JEDDAH, 10 May 2005 — The UK Offset team is to hold day presentation and seminar for Saudi businessmen at the Jeddah Chamber of Commerce & Industry (JCCI) today. The event is part of the continuing program to facilitate mutual business and technological transfer between Saudi Arabia and the UK and maintaining the profile of the program in the Kingdom. The team is on a three-city tour, covering Dammam last week, Jeddah today and Riyadh next week.
The Al-Yamamah Offset program is an agreement made between the UK government and Saudi Arabia to attract inward investment through technology transfer exclusively into the Kingdom. Originally dealing only with British companies, the program expanded to act as a conduit for companies - mainly in Europe and the US — to invest in the Kingdom and for Saudi Arabia to access technology and investment.
“Our role,” said Tony Smith from the UK Offset office in Saudi Arabia for the event and meetings with businessmen, “is that of facilitator. The inward investment we deal with has to involve technology transfer and preferably by the creation of joint ventures between Saudi companies and foreign technology companies.”
Offset’s activities are confined to the private sector and Smith sees that as an area of business potential with the current drive toward privatization of some services in the Kingdom.
Here to identify opportunities in the Saudi market, the team will also explain their role and hope to attract Saudi businessmen to use their services.
In its current form as business facilitator, the Offset program has been running since 1987when the agreement between the two governments was made. Many projects have been successfully implemented — one of the flagship projects was the Saudi Sugar Company which is now the second biggest sugar refinery in the world. “That started off as a medium size project,” said Smith, “but it has been so successful with input from the UK and Saudi companies that it expanded rapidly into a world beater.”
The program operates both active and passive sides. “We run seminars outside Saudi Arabia — Switzerland, Austria and Germany for example — to promote the program and introduce a wide audience to opportunities here,” said Saud Alfozan, the Economic Offset manger at the Offset office in Riyadh.
On the other side, the program is always receptive to and positively encourages requests and enquiries for follow up. “We can help a Saudi businessman who has an idea for a project yet does not have the technological wherewithal to fulfill it find the appropriate contacts and technologies,” explained Smith.
The same applies to foreign companies that have identified a market in the Kingdom. Offset facilitate the connections and assist with the paperwork and legal requirements in setting up business for foreign investors. “Because the program is government to government,” he said, “our high level links help with the formalities of establishing business here.”
Offeset can also arrange non-recourse financing of projects through the BAE-Systems Project Finance Initiative as further encouragement for inward investors.
Offset conducts studies of the Saudi market and makes areas that offer potential known to foreign companies. “We are proactive in that area as well,” said Smith.
Smith sees areas offering scope for development as petrochemicals; health care and pharmaceuticals; education and training — especially vocational and technical skills area that young Saudis will need for the future jobs market; power, public utilities and water and major infrastructure projects.