Local partner provision may be scrapped in Saudi
A committee has been prepared to oversee the reconsideration of Saudi's traditional local partner policy as the Kingdom tries to drive increased FDI inflows
Saudi Arabia is reportedly considering the cancellation of a policy which requires foreign companies wishing to operate in the Kingdom to have a local partner.
The move reportedly comes in light of the country's increased focus on the generation of foreign direct investment (FDI).
According to Arabian Business, citing Asharq Al Awsat, a high-profile committee is involved in the reconsideration process.
This committee was established to improve FDI flows into the Kingdom, and comprises representatives from the Saudi Arabia General Investment Authority (SAGIA), the country's Ministry of Commerce and Industry, and the Ministry of Labour.
Sources told the Arabic newspaper that “the condition for the need for a local partner is likely to be removed with the committee concludes its studies”.
The Kingdom's aim to increase its FDI inflows follows the country's foreign exchange losses in light of its oil-hit balance sheet.
According to the Arabic daily's report, the committee would seek to cut down on red tape and the conditions required for foreign investment, as the country seeks to remove obstacles for global firms wanting access to the Arab world’s largest economy.