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Saudi Arabia Expected to Invest $20 Bln in Chinese Technologies

A general view of Riyadh, Saudi Arabia. (SPA)
A general view of Riyadh, Saudi Arabia. (SPA)
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Saudi Arabia Expected to Invest $20 Bln in Chinese Technologies

A general view of Riyadh, Saudi Arabia. (SPA)
A general view of Riyadh, Saudi Arabia. (SPA)

Saudi Arabia is expected to lead Gulf investments estimated at $20 billion in the Chinese technology sector over the next two years, according to investment sources.

Governor of the Communications and Information Technology Commission (CITC), Mohammad al-Tamimi confirmed that the Saudi telecom market is the largest growing market in the Middle East and North Africa (MENA).

He indicated that the telecom market is worth an estimated $18.6 billion, the information technology market $17 billion and the postal market $1.7 billion. Telecom companies have a market value of $65.6 billion.

Abdullah bin Zaid al-Meleihi, an investor in Chinese technology, explained that Beijing plans to offer the Chinese technology sector to invest in the Middle East region.

He noted that the Chinese Ministry of Industry and Information Technology drafted a three-year work plan to develop the country’s cybersecurity sector, estimating its value could exceed $38.6 billion by 2023, according to Chinese reports.

The draft comes as the Chinese authorities intensify their efforts to prepare regulations to improve storage, data transfer, and the privacy of personal data, he added.

Cyberspace Administration of China proposes draft rules that call on all data-rich technology companies with more than one million users to undergo security reviews before listing their shares.

Meleihi told Asharq Al-Awsat that Chinese software revenues in the first half of this year amounted to $684 billion, while Gulf investments in the Chinese technology sector amount to $7 billion, with expectations to reach $20 billion over the next two years.

According to the investor, the electric car market in China is about threefold the European market. Recent data revealed that the global electric car market has grown at about 60 percent year-on-year.

Moreover, Alibaba Cloud has opened its headquarters in Saudi Arabia, which enhances the Kingdom’s digital leadership, both regionally and globally.

Alibaba Cloud plans to invest $500 million in the Kingdom as part of the qualitative partnership, said Meleihi.

The partnership seeks to provide an integrated set of cloud products and services to companies and establish the largest high-performance public cloud service for the MENA region.

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After Trump’s Victory, Arab Demands for Competitive Advantages Due to Regional Tensions

Donald Trump addresses his supporters at the West Palm Beach Convention Center in Florida on Wednesday. (EPA)
Donald Trump addresses his supporters at the West Palm Beach Convention Center in Florida on Wednesday. (EPA)
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After Trump’s Victory, Arab Demands for Competitive Advantages Due to Regional Tensions

Donald Trump addresses his supporters at the West Palm Beach Convention Center in Florida on Wednesday. (EPA)
Donald Trump addresses his supporters at the West Palm Beach Convention Center in Florida on Wednesday. (EPA)

With the election of Donald Trump as US president, the global economy has gained direction for the coming years. Trump’s policies favor corporate tax cuts, increased investment, and expansionary monetary policies. He also promotes local production to boost job creation, which involves imposing significant tariffs on trade partners, particularly in Asia. This approach could trigger a trade war, affecting inflation in both the US and worldwide.

The US economy is already grappling with high prices, slower economic growth, and rising unemployment, alongside a national debt nearing 99% of GDP. This backdrop underscores the importance of economic issues in the recent election.

For the new US administration, domestic concerns will not be the sole priority. Ongoing geopolitical tensions, especially recent Middle Eastern conflicts, will also impact the US economy. To gain regional insights, Asharq Al-Awsat consulted economists from various Arab nations on their expectations and requests from the US president regarding the Middle East.

Priority of Regional Stability

Dr. Mohamed Youssef, an Egyptian economist, emphasized that regional stability is crucial, benefiting the economy and paving the way for resolving complex issues like the Nile Dam dispute affecting Egypt. He highlighted the American role in fostering calm in the region.

Iraqi economist Durgham Mohamed Ali noted that US relations vary across the Middle East; while Lebanon and Yemen remain outside current US alliances, Sudan and Somalia require international aid to rebuild infrastructure.

Competitive Advantage for Arab Countries

Ahmed Moaty, a global markets expert from Egypt, suggested that reduced US tariffs would improve Arab economies’ competitiveness. However, he pointed out the American high debt could motivate the administration to impose tariffs to protect local industries and reduce imports. Ali observed that US tariffs are interest-driven and selective, favoring allies like Japan, Taiwan, and South Korea while being stringent toward BRICS members, such as China, Brazil, and South Africa. He linked tariff policies to regional geopolitics, especially the conflicts involving Israel, Lebanon, Palestine, and Iran, which could influence US economic decisions.

Dr. Mohamed Youssef also argued that easing US-China competition could benefit the global economy, as high tariffs on Chinese goods reduce China’s growth, decreasing demand for key commodities like oil.

Ibrahim Al-Nwaibet, CEO of Saudi Arabia’s Value Capital, predicted that a Republican win could positively impact oil and interest rates, revitalizing the petrochemical and trade finance sectors.

On currency, Moaty noted the strong US dollar pressures emerging markets, especially in the Middle East. He suggested offering US Treasury bonds with higher yields to Arab countries as a counterbalance. Ali added that the dollar’s strength poses challenges for countries heavily reliant on US currency amid global liquidity shortages.

The BRICS Bloc

Ali also mentioned the high levels of US debt, explaining: “In general, the entire world is concerned about rising US debt, slowing growth rates... and is wary of the BRICS alliance, which some Arab countries hope to join. The question remains whether a cold economic war will ensue.”

Youssef also discussed the BRICS, which could play a role in attracting the new US president’s attention to countries joining the alliance. He added: “This may provide new competitive advantages for countries in the region, particularly as countries like Egypt, the UAE, and Iran recently joined BRICS, while Saudi Arabia is still evaluating the benefits of such move.”