JEDDAH, 25 June 2007 — As many as 36 industrial and service projects with investments totaling SR17 billion have been established under the Kingdom’s Economic Offset Program since its inception in 1984, according to Maj. Gen. Hamad ibn Abdullah Al-Sugair, secretary-general of the program.
He said the projects in Riyadh, Jeddah, Jubail, Alkhobar and Dammam created more than 6,500 new job opportunities. “Plans have been made to establish a number of new projects worth SR7 billion,” he added.
Al-Sugair said a $35 billion investment fund would be set up with the support of the American Raytheon company and French Talis Electronics in order to finance a number of high-tech projects including those to be established by British Aerospace.
“This program encourages both small- and large-scale companies to carry out investment projects in the Kingdom,” he said. It has so far attracted several global giants including Boeing, British Aerospace, AC Delco and Glaxo Wellcome.
“The offset program is part of a comprehensive development plan initiated by the government with the aim of achieving diversification of economy, expansion of the industrial base and participation by the private sector in the national development drive,” Al-Sugair said.
Some foreign companies linked with the Kingdom’s offset program have jointly contributed SR40 million to establish Dar Al-Faisal University in Riyadh. Some others have contributed to setting up standards for 250 professions and work out 1,000 training programs. Total sales of companies working under the offset program reached SR30 billion in 2006. They also exported products worth SR6 billion, he added.
The offset program started with the Peace Shield programs with the US, the Al-Sawary Program with France, and the larger Al-Yamamah program with British Aerospace. The program not only boosted the country’s industrial development and economic diversification but also accelerated the inflow of new technologies in sectors such as aviation engineering, electronics, computer and information technology.
The majority of investments in offset projects have gone to aircraft industry and electronic and electrical industries (13 percent each), food and medicine (12 percent), chemical and petrochemical industries (six percent), education and services (three percent) and assembling and recycling (three percent).
Dr. Mohamed A. Ramady of King Fahd University of Petroleum and Minerals in Dhahran said the offset program would help the Kingdom achieve strategic self-sufficiency in crucial military or civilian sectors such as defense systems, aircraft repair and modification.
“The program will also act as a magnet to attract other international companies to the Kingdom and create more employment opportunities for Saudis,” he added.
The offset program is now concentrating on priority sectors for the Kingdom such as petrochemicals, high-tech education and health care services. Health management could become the next focus of the program, through specialist medical colleges and nursing schools, nanotechnology research centers and the production of specialist medical equipment.
