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University Microfilms International A Bell & Howell Information Company 300 North Zeeb Road, Ann Arbor, Ml 48106-1346 USA 313/761-4700 800/521-0600 Order Number 0006028 The impact of the international transfer of technology on the development of indigenous technology in Saudi Arabia Chlach, Talal Ramadan, Ph.D. The American University, 1989 Copyright ©1989 by Chlach, Talal Ramadan. All rights reserved. 300 N. Zeeb Rd. Ann Arbor, MI 48106 THE IMPACT OF THE INTERNATIONAL TRANSFER OF TECHNOLOGY ON THE DEVELOPMENT OF INDIGENOUS TECHNOLOGY IN SAUDI ARABIA by Talal Ramadan Chlach submitted to the Faculty of the School of International Service of The American University in Partial Fulfillment of The Requirements for the Degree of Doctor of Philosophy in International Relations Signatures of Committee: Chair: jjrw * iOQ-trz)^ --------- Dean of the College or School 0 ~ O _____________ Date 1989 The American University 70^ Washington, DC 20016 THE AMERICAN UNIVERSITY LIBRARY © COPYRIGHT by TALAL RAMADAN CHLACH 1989 ALL RIGHTS RESERVED DEDICATION To my mother, father, wife, and daughter THE IMPACT OF THE INTERNATIONAL TRANSFER OF TECHNOLOGY ON THE DEVELOPMENT OF INDIGENOUS TECHNOLOGY IN SAUDI ARABIA by Talal Ramadan Chlach ABSTRACT This dissertation explores the impact of the inter­ national transfer of technology on the development of indigenous technology in Saudi Arabia since 1970. The essential question investigated is whether a transfer of technology had occurred. If such a transfer had occurred: 1. To what extent did it occur and what sector or sec­ tors of the Saudi economy did it affect? 2. Did this transfer induce other forms of indigenous technologies? 3. How much impact, if any, did the transferred tech­ nology have on the development of indigenous human resources? 4. What was the impact of this transfer, if any, on the social and political institutions in Saudi Arabia? The general conclusion of this study is that a broad and systematic transfer of technology had not occurred in accordance with the definition offered in this research. ii After reaching this conclusion, the study then attempted to determine why this transfer had not happened. Two case studies are utilized to further investigate this problem. Finally, the study seeks to identify the conditions neces­ sary for a transfer of technology to take place. This study examines two major and separate hypotheses: (1) international transfer of technology will result in the development of indigenous technology in developing coun­ tries; and (2) the development of an appropriate indigenous technology is dependent upon the development of indigenous human resources. The study uses both primary and secondary sources. Primary data were collected through open-ended interviews with officials from the government and the pri­ vate sectors, and survey questionnaires. Secondary sources are the various government and nongovernment publications, development plans, development policies, annual statistics, and other relevant publications. ACKNOWLEDGMENTS I would like to thank God for enabling me to success­ fully conclude this research. My deepest appreciation and gratitude is extended to my Ph.D. dissertation committee members— Dr. Abdul Aziz Said, Dr. Robert Boynton, and Dr. Edmund Ghareeb— the faculty of the School of International Service, and the American University, Washington, D.C., who played a major role in directing and enriching my academic program during the period in which I obtained my B.S.T.M., M.A., and Ph.D. My thanks also goes to all those who helped me in my research at the Center for Mediterranean Studies at the American. University, most particularly Ms. Francine Marcus. I would like to thank Dr. Nabeel Abdul Aziz at the Jeddah Chamber of Commerce and Industry Information Center and officials at those companies in Saudi Arabia who either granted me an interview or graciously responded to my long questionnaire. My thanks also goes to all the officials at the various Saudi government ministries and agencies who granted me interviews and provided me with a wealth of information related to my research. I would like to extend a special thanks to the officials at both Saudi Arabian Air­ lines and Saudi Cable Company who spent time with me during iv the period I was conducting the research for the case studies. Finally, and most especially, my deepest and long- lasting appreciation and gratitude goes to my wife, Katherine L. Knight, without whose help, understanding, sup port, patience, sacrifice, and encouragement I would not have been able to finish this work. Also, my love goes to my daughter, Jennah, whose involvement in my work began prenatally and who spent the first six weeks of her life beside me, keeping me company night after night, during the writing of the final chapters. She continued to provide me with the impetus needed to carry on until the final signa­ tures were affixed. v TABLE OF CONTENTS ABSTRACT ............................................... ii ACKNOWLEDGMENTS ...................................... iv LIST OF TABLES ...........................................viii Chapter I. THE RESEARCH OBJECTIVES, DESIGN, AND METHODOLOGY ................................ 1 Objectives .................................. 1 The Research Problem ....................... 2 Research Design and Data Collection ........ 5 Limitations and Research Methodology.... 9 Definition of T e r m s ...................... 10 II. REVIEW OF THE LITERATURE .................. 18 III. HISTORICAL AND CONTEMPORARY SAUDI ARABIA . 41 Historical Background ....................... 41 History of the Arabian Peninsula ........ 41 Development of the Kingdom of Saudi Arabia . 44 The Rise of Al-Saud .................... 44 The Political system ..................... 47 Economic conditions ....................... 49 Geography and population . ........... 50 Educational system ....................... 51 Health care services .................. 52 Contemporary Saudi Arabia ................... 53 Political system ......................... 53 Educational system ....................... 56 Health services ............................ 59 IV. DEVELOPMENT POLICIES OF THE KINGDOM OF SAUDI ARABIA ....................... 62 Summary of the Development Plans ........... 62 Achievements of the Development Plans.... 72 Development of Industrial Infrastructure . 81 V. INDUSTRIAL DEVELOPMENT POLICIES, PROJECTS, AND INSTITUTIONS .......................... 90 vi Historical Background ....................... 90 Industrial Development Policies ............ 94 Industrial Development Institutions ........ 101 Action-oriented institutions ............ 101 Support-oriented institutions ............ 110 Financial support-oriented institutions . 112 S u m m a r y ...................................... 114 VI. MANPOWER DEVELOPMENT .......................... 120 Public Corporations and Agencies .......... 134 VII. ANALYSIS OF THE S U R V E Y ........................ 148 Preliminary Interviews ..................... 148 Analysis of Sample Survey D a t a ............ 155 Technological Involvement ................... 159 M a n p o w e r .................................... 173 M arketing.................................... 178 T r a i n i n g .................................... 179 Technical.................................... 180 VIII. SAUDI ARABIAN AIRLINES: CASE STUDY .......... 183 Historical Development of Saudi Arabian A i r l i n e s .................................... 185 IX. SAUDI CABLE COMPANY: CASE STUDY ............ 210 Historical Development ..................... 210 Manpower Development ....................... 215 Saudi Cable's Technical Achievements .... 226 X. FINDINGS, RECOMMENDATIONS, AND CONCLUSIONS . 232 Recommendations .............................. 240 Conclusions.................................. 248 APPENDIX ............................................... 252 BIBLIOGRAPHY .......................................... 268 vii LIST OF TABLES 1. Health Facilities ................................

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