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The fusion of age-old values with modern ideas gives thedesert kingdom stability – and a competitive edge

AA UUNNIITTEEDD WWOORRLLDD SSUUPPPPLLEEMMEENNTT PPRROODDUUCCEEDD BBYY::Robert Romaniuk, Alla Ilushka, Rafaela Villacieros & Geoffrey Cooke

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“LET OUR DIALOGUE BE ATRIUMPH OF BELIEF OVERDISBELIEF, OF VIRTUE OVERVICE, OF JUSTICE OVERINIQUITY, OF PEACE OVERCONFLICTS AND WARS, ANDOF HUMAN BROTHERHOODOVER RACISM.”

KING ABDULLAH BIN ABDULAZIZ AL SAUD, CUSTODIAN OF THE TWO HOLY MOSQUES

After a while in Saudi Arabia,most visitors realize what aunique country it is: a kingdomfusing tradition with progress.In just 80 years it has progressedfrom being a loose confedera-tion of Bedouin tribes, to an oil-rich, post-industrial nation.

Saudi Arabia is a conserva-tive, predominantly SunniMuslim state, and develop-ment must emanate from andreflect the kingdom’s tradi-tions and Muslim faith. Shari-ah law is strictly enforced andreligion is widely practiced. Is-lam is intertwined with every-day affairs, from politics andbusiness dealings to family andpersonal relationships.

Culture and traditions fromthe distant past still abound, andmost Saudis happily practicethem day-to-day. This respectfor the old ways has helped thecountry avoid the turmoil whichhas recently spread throughmuch of the Arab world. Yet atthe same time, the country hasembarked on a path of un-precedented growth, social de-velopment, and modernizationthat has been particularly en-couraged and accelerated un-der the leadership of KingAbdullah bin Abdulaziz AlSaud. He has laid out an ambi-tious reform agenda that in-cludes the privatization of keyindustries, economic diversifi-cation away from the kingdom’sheavy reliance on oil revenues,educational and legal changes,and landmark social reforms,particularly regarding the roleof Arab women.

Yet it is this clash of the mod-ern with the traditional thatmakes the desert kingdom allthe more fascinating. It has al-so led to the local belief that“future modernization musttake place within the frame-work of ‘social cohesion’ toavoid shattering the essenceof Saudi culture.”

Traditional values and culturalmores are adapted into legal pro-hibitions, even for non-Muslims,of alcoholic products and porkproducts. Saudi Arabian dressstrictly follows the principles ofhijab, the Islamic princi-ple of modesty, and his-torical rituals and folkculture permeate the coun-try’s dance and music.

Contrary to popular be-lief, Saudi Arabia is geo-graphically diverse, withforests, grasslands, moun-tain ranges and deserts.The climate varies from re-gion to region. Tempera-tures can reach over 110ºFin the desert in the summer,while in the winter temper-atures in the north and cen-

tral parts of the country will of-ten drop below freezing.

On a global level, the King hasbeen a central figure in the coun-try’s modernization process, en-couraging the efforts of the SaudiArabian General InvestmentAuthority (SAGIA) to stimulatedomestic and foreign invest-ment, streamlining privatiza-tion moves and acceding to theWorld Trade Organization. Atthe same time the kingdom isgradually opening up sectors forinvestors, including telecom-munications, airlines and in-surance, and is continuing tosupport the main engines of eco-nomic growth by encouraginglocal and foreign private sectorsto contribute to developmentof Saudi Arabia’s neweconomic cities.

N e v e r -theless ,

there arechallengesahead. A recentreport by the Swiss-based World Economic Fo-rum (WEF) says that thekingdom needs is to ensurethat its education system isadequate to support the de-veloping private sector as ameans of assisting economicdiversification, and reducing

reliance on state-run in-dustries and oil rev-enues. More skills are

also needed to reduceunemploymentand to lessenthe current de-

pendency on for-eign labor, whichstill comprisesabout a third of thepopulation.

Madinah is home to the three oldest mosques in Islam

Wednesday, December 14, 2011

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SAUDIARABIAA kingdom of

tradition and progress

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Distributed by USA TODAYWednesday, December 14, 201122 SAUDI ARABIA

King Abdullah and his visionIn November, Forbesmagazineonce again ranked Custodianof the Two Holy Mosques KingAbdullah bin Abdulaziz amongthe most powerful personali-ties in the world. In this year’sanalysis, the King features insixth place, behind Barack Oba-ma, Vladimir Putin, Hu Jintao,Angela Merkel and Bill Gates.In reviewing candidates for itslist of the World’s 70 Most Pow-erful People, Forbes takes fourfactors into account: how manypeople the individuals havepower over; the financial re-sources controlled by each can-didate; whether the nominee isinfluential in more than one are-na or sphere; and finally con-sideration as to how actively thecandidates wield their power.

With regard to King Abdul-lah, Forbes commented on hisongoing pursuance of moder-ate reform in conservative Sau-di Arabia and his stance onvarious issues. For example, itlauded the King’s recent deci-sion to allow women to run foroffice and vote in municipalelections, and that he has “con-sistently nudged the nation’seducational system out fromunder clerical control.” Themagazine also noted that theKing opposed the Arab Springuprisings that swept across theregion earlier this year and thathe has spent more than $130billion to fund social projectsin the kingdom.

Born in Riyadh in 1924, theKing spent years living in thedesert with Bedouin tribes whoinstilled in him their values ofhonor, simplicity, generosity andbravery. He became the de fac-to ruler of the kingdom in 1996when his half-brother, King Fahd,suffered a debilitating stroke, andpositioned himself as a reformerwith the desire to assist in thedevelopment of Saudi Arabia’speople. Making good on hispromises of change, in the yearsfollowing he pushed for reformsthat included the nation’s firstpopular elections, which wereheld to choose local councils,

and transferred control of theeducation of girls from religiousauthorities to the Ministry ofEducation.

Since ascending to the thronein 2005, King Abdullah has con-tinued to make good on hispromises of development, mak-ing it a central focus of his reignand launching a range of majoreconomic, social, education,health and infrastructure pro-jects that have brought aboutremarkable changes through-out the kingdom. Among hismost notable achievements in-clude the creation of four eco-nomic cities: King AbdullahEconomic City, Prince Abdu-laziz bin Mousaed EconomicCity, Knowledge Economic Cityand Jazan Economic City. Hehas also approved a historic re-

organization of Saudi Arabia’sjudicial system and enactedlaws to formalize royal succes-sion, as well as announcing pro-jects to expand the Two HolyMosques and major welfare ini-tiatives. A major cabinet reshuf-fle in 2009 replaced some seniorconservative figures andbrought in the country’s first fe-male deputy minister.

In education, the King Ab-dullah Project for General Ed-ucation Development launchedin 2009 with $2.4 billion back-ing from the government andwas designed to enhance gen-eral education levels fromkindergarten to high schoolthrough intensive teacher train-ing and better facilities. TheKing Abdullah University of Sci-ence and Technology (KAUST)

also opened in 2009 with a $10-billion endowment to sparkgreater innovation in the king-dom and is the country’s firstmixed-gender campus. In Maythis year the Princess Noura bintAbdulrahman University forGirls opened its doors to marka milestone in Arab women’seducation and is one of thelargest centers of higher edu-cation for women in the world.

A strong advocate of con-structive global cooperation,King Abdullah’s participationin international diplomacy re-flects the kingdom’s position asa defender of Arab and Islamicissues and for the achievementof world peace, stability and se-curity. He has sought out clos-er relations with the UnitedStates, viewed by many in the

royal family as essential for na-tional and regional security, andhas taken a leading role in pro-moting dialogue among theworld’s leading faiths, includinga historic meeting with PopeBenedict XVI in 2007.

In his opening address at the2008 World Conference on Di-alogue in Madrid, Spain, KingAbdullah said: “Man could bethe cause of the destruction ofthis planet and everything init. He is also capable of turn-ing it into an oasis of peace andtranquility in which adherentsof religions, creeds andphilosophies could co-exist,and in which people could co-operate with each other in arespectful manner, and addressproblems through dialoguerather than violence.”

On December 17, 2010, Mo-hamed Bouazizi set himselfalight in the Tunisian townof Sidi Bouzif in protest atthe treatment he had receivedfrom police after officers con-fiscated fruit and vegetablesthe out-of-work graduate hadbeen selling from a street stall.His act of self-immolation infront of a municipal officethat ignored his complaintsparked protests from youngTunisians, and sympatheticpro-democracy uprisingsspread rapidly across theMiddle East, known as theArab Spring. The wave of un-rest has led to Hosni Mubarakresigning his presidency ofEgypt, the death of ColonelMuammar Gaddafi and hisregime in Libya, King Ab-dullah II firing his govern-

ment to expedite political re-form in Jordan, and interna-tional pressure on Basharal-Assad mounting to stepdown as president to quellincreasingly violent clashesin Syria.

In comparison with itsneighbors, Saudi Arabia hasnot seen mass uprisings, in-stead witnessing periodicdemonstrations and scat-tered acts of civil disruptionthat have been smaller scale,ranging from 100 to 4,000people, and have targetedcivil liberties rather thanousting the monarchy. Ac-cording to Aljazeera English,King Abdullah “has tried tohead off unrest in the king-dom with a series of eco-nomic reforms valued at 135billion Saudi rials ($36 bil-

lion) … [which] include hous-ing subsidies; unemploymentbenefits; and a program togive permanent contracts totemporary governmentworkers.” In a live TV broad-cast, the King also pledgedto create 60,000 jobs in thesecurity forces and 500,000low-income apartments.

In October, next in line tothe Saudi throne CrownPrince Sultan bin Abdel Az-iz Al Saud died, and thesmooth transition of the titleto Prince Nayef bin Abdul-Aziz further secured the king-dom’s standing as a beacon ofpeace and stability in the re-gion. Prince Nayef has alreadyrun the kingdom in recentyears during extended ab-sences of both King Abdullahand Crown Prince Sultan.

The kingdom remains stable despite the Arab Spring, and death of its heir apparent

“MAN COULD BE THE CAUSE OF THEDESTRUCTION OF THIS PLANET ANDEVERYTHING IN IT. HE IS ALSO CAPABLE OFTURNING IT INTO AN OASIS OF PEACEAND TRANQUILITY IN WHICH ADHERENTSOF RELIGIONS, CREEDS AND PHILOSOPHIESCOULD CO-EXIST, AND IN WHICH PEOPLECOULD COOPERATE WITH EACH OTHER INA RESPECTFUL MANNER, AND ADDRESSPROBLEMS THROUGH DIALOGUE RATHERTHAN VIOLENCE” KING ABDULLAH BIN ABDULAZIZ

A pillar of stability inthe Middle East

Telecommunications is possi-bly the “hottest” noun in thehuman vocabulary. Smart-phones, ipads, laptops, PDAswho can live without them andwhat’s next? These gad-gets have becomehousehold namesaround the world andfurthermore an absolutenecessity for any busi-nessman living in the21st century. But, likeanything, toys break too,and boom… their goesthe central nervous sys-tem of enterprises.

However, accordingto the CEO of Tech-nology Control Com-pany Ltd. FaisalAl-Mousa, the key liesin mastering the tech-nology instead of al-lowing it to control thebusiness. For this rea-son, he explains, TCCwas established to pro-vide state-of-the-art so-lutions based onleading industrymethodologies andframeworks throughpragmatic and realisticapproaches that ad-dress clients needs andfears. In fact, Mr. Al-Mousa argues that thisapproach increases thecompany’s efficiencyand generates more val-ue for their clients.

Possibly one of thetwo biggest milestonesthus far for this youngand promising compa-ny lays in its executionof data mining, throughwhich, explains the CEO, “thecompany aims to transfer da-ta into information and in-formation into knowledge.”“And in return,” he adds, “helpdecision makers run theirbusiness.”

However, in an ever de-manding world, TCC even of-fers more by taking secrecy

to the next level through de-veloping a groundbreakingsystem for encrypting com-munications at the higheststandards of 265 bits.

With this duo of ICT body-guards protecting its clients,it seems that not even thehighest level of hacking canget through to other side ofthe gadget screen. Therefore,it’s no doubt that major ICTgiants, like IBM and Oracle,have chosen to partner withthe Saudi company. Its relia-bility and efficiency make

TCC the company of choiceto help foreign investors pilotthe virtually untapped region,and the up and coming mar-ket of Saudi Arabia that rep-

resents 40% of theMiddle East’s buyingpower.

That’s not all though,“the mentality SaudiArabia has adoptedover the years is one oftransforming the stateinto a knowledgebased economy as wellas a logistics hub,” con-firms Mr. Al-Mousa.He says, “74% of SaudiArabia’s population isless than 29 years ofage. There has been alarge growth in the lap-top industry in thecountry, and with theusage of iPads andPDA’s, I think we canachieve this target inless than 20 years.” Mr.Al-Mousa is not aloneas he adds that the gov-ernment has embarkedon this initiative and iseven building more fa-cilities to ensure thatSaudi Arabia is gearedtowards the age oftechnology.

With this in mind, it’sclear that TCC is think-ing big and therefore,has adopted its missionalong the lines of thecountries aspirations:“to be the leading In-formation Technolo-gy Company in theMiddle East by the

year 2015, affecting ourclients and their businesspositively by providing thehighest levels of service andcontinuous improvements.”

Therefore, in the words ofthe Winston Churchill: “Des-tiny is not a matter of chance,it is a matter of choice; it isnot a thing to be waited for, itis a thing to be achieved.”

TCC gives business leaders the facts they need to make decisions

Data, information and knowledge...

King Abdullah ranks among the most powerful people in the world and is a strong advocate for greater opportunities in the kingdom and more constructive global cooperation

“THE COMPANY AIMS TOTRANSFER DATA INTOINFORMATION, ANDINFORMATION INTOKNOWLEDGE... AND HELPDECISION MAKERS RUNTHEIR BUSINESS.”

FAISAL AL-MOUSA, CEO of Technology Control Company Ltd.


King Abdullah has recognizedthat tradition can coexist withmodernity. This more relaxedattitude is reflected in, for ex-ample, the fact that the king-dom’s government hascreated scholarships that ac-tively encourage Saudi menand women to study in West-ern universities, primarily inthe United States, Englandand Australia.

Back at home, modern atti-tudes are also manifested in Jed-dah, Saudi Arabia’s commercialcapital. Largely known as thegateway to the holy cities ofMakkah and Madinah, Jeddahis now coming into the limelightas the most dynamic, reform-minded and comparatively lib-eral city in the kingdom.

History and modernity de-fine Jeddah. From a traditionaltown of one square kilometerand a population of 10,000 in1948, today Jeddah is a modernand thriving metropolis with3.4 million inhabitants. The oldcity walls were demolished inthe late 1940s as oil wealth fu-eled rapid growth, though a sub-stantial portion of the historicold city has been preserved.

Jeddah’s population today ismade up of a mix of national-ities – about half the popula-tion is estimated to be foreign– and the local religious cultureis less restrictive than in otherparts of the country. Expatworkers and locals enjoy a va-riety of shopping centres, withrestaurants offering continen-tal cuisine, seafood, and Asiancooking.

Jeddah is also the country’smain port on the Red Sea, andand a prime destination fortourists. Major organizationshave established their head-quarters in Jeddah, includingthe National CommercialBank, the Organization of Is-lamic Cooperation and SaudiArabian Airlines.

The city’s modern King Ab-dul Aziz International Airportprovides excellent interna-tional connections with othermajor cities around the world,making the tourism sector oneof the strongest in the city.

Other industries contributeto making Jeddah one of theMiddle East’s chief industrialand business centers, rangingfrom the development and dis-tribution of consumer goods,to finance and health care. En-vironmental awareness is alsoa main concern.


Wednesday, December 14, 2011Distributed by USA TODAY SAUDI ARABIA33

Second city takes a leadThe ancient city of Jeddahis now a successful mix ofthe old and the new

Within the Arabian Peninsula,Saudi Arabia is the largest coun-try, and Riyadh the largest city.Riyadh, or Arriyadh, as it is lo-cally known, is experiencing aboom in many ways, from realestate and education to indus-try, business and finance.

Arriyadh means ‘meadows’or ‘gardens’ in Arabic – a trib-ute to the city’s location in oneof the few green areas lying inthe Arabian desert. Today, it isone of the world’s fastest grow-ing cities, with the developedarea expected to double fromits current 470 square miles to965 square miles by 2029. Thepopulation, meanwhile, grew ata steady rate of 4% between 2004and 2010. A high quality of life,combined with the increasingnumber of businesses openingand expanding in the city(Riyadh’s economy generated460,000 new jobs between 2007and 2009 alone), should main-tain this rate for years to come.

Businesses that already callRiyadh home include the headoffices of Saudi commercialbanks, as well as foreign branchbanks, including Emirates Bankand Deutsche Bank Group. Inaddition, Riyadh has been cho-

sen as the headquarters of theJoint Central Gulf Bank, the in-stitution that will supervise theexecution of the monetary pol-icy of the Gulf Union.

Yet another project in the fi-nancial pipeline that will boostRiyadh’s status further is the KingAbdullah Financial District(KAFD), which is set to be oneof the biggest world financialcenters. The $96 billion KAFDwill serve as Saudi Arabia’s gate-way to an intellectual economy,

facilitating the exchange of tech-nology and knowledge throughprojects such as Riyadh TechnoValley, Saudi Organization forIndustrial Estates and Technol-ogy Zones (SOIETZ), andRiyadh Assembly for Commu-nications and IT.

Administrative hubs of largecompanies – such as Saudi Ba-sic Industries Corp. (SABIC),National Co. for Glass Indus-tries, Yamama Saudi CementCo., and Saudi Real Estate Co.

– are also located in Riyadh, asare two major industrial cities,which are supervised by SOI-ETZ and collectively host 788factories. Furthermore, the roy-al city boasts more than 30 re-search centers and six majoruniversities.

Riyadh, being the capital ofthe kingdom and home to abroad scope of diverse institu-tions, is the financial, business,industrial, cultural, and politicalcenter of Saudi Arabia, capable

of competing not only on a re-gional level, but on a global scale.

“The kingdom’s continued fo-cus on infrastructural projectshave helped develop the servicesector, create economic valueand prosperity in the private sec-tor, and attract domestic andforeign investment,” explainsPrince Salman Bin Abdul Aziz,Governor of Riyadh.

In 2010, he established theRiyadh Competitiveness Cen-ter (RCC) to capitalize on the

city’s unique advantages and en-sure continued economic de-velopment in order to fulfillRiyadh’s competitive potential.The company’s four primarygoals are to develop sectors andmonitor the city’s many clusters,promote and facilitate invest-ment, encourage entrepreneur-ship and innovation, and evaluateRiyadh’s competitiveness.

The RCC has determined thatan enhanced utilization of ITwill be the best vehicle to achievethe results and performance itseeks. “We’re in the process ofimplementing a countrywidesystem – a type of database –which will contain various sortsof information: financial, eco-nomic, supply and demand, fore-casts, etc.,” explains PrinceMohammed bin Salman, sec-retary general of the RCC. “Hav-ing constant access toup-to-date, accurate, and cred-ible information will enable ex-ecutives and managers to makewell-informed decisions and ul-timately maximize profits andcompany performance. I amconvinced that having optimal-ly performing companies willdirectly enhance Riyadh’s over-all level of competitiveness.”

RIYADH COMPETITIVENESS CENTER

The kingdom’s competitive urban centerRiyadh is seeing its gross domestic product and foreign investment rise – along with interest from the international community –thanks to the federal and local governments’ efforts to facilitate business and raise competitiveness

Riyadh’s economy generated over 450,000 new jobs between 2007 and 2009 alone

RIYADH IS NOT ONLYSAUDI ARABIA’SPOLITICAL CAPITAL, ITIS ALSO A MAJORCENTER OF INDUSTRY,FINANCE, BUSINESSAND CULTURE

RIYADH IS THE FUTUREHOME OF THE KINGABDULLAH FINANCIALDISTRICT AND THEJOINT CENTRAL GULFBANK

Both foreign workers and the local population enjoy a modern lifestyle in Jeddah




In face of the global financialslowdown, the Kingdom ofSaudi Arabia’s (KSA) robusteconomy has managed to putthe country among the top 10most competitive nations, andhas seized the world’s atten-tion with its potential for fu-ture strategic investment.

In 2000, the Saudi govern-ment created the Saudi Ara-bian General InvestmentAuthority (SAGIA), respon-sible for fostering investmentopportunities in key sectorsof the economy, including

energy, transportation andknowledge-based industries.

The kingdom is undergo-ing aggressive transformationto attract foreign direct in-vestment (FDI) and wasnamed by the World Bank, in2007 and 2008, the most busi-ness-friendly country in theMiddle East, and included inthe top 20 worldwide.

KSA offers natural com-petitive advantages with un-matchable oil supplies thatallow for low energy costs anda privileged geographic loca-

tion that borders with threecontinents. Adding benefits,SAGIA has created pro-busi-ness regulations and stronginvestments are being madeon infrastructure to convertthe country into a logisticalhub between East and West.

Saudi Arabia ranks fourthin the world for “fiscal free-dom” and is considered theseventh most rewarding taxsystem in the world. It is al-so the largest free market inthe MENA region and firstfor ease of registering prop-erty. So it is no wonder thatinvestors are increasingly at-tracted to this market.

In view of long-term plan-ning, KSA is investing over$60 billion in the developmentof four integrated EconomicCities that will represent theultimate innovation in public-private partnerships. Theyhave been strategically dis-tributed to drive innovationthroughout the kingdom. Eachmetropolis will host up to fivemillion residents, create overa million jobs and most im-portantly contribute $150 bil-lion to Saudi’s GDP.

Each of these integratedcities will offer an unprece-dented standard of living withcutting-edge architecture,

Your partner in Saudi

AMR AL-DABBAGH, Governor of SAGIA

King Abdullah Economic City

world-class services andubiquitous connectivity withnegative environmental im-pact and maximum energyefficiency.

The Economic Cities willachieve economic diversifi-cation (away from oil), createjobs, enhance competitive-ness in Saudi Arabia and raiseGDP per capita. Investorswill find a business-friendlyenvironment, defined bySAGIA, offering competitiveregulatory, fiscal and finan-cial incentives.

SAGIA is also stimulating the

development of knowledge-based industries, in the cre-ation of a knowledge economy,focusing on information andcommunication technologies,education, health services andlife sciences.

To further its growth anddevelopment plans, Saudi Ara-bia will be hosting the sixthannual Global Competitive-ness Forum (GCF) in Riyadhfrom 21-24 January, 2012. Inthis edition, global businessleaders, political leaders andintellectuals will focus on thetheme of entrepreneurship

and discuss the impacts of or-ganizational and national com-petitiveness on local, regionaland global economic and so-cial development.

The GCF, now in its sixthyear, is another SAGIA ini-tiative intended to providevalue-added business servicesand solutions to potential in-vestors interested in operat-ing in Saudi Arabia. Theinternational event, the onlyof its kind, will also includespecialized workshops fo-cused on different forms ofentrepreneurship.

Saudi Chemical Company(SCC) is at the forefront of Sau-di Arabia’s civil explosives pro-duction, with three factoriesin Riyadh, the Eastern andWestern Regions, offices in Al-Khobar, Jeddah and Abha, anddistribution depots in theSouthern Region in Abha andMakkah Al Mukaramah area.

SCC has achieved continu-ous record growth rates of 13%since 2006. SCC and its sub-sidiary companies closed 2010with consolidated net salesreaching SAR1,687 billion ($450billion), representing a 3% in-crease on the previous year.

During the first quarter of2011, the company’s grossprofits ,of SAR 112 million,increased 14% compared tothe same period last year.Earnings per share reachedSAR 1.36, increasing from theprevious year’s SAR 1.18.

SCC traces its beginningsback to1972, when it was setup as a joint venture companybetween Nitro Nobel AB Swe-den and private Saudi in-vestors. It was the country’sfirst explosives manufacturer,and immediately served as thedomestic provider of civil ex-plosives used for rock blasting

in road cuts, foundations,trench blasting for oil and wa-ter pipe lines, tunnelling forroads, and for mining.

Having a domestic providerof civil explosives is of huge ben-efit to the state, as it avoids thepotential dangers and delays in-volved when transporting ex-plosives from another country.

The local market accountsfor 98% of the company’s sales– though SCC also serves for-eign markets with the essen-tial and supporting materialsfor all operations involvingcivil explosives. The compa-ny also offers a wide range oftechnical services rangingfrom safe transportation, stor-age, technical planning andon-site services.

SCC’s line of production to-day includes the world’s mostcommonly used and safest ex-plosives and non-electricaldetonators: kemulex, prillexand sanel.

Kemulex is an emulsion ex-plosive, it has a high detona-tion speed and can bepackaged in custom sized car-tridges to suit a client’s needs.It is suitable for worksiteswith wet holes and under-water explosions.

Prillex is a dry blastingagent made up of ammoni-um nitrates and fuel oil (AN-FO) used mainly with fissuredsedimentary rocks and un-derground applications.

Sanel is a non-electricshock tube detonator with es-pecially accurate controls thatreduce the blasting vibration.It is suitable for bench andtrench blasting,

In 2004, SCC once againproved itself market leader byrunning a new productionline for enviroseis, the safestseismic explosive.

SCC also controls two whol-ly owned subsidiary compa-nies serving different markets:Saudi International TradingCompany Ltd (SITCO Phar-ma) and Suez InternationalNitrate Company (SINCO).

SITCO Pharma, formed in1990, is one of the kingdom’smajor pharmaceutical distri-bution companies, and actsas agent for several leadingmultinational pharmaceuti-cal companies.

Through a unique partner-ship approach, SITCO Parmaholds distribution agreementswith major multinationalpharmaceutical companies

and their subsidiaries – GlaxoSmithKline and BoehringerIngelheim among others –and provides a large share ofinternational drugs to thekingdom.

SITCO Pharma has fourprimary distribution centerslocated in the major metro-politan areas of the country(Riyadh, Jeddah, Dammamand Khamis Mushayt) withthe capacity to service 90% of

the kingdom’s pharmacies inunder 24 hours.

In its Annual Report 2010,SCC ref lects that SITCOmaintained its sales levels andgained a record share of themarket in the sale of vaccinesand cooled drugs, becomingthe first supplier of this typeof drug in the local market.

SINCO, based in Egypt,now produces low density am-monium nitrate (LDAN), a

substance primarily used incivil explosive manufacturing.

The company is strategi-cally located in Suez, close toall major local ports which fa-cilitate transportation and ex-portation. SCC developsprograms of performance tomaintain its global standardsand contributes to social andhealth awareness campaignsthrough its Social Responsi-bility Program.

With a solid base as the leading provider of civil explosives in the country, SaudiChemical Company also has increasing interests in pharmaceuticals

More bang for your buck

The Saudi Arabian General Investment Authority is tasked with attractingand guiding foreign investors

SCC has achieved continuous record growth rates of 13% since 2006




In 1975, when the governmentof Saudi Arabia embarked on avision of enriching the nationaleconomy with comprehensivedevelopment, Saad Wallan, ea-ger to capitalize on the oppor-tunities, left his position as salesrepresentative at Saudi Airlinesand ventured into the privatesector.

He succeeded in establishinga company specializing in waterand fuel transport, and in car im-port and sales, for which he ac-quired the exclusive dealershiprights for Hyundai in 1985.Around that time, he decided tofurther pursue his passion of fly-ing. Capt. Wallan achieved hisgoal and proudly received his pi-lot’s license fromthe U.S. in 1985.“That, togeth-er with myprevious ex-

perience in Saudi Airlines, en-couraged me to enter the newfield of aviation investment; so Iestablished Wallan Aviation [in1995] and became the exclusiveagent of Cessna in the MiddleEast in 1999,” recalls Capt. Wal-lan.

Today, Wallan Aviation is amarket leader of the private avi-ation field and the sole dealer ofBell helicopters in Saudi Arabia.

The company is a one-stop shopfor aviation requirements; it op-erates, maintains and sells air-craft, as well as offering consultingservices to ensure customers findthe appropriate aircraft to ac-commodate their needs. Forclients who prefer to fly charter,Wallan’s Business Wings divi-sion, with home bases in Riyadhand Dubai, is a full 24-hour flight

operation center that grants im-

mediate access to private air char-ter services year-round.

The group also runs the Wal-lan Flying School in Riyadh, pro-viding professional coursesfollowing an integrated flight-training program designed byCessna.

Wallan Aviation has been rec-ognized for its outstandingachievements by many institu-tions, including the Award of Con-

tribution by Hyundai Motor Co.in recognition of outstanding per-formance and contributions over40 years, and the Cessna AircraftCompany’s Most CompetitiveAward. The U.S. Department ofCommerce honored Capt. Wal-lan with the Certificate of Ap-preciation for Achievement inTrade for creating internationaltrade opportunities between theUnited States and Saudi Arabia.

Success, with flying colorsWallan Aviation is synonymous with superior quality and customer care in SaudiArabia and the whole of the Middle East

Capt. Saad Wallan, enthusiastic pilot and savvy businessman, establishedWallan Aviation in 1995

Saudi Arabia enjoys one-fifthof the planet’s oil reserves, andranks as the largest exporterof petroleum in the world. Thecountry is expected to con-tinue booming, fueled by twomassive fiscal spending pack-ages worth a combined $129billion. And infrastructuralimprovement projects alreadyunderway have a total value of$600 billion.

One of the key elements ofthe transformation of theSaudi economy is develop-ment and improvement of in-frastructure at all levels, andensuring that new infra-structure is added to accom-modate the rapid changestaking place in the country –changes which include sig-nificant population growth.

Under the leadership ofKing Abdullah Bin Abdulaz-iz Al Saud, the kingdom hasmade huge investments avail-able for industrial infra-structure development,laying the foundations for thekingdom’s economic strate-gy over the next 50 years, ac-tively seeking to upgrade andimprove its rail, port, airportand other transportation in-frastructure.

According to figures re-leased by the National Com-mercial Bank (NBC), the Gulfkingdom’s largest banking en-tity, during the first half of2011 the kingdom awardedcontracts worth a total ofover SAR 84 billion ($22.4billion), a 156% increase overthe same period of the pre-vious year.

This is a result of the in-creased spending on infra-structure enveloped in the

country’s latest five-year de-velopment plan. Not sincethe country’s first two plans,which covered the 1970s, hadsuch emphasis been placedon infrastructure.

The move comes as a resultof the government’s desire tofulfil demands for improvedservices in infrastructure,power and real estate sectors,arising from needs of inter-

connectivity and urbaniza-tion. Such projects includethe North-South Railway, theMashaaer MugaddassahMetro Project, the HaramainHigh-Speed Railway alsoknown as the “Western Rail-way,” and the four EconomicCities.

The construction of uni-versities (KAUST, whichopened in 2009, is a fine ex-

ample) represent expendi-tures on both hard and softinfrastructures.

Over 31% of the contractsawarded during the secondquarter of this year – a stag-gering $34,5 billion, 43% morethan the same period of 2010– were directed towards in-frastructure-related sectors.

NCB said the surge boost-ed its Construction ContractsIndex (CCI) to an over-whelming 205.3 points at theend of the first half of thisyear, from 90.36 points at theend of the first half of 2010.

These figures clearly re-flect the wellbeing experi-enced by the constructionindustr y during 2011

throughout the countr y.Ridyah, the kingdom’s capi-tal, was allocated 26% of thecontracts, the highest shareawarded to one region, whilethe Eastern Province re-ceived 25%, mainly for in-dustrial, water and urbandevelopment contracts.

To emphasize the impor-tance the government is plac-ing on infrastructure, Jeddahjust hosted, on December 11-14, the Saudi InfrastructureForum and Exhibition 2011,a premiere internationalevent showcasing major in-vestment opportunities andinfrastructure projects. Theevent highlighted the king-dom’s encouragement of pri-

vate and foreign investmentin the form of joint ventureswith Saudi public and pri-vate companies.

The rate at which contractswere distributed in 2011 pre-sents a ‘need it fast’ and ‘needit now’ trend. In the process,increased opportunities de-veloped for both large andSME players.

Expected to continuegrowing over the comingyears, due mainly to an in-creasing population andstrong demographics – over60% of the Saudi Arabianpopulation is under 25 – de-mand for both social and eco-nomic infrastructure isensured.

With an eye to the future, Saudi Arabia is currently spending $600 billion on its roads, railways and airports

Massive spending on infrastructure




The Kingdom of Saudi Ara-bia currently boasts thelargest market for healthcareproducts and services in theArabian Gulf. It is consideredthe epicenter of advancedmedicine in the region.Boosts in annual governmentbudgets, increased foreign in-vestment and expertise arejust a few of the key ingredi-ents paving the way for thekingdom’s health care.

However, despite openingup to the private sector andestablishing partnershipswith international firms, theSaudi government continuesto be the kingdom’s main fi-nancier of health-related ex-

penditures. With a budget of$18.32 billion allocated tohealth-related matters for2011, this figure represents a12.3% increase over the$16.32 billion for 2010, andaccounts for 11.8% of thecountry’s spending, a quan-tity expected to increase to$20 billion by 2016.

With this budget, the Min-istry of Health aims “to pro-vide the highest possiblequality of healthcare servicesto people throughout thekingdom through a widerange of services and facilitiesand well-trained staff,” as af-firmed in the government’sVision for 2020 statement.

Its overall plan “is to pro-vide quality comprehensivehealthcare services to all in-dividuals, families and com-munities throughout thekingdom.” One initiative re-cently announced by SaudiHealth Minister Dr. Abdullahbin Abdul Aziz Al Rabeeah isthe construction of 33 newhospitals across the kingdom.

However, there is pressureon the government to deliv-er more. In a rapidly growingand ageing population likethat of Saudi, where the av-erage national is overweightand modern lifestyles oftenengender poor health, boostsin healthcare budgets alone

will not meet the demandsof the population without af-fecting the country’s eco-nomic progress.

The kingdom’s growingpopulation is the main causefor the heightening demandfor health care. The Saudicommunity is expected to in-crease by 20% and reach 30million by 2016. The elderlyalone, currently one million,are expected to amount to2.5 million in the next 15years. All age groups will ex-perience increased rates ofgrowth, in part due to in-creased life expectancy re-sulting from improvementsof the health care system.

Constant investment inthe nation’s wellbeingWith a steadily increasing population, the kingdom has invested heavilyin its health care sector, both quantitatively and qualitatively

The after-effects of the reces-sion, which has negatively af-fected most of the world, havehad less of an impact on Sau-di Arabia’s insurance industry,which has been thriving overthe past few years. Health in-surance is leading as one of thefastest growing segments inthe country’s insurance sector,becoming a key growth driverfor the overall market with seg-ments like engineering insur-ance, motor insurance, andaviation insurance followingclosely behind.

There has been much inter-est in investing in Saudi Ara-bia’s private medical care sincethe Cooperative HealthInsur-ance Act in 1999. This act hasprovided medical insurance toall private sector workers with-in Saudi Arabia, successfullyinsuring over 8.6 million Sau-di and expatriate employeesand their families to date.

There are many benefits ofinsurance for both workersand the insurance industry.Due to the surge in the num-ber of insured workers, in-surance companies haveadvanced their products andservices to serve the targetmarket. The Act has also led

to developments in IT uti-lization, training centers, andhealth universities, betteringthe country’s technologicalexpertise.

The role of the Council ofCooperative Health Insurance(CCHI) is to work towards ed-ucating the private sectorabout the many benefits healthinsurance has for their work-ers. The CCHI certifies 26 in-surance firms, five third-partyadministration companies, and

over 2400 healthcare providers. There is a big future of

growth for private medical carein Saudi Arabia, with sup-porting factors such as lowpenetration, strong govern-mental support, and risingawareness of insurance. Be-cause of these factors, thosewho opt for insurance plans inSaudi Arabia are likely to in-crease, giving the industry adefinitive edge for develop-ment in the upcoming years.

The thriving insurance sector has helped boost the country’s technological expertise

“He who enjoys goodhealth is rich,” says the an-cient proverb, and theKingdom of Saudi Arabiahas consistently worked toimprove and develop itshealthcare sector, to ensurethe future health andwealth of the nation.

For the past four years,the state has taken its du-ty as ‘caretakers of society’one step further by estab-lishing the Saudi Food andDrug Authority. Its visionis to lead the country in ef-fective and safe drug reg-ulations through theimplementation of quali-ty ‘Made in Saudi Arabia’consumable goods, alongwith safe and effectivemedical and pharmaceu-tical policies.

The job faces seriouschallenges in a world ruledby fast food and harmfuldiet pills. However, thanksto visionaries such as Dr.Mohammed Al-Kanhal,Chief Executive Officer ofSaudi Food and Drug Au-thority, the kingdom hasjust become an even saferhome for over 26 millionpeople. He says that oneday ‘Made in Saudi Arabia’will be a trusted householdname, just like that of theUnited States or Europe.Of course, this does nothappen overnight butrather one step at a time

through tough regulations,he affirms.

Nonetheless, accordingto Dr. Al-Kanhal the king-dom’s first step towardsreaching its goal is througheducating its human capitalon safe practices. To date,Saudi Arabia has sent over370 college graduatesabroad to study food andmedical devices in the hopeof regulating factories andrestaurants, while estab-lishing itself as a giant in thepharmaceutical industry.

There is no doubt, thathe, who has the will, willdefinitely find the way.

‘Made inSaudi Arabia’– a brand forthe future

One of the first steps to be-coming a knowledge-based so-ciety is the establishment of aworld-class public universitythat not only provides studentswith an education, but alsogenerates knowledge.Launched in 2009, the KingAbdullah University of Scienceand Technology (KAUST) isone such institution.

Home to the country’s firstmixed-gender campus, KAUSTis spread across 14 square milesof the Red Sea coast at Thuw-al, around 50 miles north of thecommercial center of Jeddah. Itfeatures state-of-the-art labs,encompasses a marine sanctu-ary, and has one of the fastestsupercomputers on the planet.In June 2010, the innovativeand sustainable architecture ofthe KAUST campus received aplatinum rating on the Leader-ship in Energy and Environ-mental Design (LEED) scale,produced by the U.S. GreenBuilding Council.

By 2020, KAUST aims to berenowned for “cutting-edge, ba-sic and goal-oriented researchin science and technology, com-parable to that of the world’stop 10 science and technologyuniversities.” The research-ori-entated graduate school isbacked by a perpetual endow-ment, or waaf, of $10 billion –one of the largest in the world– and is a key part of the gov-ernment’s plans to encourageopen research and develop-ment in Saudi Arabia.

In his message to the uni-versity, Custodian of the TwoHoly Mosques King AbdullahBin Abdulaziz Al Saud states:

“As a new ‘House of Wisdom,’ theuniversity shall be a beacon forpeace, hope, and reconciliationand shall serve the people of thekingdom and benefit all the peo-ples of the world in keeping withthe teachings of the Holy Quran,which explains that God creat-ed mankind in order for us tocome to know each other.

“It is my desire that this newuniversity become one of theworld’s great institutions of re-search; that it educate and trainfuture generations of scientists,engineers and technologists;and that it foster, on the basisof merit and excellence, col-laboration and cooperationwith other great research uni-versities and the private sector.”

Activity at KAUST focuseson impact rather than quan-tity and recent projects cen-tered on energy, food, waterand the environment at the in-stitution are already produc-ing results. Researchers havedeveloped “molecular scissors”that could improve the quali-ty, yield and disease resistanceof crop varieties, with pro-found implications for agri-cultural science worldwide.

Hybrid elastics research atKAUST has entailed the de-sign of a new elastic materialand was carried out in con-junction with the Hong KongUniversity of Science andTechnology (HKUST) andSoochow University in China.

The collaboration has pro-duced a new type of metama-terial that blurs the linebetween a liquid and a solid.

Also, scientists at the uni-versity are looking to utilize thecountry’s year-round solar ra-diation to provide potable wa-ter. While visiting theuniversity’s Water Desalinationand Reuse Center (WDRC),Professor Kim Choon Ng of theNational University of Singa-pore (NUS) and his team areworking to introduce solar-powered water desalinationtechnology to Saudi Arabia that,according to Prof. Ng, in prin-ciple can be run from anywhereand would be hugely beneficialfor the kingdom.

King Abdullah University ofScience and Technologytargets a knowledgeablesociety

KAUST spearheads high-tech R&D

DR. MOHAMMED AL-KANHAL,Chief Executive Officer of the SaudiFood and Drug Authority

KAUST IS A KEY PART OF THEOIL-RICH KINGDOM’S EFFORTSTO DIVERSIFY ITS ECONOMICBASE AND TRANSFORM ITSELFINTO A GLOBAL HOTSPOT FORSCIENTIFIC ANDTECHNOLOGICAL RESEARCHAND DEVELOPMENT

ITS BUILDINGS HAVE BEENDESIGNED TO UTILIZE NATURALLIGHT AND VENTILATION, WITHROOFS CAPABLE OFSUPPORTING 12,000 SQUAREMETERS OF SOLAR PANELS TOPRODUCE 3,300MW OF CLEANENERGY EVERY YEAR

The campus, lecture halls, labs and academic areas have been designed to foster creativity and innovation

The pillar of a prosperousnation – insuranceThe Council of Cooperative Health Insurance (CCHI) is to working to educate theprivate sector about the benefits of health insurance




Al Bawani Co. Ltd. provides con-tracting services for govern-ments, corporations and privateindividuals across the region. “AlBawani is a Class 1 constructioncompany and ISO-9001:2008-certified, which means the sizeof the contract we can take isunlimited,” says general execu-tive manager Fakher A. Al-

Shawaf. “We are focused on thequality and durability of our pro-jects.” The company is targetingthe healthcare and commercialsectors, and also looking at wa-ter and power projects. “We justfinished one of the biggest ICUsat King Faisal Specialist Hospi-tal and Research Center and weare building a central ICU for

King Saud University.” It has al-so completed security projectsfor the U.S. and other embassies.Recently, its was awarded twoprojects worth over $384 millionfrom an existing client, a testa-ment to the quality work com-pleted. With these projects, thecurrent backlog for the compa-ny stands at over $1 billion.

Al Bawani boosts healthcareNew projects build up the region’s medical, commercial and educational infrastructure

Saudi Arabia is focusing itssocioeconomic develop-ment on its youth, and thekingdom is working to pro-vide its inhabitants with thebest possible educationalservices.

As it embarks on a coun-trywide path to further so-cioeconomic development,Saudi Arabia, like the rest ofits Gulf neighbors, is un-dergoing a continuous pop-ulation boom – and toaddress this surge the gov-ernment is boosting the ed-ucation budget. In 2011, atotal of $40 billion (SAR 150billion) was allocated to thissector, representing a 9% in-crease from the 2010 $36.69billion (SAR 137.6 billion)budget.

Saudi’s Ministry of High-er Education (MOHE) con-siders that investing ineducation is investing in thefuture. Good education andskills are crucial to improv-ing one’s economic and so-cial prospects and the nationneeds to improve employa-bility of the local population.

Saudi investments in ed-ucation have tripled sincethe year 2000, in 2010 morethan a quarter of govern-ment funds were designat-ed to this sector. Theseannual increases reflect thegovernment’s desire to in-vest in human capital. Partof this year’s budget fed theKing Abdullah Project forDevelopment of Public Ed-ucation which includedbuilding 610 new schools inaddition to the 3,200 alreadyunder way. In 2010, 610 werecompleted.

The number of publicuniversities in the countryhas risen from eight to 24and some rank among theworld’s top. The objective isto double university stu-dents by 2014, from 860,000to 1.7 million.

Despite market saturationof social science majors, themost sought after degreescontinue to be social and re-

ligious studies, history andliterature.

In recent years, the gov-ernment has promotedmore technical and engi-neering oriented programsto fill gaps in the workforce.New universities being setup are following the lead ofthe recently inauguratedKing Abdullah University ofScience and Technology(KAUST) and emphasizingthese subjects and others inscientific domains.

2011 funds aided the con-struction of new universi-ties and the expansion ofalready existing ones to in-crease student enrollment.They also enhanced thescholarships catalogue in-cluding the King AbdullahScholarships Program(KASP), which operates in

more than 21 countries and,since its creation, has ben-efited over 60,000 Saudi na-tionals. These programsencourage students to studyabroad and gain expertiseand know-how to applysubsequently to the localeconomy.

The MENA region pos-sesses one of the most lu-crative education sectors inthe world. Today an averageof 18.6% of MENA govern-ment expenditures are allo-cated to this sectorcompared to the world av-erage of 14.2%.

The Ministry of Educa-tion’s Ten-Year Plan cover-ing 2004-2014 containswomen-focused goals whichinclude organizing girls’technical education and de-veloping syllabi based on Is-lamic values.

Aiming to fulfill this ob-jective, earlier this year theworld’s largest women’s uni-

versity, Princess Nora bintAbdulrahman Universityopened on the outskirts ofRidyah and is expected tohost 40,000 students. It is asymbol of women’s partici-pation in the building of Sau-di Arabia’s future andreflects King Abdullah’s aimto open all avenues forwomen.

Saudi Arabia’s commit-ment to extending educa-tion opportunity to all Saudisociety will continue in 2012.

Next year’s budget totals$144 billion – and 26% ofthat will be allocated forpublic, higher education andworkforce training. $2.5 bil-lion will go to completingconstruction of the “univer-sity cities” in different partsof the country, $3.2 billionwill continue financingKASP and other projects.

To further promote thedevelopment of interna-tional agreements, the Min-istry of Higher Educationhas organized the third In-ternational Exhibition andConference on Higher Edu-cation (IECHE) which willcement academic ties be-tween students and foreigninstitutions.

The MOHE continues totrain its future workforcethrough the establishmentof academic agreementswith renowned companies.In 2011, important partner-ships were signed and theforecast is that this tenden-cy will continue.

An agreement betweenGE and King Fahd Univer-sity of Petroleum and Min-erals (KFUPM) will award30 scholarships to studentswith a commitment of hir-ing them following gradua-tion. It is the first initiativeof its kind carried out by thecompany.

Intel has committed totraining 100,000 educatorsacross the country on intechnological programs.

Higher education in Sau-di Arabia continues to grow.The amount allocated to ed-ucation and training is ex-pected to grow in years tocome as the annual budgetdwarfs other sectors, prov-ing the kingdom’s commit-ment to Saudi youth.

Nurturing the nation’s most precious resource

“WE AIM TOPROVIDE THEHIGHESTPOSSIBLEQUALITY OFHEALTHCARESERVICES TOPEOPLETHROUGHOUTTHE KINGDOMTHROUGH AWIDE RANGE OFSERVICES ANDFACILITIES ANDWELL-TRAINEDSTAFF”

GOVERNMENTOF THEKINGDOM OFSAUDI ARABIA,VISION 2020STATEMENT

NEXT YEAR’SBUDGET TOTALS$144 BILLION–AND 26% OFTHAT WILL BEALLOCATED FORPUBLIC, HIGHEREDUCATION ANDWORKFORCETRAINING

Illnesses referred to as“lifestyle diseases” are an-other cause of worry amongSaudi Arabians.

The socio-economic trans-formation of the country hasintroduced new habits intosociety that can lead to obe-sity, hypertension and dia-betes. Statistics reveal thatcardiovascular diseases ac-count for 22% of deaths inSaudi Arabia each year.

There is an increasing needto modify trends of stress,cigarette smoking and lackof physical exercise; other-wise the number of deathscaused by such factors willcertainly increase.

While the Saudi Ministryof Health is tackling the sit-uation by concentrating partof its activities on preventiveand curative primary care,there are many issues thatneed to be addressed, andthe government has ex-pressed its interest and needto attract foreign partners.

One of the first measurestaken by the Saudi govern-ment to further private careparticipation was the intro-

duction in 2005 of mandato-ry health insurance for non-Saudis residing or workingin the country. It applies toall private-sector employees,though in time it is expect-ed to extend to all employedSaudi nationals.

The health sector is key tothe government’s privatiza-tion programs. The Ministryof Health’s idea is to restruc-ture and move away from be-ing the main provider, tobeing the regulator of privateservices.

And so, at a time when themarket is ripe for investment,many healthcare companieshave already picked up onthe chance to participate inSaudi Arabia’s initiatives toimprove the country’s healthcare services, which are seenby many as promising busi-ness opportunities.

GE’s healthcare division,GE Healthcare, has set up inthe kingdom, and invested inthree strategic service sup-port centers. The companyis working alongside gov-ernment initiatives with thecontribution of tools that al-

low earlier and faster diag-nosis. It is also equipping hos-pitals with the requiredknowledge and technology,such as imaging and infor-mation technologies to pa-tient monitoring systems.

One of GE Healthcare’scontinuous localization ini-tiatives is setting up a strongSaudi workforce and creatingmore employment opportu-nities, alongside a transfer ofknowledge and expertisethrough training and educa-tion. In 2010, they hadtrained over 150 skilled pro-fessionals.

The company’s contribu-tions have not gone unno-ticed, as it currentlygenerates over $1 million inrevenues.

Saudi healthcare servicedemand is expected to con-tinue rising in the next fewyears. Privatization, the mod-ernization of hospitals andtechnology, and training thelocal workforce are expectedto increase local productiv-ity to meet the nation’s de-mand, without hampering itseconomic drive.

Saudi Arabia knows ithas to invest in its youthin order to compete intomorrow’s businessworld

Figures released by the Sau-di Arabian Monetary Agency(SAMA) show that the in-surance sector grew by 12.4%in 2010. The Mediterraneanand Gulf Insurance and Rein-surance Company, known asMedgulf Insurance, is the in-dustry’s established leader,and has contributed to thissuccess. “We have fought andwon and we will continue todo so,” says Lutfi El-Zein, thecompany’s chairman.

Medgulf is the premier in-surance services provider inSaudi Arabia and the MiddleEast, providing the retail andinstitutional markets with allrisk coverage requirementsthrough its operations inLebanon, KSA, Bahrain, UK,UAE, Turkey and Jordan. TheGroup began its activities in1980 in Lebanon and ex-panded through acquisitionsand mergers.

Medgulf is currently thelargest privately owned in-surance and reinsurance com-pany in the Arab world, andthird in terms of the size ofpremium income, behindTawuniya and Misr Insurance.

The company has also hadto deal with negative percep-tions of the insurance busi-ness, which many felt workedcontrary to Sharia law. How-ever, attitudes gradually re-laxed, as regulation of theinsurance industry was in-troduced in the 1990s. “Be-fore regulation, manycompanies in Saudi just dis-appeared, and the rights of

the policy holders went aswell,” explains Mr. El-Zein.

However, the future nowlooks bright. Driven by strongmacroeconomic perfor-mances – numerous con-struction projects indevelopment and a global risein oil prices – the insurancemarket in Saudi Arabia is cur-rently at one of its peaks.

A combination of interna-tional know-how and an un-derstanding of the country’sculture and economy is pro-vided by Medgulf ’s workforce,

with staff trained first-hand bythe company. “People whohave lived and worked in thecountry are in a much betterposition to gauge the needs oftheir fellow citizens,” explainsMedgulf ’s chairman.

Saudi Arabia’s insurancesector is playing an increas-ingly important role in thenational economy, and willcontinue to enjoy a greatercapital position as local busi-nesses become more aware ofthe importance of adequateinsurance coverage.

Local knowledge gives Medgulf an edge in competitive insurance sector

Saudi’s premier insurer

LUTFI EL-ZEIN, Chairman of Medgulf




Saudi Arabia is presenting theworld with a new concept ofmodern living. Each of the fournew Economic Cities being de-veloped in the kingdom wasdesigned to be an exclusive 21st

century metropolis in whichto live, work and play.

With a total cost of morethan $60 billion for all fourcities, one of the government’s

objectives for this project is todiversify the kingdom’s currentoil-based economy. The Eco-nomic Cities will be integrat-ed townscapes with moderninfrastructure, and will includeeverything necessary for mod-ern life.

Building these cities involvesattracting more private and for-eign investment, and the king-

dom has reformed some con-ditions to encourage this –though it is already the largestrecipient of foreign direct in-vestment in the Arab world.

Saudi Arabia is rated as oneof the world’s top 10 most com-petitive economies, and repre-sents a sound investmentopportunity. The kingdom isthe world’s fastest reformingbusiness climate, and ranks firstfor ease of property registra-tion – and is the largest freemarket in the MENA region.Each city was designed and es-

tablished for a different pur-pose (though all share the com-mon target of attracting moreinvestment to the kingdom).

Saudi Arabia is carrying outbold business reforms and nowranks as the top economy inthe Middle East. Inflows haveincreased and continue to doso with the developments ofthe Economic Cities.

As the four Cities become areality, renowned companiesfrom around the globe contin-ue to invest. Among these areSanofi-Aventis, TOTAL Lu-

bricants Company, andMalaysian MMC which will bepartnering with the Saudi Bin-ladin Group.

King Abdullah EconomicCity, the largest of the four –and the first to be constructed– will be the kingdom’s firstfreehold city, an attractive op-portunity for foreign propertyinvestors. It is the first time thatforeign individuals or compa-nies will be allowed to ownproperty in Saudi Arabia.

Prince Fahd bin Abdullahbin Mohammed Al Saud, As-

sistant Minister of Defense andAviation and Inspector Gen-eral, and Chairman of the Eco-nomic Offset Committee,recently visited King AbdullahEconomic City (KAEC) and as-serted that it is a major contri-bution to development anddiversificvation of the nation-al economy.

Saudi Arabia’s economic per-formance on the whole is grow-ing. In recent years it hasexceeded world growth, andeven non-oil sectors have de-livered profitably.

With a planned investment of$27 billion funded entirely byprivate capital, the King Ab-dullah Economic City (KAEC)is considered SAGIA’s jewelin the crown, envisioned tobecome the single greatest en-abler of social and economi-cal growth in the entirekingdom.

The city will cover a whop-ping 168 million square me-ters near the commercial hubof Jeddah, create a million jobsand be home to two millionpeople.

The city will be divided in-to four main areas: industrialand residential zones, the sea-port and a sea resort area thatstretches along 1.5 miles ofunspoiled beach – a concept

new to Saudi Arabia that willsurely make it MENA’s primetourist destination.

120 hotels and 25,000 hotelrooms will welcome tourists,and 275,000 apartments andvillas will house the residentpopulation. World-class inter-national schools will cater tothe local and foreign commu-nity, and a university campuswith a capacity to accommo-date 18,000 students will facil-itate further education.

The city is being built bygovernment-controlled realestate giant Emaar Properties

and other Saudi investors. Up-on completion – expected in2025 – it will be the same sizeas Washington DC.

KAEC will be developed inphases and in such a way thatresponds to market conditions,so as to ensure a genuine returnon investments. Constructionbegan in 2006 with some res-idential projects on the coast-line, and an industrial zonefurther inland. With time, con-struction and development willwork its way further inland un-til the envisioned jewel in thecrown is fully completed.

Creating the lifestyles of the futureSaudi Arabia’s four Economic Cities represent a newmodel for strategic public-private partnerships and adiversification from an oil-based economy

The Knowledge Economic City(KEC) will be a cultural land-mark and the focal point of Sau-di Arabia’s knowledge-basedindustries. Situated to the eastof Al-Madinah, it will revivethe city’s role as a center for Is-lamic knowledge and culture.The city will create opportu-nities for young Saudi entre-preneurs and attract talent fromdifferent parts of the world.

KEC will cover an area of 4.8million square meters, and20,000 jobs will be created.

Different centers will feedthe city with knowledge. TheTaiba Complex for Technolo-gy and Knowledge-BasedEconomy will be equipped withstate-of-the-art infrastructureand will focus on Arabic.

The city will comprise acomplex for technology andknowledge-based economies,technological and adminis-trative colleges specializingin IT, software developmentand business administration,an Islamic civilization stud-ies center, a business centerand a complex for medicalstudies, biological sciencesand health services.

A world-class business cen-ter will occupy the heart ofthe city, and support opera-tions in Medina.

The location of KEC withinholy boundaries is expected toattract both national and foreignvisitors throughout the year.Given KEC’s proximity to theHoly Mosque in Al-Madinah,new infrastructure is plannedto connect the city with PrinceMohammed Bin Abdul AzizInternational Airport, KAEC,Makkah, Yanbu and Jeddah.

Different investment modeshave been formulated to attractinvestment to KEC, which in-clude strategic partnershipsand joint ventures, direct landsale to developers and long-term land lease.

THE CITY WILL CREATE A MILLION JOBSAND BE HOME TO TWO MILLION PEOPLE

THE LOCATION OFKEC WITHIN HOLYBOUNDARIES ISEXPECTED TOATTRACT BOTHNATIONAL ANDFOREIGNVISITORS

King Abdullah Economic City

Knowledge Economic City

The Prince Abdulaziz binMousaed Economic City(PABMEC), also denominat-ed Skyscraper City, will soonrise in the vast desert in thenorthern region of Hail. It isset to be MENA’s most mod-ern transportation and lo-gistics hub, strategicallylocated at the crossroads fornavigational, trade and trans-portation routes betweenEast and West.

Transportation infrastruc-tures will include an interna-tional airport expected to servethree million passengers peryear, a railway station for twomillion annual passengers, anda dry port and operations cen-ter capable of handling over1.5 million tons of cargo.

Furthermore, the railwaysystem and road connectionswill expand to connect withJordan, Iraq and Madinah.With an estimated investmentof $8 billion, the city is ex-pected to generate 55,000 newemployment opportunities.

PABMEC will also includespecialized zones for agricul-tural, petrochemical and min-ing industries. Business,residential and recreationalareas will of course be present

as a population of 300,000 isexpected to reside in the city.

Development of PABMEChas been assigned to Al MalInvestment. The company,an experienced developerwith a proven track record,has created a new entity, AlMal Economic City HoldingCompany (AMECHC), to de-velop PABMEC. AMECHCholds 64 shares in equity ofthe $1.3 billion capital set forthe city’s development.

The developer has creatednine specialized companiesto control operations for dif-ferent project components.Partners collaborating in thedevelopment include SABIAand the Kuwait-based privategroup, Kharafi.

An industrial city situatedjust 37 miles northwest ofJazan City, a major port onthe Red Sea, Jazan Econom-ic City (JEC) is designed tobecome an export platformfor international consumermarkets.

Its unique location – closeto the main trade routes be-tween Europe, Asia andAfrica – makes JEC a strate-gic stop for neighboringcountries that do not havethe infrastructure necessaryto access export markets. Thisattractive aspect alone isenough to draw in worldwideinvestment to the project.

Key features of the city in-clude an industrial zone, acommercial business and cul-

tural centre, and residentialareas that will house an esti-mated population of 300,000.Some $27 billion will be in-vested and 100,000 new jobscreated.

An industrial park will oc-cupy over two-thirds of thecity’s 100 million square me-ters, and it will contain amodern oil refinery and in-tegrated petrochemical com-plex, a copper refinery,fisheries, and an aluminumcomplex.

Transport infrastructurehas been designed to includea new seaport and dry dock,an international airport andrail connections to Jeddah.Positive environmental prac-tices will be employed in all

buildings, particularly thosewith intense industrial facilities.

Now is clearly the momentto invest, and the Saudi riyalis one of the world’s most sta-ble currencies having expe-rienced no significant changein its exchange value over thepast three decades.

Furthermore, Cisco isworking with JEC develop-ers to create a smart-enabledenvironment for all the ma-jor international companiesexpected to establish them-selves in the city.

IT IS SET TOBECOME THEMENA REGION’SMOST MODERNTRANSPORTATIONAND LOGISTICSHUB

$27 BILLION WILLBE INVESTED AND100,000 NEW JOBSCREATED

Prince Abdulaziz binMousaed Economic City

Jazan Economic City


wednesday, december 14, 2011 saudiarabia - unitedworld … · ah law is strictly enforced and...

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