BUSINESS DIVERSIFICATION
The country's dominant holding groups are not merely attuned to the rapid succession of economic and policy-oriented transformations sweeping the country; they are often leading them.
If I were a young Saudi entrepreneur entering the market, I would look at the simple operations in the supply chain and start from there; I would not start big. Today, everything is needed. Sometimes it is easy to say one wants to go into something big, such as oil and gas, renewable energy, or infrastructure construction. However, one also needs to look at the more day-to-day opportunities. Is anyone producing a great pair of shoes in the Kingdom? As a young entrepreneur, I would not necessarily look at the big league opportunities. There is business for everyone. Young people have to work, and we have to move away from a subsidized system into one where young people understand work is a personal duty as well as a social need, and provide them with the proper tools to express their capability. Though from our side, we have to improve the work environment. We have to motivate and incentivize people through a better HR management system that matches talent with the country's economic needs. With Vision 2030 and the oil crisis, we are rethinking our entire business model.
The market is changing in different ways. Many companies are looking at how their future fits in with Vision 2030, and whether or not they are aligned with its aims. We are no exception; we aim to align SEDCO Holding with Vision 2030. In our case, we looked at Vision 2030, our business, areas of growth, and expectations. There are fantastic initiatives across the board, and we found we were well aligned in many areas. For example, we are in the hotel business mainly in Mecca and Medina. We are well focused on the Hajj and Umrah market, and as these numbers grow, we are all set to do more. Furthermore, the country is gearing up for tourism. We are already operating the Elaf Hotel in Jeddah and just opened Galleria Hotel on Tahlia Street. Focused on car leasing, we recently signed with the German company Sixt, which gives us a strong strategic position. Our restaurant business is thriving and includes the Applebee's franchise, Ocean Basket, and others. Our fourth focus is capital markets.
The Rusd Group was established in 2002, and we were the main founder of the Salama Group, which is listed on the Dubai Financial Market. We are also the founder of Jeddah International College and the major shareholder of Taajeer, the first company to provide financial leasing in Saudi Arabia. We are a diversified group of companies operating in areas including finance, education, transport, real estate, and tourism and hospitality. We are one of the larger-sized groups operating in Mecca in the hospitality sector. As for the country's overall appeal, Saudi Arabia is part of the G20, and its GDP and GDP per capita are extremely attractive. There is a population of roughly 32 million, with about 20.5 million young Saudis. This young demographic has developed certain consumption habits in eating, entertainment, and fashion that drive the economy in a significant way. Saudi Arabia is being transformed from a conservative and closed culture to an open and progressive one. This creates many opportunities in entertainment, food, education, and health.
We consider foreign investment as opportunities, not as a necessity or trend we need to follow. Saudi Arabia already has many opportunities, and we certainly tend to make our investments domestically. Our teams maintain this focus, though if opportunities arise and we expect high returns, we invest abroad. For example, we collaborate with Khazanah Nasional, a Malaysian state investment fund. Around 60% of the company's investments are in the GCC. Everyone that comes to Saudi Arabia with the objective of finding a sophisticated investor or partner will eventually run into MASIC, especially given our leadership through conferences like the Future Investment Initiative (FII) or our MASIC forum. Openness to foreign investors entering the country, stronger regulations, and tackling corruption have all made the Kingdom extremely attractive. Our portfolio is indeed diversified, ranging from progressive real estate and hospitality investments in Mecca to a shrimp farm in Jeddah, a logistics company providing housing and accommodation for laborers, third-party model factories, and so on.
BUSINESS DIVERSIFICATION
TABLE OF CONTENTS
Interview
Majid bin Abdullah Al Qasabi , Minister , Commerce & Investment
Increasing the contribution of SMEs, enhancing the ease of doing business, and boosting automation are but three of the commerce and investment ministry's many ambitious goals to shake up the economy and meet its ambitious Vision 2030 goals.
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Prince Faisal bin Bandar bin Abdulaziz Al Saud , Governor of Riyadh province & Chairman of High Commission , Development of Arriyadh
Riyadh is working hard to become one of the world's 100 best cities by 2030. Its extensive new investments in public transport will take it much of the way.
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Munir M. Al Zu’bi , General Manager, Al Wefaq Rent a Car
The Saudi car rental industry reached saturation years ago, and while new regulations and taxes continue to force companies out of business, Al Wefaq has managed to ride the wave through decisions backed by extrapolation.
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Andy Carr Managing Director and Chief Executive, BAE Systems Saudi Arabia (BAES SA), Managing Director and Chief Executive, BAE Systems Saudi Arabia (BAES SA)
With localization at the heart of Saudi Arabia's vision 2030, BAES SA is collaborating with the government to build an independent defence industry.
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Prof. Ahmed Al-Jubaili , Executive Director, National Commission for Academic Accreditation and Assessment (NCAAA)
NCAAA's main goal is to drive excellence in all higher educational institutes in the Kingdom and help universities raise their performance to international levels.
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