RIYADH // GE has clinched US$15 billion worth of deals with Saudi Arabia as part of $200bn in agreements between the kingdom and the United States that will be signed on Saturday with a prime focus on creating Saudi jobs and industries.
GE is participating in a high-level business delegation that is in the kingdom to ink megadeals as part of US president Donald Trump’s first international trip since taking office.
The planned agreements are part of the kingdom’s Vision 2030 to diversify the economy away from oil by attracting investments to help finance projects aimed at employing the country’s young workforce.
“A big percentage of these [$200 billion agreements] is in the kingdom [and] include the localisation of strategic industries that have a high value added, and technologies, and job opportunities,” said Khalid Al Falih, Saudi Arabia’s energy minister. He was speaking at the first Saudi-US CEO Forum that coincides with Mr Trump’s visit.
The agreements cover various areas including defence, information technology and energy, such as power generation, renewables, refining, petrochemicals and new mining industries such as silicons, Mr Al Falih added.
The national energy company Saudi Aramco plans to sign on Saturday contracts with US companies worth approximately $50bn, its chief executive said earlier.
Aramco, the world’s biggest oil producing company, will ink the deals with 13 US chief executives of firms that include the oil services company Schlumberger and Jacobs Engineering Group.
“The memorandums of understanding with these CEOs are for projects that will be done in the kingdom,” said Mr Nasser.
“Definitely, a lot of them will include trade on both sides.”
GE’s deals and MOUs will be across a slew of sectors such as power, health care, oil and gas, and mining. Around $7bn of the deals include the procurement of GE technology and services.
Honeywell also signed an agreement with Aramco to help it reach its goals for the In-Kingdom Total Value Add (IKTVA) Programme, which aims to have 70 per cent localisation of the company’s spending on goods and services and to enable the export of 30 per cent of Saudi energy sector products. IKTVA, Arabic for self-sufficiency, will help to create 500,000 new jobs, a key feature of Vision 2030. “Vision 2030 is the umbrella for all initiatives in the Saudi kingdom,” Mr Al Falih said.
Saudi launched its Vision 2030 last year to wean itself off oil by increasing the contribution of the private sector to GDP to 65 per cent from 40 per cent.
The plan also includes increasing localisation of oil and gas sectors from 40 per cent to 75 per cent. More than 50 per cent of military spending is also envisaged to be sourced locally by 2030.
Jacobs also signed an agreement with Aramco on Saturday to form a joint venture to develop a wide gamut of infrastructure projects in the kingdom and at a later stage in the wider Middle East and Africa, said the chairman and chief executive Steve Demetriou.
“It will be everything from housing to highways, rail to aviation, entertainment cities, and infrastructure associated with those,” said Mr Demetriou, adding the agreement excludes oil and gas projects which have a separate division.
He declined to give a value for the joint venture, which will be funded equally by the two companies. The joint venture is expected to create several hundred jobs, with a view to increasing them to 3,000 over the next five years. The lion’s share of jobs is expected to go to Saudis.
Saudi-US trade topped $35bn last year, but the two countries want to bolster their economic ties as part of creating new jobs for their citizens.
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