Saudi Aramco participated on Tuesday in the US-Saudi Arabian Business Council’s (USSABC) premier US-Saudi SME Forum in Los Angeles, adding momentum to ongoing efforts by the integrated energy and chemicals giant to develop a locally accessible, reliable and innovative supply chain, reported the Saudi Press Agency.
Senior Vice President of Technical Services Ahmad A. Al-Saadi was a keynote speaker at the forum where he highlighted Saudi Aramco’s In Kingdom Total Value Add (IKTVA) program that was launched in 2014 to boost energy-sector localization and greater competitiveness and efficiencies.
Saudi Aramco has been active in the USSABC since the council’s founding in 1993 to encourage cross-border trade and investment between the Kingdom and the United States. American business has a longstanding relationship with Saudi Aramco, dating back to the 1933 oil concession agreement signed between the Kingdom and Standard Oil Company of California.
Currently, more than 10,000 US suppliers are registered to do business with Saudi Aramco, with the company spending more than $30 billion on their goods and services in the past four years alone.
IKTVA began as a strategy to increase Saudi Aramco’s energy goods and services supply chain to 70 percent local content by 2021, with participating companies contributing to training and development, technology transfer and manufacturing while enjoying opportunities for growth.
In 2017, Saudi Aramco sharpened IKTVA’s focus on small to medium enterprises (SMEs) as the backbone of any prosperous economy.
“Local content development is ultimately about sustainability, driven by the better integration and agility that come from sourcing our value chain from our own backyard,” Al-Saadi said.
“By helping create quality jobs, building an innovative workforce and stimulating economic growth, localization aligns with the economic and social aims of Vision 2030, the Kingdom’s economic diversification program.”
Al-Saadi noted that SMEs now add just 20 percent to Saudi Arabia’s GDP, less than half the level in most industrialized nations.
“We want to incentivize American participation, and raise the SME contribution to 35 percent of GDP. We have identified 140 SME development opportunities across nine industrial segments, with a more than $16 billion market gap; that is only a fraction of our $400 billion capital program over the next decade,” he added.
“There has never been a better opportunity for large and small US companies to invest in the long-term prosperity of Saudi Arabia – and we have the incentives and support to create a true win-win for our partners.”
Saudi Aramco’s support for SMEs is also reflected in Wa’ed (“promising”), the company’s small-business arm established in 2011 to offer funding, incubation, coaching and mentoring for innovative new and potential businesses, and foster a new generation of entrepreneurs in Saudi Arabia.