SAGIA chief to lead delegation to WEF meeting in Davos as number of overseas firms starting business in Saudi Arabia breaks record

Al-Omar will lead the SAGIA delegation as part of a significant Saudi presence at the World Economic Forum (WEF) annual meeting in Davos, which begins on Tuesday. (Photo/Markus Schreiber)
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Updated 20 January 2020

SAGIA chief to lead delegation to WEF meeting in Davos as number of overseas firms starting business in Saudi Arabia breaks record

DUBAI: Foreign investors are flocking to Saudi Arabia as the reform program under the Vision 2030 strategy accelerates, new official figures show.

In 2019, according to statistics released by the Saudi Arabian General Investment Authority (SAGIA), there was a 54 percent increase in the number of international companies setting up operations in the Kingdom, with 1,131 new foreign businesses launched — a record year.

“Leading growth sectors include construction, manufacturing and information and computer technology, as demand in these industries increases alongside infrastructural development and progress of the Kingdom’s giga projects driving forward in line with Vision 2030,” said SAGIA’s Invest Saudi report.

“During 2019, 193 new construction, 190 manufacturing and 178 ICT (information and communications technology) companies were established, compared to 111, 113 and 111 established in the three sectors in 2018 respectively.” The pace of new foreign startups accelerated in the final quarter, the report said.

SAGIA Gov. Ibrahim Al-Omar said: “Guided by Saudi Vision 2030, our country is undergoing a remarkable economic transformation. The continued prosperity of the Kingdom depends on sparking innovation, attracting foreign investors and empowering the private sector.”

He added: “The positive growth numbers that we have seen in the final quarter of 2019 — and indeed throughout the entire year — represent a significant milestone on the road to 2030.”

The Kingdom’s growing foreign investment landscape is underpinned by sweeping economic and social reforms made throughout 2019, aimed at improving Saudi Arabia’s business climate and attracting new investments.

The impact of these reforms is being recognized on a global scale: Saudi Arabia was ranked the world’s top improver and reformer by the World Bank, climbing 30 places in its Doing Business 2020 report, SAGIA said.

“The goal of our reform program is to help realize the potential that Saudi Arabia holds for the benefit of Saudi nationals and improve our competitiveness,” said Al-Omar, who will be among the Saudi delegation at the forthcoming World Economic Forum (WEF) annual meeting in Davos.




Snow falling in Davos, Switzerland, where around 3,000 political and business leaders will gather for the World Economic Forum this week. (Shutterstock)

“The investment opportunities that the Kingdom offers international companies also creates opportunities for the transfer of skills, expertise and best practice to local communities across the Kingdom, while providing new private sector job prospects for young Saudi men and women,” he added.

“We consider foreign companies who look to Saudi Arabia as growth partners for their business expansions — whether they seek a joint venture with Saudi companies or choose to set up on their own,” he said.

“Out of the new international companies setting up in Saudi Arabia in 2019, 69 percent were full foreign ownership, while 31 percent were joint venture partnerships with local investors. Our 2019 figures therefore demonstrate how integral new international businesses are to the success of our journey toward 2030.”

The Invest Saudi report found that the growth in the number of foreign startups came from “long-standing and strategically-important Saudi partners” such as the US and UK, with 100 UK companies and 82 US ones setting up in 2019, compared to 24 for both countries in 2018.

India, Egypt, Jordan and China were also among the top countries represented, with India’s share of the market increasing dramatically from 30 companies established in 2018 to 140 in 2019, driven by high-profile royal visits to the country in February 2019.

Other top countries from 2018, Jordan and France, were well-represented in 2019, the report said.

FASTFACT

The number of international companies setting up in Saudi Arabia rose by 54 percent last year.

SAGIA is continuing to introduce new measures to make setting up in the Kingdom easier and more efficient.

“We want to make it easier for foreign companies to set up and do business in Saudi Arabia,” said Al-Omar. 

“We have taken global best practice models and combined them with local knowledge and insights in order to eliminate unnecessary barriers to doing business, while making it easier for our new partners from abroad to understand our unique Saudi culture and customs and how they can better integrate and contribute.”

SAGIA has increased its global profile, and will have a prominent presence at the forthcoming WEF annual meeting in Davos.

“We have played an important role in attracting foreign companies to establish operations in the Kingdom throughout 2019, facilitating a series of high-level investor forums in countries such as China, India, Germany and South Korea, as well as hosting delegations to the Kingdom from the US, UK, Japan and Russia,” Al-Omar said.


G20 ministers agree to keep markets open, tackle pandemic supply disruptions

Updated 31 March 2020

G20 ministers agree to keep markets open, tackle pandemic supply disruptions

  • G20 leaders pledged last week to inject over $5 trillion into the global economy to limit job and income losses from the coronavirus outbreak
  • The coronavirus has infected nearly 738,500 people worldwide and killed some 35,000

RIYADH/WASHINGTON: Trade ministers from the Group of 20 major economies agreed on Monday to keep their markets open and ensure the continued flow of vital medical supplies, equipment and other essential goods as the world battles the deadly coronavirus pandemic.
G20 leaders pledged last week to inject over $5 trillion into the global economy to limit job and income losses from the coronavirus outbreak, while working to ease supply disruptions caused by border closures by national governments anxious to limit transmission of the virus.
In a joint statement issued after a videoconference, the trade ministers pledged to take “immediate necessary measures” to facilitate trade, incentivize additional production of equipment and drugs, and minimize supply chain disruptions.
They agreed that all emergency measures should be “targeted, proportionate, transparent, and temporary,” while sticking to World Trade Organization (WTO) rules and not creating “unnecessary barriers” to trade.
They also vowed to work to prevent profiteering and unjustified price increases, and keep supplies flowing on an affordable and equitable basis.
“As we fight the pandemic both individually and collectively and seek to mitigate its impacts on international trade and investment, we will continue to work together to deliver a free, fair, non-discriminatory, transparent, predictable and stable trade and investment environment, and to keep our markets open,” the ministers said.
They agreed to notify the WTO about any trade-related measures taken to keep global supply chains running and said they would convene again as necessary.
The ministers, however, stopped short of explicitly calling for an end to export bans that many countries, including G20 members France, Germany and India, have enacted on drugs and medical supplies. A key adviser to US President Donald Trump is working on new rules to expand “Buy America” mandates to the medical equipment and pharmaceutical sectors, something that dozens of business groups said could worsen shortages.
The joint statement included the phrase “consistent with national requirements” already used by G20 leaders, which experts say could provide a loophole for protectionist barriers.
Lack of protective medical gear is putting doctors and nurses at risk. Many countries rely on China, the source of the outbreak, for drug ingredients and are struggling to avoid shortages after lockdown measures prompted by the epidemic held up supplies and delayed shipments.
Supply chains are backing up as air freight capacity plunges and companies struggle to find truck drivers and shipping crews. Europe and the United States are short of tens of thousands of freight containers. Shippers struggle with crew shortages and quarantines at ports. Agriculture is also being disrupted.
The ministerial video conference was attended by representatives from the WTO, World Health Organization and Organization for Economic Cooperation and Development.
A senior World Bank official urged G20 members to agree to refrain from imposing new export restrictions on critical medical supplies, food or other key products, and to eliminate or reduce tariffs on imports of key products.
US Trade Representative Robert Lighthizer told the ministers during the meeting that the pandemic had revealed vulnerabilities in the US economy caused by over-dependence on cheap medical supplies from other countries. He did not reference the “Buy America” rule specifically, but said Washington was encouraging diversification and wanted to promote more domestic manufacturing to produce more suppliers for the United States and others.
G20 finance ministers and central bankers will also meet virtually, on Tuesday, for the second time in just over a week to continue coordinating their response, the Saudi G20 secretariat said, as worries grow about the debt crisis looming over poorer countries.
Japanese Trade Minister Hiroshi Kajiyama told counterparts that both the public and private sectors should try to avoid shutting supply networks to enable an early resumption of economic activities.
The coronavirus has infected nearly 738,500 people worldwide and killed some 35,000, and has plunged the world into a global recession, according to International Monetary Fund chief Kristalina Georgieva.