Saudi requiring foreign companies to have HQ within the Kingdom by 2024

If you are an expat following the new announcement for foreign businesses to have a headquarters within the Kingdom, then you may be wondering about the future of the company you work for. It is pretty well known that in this area of the world, Dubai has the monopoly on foreign business, banking and development. Saudi is apparently challenging this, and exploring a future where Riyadh will figure prominently within the Middle East. So what does this new mandate hold for you in the future as an expat in Saudi? It could mean great things for you and the company you work for if they have their headquarters here. Or if your company decides not to follow the new rule going into effect by 2024, you may be limited in your time here. Read on to find out more about the possibilities of doing business within KSA.

“‘Dramatic and risky’ — and a shot at Dubai? Saudi Arabia issues bold business ultimatum to pull regional HQ offices into the kingdom” by Natasha Turak on 16, Feb. 2021, cnbc.com. Here is an excerpt from the link below.

“DUBAI, United Arab Emirates — Saudi Arabia, in a bold and unexpected move, announced late Monday that by 2024 its government would cease doing business with any international companies whose regional headquarters were not based within the kingdom.  

The news has investors, bankers and expat workers buzzing — and scratching their heads.  

Saudi Arabia in recent years has pitched itself as a location for HQ offices in its campaign to create private sector jobs and diversify its economy as part of Crown Prince Mohammed bin Salman’s Vision 2030.”

https://www.cnbc.com/2021/02/16/targeting-dubai-saudi-arabias-ultimatum-to-pull-hq-offices-to-kingdom.html

“Saudi Arabia says foreign companies must have regional HQs in Kingdom to access government contracts” 15 Feb, 2021, arabnews.com. Here is an excerpt from the link below.

“RIYADH: Saudi Arabia will stop signing contracts with foreign companies from 2024 unless their regional headquarters are based in the Kingdom.

The rule will include agencies, institutions and government-owned funds, a statement on Saudi Press Agency said.

The decision aims to incentivize foreign companies that deal with Saudi Arabia’s government to base themselves in the Kingdom.

It will also create jobs, increase spending efficiency, and guarantee that the main goods and services purchased by government agencies are from the Kingdom.”

https://www.arabnews.com/node/1809861/business-economy

“24 international firms sign deals to establish main regional offices in Riyadh”, 3 Feb. 2021, saudigazette.com. Here is an excerpt from the link below.

“The efforts to attract regional offices of international companies come as an element of the Riyadh strategy, which aims to double the size of the economy and achieve major leaps in generating jobs, improving the quality of life, and attracting and expanding investments to place Riyadh among the ten largest city economies in the world by 2030.

The headquarters attraction program aims to increase the percentage of the local content, reduce any economic leakage, and develop new sectors, in addition to creating tens of thousands of new quality jobs for the best qualified people.

Attracting regional headquarters is not an end, but rather one of the economic growth potentials that Riyadh aspires to achieve. It must be noted that Saudi Arabia is currently working on many systemic amendments with the aim of developing an investment environment that incubates global investments.”

https://saudigazette.com.sa/article/603197/SAUDI-ARABIA/24-international-firms-sign-deals-to-establish-main-regional-offices-in-Riyadh

“Saudi HQ: Kingdom will require foreign firms to set up shop” by Matthew Martin and Zaid Sabah, 15 Feb. 2021, aljazeera.com. Here is an excerpt from the link below.

‘Saudi Arabia said it will stop working with foreign firms that don’t base their Middle East headquarters in the kingdom, in its latest effort to shift the Gulf region’s business hub away from Dubai.

From Jan. 1, 2024 the government as well as agencies, institutes and funds owned by the state will no longer contract any companies or commercial institutions unless they have a regional hub in Saudi Arabia, according to a statement on the Saudi Press Agency attributed to an official source. The move is intended to encourage foreign firms to hire more Saudi nationals and limit “economic leakage,” according to the SPA report.

Dubai in the United Arab Emirates has firmly established itself as the regional business hub for everything from banking to transport and logistics. As part of attempts to open and diversify its economy Saudi Arabia has though offered firms a package of incentives including tax breaks under a plan dubbed “Project HQ.”’

https://www.aljazeera.com/economy/2021/2/15/saudi-hq-kingdom-to-require-foreign-firms-set-up-shop

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