Arab News, Monday, Mar 13, 2023 | Sha'ban 21, 1444
Saudi Arabia promotes investment opportunities at Tokyo forum
Saudi Arabia: The Japan Cooperation
Center for the Middle East (JCCME) held a business forum on investment
opportunities with the Saudi Arabian National Center for Privatization (NCP) in
Tokyo on Monday.
The event featured Mohammed Basodan, the CEO of
NCP; Hani Alsaigh, the NCP’s Vice President, Strategic Marketing and Knowledge
Management; Salman Badr, Executive Vice President of the NCP’s Infrastructure
Advisory; and Mohammed Al-Dahlawi, Saudi’s Ministry of Investment’s
Representative in Japan.
The NCP’s Privatization Program aims to enhance
the role of the private sector in provision of services and the availability of
government assets.
The Saudi representatives explained that the Saudi
market is “ripe for investments,” adding: “There is a strong commitment towards
privatization that comes from the KSA leadership. Laws and regulations are
geared to safeguard investors rights as well as a clear ecosystem and process
put in place to facilitate and push through transactions.”
They noted that there are over 200 projects
currently in the pipeline and 300 future opportunities.
“The pipeline has been tested, with about 30
projects awarded and closed to date and multiple success stories,” they said,
noting that Saudi Arabia is witnessing significant growth and has excellent
credit ratings.
The Saudi side also noted that “in Saudi Arabia we
have the largest, broadest, and most successful Privatization and PPP program in
the Middle East, and it is a top priority for the Saudi government. The NCP
Board includes 11 ministers responsible for all the main economic and
infrastructure sectors.”
“Saudi Arabia has long welcomed international
investors, building on our experience in oil and petrochemicals. Our
sophisticated local banks actively participate in financing PPPs alongside
international lenders. There are also strong local players in construction, as
well as considerable financial liquidity in the market. These provide a pool of
potential consortium partners, sub-contractors, and financial investors.”
The Japanese representatives included Tamura
Mitsuo, Managing Director of the Middle East Cooperation Center, and Fujiwara
Toshiharu, the International Strategic Information Department General Manager at
Mizuho Bank.
Fujiwara noted that “Saudi Arabia has the largest
population and economy in the Gulf region and the two largest religious holy
sites of Islam. Crown Prince Mohammed bin Salman is garnering increasing support
from the people, especially the younger generation, and various economic reforms
are being implemented, such as the Giga Projects, the Saudi Green Initiative,
and the measures to attract international companies to relocate regional
headquarters to Saudi Arabia.”
“One of the key drivers for privatization at the
national level is a Housing Program, targeted improvement in service quality and
reduction in and improving quality of life for citizens. The government is open
to various forms of private sector investment such as full/partial assets sale,
IPOs, management buyouts, public private partnerships (PPPs) and outsourcing.”
“PPPs are being increasingly used as a means of
attracting more private investment into areas of the Saudi Arabian economy that
have traditionally been financed by the public sector. PPPs form a key component
of Saudi’s National Transformation Program which is also one of the key programs
under Vision 2030, aiming to increase the percentage of private sector from 40%
of GDP in 2016 to 65% by 2030.”
“The PPP model provides an important vehicle for
both international and regional investors and developers to take advantage of
the potential, especially in the water, transportation, education and healthcare
sectors of the Saudi market.”
He explained that the benefits of private sector
participation include availability and quality of service; increasing efficiency
and effectiveness; enhancing the efficiency of the legislative and regulatory
environment; and financial sustainability.