Saudi Arabia’s government is facilitating an industrial shift away from petroleum, and the entrepreneurial mindset of Saudis is making it a success. Numerous companies have been prominent in driving forward the idea of a Saudi industrial brand that is synonymous with quality.
The National Industrialization Company (TASNEE) was the first Saudi joint-stock industrial company to be wholly owned by the private sector. Established in 1985, TASNEE is now the second-largest producer of titanium dioxide in the world.
CEO Dr. Moayyad Bin Issa Al-Qurtas says, “TASNEE is one of the biggest industrial companies in Saudi Arabia, yet at the same time we are diversified; we also operate in chemical, petrochemical and downstream industries. By spreading our investments we are lessening the dependence on oil exports and enhancing economic development in the country.”
In 2007 the company bought Millennium Inorganic Chemicals, one of the largest purchases by a Saudi company abroad, and acquired facilities around the world.
Dr. Al-Qurtas believes that the mentality Saudi Arabia has adopted in recent years has positively shaped the future opportunities of the country. “It is getting easier to do business in Saudi Arabia; we have seen substantial improvement in governmental procedures. It is considerably more investor friendly,” he says.
Sheikha Nadia K. Al-Dossary is the CEO of Al Sale Eastern Company. Founded in 1976, it specializes in ferrous scrap metal processing and weighing systems. As a woman in industry, Sheikha Al-Dossary is transcending traditional attitudes.
“I made this business,” she says. “I tell girls that when they are in a place where they do not feel like they have an opportunity, they have to go ahead and make that opportunity.”
Saudia Arabia is a huge market for steel. SABIC, just one of the company’s many customers, takes delivery of 15,000 tons every month. Management at Al Sale believe their Saudi steel has a competitive edge due to their high-tech processing equipment and stringent standards that focus on quality rather than quantity. The company also supplies weighing systems in Oman, Kuwait, Bahrain and the UAE, and it is ambitious to expand further.
As well as a working with industrial heavyweights, Al Sale is keen to develop the younger generation of entrepreneurs in the country. Innovatively they have collaborated with small-scale scrap dealers to co-own scrap yards. The company provides them with training on how to weigh and treat scrap, and shares the profits from their sales. Dealers can also opt for an installment plan that allows them to purchase the yard outright.
Another company set up in response to a call for the private sector to invest in the country’s economic diversification is Saudi Advanced Industries Company (SAIC). Established in 1987, it is an investment company that allocates money to industrial enterprises to enable them to realize their projects. General Manager Saad A. Al-Shammari says, “The private sector is trying to support the government’s vision and make a positive contribution to it. Indeed we are diversifying and differentiating our own products.”
The company has a strategic plan to move from being an investment company to an operations company. It is looking into solutions to reduce energy consumption in buildings, and replacements for expensive materials like metals and plastics.
Mr. Al-Shammari thinks there are investment opportunities for both Saudi and non-Saudi companies in the country. “It is not difficult to start a business here, you just have to do your homework and understand the culture.” Dr. Al-Qurtas adds, “The emerging economies that surround us are gaining importance, and we have a mass of middle-class people eager to consume products and services.”
Sheikha Al-Dossary agrees, saying: “Business takes risks and Saudi Arabia is very adventurous and lucrative. There is a lot of money and opportunity here.”