View Full Version : Doing Business in Saudi Arabia

August 15th, 2007, 08:42 PM
Hello there,

Anyone here interested in association or affiliation with a Saudi Law Firm, or a Saudi Financial Advisor's.

As ever one knows, the business and financial potentials in Saudi Arabia is very high and promising, considering; increasing oil prices, new and encouraging investor protection laws and policies, big money, low risks, low competition, strategic location, between east and west, easy establishment of new business.


Cooperation needed.


Saudi Arabia has many relatively high advantages in some strategic sectors at regional and global levels, which make it attractive for international investment. For example, the Kingdom is ranked first with regards to prices of energy provided for investment projects. (Saudi energy report link 2007).
Generally speaking, investment in Saudi Arabia realizes high profit ratios for local, foreign and shared projects, with low risk exposures, and a simple form of taxes and property registration fees. Here, the Kingdom, globally, occupies the fifth position regarding taxes and forth in property registration costs, according to business performance reports 2006/ 2007 issued by the International Bank.
According to a comprehensive study published by Arab Forbes Magazine’s in late 2006 assessing the performance of (1616) joint-stock companies in the Arab world, the first three positions were Saudi companies, and among the best 50 companies, 22 were Saudi companies, including Saudi and joint companies, applying a number of standards such as: operational efficiency, market value, sales, revenues, dividends, return on equity, return on two last year assets (2004 - 2005), in addition to the company expected growth.
Another example in the banking services sector is that the ten Saudi banks are of the best banks, most growing and profit realizing in the Arab World. These Saudi banks comfortably rest within the list of biggest 1000 banks of the world, according to the Financial Times 2006. Also the 3 biggest banks in the Arab world are Saudi.
The Kingdom of Saudi Arabia is the biggest free economic market in the Middle East. It acquires 25% of gross national Arab product and has the biggest oil reserve in the world (25%). Saudi Arabia is the most ideal environment for projects depending on energy consumption because it provides energy for investment projects with the least prices at global level. In addition, there are many natural resources in mining that are supported by the geographical location of the Kingdom making them of easy access to European, Asian and African markets. Saudi market has a high purchasing power and of continuing expansion.
The Saudi Riyal is one of the most stable currencies in the world. There was no significant change in its exchange value during the last 3 decades. There are no restrictions on foreign currency exchange and outgoing money transfers. Inflation rates in Saudi Arabia are very low and the Kingdom is endeavoring to sign bilateral agreements with an increasing number of countries regarding investment encouragement, protection and arrangement of taxation issues.
All the above mentioned advantages made the report issued by Milken International Corporation in Feb. 2007 to classy the Kingdom of Saudi Arabia in the first rank worldwide with respect to total economic environment classification i.e. environment capability for project management and financing. Milken Corporation focused on the low and stable interest rates, low inflation and low taxes, compared with international standards.
On the other hand the majority of Saudi Arabia population is young, which is a continuously increasing ratio due to age category rate between less than 1 year to 15 years representing about 45% of total Saudi population. The Government is actively improving the human resources development pattern to include all categories and ages. It provides investors more opportunities to select required labor for their projects. Many public and private educational institutions and research facilities have been established in the kingdom, to meat the demand of a great portion of Saudi labor market requirements.
Recently, the Human Resources Development Fund launched to train and recruit Saudis and provide many incentives for companies that employ nationals through:

Provision of aids and support for activities related to qualifying, training and recruitment of Saudi labor in private sector.
Contribution in the private sector Saudi laborers’ qualification and training costs.
Covering a percentage of the salary of Saudi labor employed by the private sector.
Supporting programs aiming to improve the possibility of Saudi labor recruitment and replacement of foreign labor.
Financing private sector corporations that train and qualify Saudi labor through granting necessary loans to enable them expand their activities and use modern technologies.
Carry out studies, researches, and provision of technical and administrative consultancy in the area of training and qualifying nationals.Foreign Investment Regulation allows foreigners to invest in all economic activities other than those listed in the excepted foreign investment activities. The Kingdom has committed to reduce that list under conditions of joining the World Trade Organization agreement. The new Foreign Investment Regulation grants foreign investors the right in having their own and employees’ sponsorship on the licensed projects. Also foreign investors have the right in possessing real estate related to their activities. All foreign investment projects enjoy the same privilege, incentives and guarantees as the local projects, including the following:

All incentives stated under national industries’ protection and encouragement. That includes customs duty exemption for industrial commodities, equipments and preferential treatment for national products to secure governmental purchases.
Possibility of obtaining land in industrial cities with nominal cost.
Possession of real estate necessary for the project, including employees’ residence and housing.
Privileges available as per the bilateral and collective agreements related to taxes and investment.
Non expropriation of any investment without the court judgment.
Free transference of the capital and profits out of the Kingdom.
Free movement of stockholders’ shares in the project.
Foreign investor is allowed to possess the whole project.
Foreign investors’ sponsorship and their expatriate employees’ sponsorship is on the licensed project.Specific reasons for investing in Saudi Arabia

Availability of low price facilities and services.
Low cost governmental financing opportunities.
No. I in exports and imports size in the Arab world.
Within the first 7 countries of least inflation rates in the world (IMD).
The 7th country in total local savings (IMD).
Within the first best 8 countries in exchange rate policies (IMD).
Biggest financial market in Middle East.
Within the first 25 countries in total cash savings (index of Economic Freedom).
Within in the first 24 countries of least cost loans from Saudi Industrial Development Fund.
Losses carry over for coming years regarding profit taxes.
Provision of assistance and consultancy by the General Investment Authority.
Within the best 3 countries in the world as of proprietorship registration cost.
Best country in the Middle East as of exchange rate index (Doing Business 2006).
Biggest foreign investment balance in the Arab world since many years till now (Arab Investment Guarantee Corporation Reports).
Biggest economy in the Middle East with gross local product exceeding 300 billion dollars, and a growth rate reaching 6% during the last 3 years.
Within the first 6 countries having the least company taxes in the world according to (IMD) report.
Biggest oil reserve - about 26% of the world’s reserve.
Forth natural gas reserve in the world.
Wide market serving a population of more than 22 million, and a gate to the markets of 205 million persons.
High incomes and purchasing power.
Strategic geographical location through which most significant international aviation lines pass, linking between three continents.
Nonexistence of local disputes due to prolonged political stability.
Nonexistence of multiple taxation (except profit taxes on foreign companies amounting 20%, allowing carrying over the losses of unlimited investments).
Within the first five countries in the world having easiest labor recruitment and work hours flexibility.
Nonexistence of work strikes.
Availability of energy with the least prices in the world.
A net of advanced banks with high technology and efficiency.
Capital cost rate (IMD).
Best in the world regarding financial solvency index (IMD).http://www.sagia.gov.sa/en/business-environment/why-saudi-arabia/why-invest-in-saudi-arabia.html

www.alhazmilawfirm.com.sa (http://www.alhazmilawfirm.com.sa)

for those who are interested in getting more info please email

September 11th, 2007, 09:40 AM
there's a good money and Business in KSA

September 11th, 2007, 02:03 PM
"I like money, you like money lets do business! Do not worry where your money is going, everything will be alright my friend! God is great!"

- Osama Bin Laden to CIA operatives in the 1980's while fighting the Soviets


September 12th, 2007, 01:23 PM
We talk about Business in Saudi Arabia ,not Ossama and war