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Lenovo: Partnership with ALAT to Add $10 Billion to Saudi Economy by 2030

A Lenovo factory (the company’s website)
A Lenovo factory (the company’s website)
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Lenovo: Partnership with ALAT to Add $10 Billion to Saudi Economy by 2030

A Lenovo factory (the company’s website)
A Lenovo factory (the company’s website)

Following the establishment of a factory by Lenovo in Riyadh through a $1 billion partnership with Alat, a company affiliated with the Public Investment Fund, the project has now entered its active execution phase.

Production is scheduled to begin in 2026 and will see millions of desktop and laptop computers and servers carrying the “Made in Saudi” label being manufactured, coinciding with Saudi Arabia’s efforts to double non-oil industrial exports to $149 billion by 2030.

The Lenovo-Alat collaboration alone is expected to contribute as much as $10 billion to the Kingdom’s non-oil GDP by the end of this decade.

Officials from Lenovo’s Chinese headquarters told Asharq Al-Awsat that the project goes beyond a purely financial investment. It is intended to become a platform for digital innovation, artificial-intelligence applications and the integration of local start-ups into Lenovo’s global innovation chains, thereby enabling the Kingdom to benefit from the company’s international manufacturing and advanced-technology expertise.

They added that the project supports the aims of Saudi Vision 2030 by boosting domestic manufacturing, doubling non-oil industrial exports and generating direct and indirect employment for Saudi youth, alongside upskilling them in AI and advanced computing.

The initiative is among the most prominent examples of Saudi Arabia’s shift towards becoming a regional hub for advanced technologies and artificial intelligence, with a focus on integrating multinational companies into the local innovation ecosystem and localizing high-tech industries under global sustainability standards.

Lawrence Yu, Head of Lenovo’s Middle East & Africa regional headquarters, told Asharq Al-Awsat that the partnership with Alat “marks a turning point from dependence on imported technologies to developing local capabilities.”

He noted the project will transform the Kingdom into “a regional base for advanced manufacturing in computing and artificial intelligence.”

A State-of-the-Art Facility

Yu explained that the new facility in Riyadh has been designed according to the highest global sustainability standards. Production is set to commence in 2026, manufacturing millions of “Made in Saudi” desktop and laptop computers and servers, supporting both local and regional demand and positioning Saudi Arabia at the forefront of digital transformation in the region.

He added that the project will provide approximately 15,000 direct jobs and 45,000 indirect jobs, as well as support the development of local skills in AI and advanced digital technologies.

On his part, Giovanni Di Filippo, Vice President and General Manager for Lenovo Saudi Arabia, described the project as “a strategic step to reinforce the company’s global footprint and diversify its manufacturing geography.”

He explained that Lenovo will transfer part of its technology, manufacturing capabilities and supply-chains to the Kingdom, enabling local start-ups such as Novo Genomics and Nybl Global to be integrated into the company’s global innovation system and scale internationally.

Di Filippo noted that the project aligns with Vision 2030’s targets to enhance local manufacturing and increase the industrial sector’s contribution to GDP to more than $238 billion, and to double non-oil industrial exports to $149 billion by 2030. He emphasized that the Lenovo-Alat partnership alone will contribute up to $10 billion to the non-oil GDP by the end of the current decade.

The officials pointed out that this initiative marks a clear shift in the Kingdom’s strategy from reliance on imported technologies to building local capabilities. It reinforces Saudi Arabia’s role as a regional hub for AI and advanced computing, and supports the private sector and innovation across a variety of fields, including major digital and cultural events such as esports and Expo 2030.

Yu affirmed Lenovo’s commitment to supporting local entrepreneurs and equipping Saudi youth with future skills in advanced manufacturing and AI. He said the company is working with Alat on programs to develop the Saudi workforce, enabling them to lead the digital transformation and contribute to the knowledge-economy, in line with the Kingdom’s commitment to investing in human capital and innovation.

Di Filippo added that the project is not simply about technical manufacturing, but about localizing multinational companies and integrating them into Saudi Arabia’s innovation ecosystem.

He said the partnership with Alat ensures the benefit of extensive regional networks and deep local market experience, making the project a driver of innovation and industrial growth in the Kingdom.

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Business

US, Mexico Finish First Round of Trade Agreement Talks

Mexican Economy Minister, Marcelo Ebrard, gestures as he speaks during a press conference in Mexico City on May 27, 2026. (AFP)
Mexican Economy Minister, Marcelo Ebrard, gestures as he speaks during a press conference in Mexico City on May 27, 2026. (AFP)
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US, Mexico Finish First Round of Trade Agreement Talks

Mexican Economy Minister, Marcelo Ebrard, gestures as he speaks during a press conference in Mexico City on May 27, 2026. (AFP)
Mexican Economy Minister, Marcelo Ebrard, gestures as he speaks during a press conference in Mexico City on May 27, 2026. (AFP)

The United States and Mexico completed a first round of bilateral trade talks Friday, focused on revising the North American Free Trade Agreement in light of pressure from President Donald Trump's tariff policies.

The US-Mexico-Canada Agreement (USMCA) is due for its first review since coming into force in 2020, with talks starting Wednesday led by Mexico's Economy Secretary Marcelo Ebrard and US Deputy Trade Representative Jeff Goettman joining Thursday.

"We talked about rules of origination, the automotive sector, how we compete with countries in Asia and other parts of the world, and how we can integrate more," Ebrard said in a statement.

The Mexican delegation in a statement described the talks as being held "in a constructive environment and with frank dialogue" that ended with a "net positive."

The US Trade Representative Office said in a statement the US approached the talks with the goals of reducing Washington's trade deficit with Mexico and strengthening US supply chains.

"During this first round, negotiators discussed priority issues related to automotive rules of origin, steel and aluminum, and economic security," the statement said.

"The United States and Mexico recognize the importance of advancing cooperation to enhance regulatory compatibility to strengthen sectors, including medical devices, pharmaceuticals, cosmetic products, and others."

Trump has threatened to pull out from the USMCA, arguing it doesn't benefit the US economy, casting a shadow over the talks.

The USMCA is critical for Mexico, as the United States accounts for more than 80 percent of its exports.

With the first round complete, future rounds of negotiations will take place in Washington in June, then Mexico City in July.

Business

EU's Six Biggest Economies Agree on Capital Markets Supervision

German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)
German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)
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EU's Six Biggest Economies Agree on Capital Markets Supervision

German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)
German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)

Finance ministers from the EU's six biggest economies (E6) agreed among themselves on Friday to support more centralized capital markets supervision, in a breakthrough crucial for deeper integration of Europe's fragmented capital markets.

The push for financial market players to be supervised at a European Union rather than national level is part of the EU's plan to redirect trillions of its citizens' savings, now idling in bank deposits, into more productive investment in Europe.

Access to such a large ‌amount of capital ‌for investment would boost the bloc's chances of competing against ‌the ⁠United States and China.

Supervision ⁠of significant market infrastructure would be gradually transferred to the European Securities and Markets Authority in Paris, the finance ministers of Germany, France, Italy, Poland, Spain and the Netherlands agreed after they met in Berlin on Thursday to discuss the issue.

The issue of handing over local powers to supervise trading platforms, central counterparties and central securities depositories to the EU has been difficult because of vested national interests and opposition from Ireland and Luxembourg and ⁠initially Germany.

But the issue will be decided by qualified ‌majority, meaning it needs the support of 15 ‌out of the EU's 27 countries representing 65% of the bloc's population.

With the backing of the ‌E6, which represent 70% of the EU's population, centralized supervision is now much ‌more likely to happen.

"The fact that the EU's six largest economies are prepared to leave national self-interest behind and move forward together is an important signal for the entire European Union," German Finance Minister Lars Klingbeil said in a statement.

ACCOUNTABILITY MUST BE ENFORCED

The European Commission presented its ‌plan to better integrate EU capital markets in December, and Germany's finance minister has said he expects the package to ⁠be adopted by ⁠the end of this year.

"In an uncertain international context, Europe needs deeper and more integrated capital markets," Spanish Finance Minister Carlos Cuerpo said. "This joint positioning is a decisive step towards a true savings and investment union."

ESMA's governance structure must be set up efficiently: expertise, supervisory and market experience, and geographical balance should play a decisive role, the ministers agreed in a paper seen by Reuters on Friday.

In addition, costs must be kept under control and accountability must be enforced, the joint paper said about the ESMA.

However, the paper said that in their current form and size, German trading venues would currently not be subject to mandatory European supervision authorities over trading in crypto-assets, and to reduce barriers to cross-border funds to help company financing, according to the paper.

Business

Saudi Fintech, Cloud Services Drive Technology Sector Profit Boom

Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)
Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)
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Saudi Fintech, Cloud Services Drive Technology Sector Profit Boom

Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)
Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)

Saudi Arabia’s listed technology companies posted strong first-quarter earnings for 2026, reflecting a structural shift in the sector as digital revenue growth converged with tighter control over operating and administrative costs.

Combined net profits for companies in the Kingdom’s applications and technology services sector rose 16% year-on-year to SAR1.07 billion ($285 million), up from SAR920 million ($245 million) in the same period last year. The performance underscores the sector’s growing ability to diversify revenue streams across cybersecurity, digital identity, managed services and cloud computing.

Analysts said the gains were fueled by the continued expansion of Saudi Arabia’s digital transformation programs, the rapid maturation of the fintech industry, infrastructure development and rising investment in cloud computing.

Strong corporate demand is also pushing the Kingdom’s information and communications technology market toward what analysts expect will exceed $100 billion in spending by 2031.

The sector includes five listed companies, four of which reported profits during the quarter: Elm Co., Solutions by stc, 2P Perfect Presentation and Al Moammar Information Systems Co. Bahr Al Arab Systems Information Technology continued to post quarterly losses through the end of the first quarter.

Elm accounted for roughly 61% of total sector profits, recording the highest net income at SAR656 million in the first three months of the year, up 32% from SAR495 million a year earlier. The company benefited from a 31% rise in revenue to SAR2.47 billion, in addition to lower research and development expenses.

Solutions by stc ranked second, posting profits of SAR370 million, up 2.5% from SAR361 million in the same quarter last year. The increase was supported by lower operating costs, reduced selling and administrative expenses, and a 6.3% rise in revenue to SAR3 billion.

2P Perfect Presentation came third in sector profitability, reporting net income of SAR33.06 million, up 2.4% from SAR32.28 million a year earlier. The company cited strong performance across most operating segments, particularly call center services, while revenue climbed 14% to SAR330.08 million.

The Saudi Data and AI Authority's (SDAIA) "Hexagon" data center, the largest government data center in the world. (SPA)

Five drivers behind the growth

Financial analyst Nasser Al-Rashid told Asharq Al-Awsat that the strong earnings growth reflects the intersection of several operational and strategic factors centered on five main pillars.

The first is sustained government and private-sector spending on digital transformation, which remains the sector’s largest growth engine, he explained. As government agencies and major corporations expand automation and strengthen digital infrastructure, demand has increased for technology solutions, data management, cybersecurity and cloud services, creating stable long-term revenue streams for companies with major public-sector contracts.

The second pillar is the rapid development of the fintech sector, which has accelerated adoption of digital payments, e-services, digital identity tools and smart business platforms. This has directly boosted recurring revenues and profit margins for technology and applications companies, Al-Rashid said.

Third, companies have improved operational efficiency, as reflected in lower operating and administrative costs and reduced sales and distribution expenses. This demonstrates that firms are not relying solely on revenue growth but are also improving profitability through tighter cost controls, he added.

The fourth driver is the expansion of cloud computing and data center services, among the industry’s most profitable activities, he continued.

Rising demand from businesses for cloud hosting, data analytics and managed services has increased returns on technology contracts as institutions reduce reliance on traditional infrastructure.

The fifth pillar is the diversification and quality of revenue streams, said Al-Rashid.

Major companies are no longer dependent on a single source of income but now generate returns from digital operations, cloud solutions, business platforms, call center services and systems management, reducing exposure to operational volatility and improving earnings sustainability, he went on to say.

Market analyst Tariq Al-Ateeq told Asharq Al-Awsat that Elm’s contribution of more than 60% of sector profits highlights the strength of its innovation-driven model built around government digital services, data and specialized solutions.

He added that the Saudi technology sector has formally entered a phase of “sustainable operational growth,” supported by Vision 2030, rapid digitalization and rising spending on technology infrastructure.

Al-Ateeq expects technology and applications companies to maintain solid earnings and revenue growth in coming quarters, albeit at a more balanced pace than in previous years.

The sector’s long-term expansion will continue to be driven by government digital transformation spending, the rapid growth of cloud and artificial intelligence services, and rising private-sector demand for automation, he remarked.