RIYADH, 10 April — The Saudi Arabian General Investment Authority is planning to introduce changes in the foreign investment law as part of its bid to attract more foreign capital. The move highlights efforts to open up the country’s investment sector by scaling down restrictions.
The new investment law is likely to undergo a total review in order to remove the obstacles that still stand in the way of the free flow of foreign funds. The law was passed two years ago at the initiative of the Supreme Economic Council chaired by Crown Prince Abdullah, deputy premier and commander of the National Guard.
While making the changes in the law, the GIA will consider the viewpoints of commercial attaches at foreign embassies in the Kingdom, foreign investors, Saudi businessmen and chambers of commerce, informed sources said.
The move is an important step in avoiding what GIAA Governor Prince Abdullah ibn Faisal described as “an imminent danger” to the Kingdom as a result of a possible decline in foreign investment.
The GIA chief emphasized the need to understand the requirements of foreign investors. He pointed out that there were shortcomings on the part of certain government departments in dealing with foreign investors and meeting their requirements.
Osama Kurdi, secretary-general of the Council of Saudi Chambers of Commerce and Industry, said the action to make changes in the law was taken not because of any big differences with investors. “There is an article in the law which calls for regular revision of the law,” he added.
Kurdi added that the chamber council, which is authorized to recommend changes, was holding meetings with businessmen and officials to discuss the aspects which require changes.
There were calls to make changes in the negative list of areas where investments are banned. Prince Abdullah has said that there was a great need to meet the interests of the global economy and shorten the negative list for foreign investment in Saudi Arabia.
The list, published on Feb. 12, 2001, will be reviewed every year. “Our surveys include the public and private sectors. Their findings help us to evaluate the current situation and the investment climate,” Prince Abdullah said.
The Kingdom has attracted foreign investments worth SR34 billion since the new law came into effect two years ago.
Sectors like telecommunications, insurance, oil exploration, security, retail and wholesale, education, and land and sea transport are among 19 activities barred to foreign investors.
