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Recycling more than just paper

Interview - October 8, 2012
Saudi Paper Manufacturing company has the power to do more than just protect the environment.
The King has a prosperous vision to diversify the economy and decentralize the Kingdom demographically and to give young people a good education. There are several programs put in place to achieve the King’s vision. What is your assessment of the King’s vision to take Saudi to the next level?

We are and should be proud of what the Kingdom has accomplished during its first 100 years. The vision of the Custodian of the Two Holy Mosques calls on all of us as Saudis to find ways to build upon our past success and to achieve even greater success. To prosper over time, every nation should constantly, and at least every two or three generations, review what it is doing, and try to make needed improvements.
With so much change happening in the world over the past ten to fifteen years, Saudi Arabia must change as well. There are, of course, things that we should never change, like the fact that we are a Muslim country and we have Mecca and Medina. But other than that, I think we need to review everything we are doing, especially regarding the economy and women’s roles in society and our view on oil. As a Saudi, I always think about the future, and no matter how good this oil is, one day it will end, so we always need to recognise that in the future things may change.

Our generation has seen the best of times and the worst of times. I remember when the NASDAQ was at an all-time high in 1999 or 2000, but we were going through the worst financial crisis three or four years ago. No matter how well we do in here in Saudi Arabia, we are connected to the world. In our region, we have seen significant changes in recent years, making it hard to predict what may come regarding, for example, Iran and other issues.

At a personal level, you always try to do your best, but you are always affected by what happens outside. For my part, I am cautiously optimistic. In Saudi, we have all the tools to accomplish the King’s vision and to change the country for the better. But it needs hard work and accountability. I think over the next ten to fifteen years, we will transfer the management of the country to the new generation. Sooner or later, they will be leading the country. We want that transition will be smooth. We always want to advance, but you have to take your roots and who you are into account.

In my opinion, our commitment to Islam in no way compromises or contradicts what must be our commitment to excellence and advancement. To the contrary, Islam inspires our quest for know-how and deepens our appreciation of science. Islam is about hard work and being good with people. It is about seeking knowledge. If you look at our history, the best of Islamic times were when Muslims were open-minded, welcoming scientists of all faiths in our great seats of learning, such as Baghdad, Damascus, Cairo and Andalusia.

To prosper we need not only information and raw materials. We also need talent. We need the best and brightest minds. Not only should we seek to develop our own sons and daughters, and to ensure through Saudization that they have opportunities to prosper and contribute; we should, I think, seek to attract the best and brightest minds (scientists, specialists, entrepreneurs) within the Muslim world, even allowing them to acquire Saudi nationality. Let them come and help us move the country forward. We should welcome that. I do not think we should be a closed society.

We have been reporting that it is slowly becoming easier to do business in Saudi Arabia. Do you sense that it is easier for foreigners to expand in the GCC?

Yes, it is easier. We have been misunderstood. Some of the misperceptions are not true. I am not saying we are perfect; we are far from it, but the image of us, Saudis and Saudi women is far from the truth. When other people do business in Saudi, this can improve the image of Saudi.

What have been the key moments in the history of the company?

People also have a perception that if you are a member of the royal family, you are born wealthy. But this is not true. My father was a very religious and private man, and he did not get into business or anything. I am an industrial engineer, and when I was about to finish university, I wanted to get married and start a business. I knew that money was important and that my father would help me however he could, but this would not be enough to have the life I wanted. Sometimes then, when I compared myself to some of my relatives, I felt unlucky, but that was a blessing. My only choice was to work hard. Then, after hard and deep studies, I started with my business in 1990, just before the first Gulf War. Since my early days in business, my companies have grown to include the biggest paper company in the Middle East, the Saudi Paper Manufacturing Company.

I started that paper business with a single tissue paper machine; the first one was built in 1991. I did not have experience or confidence at the time. I could not afford to pay high salaries, and a lot of my colleagues were my classmates. That was also a blessing in disguise, because we had to learn everything by ourselves. If you wanted to review a letter of credit or review the first paper machine contract, I could not bring the most expensive lawyer in, so I brought in a cheap lawyer, sat with him and tried to understand everything. You always try to find ways to save money. One of my partners was very tough and he was very helpful to me. He was my classmate in engineering and my neighbour. We started together.

We were the first tissue paper company in Saudi, other than a tissue paper mill company in Kuwait, so we had immediate success. I had a choice to start distributing profits and improve my life. When I first got married, I lived in my wife’s father’s house, because I could not finish or furnish this house. But my wife is a very good woman and she is not materialistic. She was patient and she is from a good family. I chose to expand the business, not to enjoy life. So we put everything we made into another paper machine. Whenever there is a successful business, unfortunately people start to copy you. I started thinking about how my company could have an edge. That is when I started to think about recycling.

We were importing 70% of our raw materials from different parts of the world, such as Brazil, the US, Indonesia and Scandinavian countries, so I thought about recycling. That was the biggest challenge of my business life. There was no paper recycling in Saudi, so we had to start everything from zero. I had to go to all the government agencies. For instance, the Ministry of Education at the time used to pay contractors to come and burn the paper after exams, and old books. I told them that I wanted to buy the paper from them, although they offered to give it to me for free. I knew eventually that this would have value, and I wanted to do it the right way.

If you take all the paper from all the schools however, that is not enough. We started to do recycling outside of Saudi too. We have branches in Algeria, Morocco, Jordan and Gulf countries.

Are people in Saudi Arabia willing to recycle? What needs to happen to change their mentality?

There is a lot of waste paper in Saudi, and that is not good for the environment and the economy. I think we can solve many problems if we just start segregating waste from houses, just the main things like paper, glass and aluminium. If we were to do this, waste paper would be more readily available to people other than us to start up different industries. That would help create Saudi jobs. We have not been successful up until now when it comes to dealing with home waste, but I think it is only a matter of time.

Is there any country or city, which has a recycling system that inspires you?

When I started Saudi recycling, my hobby was recycling. I used to read really boring reports about recycling. I have this thing where I cannot walk out of a bad movie, because it might improve. I have only walked out of two movies in my life. It is the same with a report; I have to finish it. I also went to Japan and Sweden and looked at what they did with recycling. We in Saudi in general are not where we need to be. Until we start to separate home waste, we will never get where we need to be on recycling. You need education.

In my house, we are very good with paper. We do not throw anything out, but that is not the same in every house. We told the Government that we wanted to start a campaign to put containers in the front of every mosque, and whenever it is full of paper, we will give a donation. But they said no, and that they preferred to sell all the waste together. I think it will take time. We won the first three contracts but we did not submit the last one. In my opinion, the Government has not been able to protect who wins the contract. If you pay the Government millions of Riyals per year, you expect a certain amount of material. But if other people can collect it, it is very difficult for you to make money. Our Saudi recycling company is nonetheless doing well in the Gulf countries, especially the UAE and Algeria. We are opening in Morocco this year. Things are improving.

We found that 2007 was a key year for the company, as there were a lot of changes and a partnership with a Swedish company.

We had some discussions before 2006, but it did not materialise. That is when I went to Sweden. But then we decided to go public. We built our third paper machine. We also started with some converting plants outside of Saudi. Last year, we started in Turkey and Kuwait, and we are looking to other areas as well. The paper business is really tough, and the competition is always very high. You cannot relax and sleep. I have some friends in the petrochemical business. No business is easy, but the raw materials side is not as complicated as our business. But you have to live with it.

Since the company went public, have there been any changes in terms of the relationship with shareholders?

Before there were only two shareholders, and the relations were very good! It was me and my friend. But now of course I only own 50% of the company. We are proud of our results. Our profit has increased every year, bar one year. Of course, the crisis that affected every business, including us. But we have always been able to distribute profits to our shareholders. We think the future will be better than the past. With hard work and the help of God, we will weather whatever storms may come. I’m optimistic that, during the next two to three years, we will begin to see significant improvement.

We know that global media can have a positive or negative effect on the image of the country affecting its opportunities abroad. As a well-rounded and well-travelled man, what is your view in this regards? How does your company use media platforms?

Although I built my career through industry, I was also involved in sport. You can throw money wherever you want and improve your image, but first you have to improve yourself, and be strong. But I think Saudis can also improve the image, by how you communicate with people and how we carry ourselves when we are outside of Saudi. Sometimes you feel helpless when you see some of the movies and how they portray Arabs and Muslims, and September 11th of course did not help. I do not think you should give up; you should always try. Every Saudi through his personal conduct can change people’s images of Saudi. Of course, the media now is a professional business. It has also experienced change through the new media platforms such as Twitter and Facebook. I am a big 49ers fan. I think we should try and use the new media, and improve ourselves as a society. If we do that, eventually our image will improve.

The paper company has a website, but is really only just beginning to explore new media as a means of building our brand. I have encouraged my managers to take this on with passion. I used to run everything myself, but then I brought in professional managers and I have meetings with every company once every two weeks. I think when you start a company you should be close, but once it becomes good business, you have to run it differently. You have to run it professionally so the business can grow after you.

Where do you see the company in the next five to ten years?

I want it to grow to become a regional power. I want to see Saudi Paper strong in Asia and Africa. We will also export to Europe. I want to see it grow into other related businesses. I want to always have strong passionate, young management. And of course, I want to make more money.