SAUDI ARABIA, May 31 — The Saudi Arabian General Investment Authority (SAGIA) has cancelled 792 licenses of foreign companies registered in the kingdom while urging small-scale foreign investors to either improve their performance or leave.
These include 403 in the contracting sector, 117 in the light industries, 189 in metal works, gold and furniture, 10 restaurants and 18 tour operators, Arab News reported.
“We have given an ultimatum to these small investors who have failed to add value to the national economy,” said Abdullathif Al-Othman, SAGIA governor, adding that the deadline ends within a week, and issued stern warning to bogus investors.
Al-Othman said the move was aimed at attracting investments to quality projects that not only add value to the economy, but also help the transfer of technology and employment of more Saudis.
“New investment licenses will be given only to those who fulfill these conditions,” he said in comments published on Thursday. He said some of these small investors have submitted an undertaking that they would improve their level of investment.
“If they do this, they will continue in the market,” he said, adding that serious investors have expressed their readiness to meet the conditions.
Abdul Rahman Al-Zamil, president of the Council of Saudi Chambers, applauded SAGIA’s move to clean up the investment sector.
Al-Zamil said the SAGIA move would also help eradicate illegal cover-up businesses from the country.
“There are hundreds of investors who have licenses, but did nothing to kick-start their projects. Some of them are engaged in activities other than what they are licensed to do,” he told the paper.
“Saudi Arabia is not against foreign investors, but we are looking for serious investors,” he said, adding that about 8,000 foreign investors had not contributed to the national economy after receiving SAGIA licenses.
SAGIA has reportedly launched a survey of foreign investment projects across the country long been recognized as a powerhouse of the Middle East. Now’s it’s poised to become one of the world’s top 10 most competitive nations and with that, one of the most lucrative markets for strategic investment.
The kingdom is spending more than $500 billion to upgrade infrastructures and create jobs for Saudi nationals. It has embarked on an ambitious plan to diversify economy beyond oil, making it less vulnerable to any future plunge of global oil prices