Saudi Arabia’s push for firms to set up regional headquarters in Riyadh is not aimed at dismantling corporate operations elsewhere and proves its success.
The world’s top oil exporter, Saudi Arabia, gave foreign companies until the end of 2023 to establish regional headquarters or risk losing government contracts as it competes to attract foreign capital and talent.
President of the Royal Commission for Riyadh City Fahd al-Rasheed told Reuters there has been “much success” in attracting multinationals.
Details will be available at Saudi’s investment forum Future Investment Institute (FII) which starts on Tuesday.
“Companies want to move here. Once they learn about the investment opportunities and the kinds of full offer that we provide them, they immediately decide to (come),” Rasheed said, speaking on the sidelines of a Saudi climate forum.
Regional business hub
“It’s not about dismantling what companies are doing in other cities in the region;” he said, also urging multinationals without a regional presence to set up shop.
Saudi Arabia has not yet revealed the number of companies that have moved their headquarters under the initiative of Crown Prince Mohammed bin Salman to make the Kingdom a regional business hub, putting it in competition with another commercial center, the UAE.
Several foreign companies, including PepsiCo, Bechtel, Schlumberger, and others, agreed earlier this year to set up regional offices in the Kingdom rather than overseeing operations remotely from Dubai.
Sources said last month that Saudi media companies in Dubai had begun relocating their employees to Riyadh.
“We’re giving incentives per sector. It’s not a blanket incentive process,” Rasheed said; adding that it would be “super easy” to lure the investment banking sector.
He cited Crown Prince Mohammed’s plan to wean the economy off oil by building new industries; and launching mega projects; and a specific strategy for Riyadh will be announced soon.
“Riyadh’s sustainability strategy alone is an investment opportunity worth $40bn for the private sector,” he said; adding that “the opportunity is unprecedented around the world.”
“Just the Riyadh Sustainability Strategy, it’s a $40bn investment opportunity for the private sector. It needs to structuring by investment banks, so the opportunity is unprecedented across the globe,” he said.
Saudi Arabia plans in the next decade to double the population and economy of its capital city; currently home to some seven million people, and has moved to improve quality of life.