RIYADH, 5 March — Setting up new joint ventures in the Kingdom will be one of the key items on the agenda for the third session of the Saudi-Japan Business Council that takes place in Riyadh today and tomorrow.
More than 100 Saudi businessmen and 60 Japanese delegates from various fields will participate in the meeting, being hosted by the Council of Saudi Chambers of Commerce and Industry (CSCCI) and co-sponsored by Japan Cooperation Center for the Middle East (JCCME).
According to Osama Al-Kurdi, secretary-general of CSCCI, the meeting will deal with the general economy, trade and investment prospects on the first day of its session. The theme of discussions on the second day will be the current state of the Saudi economy and general prospects for investors.
Currently, there are ten Saudi-Japanese projects in the Kingdom, of which four came on stream last year. They include the Saudi-Japanese Textile Co. (for thobe and abaya production in Al-Hasa), United Ink Production Co. Ltd. (for high quality ink production in Jeddah), Denso Abdullatif Jameel Co. (car air-conditioner manufacturing in Jeddah) and Sun Ace Gulf (manufacturing of stabilizers and additives for PVC in Jubail).
A major joint venture for building an SR8.25 billion desalination plant in Jubail was floated last year by Japan’s Sumitomo Corporation, which will set up a Saudi-Japanese consortium to fund the giant project. Sumitomo is also committed to investing in similar projects in other parts of the Kingdom.
As part of its initiative to identify and promote new joint ventures, a Japan Desk was set up at the headquarters of the Saudi Arabian General Investment Authority (GIA) for boosting Japanese investment in the Kingdom. Yasuharu Tanaka, investment expert, has been seconded to GIA office to coordinate between Saudi and Japanese companies. He will also act as a moderator with Omar Bahaliwa of the Council of Saudi Chambers for the panel discussion on joint ventures and investment tomorrow.
As part of its cooperation program, Japan External Trade Organization (JETRO) had invited four Saudi officials in charge of SMEs to participate in a training program in Japan. They studied the problem of financial support scheme that the Kingdom’s SMEs are facing. They also visited an incubation center for venture business relations with Saudi Arabia.
CSCCI is also establishing a consortium to finance small- and medium-scale industries in the Kingdom. Al-Kurdi said small and medium enterprises account for 88 percent of the economic ventures in the Kingdom. “Greater attention should be paid to these firms to help them improve their performance and provide them with the best means of financing.”
The secretary-general pointed out that the Seventh Five-Year Plan stresses the importance of implementing programs for assisting SMEs. To this end, he highlighted the need for setting up a database that would help expedite aid from specialized government agencies to these establishments.
Small firms include those with less than 60 employees, while medium enterprises consist of 60 to 100 workers. Of the total 19,100 enterprises in the Kingdom, 15,400, or 81 projects, are small-scale units, while 1200 units, seven percent, are medium establishments. The private sector owns 94 percent of these enterprises, with the government owning the rest.
