The Governor of the Saudi Arabian General Investment Authority (SAGIA), HE Amr Abdullah Al-Dabbagh, addressed an audience including high-level international dignitaries at the 2005 Jeddah Power and Water Forum today.
The forum was held under the auspices of HRH Prince Abdul Majeed bin AbdulAziz, Governor of the Makkah Region.
HE Governor Al-Dabbagh illustrated the Kingdom’s distinctive investment value proposition in water and power underlining the central theme of pursuing opportunities one is best equipped to capitalize on. With a population forecast of almost 36 million by 2020, Saudi Arabia is slated as the water desalination and energy capital of the world, the largest per-capita water and power consumer in the world and home to the best investment for water and power in the world.
SAGIA envisions rapid economic growth in Saudi Arabia capitalizing on the Kingdom’s competitive strengths as the global capital of energy. This vision is legitimated considering the Kingdom holds one-quarters of the world’s proven oil reserves, one-fifth of the world’s total water treatment capacity and one fourth of the world’s largest phosphate deposits. Realizing this potential and foreseeing a rise over the present 4% in water and power demand, the Supreme Economic Council’s Resolution created a framework to promote private sector involvement in the water and power industry via the Independent Water and Power Projects, IWPPs.
The growth of other energy sub-sectors will further drive demand for water and power. 2004 saw investment of over $10 billion in the Kingdom’s petrochemical sector and forecasts for the next decade indicate over $90 billion.
Saudi Arabia’s economic upsurge strengthens rapidly as the country diversifies through full capitalization of its resources. Despite complete lack of agriculture and irrigation industry and through leveraging the phosphate deposits, the Kingdom is expected to become the world’s third largest producer of fertilizers in the next decade.
Another sector directly proportional to the growth in the energy sector is the transportation sector, characterized by the Kingdom’s second competitive advantage due to the unique geographical location between East and West. Most of the Gulf ports imports are re-exported to Saudi Arabia and the country makes for an ideal launch pad to a 270 million strong consumer market.
Following hot on the heels of the energy and transportation sector are the ICT and Knowledge Based Industries sector. SAGIA is aggressively driving the Kingdom’s investment strategy to become the global leader in water and power technology, and global provider of intellectual capital. The first step towards this goal is the creation of multiple centers of excellence and specialization around core competencies in certain segments of the water and power sector, such as IT energy applications. The petrochemical industry has already set the lead as SABIC’s Riyadh R&D Center developed and commercialized an entirely new and Saudi-derived technology for manufacturing Acetic Acid from Ethane, the first of its kind worldwide.
The 4,500% increase in FDI in the second quarter of 2005 compared to the equivalent period in 2004, indicates the successes of SAGIA’s pro-business initiative with sister ministries and the One Stop Shop investment services for the investors.
About SAGIA
Saudi Arabian General Investment Authority (SAGIA) is a service entity aiming to provide services and facilities to promote investment and economic development in the Kingdom of Saudi Arabia (KSA). SAGIA was established in April 2000 under the directives of the Supreme Economic Council (SEC) as a catalyst to promote inward investments, facilitate exchange of best practice between the public and private sectors, as well as act as an intermediary between the global business community and the Saudi Government and its ministries and agencies. It also aims to contribute to economic policy-making substantiated by research and strategic criteria.
SAGIA’s role is complementary and supportive to the bodies directly concerned with the various investment sectors and working to finalize the investors’ procedures. The mission of SAGIA is to create a pro-business environment while providing comprehensive services to investors, and fostering investment opportunities in energy, transportation and knowledge-based industries. For more information on SAGIA please visit www.sagia.gov.sa
