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Inventory of Saudi Arabia Industrial Co-Operation Capacity Represents a Part of UNIDO Program for Cooperation Between

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Inventory of Saudi Arabia Industrial Co-Operation Capacity Represents a Part of UNIDO Program for Cooperation Between OCCASION This publication has been made available to the public on the occasion of the 50th anniversary of the United Nations Industrial Development Organisation. DISCLAIMER This document has been produced without formal United Nations editing. The designations employed and the presentation of the material in this document do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations Industrial Development Organization (UNIDO) concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries, or its economic system or degree of development. Designations such as “developed”, “industrialized” and “developing” are intended for statistical convenience and do not necessarily express a judgment about the stage reached by a particular country or area in the development process. Mention of firm names or commercial products does not constitute an endorsement by UNIDO. FAIR USE POLICY Any part of this publication may be quoted and referenced for educational and research purposes without additional permission from UNIDO. However, those who make use of quoting and referencing this publication are requested to follow the Fair Use Policy of giving due credit to UNIDO. CONTACT Please contact [email protected] for further information concerning UNIDO publications. For more information about UNIDO, please visit us at www.unido.org UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Vienna International Centre, P.O. Box 300, 1400 Vienna, Austria Tel: (+43-1) 26026-0 · www.unido.org · [email protected] I t/.... :•t11/ , ..... { ... ..1 .. 1 , ) I ·' ._ .. /r), ,)( - /' • - /. ~. / l' J ........ l ,- II ( I • I I I IllVEMTORY OF S&UDi &RUI& IllDUSTR~U. I CO-OP&ll&TIOB C&P&CITY I I I PllSPAIUU> BY ll&HMOUD RIPllH I I I I I SBPTKMBD 1993 I I I I I I I I I I I IllVBllTORY OP S&UDI &RUI& IllDUSTRIU. I CO-GPBR&TIOll C&P&CITY I I I PaBP&ll8D BY I ll&llHOUD RIPllll I I I I I SSPTDIBD 1993 I I I I I I IllVBllTORY OP l&UDI ll&BI& IHDUSTRl&L I CO-<>PBR&TIOll c&P&CITY I Table of Contents A. OBJECTIVES PAGE I B. OUTLINE OF THE INVENTORY I. GENERAL OVERVIEW OF INDUSTRY IN SAUDI ARABIA 1 I A.Industrialization Historical Progress 2 I B.Industrial Structure in Saudi Arabia 3 C.The Constituents of the Kingdoa's Industrial 7 I Sector with prospects for nev industries D.Industrial Policy in Saudi Arabia 11 I E.Conclusion 18 I II. INDUSTRIAL IHSTITUTIOHS 22 I A.Governaental Institutions 23 38 I B.lndustrial Coapanies - Petrochcaical & Cheaical Industries 39 I - Metallurgical Industries 50 - Bn9ineerin9 & Mechanical Industries 57 I - Food Industries 66 I - Textile Industries 76 I C.Industrial Investaent Groups 79 - The Saudi Basic Industries Corporation (SABIC) 81 I - The National Industrialization Company <NIC) 86 I I I I I I PAGE I III. INDUSTRIAL OPPORTUNITIES IN SAUDI ARABIA 89 - Textile and Garaents Industries I - Food Industries I - Wood Products Industries - Paper Products Industries I - Drugs and Medicines Industries - Rubber Products Industries I - Pla~tic and Cheaical Industries I - Ceraalc Products Industries - Glass Industries I - Non-Ferrous Metal Industries - Manufacture of Fabricated Metal Pr~ducts I - Manufacture of Machinery Iteae I - Manufacture of Electronic Accessories IV. SERVICES RELATED TO INDUSTRY 91 I A.Consulting Piras 92 I B.Research Centers 96 C.Training Centers 100 I ANNEXES 103 I I. Foreign capital Investaent Lav 104 I II. Addresses of Governaent Aqer.cJes Related 110 to Industrial Deve~opaent I I I I I I INVINTQRY or SAUDI ARABIA I INDUSTRIAL CO-OPERATION I CAPACITY I I. OBJECTIVES I The inventory of Saudi Arabia industrial co-operation capacity represents a part of UNIDO program for cooperation between I developing countries. The purpose of the inventory is to give an I overall view of the industrial capacity in Saudi Arabia in the variou~ industrial sectors of its economy. I It is intended to identify the existing capabilities in the I different fields which Saudi Arabia might offer for other I developing countries such as know-how, technology, expertise ... etc. I It is also intended to identify the industrial opportunities in I Saudi Arabia, which might attract interested counterparts in I other developing countries to collaborate with Saudi investors. I II. OUTLINE OP THE INV2JITORY I Chapter Cll begins by reviewing the different stages of I industrial development in the Kingodm of Saudi Arabia. I I I I I I The next issue in chapter (1) defines the industrial structure ln I Saudi Arabia as well as the constituents of the Kingdom's I industrial sector. Moreover, chapter (I) focuses on the goals and priciples of the industrial policy in Saudi Arabia. I Chapter (II) consists of three parts. The first part includes I the governmental institutions involved in industrial development I while the second part includes the industrial companies covering the various industrial sectors. The selected companies are the I leading companies in their fiel~s. The third part ls concerned I with the industrial investment groups. I Two examples are given, the first one represents the governmental sector and the second represents the private sector. I Chapter (III) identifies the industrial opportunities in Saudi I Arabia. It includes a list of 103 industrial projects suitable for implementation in the different industxial sectors and sub­ I sectors. I Chapter (IV) is devoted to institutions which ~rovide servl~es I related to industry such as research centers, consulting firms I and training centers. I I I I I I I ~ OINIRAL OVERVIIW or INDUSTRY IN SAUDI lRlBll I I I I I I I I I I I I I I I I I I I I INTRODUCTION I Industry is one of the pillars of au ambitious economy, I indicating the nation's progress and stage of development. I The government of the Kingdom of Saudi Arabia attaches top I priority to the grovth of the industrial sector. A strong industrial bd~~ has been built along vith th~ related I infrastructure, to encourage industrial projects, vlth the aim of reducing the Kingdom's dependence on oil. I The industrial sector plays a major role in the diversification I of the Kingdom's production base. It's contribution in I generating and increasing income is one of the important objectives of the Kingdom's development plan. I Hanufaturing represents 7.9\ of the tota1 GOP, the fifth five­ I year Development Plan C1990 to 1995) aims at growth rate of 7.8\ I in manufacturing, to be achieved mainly through private sector. The basic strategies of the current Development Plan are to I ensure that the industrial sector plays its part in the development o! the Kingdom mobilizing its potential and resources I to at.tair1 the strategic goals. I According to the current Five-Year Plan, the manufacturing sector I 1 I I I I is expected to lead economic grovth during the 1990s. I Industrilization is given prime importance in the development I strategy of this decade and the private sector ls being call~d to take the lead. I I A - INDUSTRIALIZATION HISTORICAL PROGRESS. I Industrialization in Saudi Arabia has been progressing at a very rapid rate vith the gevernment spearheading the process. I Such industrialization and development progress takes a I tremendous effort and time. The stages of these industrialization process have been divided into five periods as I follows: I 1950-1965: No real industry existed, however, there vas a I small refinery for domestic needs, a large number of cottaqe industries and workshops, and the first 2-30 modern I factories producing a few relatively simple products such as I soap and building materials. I 1965-1975: During this period th~ number of factories grow from less than 30 to about 7000. By 1970, industry I accounted for about 10 percent of GDP. I 1975-1985: During these 10 years industry grew by some 10-15 I I I I percent annually in real terms. Huch of the development was I in the building materials sector, but it should be mentioned that the foundation of the Kingdom's massive petrochemcial I sector was also established. I 1986-1990's: Many of the large petrochemical and heavy I industrial plants vhich began in the previous stage have become operational during this period. The manufacturing I industry will face a period of consolidation and restructuring to adapt to post-boom conditions. These will I also be an emphasis on qualitative upgrading and I technological development. I B - IllDUSTRIAL STRUCTURE Ill THE KillGDOH OF SAUDI ARABIA I Industrial activities in the Kingdom are carried out by two main sectors, the governmental sector and the private sector. The I development of basic industries has been undertaken mainly by the I governmental sector because of the large amounts of capital required, while light manufacturing has been left to the private I sector, which has benefited from government incentives and support. In order to define the role and the impact of each I sector, we shall go through a general overview of both sectors. I .L. T~e Governmental Sector I I 3 I I I I I Industiral projects are carried out by the follo~·ing governmental I bodies: I SABIC I General Grain Silos and Flour Kills Organization PETROMIN I The Royal Commission for Jubail and Yanbu I - Saudi Basic Industries Corporation (SABIC) I Since its formation in 1976, SABIC has assumed responsiblity for I setting up basic-industries that depend on local minerals and I hydrocarbon materials and for marketing the products of these indsutries.
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