing various concepts related to efficiency.
This approach aims to reduce consumption without conflicting with the developmental plans of each country.
Al-Maliki highlighted the council’s efforts to monitor the stages of efficiency in the Arab region. This includes developing, implementing, and monitoring national efficiency plans.
The council has also prepared the Renewable Energy and Energy Efficiency Guide in Arab Countries, which provides statistical information on policies and programs adopted in nations to enhance the efficiency of production and consumption and the use of renewables.
Additionally, the guide details the institutional and legal frameworks and the necessary financial incentives implemented or planned in these fields.
Saudia orders additional 105 aircraft from Airbus
RIYADH: Saudia Group has signed an order for an additional 105 A320neo family aircraft, marking the largest aircraft deal with Airbus in the Kingdom’s history.
Announced at the Future Aviation Forum in Riyadh, the order comprises 12 A320neo and 93 A321neo aircraft, and increases Airbus aircraft order backlog from the Saudi Arabia’s national flag carrier to 144 A320neo family aircraft.
Saudia Group is set to receive the first aircraft in the first quarter of 2026. These aircraft will be distributed between Saudia and flyadeal, the group's low-cost carrier.
The agreement was announced in the presence of Minister of Transport and Logistic Services Saleh bin Nasser AI-Jasser, Director General of Saudia Group Ibrahim Al-Omar, and Benoît de Saint-Exupéry, executive vice president sales of Airbus.
Al-Omar said: “Saudia has ambitious operational objectives to meet growing demand. We are increasing flights and seat capacity across our existing 100+ destinations on four continents, with plans for further expansion.
“The progress of Saudi Vision 2030 is attracting more visits, tourists, entrepreneurs, and pilgrims each year. This motivated our decision to secure this significant deal, which will create jobs, increase local content, and contribute to the national economy.”
De Saint-Exupéry said the new aircraft will play a “vital role” in contributing to Saudi Arabia’ ambitious Vision 2030 plan.
He added: “It will enable Saudia Group’s strategy to advance the Kingdom’s aviation capabilities while enabling both airlines to benefit from the A320neo Family’s exceptional efficiency, superior economics, highest level of passenger comfort as well as lower fuel-burn and emissions.”
Saudi-Chinese financial ties to strengthen as top officials meet in Beijing
RIYADH: Saudi and Chinese top officials are holding joint meetings in Beijing focused on fostering international economic growth.
The sessions, which are slated to take place from May 20 - 21 in Beijing, include the Kingdom’s Minister of Finance Mohammed Al-Jadaan, the newly appointed Vice Minister of Finance Abdulmuhsen Al-Khalaf, along with officials from the Ministry of Finance, the National Center for Privatization, and the Saudi Central Bank.
Officials from the Capital Market Authority, Zakat, Tax and Customs Authority as well as the National Development Fund, are also part of the delegation, as well as representatives from the Saudi Fund for Development, and the National Infrastructure Fund.
In a post on his X account, Al-Jadaan said: “Today (May 20), as part of my visit to China, I met with the Chinese Minister of Finance, Lan Fo’an. We discussed ways to enhance the finance, trade and investment cooperation between Saudi Arabia and China to advance prosperity and growth for the global economy.”
The Saudi finance minister and his Beijing counterpart co-chaired the third meeting of the Financial Sub-Committee for the High-level Chinese-Saudi Joint Committee, where Al-Jadaan emphasized that China is a key partner in the Kingdom’s transformation under Vision 2030, according to a statement by the Saudi Finance Ministry.
The release added that the minister would participate in a roundtable discussion organized by the NCP in cooperation with the Industrial and Commercial Bank of China.
Al-Jadaan will also speak with various Chinese ministers, officials, and investors, focusing on recent economic and financial developments, shared interests, and investment prospects in Saudi Arabia, aligning with the Kingdom’s Vision 2030 goals.
Meanwhile, Al-Khalaf and the Chinese Vice Minister of Finance, Liao Min, will co-chair a roundtable meeting hosted by the Chinese Ministry of Finance and organized by the China Development Bank and the China Investment Corp.
Al-Jadaan’s visit to the Asian powerhouse comes after he used a panel discussion at the Qatar Economic Forum on May 14 to urge financial planners to optimize their strategies to curb “economic leakage” and prevent resources or funds from being wasted.
Calling for the adoption of prudent fiscal policies, the minister said at the event that spending during a time of global inflation results in increased project costs, which he believes further fuels inflation and “overheats” the economy.
Diplomatic and economic ties between Saudi Arabia and China have been strengthening in recent years, and in November the Kingdom’s central bank, also known as SAMA, and the People’s Bank of China signed a local currency swap agreement worth $6.93 billion.
The agreement will last three years, but China’s central bank said at the time it can be extended after two years by mutual agreement.
Saudi Arabia’s first quantum computer on its way after Aramco, Pascal deal
RIYADH: Saudi Arabia's first quantum computer is set to be installed after energy giant Aracmo signed an agreement with computing firm Pasqal.
Under the deal, the French company will install, maintain and operate a 200-qubit device, scheduled for deployment in the second half of next year, according to a press statement.
A quantum computer uses qubits to run multidimensional algorithms, and these machines are capable of solving complex problems faster than traditional computers.
Ahmad Al-Khowaiter, executive vice president of technology and innovation at Aramco, said the deal with Pasqal is expected to bring high-performance information processing to Saudi Arabia.
“In a rapidly evolving digital landscape, we believe it is crucial to seize opportunities presented by new, impactful technologies and we aim to pioneer the use of quantum computing in the energy sector,” said Al-Khowaiter.
He added: “Our agreement with Pasqal allows us to harness the expertise of a leading player in this field as we continue to build state-of-the-art solutions into our business. It is also further evidence of our contribution to the growth of the digital economy in Saudi Arabia.”
The quantum computer that will be installed in Saudi Arabia will initially use an approach called “analog mode.”
Within the following year, the system will be upgraded to a more advanced hybrid “analog-digital mode,” which is more powerful and able to resolve more complex tasks, the statement added.
The agreement follows a memorandum of understanding signed between Aramco and Pasqal in 2022 to collaborate on quantum computing capabilities and their applications in the energy sector.
Georges-Olivier Reymond, CEO and co-founder of Pasqal, noted that the agreement would see the commercial adoption of quantum computers in the Kingdom.
“This isn’t just any quantum computer; it will be the most powerful tool deployed for industrial usages, unlocking a new era of innovation for businesses and society,” said Reymond.
Earlier this month, Aramco also signed three MoUs with US firms, including Aeroseal, Spiritus, and Rondo, to accelerate the development of potential lower-carbon solutions.
In May, Aramco also announced its financial results for the first three months of this year.
The company revealed that its net profit reached $27.27 billion in the first quarter, representing a rise of 2.04 percent compared to the last quarter of 2023.
