Saudi Minister of Industry and Mineral Resources Bandar Bin Ibrahim Alkhorayef says his country could complement Asia by providing more opportunities and help Asian enterprises relocate much of their manufacturing operations to Saudi Arabia through cooperation in R&D and innovation.

Such collaboration and advancement in pushing to transform the Gulf state’s mining and other industrial sectors are part of Saudi Arabia’s grander economic diversification plan, Vision 2030, which was unveiled by Saudi Crown Prince Mohammed bin Salman Al Saud in 2016 and includes mining as the third pillar of national industrialism. As one of the biggest oil producers in the Middle East, the country’s abundant mineral wealth is estimated at $2.5 trillion.

“There’re a lot of commonalities between the two regions and (one of) Saudi Arabia’s ambitions is to grow its manufacturing base to explore its mining capabilities. This is not just to satisfy our local market, but also to participate in the global market,” he told China Daily in an interview over the weekend.

“We’ve all seen the challenges of supply chain disruptions. We believe Saudi Arabia can be a great place to solve these problems.”

Alkhorayef had earlier wrapped up what he called an “overwhelming” visit to the Guangdong-Hong Kong-Macao Greater Bay Area after a week-long tour of Asia, including Singapore, where he said the aim was to help key businesses look to Saudi Arabia as their next production base.

The minister had visited the Chinese mainland almost exactly a year ago, holding talks with ministers and officials and touring companies and factories.

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“China’s a big country. The last time, we visited five cities and, this time, we went to Guangzhou. There’s a different flavor in each one of these cities and we try to capture the value and what each region in China can offer to Saudi Arabia,” says Alkhorayef.

“Our aim is to focus on two areas. One is to help large players look to Saudi Arabia as their next production or logistics location because we can offer a great location to a mixture of enablers -- from raw materials to energy prices and infrastructure.”

The other sector, which he calls “interesting”, is innovation and the adaptation of new business models, such as “Industry 4.0” and “Industry 5.0”, plus artificial intelligence, apart from manufacturing. “This is where we see a lot of opportunities for collaboration.”

“Industry 4.0” or “The Fourth Industrial Revolution”, is defined by The World Economic Forum as the next phase of manufacturing, characterized by smart technologies and automation that will allow manufacturers to produce goods more efficiently, quickly, cheaply and sustainably. “Industry 5.0” is an emerging phase that sees machines working alongside humans to enhance workplace processes sustainably.

During his latest tour of the Chinese mainland, Alkhorayef invited companies there to invest in Saudi Arabia, as highlighted in its National Industrial Strategy, during a roundtable meeting organized by the Federation of Chambers of Commerce in  Guangdong’s provincial capital, Guangzhou.

In the Hong Kong Special Administrative Region, he met the secretary for commerce and economic development, the director of the Trade and Industry Department, and officials of the Innovation and Technology Commission, according to the Saudi Press Agency.

China is Saudi Arabia’s largest trading partner. The Saudi Ministry of Finance said the volume of trade between the two countries exceeded $100 billion last year.

According to data released by Saudi Arabia’s General Authority for Statistics in February this year, China is the main destination for Saudi exports, accounting for 13.2 percent of exports. China also ranks first in terms of the kingdom’s imports, taking up 19.9 percent of total imports.

Saudi Arabia enacted a mining investment law in 2021 to ensure that mining activities contribute to community development, generate new job opportunities, and support the growth of local businesses.

The law requires full environmental impact studies for all new projects to ensure protection of the environment, as well as detailed plans for the eventual closure and rehabilitation of any mining site. It’s also aimed at making it easier to do business by digitizing the process for issuing new mining licenses, streamlining license approvals, and ensuring the transparent publishing of records concerning all mining licensing activities.

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Saudi Arabia is also stepping up the exploration and development of minerals, raised its estimated mineral wealth and had invested $182 million in exploration incentives by late 2023.

Alkhorayef says his ministry has identified 12 sectors as priorities in the country’s transformation plans, adding that some of them are “related to our national security, like food security, pharmaceuticals, water security and defense”.

“The other products are related to capturing added value from our natural resources in oil and gas, petrochemicals, minerals, downstream chemicals and the processing of minerals.”  

Another group concerns future industries like the manufacturing of electric vehicles, aerospace and, generally, new technologies emerging in the future and “we want to be ready for that”, the minister says.

“We believe Saudi Arabia can offer many opportunities for global players from various countries. China is definitely Saudi Arabia’s top trading partner. It’s logical we should we find areas for collaboration, while localization is also important in our strategy.”

Alkhorayef  also serves as chairman of National Industrial Development and Logistic Program, chairman of Local Content and Government Procurement Authority, chairman of Saudi Industrial Development Fund, Chairman of National Industrial Development Center, chairman of Saudi Export Development Authority, chairman of Saudi EXIM Bank and chairman of Saudi Authority for Industrial Cities and Technology Zones.

As for the Belt and Road Initiative, Alkhorayef stresses that Saudi Arabia is located in an area where it can help to link up many other regions. “Definitely we’re in a position to allow us to access markets that are growing and have high potential for growth.”

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The minister said he used to be a businessman visiting Singapore, China and its Hong Kong region. But, “it’s great to be here in an official capacity. I’ve received a warm welcome from everyone, both in the government and the private sector. I think there’re great opportunities we can bring together."  

Alkhorayef has a renowned career with the launch of the Saudi EXIM Bank, the Saudi Made Program and the National Geological Survey Program. He also helped establish the Saudi Mining Services Company, implement the Future Factories Program, and transform industrial clusters to the National Industrial Development Center.

Contact the writer at jan@chinadailyapac.com