What the Saudi Crown Prince’s visit means for UK companies

By March 13, 2018News

The Crown Prince’s UK visit resulted in new agreements with the British government and the signing of a raft of business deals.

Prime Minister Theresa May’s own words captured the mood that surrounded the visit: “The link that we have with Saudi Arabia is historic, it is an important one, and it has saved the lives of potentially hundreds of people in this country.”

That meeting saw the launch of the UK-Saudi Arabia Strategic Partnership Council; a broad understanding was agreed for a £65 billion ($90 billion) mutual trade and investment target, which would include direct investment in Britain and new Saudi public procurement from British companies. This would be spread across sectors including finance, education, health care, renewable energy and defense, May’s office said. Britain is also vying to land the stock market listing of state oil firm Saudi Aramco, but no decision emerged during the visit.

“This is a significant boost for UK prosperity and a clear demonstration of the strong international confidence in our economy as we prepare to leave the European Union,” a spokeswoman from May’s office said after the meeting.

“This is a significant boost for UK prosperity and a clear demonstration of the strong international confidence in our economy”

On the second day of the visit, the Crown Prince established a milestone in demonstrating a new Saudi Arabia by visiting the Archbishop of Canterbury at Lambeth Palace in south London. The Archbishop showed the prince a rare copy of an ancient Qur’an manuscript that was discovered a few years ago at Birmingham University and the Crown Prince extended an official invitation for the Archbishop to visit the Kingdom

The Crown Prince met with defence secretary, Gavin Williamson and during the meeting signed two memorandums to improve Saudi defence capabilities and to increase cooperation and partnership in the fields such as knowledge transfer, manufacturing partnership, training, research and technical support, as detailed by Vision 2030.

Britain has signed a multi-billion-pound preliminary order with Saudi Arabia for 48 Eurofighter Typhoon fighter jets, military equipment maker BAE Systems said on Friday.

The joint statement issued at the end of the three-day visit, and published by the Saudi Press agency, indicated that both parties signed a letter of intent to supply Saudi Arabia with 48 new Typhoon fighter jets.

“The Crown Prince’s visit has opened a new chapter in our two countries’ historic relationship,” British defence secretary Gavin Williamson said. “We have taken a vital step toward finalizing another order for Typhoon jets that will increase security in the Middle East and boost British industry and jobs in our unrivalled aerospace sector,” he said.

More than 18 economic agreements were made between the UK and Saudi, worth over £1.5 billion across numerous sectors including, education, pharmaceuticals and banking.

Before a private dinner with the Prime Minister, the Crown Prince held a meeting at the Saudi embassy in Mayfair. Among those invited were chief executives of major British banks, the Chancellor of Exchequer and a select group of MPs, where the Crown Prince highlighted the importance of education and women’s empowerment in the Vision 2030 plan to modernize the country.

Kevin Costa, the UK government’s special adviser to Saudi’s Vision 2030, co-chaired the debut meeting for the UK-Saudi Arabia Strategic Partnership Council. His primary responsibility is to identify where British companies can partner and assist in delivering Saudi reforms and increase the private sector GDP contribution from 45% to 60%.

Through this meeting, opportunities were identified, and preferred partners were selected. Partners in finance and investment included; HSBC, Standard Chartered, Lloyd’s of London, Schroders, Standard Life, Legal & General, Man Group and Winton Capital. The life sciences and engineering partners included Atkins, BAE Systems and Wood Group; media spanned BT, Vue International and WPP. However, none of the opportunities or partners have been finalized. “If the objective was to convince us there was more to the future of Saudi relations than arms deals, then it worked,” said one participant.

“If the objective was to convince us there was more to the future of Saudi relations than arms deals, then it worked,” said one participant.

Going forward, British companies can expect new opportunities being offered in the Kingdom. With Saudi Arabia being the UK’s largest trading partner in the Middle East, with over £8 billion worth of trade in 2016 alone, the history of the two countries are a solid foundation for their future relations.

“The partnership between the UK and Saudi Arabia already helps make both our countries safer through intelligence-sharing which has saved British lives, and more prosperous, with thousands of jobs created in the UK and substantial opportunities for British companies in Saudi Arabia” said the PM’s office.

Britain will be a major beneficiary of Vision 2030

Britain will be a major beneficiary of Vision 2030, said Foreign Minister Adel Al-Jubeir, continuing, “After Brexit, there will be huge opportunities for Britain as a result of Vision 2030”.

British companies looking to set up 100% foreign ownership in certain industries in Saudi can do so through a number of different types of business licenses depending on their requirements; limited liability company (LLC), joint ventures, joint stock company, partnership, branch office, sole proprietor, Scientific and technical offices: (STO) .

The Saudi General Investment Authority has made a lot of reforms recently to facilitate the entry of the foreign investors to the Saudi market, reducing the period of issuance of the license to 4 hours and reducing the main requirements down to two:

  1. A copy of the commercial registration of the shareholding partner certified by the Saudi Embassy. In addition, a copy of the national identity if one of the partners is a natural person holding the nationality of one of the GCC countries. And a copy of the national identity if one of the partners is holding the Saudi nationality and a statement issued by Civil Affairs Dept.to prove the profession; and a copy of the commercial registration for Saudi companies.
  2. Financial statements of the last financial year of the applicant foreign company and certified by the Saudi Embassy.

Those who wish to visit Saudi to explore opportunities can do so on a commercial visit visa, this is available for those that have business meetings, conferences, negotiations, trade shows, etc. in the Kingdom.

For more information contact us on info@proven-sa.com and see how we can help you in Saudi Arabia.