saudi private sector ‘must adapt to new global competitive environment’
Last Updated : GMT 06:49:16
Arab Today, arab today
Arab Today, arab today
Last Updated : GMT 06:49:16
Arab Today, arab today

Saudi private sector ‘must adapt to new global competitive environment’

Arab Today, arab today

Arab Today, arab today Saudi private sector ‘must adapt to new global competitive environment’

Panelists included Ziad bin Bassam Al-Bassam, vice chairman of the Jeddah Chamber of Commerce, Dr. Makarem S. Batterjee, vice chairman of Saudi German Hospitals Group, Mouhannad Makhlouf, senior director, environmental services, at Abdul Latif Jameel Energy and Environmental Services and Shady Shaher Elborno, head of micro strategy, global markets and treasury, at Emirates NBD.
Jeddah - Arab Today

The low oil price environment is a blessing in many ways for Saudi Arabia, which has embarked on an ambitious economic transformation program, several top industrialists and bankers attending a major trade finance forum in Jeddah told Arab News Tuesday. 
“Saudi Arabia is a member of Group of 20 economies but highly dependent on oil. Saudi Vision 2030 offers great opportunities for investment,” Makarem S. Batterjee, vice chairman of Saudi German Hospitals Group, said. 
“Foreign investors will come to Saudi Arabia. They will see the change. The government has to do more marketing to attract more foreign investment.”
Batterjee added: “Government should focus on education. If you fix education, it will take care of everything.”
The 4th annual Saudi Trade Finance (STF) Summit brought together government regulatory authorities, finance professionals from leading corporates along with top financial institutions and technology solution providers to discuss current trade trends and challenges faced by organizations in creating a thriving economy for the Kingdom.
The summit theme is “Shaping the Kingdom’s Economy: A bright future unfolds.” 
According to organizers, the event serves as a crucial platform for connecting the key stakeholders for trade finance development in Saudi Arabia and highlights the future trends for the trade finance business in the Kingdom.
Speaking at the summit, Hatem A. Samman, chief economist at Saudi Arabian General Investment Authority (SAGIA), said the current economic model, which depends on oil for exports and government spending, is unlikely to support diversification.
He said that the governance model of Vision 2030 will institutionalize government effectiveness and facilitate stakeholder coordination.
The private sector needs to adapt to a new global competitive environment based on technology and high skills, he said, adding that the banking sector has a critical role to play in Saudi Arabia’s economic transformation path.
Saudi Arabia has made great strides in developing its oil economy and petrochemical industry. However, in the face of a changing global energy market and demographic changes at home, the old model based on oil revenues and public spending needs to be transformed, said the economist.
“To ensure sustainable and healthy economic prospects Saudi Arabia will need to diversify its economic base by empowering the private sector and open investments in promising economic sectors,” Samman said. 
The SAGIA official made these remarks during his keynote presentation at the summit on"Vision 2030: The Kingdom’s bold move toward economic diversification." 
Saudi Arabia’s GDP of $800 billion in 2014 has the potential to reach $1,600 billion by 2030, Samman said, naming eight sectors that can contribute 60 percent of the overall growth needed to double Saudi Arabia’s GDP by 2030. 
These sectors include travel, tourism and hospitality, retail and wholesale trade, mining and metals, advanced manufacturing, banking and finance, construction, petrochemicals and health care.
He said that some challenges in trade and finance will be addressed by Vision 2030 through different government agencies. 
Addressing the summit, Ziad bin Bassam Al-Bassam, vice chairman of the Jeddah Chamber of Commerce & Industry (JCCI), asserted that Saudi Arabia can become an international trade hub.
“We can work on oil, gas and petrochemical, and religious tourism — especially Haj and Umrah. Makkah is Islam’s capital. If we can work harder we can bring more activities in the public and private sectors,” he added.
Speaking to Arab News, Mohamed Mostafa Abdelhady, SAP’s business analytics leader for Saudi Arabia, Bahrain and Yemen, highlighted his group’s efforts to support Saudi Arabia’s economic transformation. 
He said: “Digital transformation is a key strategy for Saudi Vision 2030 and the National Transformation Program (NTP 2020) to achieve the objective of growing non-oil revenues to SR1 trillion by 2030.”
In line with Vision 2030, adopting digital transformation is a key to achieving the vision’s goals, together with the vital role of the SMEs and financial institutions as well as the public sector, he said. 
Abdelhady added: “SAP is working closely with the public and private sectors and their strategic initiatives to provide end to end digital transformation platform for real-time analytical information for rapid decision making, accommodating the business model changes and integrating SMEs on the same platform to provide a 360 degree view of information to increase efficiency and productivity and closely monitor progress toward the Kingdom’s goals.”
Having well-talented Saudi nationals as an essential factor for successful journey toward the vision, SAP is aligning with global university partners to train thousands of students for the Kingdom’s specific requirements for Vision 2030, Abdelhady said.
Arup Roy, head of global trade and receivable finance, at Saudi British Bank (SABB), said the Kingdom is taking the right steps to push the economy forward by navigating the challenging business environment.
The Kingdom's economy continues to remain strong and the Saudi Arabian Monetary Agency (SAMA) always takes proactive measures in managing risks, he told Arab News on the sidelines of the conference.
The global confidence in the Saudi economy was demonstrated by the recent successful international bond issue, he added
“These are interesting times for us,” Roy said, when asked to comment on the current business environment.
“We have seen similar situations in other countries before,” said Roy, who has several years of experience in different markets. 
“The depressed oil price environment will prompt us to adopt the right path to diversify the economy,” he commented.
Saudi banks are willing to support both public and private sectors. They are capable of developing/introducing right solutions to meet the changing demands of Saudi clients and help them expand their business, the senior SABB executive added.
He said that Saudi Arabia should consider positioning itself as a re-export hub to grow non-oil exports.
He also stressed that Saudi corporates would need to be internationally competitive to become more successful.
Anjum Noman Mirza, head of trade finance sales and solutions, Banque Saudi Fransi (BSF), told Arab News that government and banks would support meeting the Kingdom’s target of non-oil exports of SR1 trillion by 2030. The 2020 target is SR330 billion.
There are many challenges; awareness is one of the biggest challenges, Mirza said, adding that banks need to extend support across the board. 
In the non-oil sector, the first focus should be on raw materials that are readily available in Saudi Arabia. The private sector needs to embrace it and look at it as an opportunity for new businesses.
“With SR32 billion re-exports yearly, Saudi Arabia can also be a hub for re-exports,” Mirza added.

Source: Arab News

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saudi private sector ‘must adapt to new global competitive environment’ saudi private sector ‘must adapt to new global competitive environment’

 



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