General Electric pushes to increase its revenue in Saudi Arabia from last year's $3bn.
General Electric Co aims to make Saudi Arabia its manufacturing hub in the Islamic world as the company pushes to increase its revenue in the kingdom from last year’s $3bn.
Fairfield, Connecticut-based GE is focused on increasing its Saudi investments in terms of manufacturing, job creation and technology development, Akram Hamad, the president for the Gulf region, said in an interview on Tuesday.
“By 2013, Saudi Arabia will be the manufacturing hub for GE in the Islamic bloc,” he said.
The maker of gas turbines, engines and trains joins other US companies seeking to expand in the Arab world’s largest economy. Saudi Arabia is implementing a $400bn, five-year spending program to boost economic growth and build infrastructure. It’s the biggest stimulus package by any of the Group of 20 nations as a percentage of gross domestic product.
“There are a lot of projects and the government is playing a key role in stimulating the economy,” Hamad said. “We are not afraid about any slowdown in business.” GE’s 2009 revenue in Saudi Arabia should be exceeded this year, Hamad said.
Companies from China, Europe and the U.S. are competing for contracts to build railways, petrochemical and electricity plants and water facilities. “With the increasing role of the government in 2008-09 amid the financial crisis globally, we put more focus on government stimulus and worked more closely with the government,” Hamad said.
Two hundred Saudi government and business leaders, including Oil Minister Ali al-Naimi, attended the U.S.-Saudi Business Opportunities Forum in Chicago in April. US companies that were present included Exxon Mobil Corp.
After the Chicago meeting, GE signed a strategic partnership with the Saudi Ministry of Industry and Commerce. The company will treat Saudi Arabia as a global supply-chain and manufacturing center, Hamad said.
Along with expanding its energy, aviation and health-care business, GE plans to offer financial services in the kingdom by the end of this year through a joint venture with Mubadala Development Co.
GE formed the venture in 2008 to invest in emerging markets, including the Middle East and North Africa. Mubadala owned 65.8 million shares of GE at the end of March, according to Bloomberg data.
Saudi Arabia is a “key market” and GE would like to support the country, “not only on the industrial side, but on the financial side,” Hamad said. (Reuters)