Doing Business in Saudi Arabia - International Franchise Association

and has earmarked $8 billion for new rail expansion projects that will contribute to the rise in
private investment in infrastructure, particularly in the transport sector. Finally, the
forthcoming $3.5 billion Saudi-Egyptian Causeway, which will provide a road link between
Saudi Arabia and Egypt across the Red Sea, is expected to raise Saudi Arabia’s
attractiveness to Islamic and non-Islamic visitors.
No reliable, published statistics are available on the CON sector in Saudi Arabia.
Best Prospects/Services Return to top
The Saudi government is gearing up to meet the residential, health, and education needs of its
rapidly growing population. Over 3.2 million new housing units will be needed, with over
800,000 for Riyadh alone, as well as hospitals, schools, universities and leisure centers. The
country’s electricity sector is to be expanded by 300% over the next two decades. More than
800 new factories are being built, the telecoms sector is being developed, and the water sector
is being upgraded, to include more desalination plants, better drinking water networks, and
broadened pipeline networks. Hundreds of projects in all are creating unprecedented demand
for the latest construction industry machinery, technology and tools, from the world’s leading
companies.
The construction element related to power supply development alone is estimated at nearly $1.2
billion. In total, current infrastructure and public sector building programs are valued at some
$40 billion. Plans include building 800 new factories, schools, doubling desalination capacity,
and increasing electrical generation and distribution. The Ministry of Education has outlined a
$4.5 billion plan to build another 4,000 schools.
Most of Saudi Arabia’s mineral wealth still remains unexplored. In the next four years, some
$20 billion will be invested in mining projects in the Kingdom of Saudi Arabia, much of it by the
state-run Saudi Arabian Company (Ma’aden). The main minerals are gold, phosphates and
bauxite. While aluminum smelter and fertilizer plants add value, perhaps the largest value will
come with the new freight rail network designed to carry minerals to the coast for export.
Opportunities Return to top
There are good opportunities for U.S. companies in the following areas:
• earth-moving machinery and equipment
• construction tools
• construction equipment
• bathrooms
• asphalt machinery
• architectural finishes
• anti-corrosion products
• asphalt plants
• architectural services
• aluminum products
• wall coverings
• building automation
• ceiling materials
• carpentry equipment