LONDON, 21 June 2006 — A big industrial breakthrough in Saudi Arabia can be expected by the end of the current 8th Five Year Development Plan in 2009 stressed Prince Mohammed ibn Fahd, governor of Eastern Province, in his closing address at the ‘Invest Saudi Arabia’ conference in London yesterday.

Prince Mohammed urged British companies to participate in this continuing boom which he said would offer ideal opportunities for the UK companies to expand their business in the Kingdom. “In our struggle to diversify our economy and thus achieve non-oil industrial development, the UK government and several of your leading business houses have made notable contributions. Out bilateral trade has made substantial progress. The two-way trade reached a massive £3.4 billion in 2005. I feel that while the direction of these efforts is no doubt correct, we have not exploited fully the potential for bilateral trade and investment. Furthering the cause of Saudi-British cooperation is not only possible but also necessary.”

The 8th Five-Year Development Plan (2005-2009) envisages the doubling of the per capita income in five years to about $27,000, which is on par with many developed countries. The plan in which the private sector is assigned the pivotal role, calls for huge investment in the oil, refining, gas and non-oil minerals, infrastructure facilities, transport and real estate sectors.

According to Prince Mohammed Saudi Arabia has created an investor-friendly climate for foreign investors in order to exploit these opportunities. This has been done through drastically liberalizing economic polices in the Kingdom over the last five years and the establishment of the specialized body for the licensing — the Saudi Arabian General Investment Authority (SAGIA).

Saudi Arabia’s foreign investment incentive package, he emphasized, has many outstanding features, including 100 percent foreign ownership; equality of treatment for domestic and foreign investors for incentives and soft loans; and permission to investors to own local property.

Prince Mohammed lauded Saudi Arabia’s accession to the World Trade Organization (WTO), which he said, would further boost the inflow of foreign direct investment (FDI).

“Apart from the general benefits, the WTO pact has confirmed the Saudi pricing system for feedstock (natural gas in particular), ensuring an edge over others in the production cost of petrochemicals, Saudi Arabia’s major non-oil industry,” he explained.

Prince Mohammed highlighted the boom in the mega projects in the Kingdom, especially in the Eastern Province, the industrial and petrochemical hub of Saudi Arabia. These include the Jubail Industrial City II project with an investment of $60 billion; the Ras Az Zour mineral city with proposed aluminum and fertilizer plants; and the Dammam Industrial City.

Sherard Cowper-Coles, Britain’s ambassador to Saudi Arabia, reiterated that there are huge opportunities for British investors and companies in the Kingdom, which he said has one of most investor-friendly climates. He also advised potential British investors, big or small, not to be put off by security fears.

Dr. Abdallah Dabbagh, president and CEO of Saudi Arabian Mining Company (Maaden), gave an update on the current projects of Maaden which currently has cash resources of over $1.3 billion. Maaden, which is presently 100 percent state-owned, he confirmed, would float an initial public offering (IPO) at the end of the year aimed at offloading 50 percent of its shares to Saudi public. Maaden also is in the process of creating individual companies for its gold, industrial minerals, phosphate and aluminum interests. The Saudi mineral giant, he added, is also establishing an infrastructure development company which will build and operate common facilities in Ras Az Zour.

“We believe the organization and structure envisioned for Maaden not only would provide great opportunities for our fellow Saudi citizens to benefit from the country’s wealth but would also provide great opportunities for our strategic partners to benefit from our highly competitive world class projects.”

Khalil H. Alyahya, president of Saudi Railways Organization (SRO), stressed the importance of an integrated railway network linking major cities of the Kingdom such as Makkah, Madinah and Jeddah and also the industrial cities including the minerals railway.

Basil Al-Ghalayini, CEO of BMG Financial Advisors, told Arab News that investors should leverage the opportunities in the Kingdom as a result of the boom. Saudi Arabia, he added, ranked in the top 40 most competitive countries in the World, according to a recent World Bank Report, ahead of the UAE and France.