Saudi Arabia To Diversify Its Economy; Pressurises Multinational Firms

Story Highlights
  • KSA is investing trillions in diversifying its global economy
  • Orders International firms to shift hub in the capital
  • Small scale traders excluded from the ruling

World: The kingdom of Saudi Arabia is increasing pressure on international organisations to shift their headquarters to the Kingdom.

As per the 2o24 agenda, the Saudi government and state-backed institutions will stop signing contracts with foreign companies that situate their base in the Middle East, according to a statement from the Saudi Press Agency. The move is intended to limit “economic leakage” and boost job creation; as per an anonymous source.

The country decides to beef up the presence of international firms in the country’s capital, supporting a border plan to broaden its horizon. 

Crown Prince Mohammed bin Salman released $800billion into the market to boost its economy.

“It’s not natural for companies without their decision-making apparatus in the country to be getting the prime contracts that the government and government entities would be awarding,” Khalid Al-Falih, Saudi Arabia’s Minister of Investment, said in a phone interview. “It’s a reward for those who choose to be here.”

This decision of the Arabs is a regional competition over global commerce and talent that has escalated as Prince Mohammed opens the kingdom’s economy while touting $6 trillion in investments over the next decade.

The ruling applies only to government bodies that go through MoF procurement process. The private firms and publicly traded companies have no such implications to adhere to. 

Al-Falih said, “We believe that the combination of the infrastructure in place in Riyadh, the incentives that will be given, as well as the size of the pie in terms of business opportunities, will attract hundreds of companies to relocate and not wait until 2024.

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