RIYADH, 16 January — Crown Prince Abdullah, deputy premier and commander of the National Guard, has said that all government agencies have been geared to support potential investors in the agriculture sector in a move to reduce dependence on imports for the country’s food needs.

"The Kingdom of Saudi Arabia has taken a strategic decision to attract national and foreign investments," Prince Abdullah said as he opened a three-day agriculture forum at King Fahd Cultural Center here yesterday. "All the necessary incentives, guarantees and facilities must be provided to lure these investments and encourage them in all fields."

Some 30 international companies from 18 countries and hundreds of Saudi investors are attending the forum organized by the Ministry of Agriculture to highlight the tremendous potential of agro-business investments in the fertile southwestern plains of Jizan and Tihama.

Crown Prince Abdullah called on the local and foreign businessmen to invest in the Kingdom, which "is an ideal investment destination keeping in view its political stability, population density and a growing consumer market".

He reiterated the agriculture development will remain an indivisible part of the Kingdom’s overall policy on food security and said the forum will serve as a platform for businessmen to acquaint themselves with the investment potentials in Jizan and Tihama.

The 800-km strip on the Red Sea between Jeddah in the west and Jizan in the southwest is one of the most fertile virgin lands in the world, with sufficient water supplies, Agriculture Minister Dr. Abdullah Muammar told the forum.

Average annual rainfall in the region is 600 mm, almost five times higher than the desert central and northern areas, the minister added.

Muammar said the government was taking measures to liberalize the agriculture sector as it restructures the water department, whose services are heavily subsidized.

He disclosed that a separate water ministry would be set up within two months and that the government planned to halve its subsidies on water, sold now at just one percent of cost.

Muammar later said the area has 10 dams with a capacity of 105 million cubic meters of water. The state is planning to build 10 more dams with a capacity of 760 million cubic meters within the next two years at a cost of $613 million, the minister added.

Muammar said that, based on the agricultural potential of the region, the Kingdom is anticipating billions of dollars of foreign and local investment over the next few years.

The minister said lucrative incentives such as the lease of land on a long-term basis of 30 to 40 years, irrigation facilities in addition to other incentives offered to foreign investments in the Kingdom.

Feasibility studies indicate that the region is good for cultivation of mango, figs, bananas, pineapple and many other fruits and vegetables because of its warm tropical climate.

The region, which is an empty coast, is also famous for its shrimp and fish farms, with hundreds of millions of dollars of investments already under way. The largest shrimp farm project in the world is being carried out in that region. Expected to be completed next year, the $100-million project plans to produce some 10,000 tons annually.

The Kingdom is keen to reduce its dependence on oil revenues and boost job creation to cut unemployment, now at an alarming level of around 25 percent of the male workforce. Oil revenues fell sharply last year and are expected to drop further this year.

Saudi Arabia has attracted some $10 billion in foreign investment commitments since it launched sweeping market reforms in 2000, allowing full ownership in some sectors for the first time.

But officials said there were fewer potential foreign investors visiting since the Sept. 11 attacks. "There is a negative impact: fewer inquiries, fewer visits by foreign delegations. Some people are still afraid ... for the wrong reason," said Prince Abdullah ibn Faisal ibn Turki, governor of the Saudi Arabian General Investment Authority.

He said that a new and revised "negative list" was expected to be approved by the Supreme Economic Council, headed by Crown Prince Abdullah, that would open up more sectors. "If it were up to me, I would have opened all sectors to private investors both local and foreign," the GIA chief told reporters.

Crown Prince Abdullah’s speech did not signal a move to totally abolish the negative list that has kept many lucrative sectors such as the upstream oil industry, telecommunications and insurance off limits to foreigners.

On the export capability and the growth of the local industry, Commerce Minister Osama Faqeeh said the Kingdom ranks 13th among the exporting nations and it stands 25th among importing countries of the world. Saudi Arabia’s foreign trade exceeds SR438 billion and trade surplus stands at SR193 billion, he said.

A documentary on the agro investment potentials of Jizan and Tihama was shown during the inaugural session.