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19-03-21 Events

Business

Macron pushes French business in Saudi Arabia

While Saudi Arabia ranks first among France’s trading partners in the Gulf, and France is currently the third largest foreign investor in the kingdom, both countries aim to strengthen their economic collaboration over the coming years.

Several recent cooperation agreements are already moving in this direction, such as the contract signed last January between the SIDF and the French state-owned bank Bpifrance, to promote the development of the entrepreneurial ecosystem by supporting the creation of companies, promoting the development of companies interested in the Saudi market, and developing synergies to intensify collaboration between the two partners.

“This is a great challenge because competition is tough between Westerners, and comes not only from the United States, but also from Russia, China, Japan and European countries.”

François Touazi, founder of the think-tank CAPmena

An opened window of economic opportunities between Paris and Riyadh

French President Emmanuel Macron is playing a new diplomatic card with Saudi Arabia, encouraging French companies to seize new markets in the Kingdom, which is currently experiencing a deep economic and societal transformation. “Today, France wants to come back in force in Saudi Arabia because a window of opportunities is currently opened. There is a chance to play,” explains François Touazi, founder of the think-tank CAPmena. “This is a great challenge because competition is tough between Westerners, and comes not only from the United States, but also from Russia, China, Japan and European countries“. 

Everywhere in the Saudi capital Riyadh, building sites are popping up like mushrooms. Missing out on strategic contracts is out of the question for French companies,  especially since they still have a long way to go to catch up on business. France is only the 8th largest trading partner of the Kingdom, which remains a prime target with a GDP growth expected to reach around 3% in 2021 – driven mainly by the rise in oil prices. The rise of private financing in development projects is also a positive step forward for Saudi Arabia, that is becoming more and more business friendly.

“We haven’t noticed any slowdown in investments for mega projects such as NEOM, Al-Qiddiya or Red Sea”.

Laurent Germain, Chairman of the French-Saudi Arabian Business Council of MEDEF International

Saudi mega projects are highly attractive for France 

Over the past two years, the business environment has made great strides in Saudi Arabia, according to Laurent Germain, Chairman of the French-Saudi Arabian Business Council of MEDEF International. The ambitious growth targets of the Kingdom’s Vision 2030 transformation plan offer great prospects for development. Covid’s crisis has not slowed down the French investor’s interest in the Saudi market. “In fact, we haven’t noticed any slowdown in investments for mega projects such as NEOM, Al-Qiddiya or Red Sea,” he added. 

For this privileged observer of the economic ties linking both countries, a forthcoming visit by President Macron to Riyadh will also be an opportunity to give a boost to bilateral work, in the sectors of transport, health, renewable energy or new technologies. This flourishing market represents a new chance for major companies as well as for SMEs. MEDEF International is planning a new mission of entrepreneurs in the Kingdom, which represents, seen from Paris, a welcome business oasis in an insecure economic landscape.

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