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Lenovo: Saudi Arabia Capable of Hosting High-Value Industries

A view of a Lenovo event in Saudi Arabia. (Lenovo)
A view of a Lenovo event in Saudi Arabia. (Lenovo)
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Lenovo: Saudi Arabia Capable of Hosting High-Value Industries

A view of a Lenovo event in Saudi Arabia. (Lenovo)
A view of a Lenovo event in Saudi Arabia. (Lenovo)

China’s Lenovo is betting big on Saudi Arabia, naming Riyadh as its regional base for the Middle East, Türkiye, and Africa as it ramps up manufacturing and research investments to boost the Kingdom’s non-oil economy.

The partnership is set to inject fresh momentum into Saudi Arabia’s non-oil gross domestic product through a large-scale manufacturing facility and an integrated research and development ecosystem aimed at localizing knowledge and building national talent capabilities.

This was outlined by Tareq Alangari, Senior Vice President and President of Lenovo for the Middle East, Türkiye, and Africa, who described the company’s investments in Saudi Arabia as among its most critical global commitments, reflecting a long-term partnership with the Kingdom in digital transformation and economic diversification.

The move is part of a strategic collaboration with “Alat”, covering advanced manufacturing, talent development, innovation, and strengthening regional presence, under a vision that extends beyond the local market to serve broader regional markets.

Market support

Alangari told Asharq Al-Awsat that this commitment rests on two main initiatives that underpin Lenovo’s strategy in the Kingdom.

The first is the establishment of an advanced manufacturing facility spanning 200,000 square meters in Riyadh’s Integrated Logistics Special Zone, scheduled to begin production in 2026. The facility will become a global site producing millions of devices annually, including laptops, smartphones, desktop computers, and servers manufactured in Saudi Arabia.

The second initiative is the establishment of Lenovo’s regional headquarters in Riyadh, which will serve as the leadership center for the Middle East, Türkiye, and Africa.

The headquarters will house leadership, research and development, marketing, retail strategy, and customer engagement functions to support government, commercial, and consumer markets across the region, streamlining decision-making and strengthening proximity to customers and partners.

The company has previously projected that these combined investments could contribute up to $10 billion to Saudi Arabia’s non-oil GDP by 2030, while creating extensive direct and indirect job opportunities and accelerating the development of local skills in advanced technologies and artificial intelligence.

Supply chain resilience

Alangari said the company’s approach in Saudi Arabia is not based on short-term deals, but on a transformational vision aimed at strengthening regional supply chain resilience, deepening local partnerships, and supporting Saudi Arabia’s ambition to become a global hub for innovation and the manufacturing of sustainable technologies and AI-driven solutions.

Assessing the investment environment, he said Saudi Arabia represents a high-growth market of exceptional strategic importance, driven by economic diversification, rapid adoption of modern technologies, and the expansion of advanced sectors.

This growth, he noted, aligns with Lenovo’s strengths in cloud computing, artificial intelligence, infrastructure modernization, and the digital sector.

In the supply chain, Lenovo’s factory in the Integrated Logistics Special Zone is expected to play a key role in enhancing resilience at the local and regional levels.

Having a production line in the Kingdom, at the heart of the Middle East and Africa, will help reduce delivery times, ease logistical complexities, and improve the ability to respond quickly to market needs, according to Alangari.

Technology localization

In parallel, Lenovo is seeking to localize advanced technologies by building local capabilities, transferring advanced manufacturing expertise, embedding sustainability standards, and developing a supplier ecosystem that supports the Kingdom’s long-term technological leadership.

The company places the development of Saudi talent at the core of its investments. It has launched a national program to develop capabilities in cooperation with Alat, the Human Resources Development Fund, and the Ministry of Industry and Mineral Resources.

The program aims to train Saudi graduates in advanced manufacturing, engineering, AI-enabled operations, and digital technologies through a mix of theoretical education and hands-on training inside the Kingdom and at global manufacturing sites.

As its operations expand, Alangari expects Lenovo’s investments to create thousands of direct and indirect jobs, supported by production growth and the expansion of research and development, manufacturing, and customer experience activities.

He said this integrated ecosystem would boost local innovation, expand the range of advanced technologies manufactured in Saudi Arabia, and help build a sustainable technology environment in line with the Kingdom’s economic and industrial ambitions.

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Business

US Debt Hits $40 Trillion as Higher Yields Open New Opportunities for Gulf Investors

An electronic display in Washington, DC, shows the US national debt on Aug. 19, as federal debt surpassed $40 trillion for the first time. (AFP via Getty Images)
An electronic display in Washington, DC, shows the US national debt on Aug. 19, as federal debt surpassed $40 trillion for the first time. (AFP via Getty Images)
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US Debt Hits $40 Trillion as Higher Yields Open New Opportunities for Gulf Investors

An electronic display in Washington, DC, shows the US national debt on Aug. 19, as federal debt surpassed $40 trillion for the first time. (AFP via Getty Images)
An electronic display in Washington, DC, shows the US national debt on Aug. 19, as federal debt surpassed $40 trillion for the first time. (AFP via Getty Images)

As US debt surpasses $40 trillion, Gulf investors are looking beyond the record figure to the broader implications of Treasury yields for capital flows, financing costs and investment strategies.

US assets and the dollar remain central to Gulf portfolios because of the depth of American markets and Gulf currencies’ links to the dollar. At the same time, higher yields are creating opportunities for Gulf sovereign wealth funds to rebalance portfolios and generate stronger returns on new investments.

Economists say the Gulf’s strong financial positions give the region considerable flexibility in navigating shifts in global interest rates. Higher fixed-income yields are also encouraging more diversified strategies spanning bonds, private credit, infrastructure and global equities, alongside growth sectors, such as technology, artificial intelligence and new energy.

Dollar remains central

Abdullah Almeer, assistant professor of economics at King Fahd University of Petroleum and Minerals (KFUPM), said US debt reaching $40 trillion does not pose an “immediate risk” to Gulf dollar-denominated investments, although it increases longer-term structural risks monitored by sovereign wealth funds and central banks.

Almeer told Asharq Al-Awsat that Saudi Arabia holds about $142 billion in US Treasury securities, while the dollar accounts for roughly 57% of global central bank reserves, underscoring its continued central role in the international financial system.

The doubling of US debt from about $20 trillion in 2016 to more than $40 trillion today warrants closer scrutiny of fiscal developments, but does not, for the foreseeable future, diminish the attractiveness of US markets or the dollar’s importance to Gulf economies, he argued.

US dollar bills are seen in front of displayed stock graph in this illustration taken, February 8, 2021. (Reuters)

Higher yields, new opportunities

Persistently high US bond yields could reduce the market value of existing securities and result in valuation losses for some Gulf portfolios.

Almeer does not, however, expect the US economy to default, stressing that American markets retain high levels of liquidity, depth and institutional stability. A large-scale Gulf exit from US assets is therefore unlikely in the foreseeable future.

The main transmission channel to Gulf economies is interest rates. Financing government debt exceeding $40 trillion requires massive Treasury issuance, potentially pushing yields higher, particularly if inflationary pressures persist or oil prices rise.

Saudi Arabia’s riyal peg of SAR 3.75 to the dollar also means its monetary policy is closely tied to US interest rates. A widening rate differential between the two countries could put pressure on the exchange rate and capital flows.

Almeer estimated Gulf financial reserves at about $874 billion, while sovereign wealth fund assets are approaching $5 trillion, giving the region substantial capacity to finance projects and continue attracting investment.

Broader diversification

Rising US debt could encourage Gulf states to further diversify investments toward emerging economies such as India, China and Türkiye, as well as real assets, global infrastructure and fast-growing Asian markets, he added.

Technology, AI and clean energy could also attract a larger share of investment, in line with economic and investment shifts taking place across the region and globally.

Debt figure is not the whole story

Almeer stressed that the $40 trillion threshold does not in itself represent a decisive turning point for the global financial system. Markets focus less on the absolute size of debt than on a country’s ability to finance and service it and maintain investor confidence.

The US still has the world’s largest economy and financial market, while the dollar remains the most widely used currency in international trade and reserves, giving Washington flexibility unavailable to most other economies, he noted.

What makes the figure significant is the accelerating pace of government borrowing and the rising cost of servicing that debt, particularly with interest rates remaining relatively high, he explained.

Economic history also suggests that absolute debt levels are not necessarily the decisive factor in determining crisis risk. Japan, for example, has managed debt exceeding 200% of GDP for extended periods without suffering a sovereign debt crisis, Almeer went on to say.

A Saudi money changer displays Saudi Riyal banknotes at a currency exchange shop in Riyadh, Saudi Arabia July 27, 2017. (Reuters)

Pace of debt growth matters

Mohammed Al-Farraj, Head of Asset Management at Arbah Capital, told Asharq Al-Awsat that the $40 trillion figure should be assessed alongside the pace of debt growth, servicing costs, the annual deficit and markets’ capacity to absorb US Treasury issuance.

He explained that the trajectory does not necessarily signal an imminent threat to Washington’s ability to meet its obligations, but it is reshaping the global investment environment by raising financing costs and altering returns across asset classes.

Higher Treasury yields can reduce the market value of existing bonds while offering better returns on new issues, creating opportunities for investors to rebuild fixed-income portfolios at more attractive levels, he added.

Al-Farraj said the current environment could encourage Gulf sovereign wealth funds to strike a better balance between fixed-income instruments and higher-growth assets, with opportunities in gold, global equities, private credit and infrastructure, alongside more flexible management of US Treasury maturities.

That does not mean abandoning the dollar, but rather adopting more diversified portfolio management while keeping dollar assets at the core of Gulf investment strategies, he remarked.

The main effect of record US debt on the Gulf may therefore be to accelerate the evolution of investment strategies rather than change their direction. The dollar remains pivotal, even as opportunities for Gulf capital expand across bonds, US markets, infrastructure, technology and fast-growing Asian economies.

Business

Libya’s Dbeibah Halts Steel Firm's Production Due to Power Shortages

Prime Minister of Libya's Government of National Unity (GNU) Abdulhamid Dbeibah (Dbeibah's office)
Prime Minister of Libya's Government of National Unity (GNU) Abdulhamid Dbeibah (Dbeibah's office)
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Libya’s Dbeibah Halts Steel Firm's Production Due to Power Shortages

Prime Minister of Libya's Government of National Unity (GNU) Abdulhamid Dbeibah (Dbeibah's office)
Prime Minister of Libya's Government of National Unity (GNU) Abdulhamid Dbeibah (Dbeibah's office)

Prime Minister of Libya's Government of National Unity (GNU) Abdulhamid Dbeibah ordered the country's biggest steel firm, state-owned Lisco, to halt production due to power shortages, the state-owned Alwataniya TV channel reported on Thursday.

The broadcaster said the PM ordered Libyan Iron and ⁠Steel Company (Lisco)in the coastal city of Misrata to connect its power plant to the national ⁠grid.

Lisco is one of the only companies outside the energy sector still exporting products from the country.

The plant has a design capacity of 1.7 million ⁠metric ⁠tons of liquid steel per year.

Libya has had a power crisis as temperatures soar with outages of up to 10 hours a day in main cities, sparking protests.

Business

Swiss and Chinese Reach Agreement on Updated Free Trade Deal

FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo
FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo
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Swiss and Chinese Reach Agreement on Updated Free Trade Deal

FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo
FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo

Switzerland and China have completed negotiations on an updated free trade deal which will increase Swiss access to its third biggest trading partner, Swiss officials said on Thursday.

Swiss president Guy Parmelin and China's Commerce Minister Wang Wentao announced the conclusion of the talks after a meeting in Bern.

Under the agreement, 99.8% of Swiss exports can enter the Chinese market duty free, upgrading an existing deal where the terms applied to only around half of Swiss shipments, Reuters reported.

Almost all Chinese exports to Switzerland are duty free under the existing 2014 free trade agreement between the two countries, Beijing's first such deal with an economy in continental Europe.

Other areas covered in the new agreement include rules of origin and trade facilitation, trade in services, digital trade, competition, and economic and technical cooperation.

China is Switzerland's third biggest trade partner after Germany and the United States, with bilateral trade amounting to 46 billion Swiss francs ($57.6 billion) so far in 2026.

Trade between the two countries has expanded from 31.7 billion francs in 2015 to 51.2 billion francs last year, according to figures from the Swiss customs office, with China a big market for Swiss chemicals, pharmaceuticals, precision instruments and watches.

Once the legal review has been completed, a signing of the deal is expected later this year, before the domestic approval processes in each country take place.