JEDDAH, 25 June — The Saudi Arabian General Investment Authority has so far licensed projects worth SR32 billion by foreign investors, according to its governor, Prince Abdullah ibn Faisal ibn Turki.
The authority is also considering proposals to shorten a list of investment sectors that are closed to foreign businessmen, he said. Known as the Negative List, it was released some six months ago and will be subject to revision after a year.
The list includes such sectors as oil exploration and production, manufacture of military equipment, military supplies, security services, wholesale and retail trade, real estate investment in the holy cities of Makkah and Madinah, printing, radio and television services, transport, pipelines, power distribution, fishing, and medical services such as nursing, physiotherapy, blood banks, quarantine and ambulance services. Both telecommunications and insurance have been removed from the list in compliance with decisions of the Shoura Council.
Speaking on Saudi Television Saturday evening, Prince Abdullah said the authority had already approached several departments over the matter. The list is now half way and during the next six months, it will put forward recommendations to further bring down the restricted areas for foreign investment, he said. “The Negative List covers areas that are closed to foreign investment. It is our responsibility to reduce the list .... We want to bring down the number of activities which are not open to foreigners,” said the prince.
Under the foreign investment law issued in April last year, foreign investors are allowed full ownership of their projects, they are free to transfer capital and profits, own property and their businesses are immune from any action unless under a court order. Prince Abdullah said although GIA does not issue licenses to local investors, it nevertheless supports efforts aimed at securing business opportunities for them and in this capacity, it is responsible for following up the investment process in general.
He urged Saudi businessmen to invest in such areas as power generation and water desalination saying they provide huge opportunities. “We want to see large projects that are entirely and fully run by local investors,” the prince said.
On complaints by small and medium investors who act as local agents for international firms that the opening up of the market for international investment would lead their businesses into bankruptcy, Prince Abdullah said the wholesale and retail trade is included in the Negative List. This kind of business is subject to the dealership law, he added.
Asked about the red tape in government departments as against the open-minded GIA, Prince Abdullah said bureaucracy was an international phenomenon. “This does not mean that GIA knows better than others but dealings with investors make us more aware of their concerns and priorities,” he said. “In the past, there were few foreign companies but now with the market becoming more open entry is more direct.”
He said GIA is closely cooperating with such bodies as the Supreme Economic Council and the Supreme Commission for Tourism and is serving as a bridge between investors and the government. “The authority is only offering services to investors and does not commit them to specific obligations. In future, it will search for investors and explain to them the opportunities available in the Kingdom,” the prince said. (AWB)
