Foreign companies pushed to site regional HQs in Saudi Arabia

Foreign companies pushed to site regional HQs in Saudi Arabia

Saudi Arabia will stop awarding contracts to foreign companies that do not have their regional headquarters based in the kingdom within three years in the latest move by Crown Prince Mohammed bin Salman to lure global firms to the oil-rich nation.

The measure will be enforced by entities including "agencies, institutions, and funds owned by the government,“ and will take effect from the beginning of 2024, the state news agency said, citing an "official source“.

The statement suggests the move will relate to contracts made by foreign groups with the kingdom's most powerful entities, including Saudi Aramco, the state oil company, and the Public Investment Fund, a $400bn sovereign wealth fund, as well as ministries.

The measure comes as Prince Mohammed has pledged to spend hundreds of billions of dollars on megaprojects to modernise the kingdom and reduce its dependency on oil. The government in the world's top crude exporter is the main driver of economic activity and foreign companies working in Saudi Arabia typically look to state entities to secure lucrative contracts.

The kingdom boasts the Middle East's biggest economy, but most global companies prefer to house their regional headquarters in Dubai, which has developed state of the art infrastructure to become the