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Defense Aircraft Maintenance Focal Interest of Saudi Companies

A part of the agreements that took place on the sidelines of the World Defense Show (Asharq Al-Awsat)
A part of the agreements that took place on the sidelines of the World Defense Show (Asharq Al-Awsat)
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Defense Aircraft Maintenance Focal Interest of Saudi Companies

A part of the agreements that took place on the sidelines of the World Defense Show (Asharq Al-Awsat)
A part of the agreements that took place on the sidelines of the World Defense Show (Asharq Al-Awsat)

Defense aircraft maintenance dominated the interests of Saudi companies at the World Defense Show (WDS) in the Saudi capital, Riyadh. Companies emphasized efforts to commit to localizing defense industries and technical investment, at a time when cooperation agreements and memoranda of partnerships for building military ships and helicopter platforms were a prominent focus in deals signed on the WDS’ last day.

The four-day WDS 2022, which began on March 6, witnessed the signing of a deal between the Saudi-based Overhaul and Maintenance Company (OMC) and the Saudi Technology Development and Investment Company (TAQNIA).

OMC also signed another deal with the Saudi Authority for Data and Artificial Intelligence (SDAIA). Its deal with SDAIA aims to develop innovative geospatial products and services that contribute to enhancing local content and serving the Saudi market, to enhance the Kingdom's global position in the fields of data and artificial intelligence.

BAE Systems Saudi Arabia and SDAIA signed a deal to provide information technology services, cybersecurity services, as well as professional services and manpower for institutions.

A second deal was signed between the two. It aims to develop operational and technical capabilities, advance security operations centers and network security, as well as support data management analysis systems by participating with specialized experts, developing strategies for future improvement.

Abdulatif Al-Sheikh, CEO of OMC, confirmed to Asharq Al-Awsat that the company is continuing to localize the defense industry in the Kingdom, indicating that the company owns three companies in the defense field.

“Companies in Riyadh and Jeddah have invested in qualitative capabilities and national competencies working in training Saudi technicians through a package of training programs, most of which are internationally accredited by the European International Safety Organization,” Al-Sheikh told Asharq Al-Awsat.

International Systems Engineering (ISE) CEO Majid AlMuzairi told Asharq Al-Awsat that his company was working to expand the scope of its projects, in addition to signing many agreements and strategies with a number of government agencies and related companies on the sidelines of the WDS.

AlMuzairi stressed that cybersecurity is one of the Kingdom’s priorities and noted that ISE is launching a pivotal action plan in the digital transformation process.

He revealed the company's vision to be the first provider of information services and technology management for companies operating in the defense and national security sectors.

Saudi Maintenance and Supply Chain Management Company (SMSCMC) CEO Jeremy Charmak told Asharq Al-Awsat that his company is using its capabilities to push the local industry in the Kingdom, as it currently has eight branches, six of which are in Saudi Arabia.

He revealed that the Saudization rate at his company is up to 72%.

Charmak pointed out that SMSCMC is launching very important training programs in the transportation of sensitive and dangerous equipment and safety equipment, indicating that the company specializes in supply chains and logistics services, and was established in 2006.

International Maritime Industries (IMI) , the largest shipyard in the MENA region, has expanded its partnership with Hyundai Heavy Industries (HHI) to enable the construction of naval vessels at its yard in Saudi Arabia.

The extension of the existing memorandum of understanding (MoU) between IMI and HHI will lead to further cooperation between the two partners in areas including naval vessel research, development and construction, and the localization of engine manufacturing for naval ships in the kingdom.

It will also deliver further knowledge transfer through the training of IMI’s Saudi team members at HHI facilities, providing them with new skills and future career opportunities, as well as the development of further commercial relations, said a statement.

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Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
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Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)

Saudi Arabia’s digital advertising sector is experiencing rapid growth, but a significant portion of its revenues is leaking to foreign platforms. To maximize the impact on the national economy, experts are calling for strategies to curb this outflow and redirect it to local channels.

The importance of retaining digital ad revenues lies in the substantial size of this market. It is estimated that approximately $1 billion in ad spent is lost annually to foreign platforms, representing a considerable loss to Saudi Arabia’s economy.

Dr. Ebada Al-Abbad, CEO of Marketing and Communications at Tadafuq, a Saudi digital advertising network, told Asharq Al-Awsat that the problem stems from the fact that although advertisers, products, and audiences are often local, the largest share of financial gains goes to foreign platforms. He estimated that 70-80% of the $1.5 billion spent on digital advertising in Saudi Arabia in 2022 went to global platforms such as Google and Facebook. This results in the national economy losing nearly $1 billion annually from this sector alone.

Al-Abbad noted that government agencies in Saudi Arabia also contribute to the outflow. He explained that public sector spending on digital advertising, intended to raise awareness among citizens and residents, frequently ends up on foreign platforms. Government spending makes up about 20-25% of the total digital ad market in the Kingdom, meaning hundreds of millions of riyals leave the country annually, weakening the local digital economy.

Al-Abbad argues that Saudi Arabia needs strong local digital ad networks to keep this revenue within the national economy. These networks would help create jobs, drive innovation, and promote cultural diversity in digital content. Developing local platforms would also enhance Saudi Arabia’s digital sovereignty by ensuring that data remains within the country and is not controlled by foreign entities.

Moreover, local networks would reduce dependence on international platforms, ensuring that the economic benefits of digital advertising remain in the Kingdom, he said, stressing that this would align with Saudi Arabia’s broader Vision 2030 goals, which emphasize building a robust, diversified economy driven by local industries and digital transformation.

Globally, the digital advertising sector is growing rapidly. In 2022, worldwide spending on digital ads reached $602 billion, and it is projected to hit $876 billion by 2026. In the Middle East and North Africa (MENA) region, the digital ad market grew to $5.9 billion in 2022, with Saudi Arabia’s market accounting for over $1.5 billion.

In other countries, the digital ad sector plays a crucial role in boosting national economies. For example, in the United States, the digital advertising industry contributed $460 billion to the GDP in 2021, about 2.1% of the total. In the UK, the sector accounted for 1.8% of GDP in 2022. This shows how important digital advertising can be in driving economic growth.

One of the key challenges facing Saudi Arabia’s digital ad sector is the dominance of global platforms like Google and Facebook, which control 60% of the global digital ad market, Al-Abbad told Asharq Al-Awsat. This dominance results in a significant outflow of revenue and allows these platforms to control digital data and content. He warned that this could undermine Saudi Arabia’s national sovereignty over its digital economy.

To counter this, he emphasized that Saudi Arabia needs to build competitive local networks that can retain a larger share of the market. This will not only keep more revenue in the country but also strengthen the Kingdom’s control over its digital data and content.