Top Leaders Gather for USSABC Business Conference in Los Angeles
On August 25, 2016, the U.S.-Saudi Arabian Business Council (USSABC) held a business conference titled Localization, Innovation, and Partnership Opportunities for Industrial Development in Saudi Arabia. The event took place in Los Angeles and featured top government and business experts from the U.S. and Saudi Arabia. Keynote speakers included H.E. Eng. Khalid Al-Falih, Saudi Minister of Energy, Industry, and Mineral Resources; H.R.H. Prince Saud Bin Khalid Al-Faisal, Acting Governor of the Saudi Arabian General Investment Authority (SAGIA); and H.H. Prince Saudi Bin Khalid Al Faisal, Saudi Ambassador to the U.S.
Over 250 U.S. and Saudi business leaders attended the event. Senior leaders of prominent Saudi government entities and companies spoke at the conference, including the Royal Commission for Jubail and Yanbu, Saudi Basic Industries Corporation (SABIC), Sadara Chemical Company, and Saudi Arabian Mining Company (Ma’aden). The event also featured speakers from U.S. companies such as Fluor Corporation, ExxonMobil, Jacobs Engineering, The Dow Chemical Company, General Electric Company, and Laureate Obeikan, Ltd.
The program focused on strategic objectives outlined by Saudi Arabia’s National Transformation Program (NTP) 2020. The NTP is part of the Kingdom’s Vision 2030, which seeks to diversify the country towards a knowledge-based economy. Two of the NTP’s primary goals are to promote industrial development in Saudi Arabia and to develop the country into a regional business and manufacturing hub.
In his remarks, Minister Al-Falih discussed the changes and trends that Vision 2030 is bringing to Saudi Arabia. He stated that Saudi Arabia’s economy has grown significantly over the course of the eight-decade bilateral business relationship with the United States. Over that timeframe, Saudi Arabia has become a global leader in oil and gas, joined the G20, built a sizable industrial infrastructure base, and created modern healthcare and education systems. Minister Al-Falih noted that the U.S. is the Kingdom’s leading partner in a majority of economic sectors, and that it will continue to remain a critical part of Saudi Arabia’s development.
The Minister stated that the downstream and mining sectors are key areas for growth and collaboration, and that Saudi companies will seek additional foreign partnerships and investment. Localization of manufacturing industries is also a priority for the Kingdom as it seeks to diversify and create local jobs. Minister Al-Falih said that developing infrastructure, education, and healthcare will continue to be strategic objectives for Saudi Arabia. Regarding government initiatives, the Minister stated that the recent restructuring of ministries will help improve focus and efficiency. He mentioned that the oft-discussed Saudi Aramco IPO has multiple aims. The IPO has obvious financial benefits, but Saudi Arabia also views this sale as a necessary part of Vision 2030. Such a sale will help Saudi Arabia commit to a massive Public Investment Fund to ensure future opportunity for its citizens, encourage transparency, and demonstrate the Kingdom’s commitment to privatization.
During the luncheon keynote address, Ambassador Al-Saud spoke about the lasting relationship between the U.S. and Saudi Arabia, stating that the Saudis “have a long and trusting relationship with the United States, perhaps more so than with any other country.” He said that “Americans and American business will play an important role in Saudi Arabia’s progress towards Vision 2030.” The Ambassador stressed that the business relationship between the U.S. and Saudi Arabia is strong, and that the Kingdom seeks to further diversify the relationship.
Through the various panel discussions, attendees learned about opportunities in Saudi Arabia’s rapidly changing and modernizing economy. The Opportunities for Downstream Petrochemicals and Plastics panel spoke of how the Kingdom seeks to increase its private sector presence and attract foreign investment in areas such as plastics, specialty chemicals, elastomers, automotive, and fast-moving consumer products. The Partnership and Localization Opportunities in the Mineral Industry panel discussed how Saudi Arabia’s mining sector is a priority in the NTP. The Kingdom has large reserves of gold, bauxite, phosphate, and at least 15 industrial minerals deemed economically feasible for extraction. Demand has increased for limestone, iron, feldspar, gypsum, silica, and marble due to the growing Saudi construction sector. Eng. Khalid Al-Mudaifer, President and CEO of Ma’aden, spoke of the company’s reported $26.8 billion in investment and its partnerships with major foreign companies such as Alcoa and Barrick Gold Corporation. The recently completed North-South Railway, upgraded seaports, and investments in water and power infrastructure for minerals processing are developments that will help the Saudi mining sector blossom.
The Expanding Opportunities for Local Manufacturing panel discussed how Saudi Arabia continues to create opportunities for small and medium-size enterprises (SMEs) in the U.S. and the Kingdom. As Minister Al-Falih mentioned, localization is a priority for Saudi Arabia, which seeks to spur innovation and create jobs. The Kingdom is looking for manufacturers to supply equipment and spare parts for large companies in the oil & gas, petrochemicals, power generation, mining, desalination, and transportation industries. Saudi Arabia is also promoting the production of basic materials and upstream petrochemical and mining products in order to help companies create value-added downstream products. The Incentives to Create an Attractive Manufacturing Hub panel spoke of how low-cost utilities, financial incentives, access to feedstock, abundant land, geographic location for other markets, and transportation infrastructure make Saudi Arabia an appealing market for investment. Saudi Arabia is working with the private sector to improve education and training in order to prepare the country for a knowledge-based and highly skilled economy.