Saudi Arabia announces investments in local companies in Vision 2030 push
Saudi Arabia is moving towards the diversification of its economy and it is doing so with a firm step. This time the Public Investment Fund (PIF) has announced the investment of 1.3 billion dollars in four local companies. By subscribing to new shares in the companies, it aims to help enable the construction sector and improve local supply chains for current and future projects in the country.
Nesma & Partners Contracting Company, ElSeif Engineering Contracting Company, AlBawani Holding Company and Almabani General Contractors Company already have a track record of success in investing, executing and managing projects in Saudi Arabia, and it is hoped that this investment will enable the companies to make the step into the international market.
An investment by which the Saudi Kingdom hopes not only to contribute to gross domestic product (GDP) growth, but also to adopt the latest technologies and knowledge transfer from global companies to increase competitiveness in the sector in Saudi Arabia.
"These partnerships demonstrate PIF's commitment to unlocking the capabilities of key strategic sectors in Saudi Arabia, including the Building and Construction Services and Components sector, which has been identified as one of the 13 strategic sectors locally," says Yazeed A. Al-Humied, Deputy Governor and Head of MENA Investments at PIF.
The firm investment is part of the Saudi Vision 2030 strategic framework created by Crown Prince Mohammed bin Salman to diversify the country's economy away from dependence on oil. The development of sectors such as health, education, tourism and infrastructure, as in the case of these companies, is key to achieving these objectives. Al-Humed argued: "PIF's investment in four national companies will support the expansion of local capacity across the sector and stimulate private sector participation and investment to meet current and future demand, in line with Vision 2030".
For the companies themselves, the investment has been welcomed with good prospects and they look forward to achieving the targets proposed by the Public Investment Fund. "As a leading sustainable Saudi company operating for over 40 years in harmony with our society and environment, we seek to maintain the highest global standards to contribute positively to the Saudi Arabian economy," commented Abdulaziz Al Turki, chairman of Nesma & Partners Contracting Company. "We believe that this partnership will strengthen our position as one of the leading construction companies in Saudi Arabia and enable us to contribute to achieving the goals of Vision 2030," he added.
He shared these aims with the chairmen of the other three local companies. "The investment will support the growth and development of the sector and contribute to expanding the capacity and local content of the private sector, enabling us to deliver world-leading projects as we strive to become the leading player in the sectors in which we operate," said Khaled El Seid, chairman of El Seif Engineering Contracting Company.
"The partnership with PIF presents us with an exceptional opportunity for growth," commented Fakher AlShawaf, Chairman of AlBawani Holding Company, while Youssed Nehme Tohme, Chairman of Almabani General Contactors, reiterated the importance of the Saudi strategic plan: "The Kingdom aims to increase the role of the private sector in the economy, and this investment will enhance the ability of private sector companies to provide key services".
Precisely the creation of the FIP went hand in hand with Vision 2030, ascribing to itself a leading role in advancing Saudi Arabia's economic transformation and diversification. It is now a major player for these purposes as one of the world's largest sovereign wealth funds that has established more than 70 companies and created more than 500,000 jobs. This is yet another step by the Kingdom to anchor its economy in the global framework in the medium to long term.