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Saudi Arabia Seeks Promising Local Content Opportunities

Session at the Local Content Forum in Riyadh (Asharq Al-Awsat)
Session at the Local Content Forum in Riyadh (Asharq Al-Awsat)
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Saudi Arabia Seeks Promising Local Content Opportunities

Session at the Local Content Forum in Riyadh (Asharq Al-Awsat)
Session at the Local Content Forum in Riyadh (Asharq Al-Awsat)

Saudi Arabia is pushing towards activating local content in the national industry, specifically in promising sectors.

The Minister of Industry and Mineral Resources, Bandar Ibrahim AlKhorayef, met Tuesday with 20 prominent local and international companies to discuss promising local content opportunities and cooperation between the firms and Government Procurement Authority.

The meeting also addressed the role of the private sector in directing its spending toward local content and the companies' efforts in developing content in several key industries.

Procurement Tools

AlKhorayef stressed that local content has several tools in government procurement that push demand toward local manufacturers and suppliers and help the private sector seize promising investment opportunities.

He noted that industry localization and knowledge transfer pave the way for investors to localize new products.

The Kingdom has promising opportunities to maximize interest by taking advantage of the purchasing power of state-owned companies, especially after the Cabinet decided to compel these companies to prioritize local content.

Content Preference

During the meeting, Khorayef called on the private sector to be equally responsible by prioritizing local content and products in its purchases and projects, identifying localization opportunities in its supply chains, and presenting them to small and medium enterprises (SMEs).

Promising sectors

In a panel entitled "Promising Sectors and Opportunities," the Local Content Forum discussed the role of entrepreneurs in developing local content, products, and services and the importance of research and innovation in enabling local content opportunities.

The executive vice president of operations at the Local Content and Government Procurement Authority Mohammad al-Qahtani and Executive Vice President for Studies at the Industrial Development Fund Ahmed al-Baqawi attended the session.

The session also included Deputy Governor for Entrepreneurship at the General Authority for Small and Medium Enterprises (Monshaat) Saud al-Sabhan and Supervisor of the Localization, Local Content, Risk Management Department at the Ministry of Energy Fouad Moussa.

The participants emphasized that local content highlights the promising sectors and opportunities for entrepreneurs in developing and providing investment opportunities.

Qahtani explained that the Authority is working on several strategic and vital sectors full of promising opportunities to develop local content.

Purchasing power

Qahtani indicated that the Authority targets opportunities to develop local content in several sectors and directs the government's purchasing power toward local content.

The Authority developed many mechanisms and legislation to seize opportunities, including one for government procurement, which compels contractors to deal with government agencies to provide national products from local factories.

He stated that since the activation of the mechanism, the Authority has launched several lists of over eight different sectors and more than 400 other products from national factories. The list continues to be developed and updated.

Small and medium enterprises

Meanwhile, Sabhan explained that SMEs constitute 99.3 percent of the manufacturing activity that contributes to localization.

He noted that local content in the government competition and procurement system directly supports and empowers SMEs, recalling that government purchases in Saudi Arabia increased 26.6 percent until the end of the third quarter of 2021, compared to 24.9 percent in 2019.

He explained that Monshaat launched a service to transform over 3,000 small and medium enterprises and had a role in increasing the local content.

Monshaat seeks to enhance the contribution of SMEs in local content by increasing the opportunities for their participation in the commercial franchise to expand their activities.

Entrepreneurs

Executive Vice President for Studies at the Industrial Development Fund Ahmed al-Baqawi stated that the Fund supports the client and the private sector to advance the Kingdom under Vision 2030.

Baqawi explained that young men and women at the Fund provide appropriate advice to the investor, pointing out that the Fund is a forum for all entrepreneurs in various fields.

Risk management

Meanwhile, Ministry of Energy official Fouad Moussa explained that the energy sector has a significant impact on the economy in the Kingdom.

Energy represents 45 percent of capital and operational spending and provides excellent opportunities for the products used in the energy, petroleum, gas, petrochemical, and electricity production sectors.

Moussa indicated that Saudi Arabia is heading to become the largest producer of hydrogen, which will become the future fuel.

He indicated that the Ministry had set new targets to localize the main products used directly in capital and operational spending and seeks to use available resources to serve the energy sector, ensuring it becomes parallel to other industries.

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Euro Zone Growth Slows on Surging Energy Costs

Industrial facilities and infrastructure at the Hoechst Industrial Park, near Frankfurt, Germany, 07 April 2026. (EPA)
Industrial facilities and infrastructure at the Hoechst Industrial Park, near Frankfurt, Germany, 07 April 2026. (EPA)
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Euro Zone Growth Slows on Surging Energy Costs

Industrial facilities and infrastructure at the Hoechst Industrial Park, near Frankfurt, Germany, 07 April 2026. (EPA)
Industrial facilities and infrastructure at the Hoechst Industrial Park, near Frankfurt, Germany, 07 April 2026. (EPA)

The euro zone's private sector expansion weakened sharply in March as the Middle East war drove up energy costs and disrupted supply chains, with overall demand - a key gauge for economic health - falling for the first time in ‌eight months, a survey showed on Tuesday.

The S&P Global euro zone Composite Purchasing Managers' Index fell to 50.7 in March from 51.9 in February, but was slightly higher than a preliminary estimate of 50.5. PMI readings above 50.0 indicate growth in activity, according to Reuters.

“March's PMI indicates that the euro zone economy has already been hit hard by the war ⁠in the Middle East,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.

New business declined in March after improving steadily since July, dragged down by weaker demand for services. Overall export orders also fell again, with international services demand recording its steepest drop in six months.

The encouraging signs of growth seen earlier in the year have been eradicated thanks to surging energy prices, choked supply chains, financial market volatility and a renewed downturn in demand, Williamson added.

Services activity barely rose, with the business activity index sliding to 50.2 from ‌51.9 ⁠in February - its weakest reading in 10 months.

Manufacturing output growth remained solid.

Spain led the growth among the major economies, while France and Italy contracted. Germany's expansion slowed to its weakest pace so far this year.

Employment declined while business confidence dropped, raising concerns about future hiring and investment.

Input cost inflation ⁠surged to its highest in slightly more than three years, with manufacturing seeing a record one-month jump. Firms raised prices charged to customers at the fastest pace since February 2024, though the increase was ⁠more modest than the spike in their own costs.

Headline inflation in the bloc jumped above the European Central Bank’s 2% target last month, hitting 2.5% from 1.9% as soaring oil and ⁠gas prices intensified the dilemma between safeguarding growth and curbing inflation.

The survey's signal for first-quarter gross domestic product growth was 0.2%, with a risk of contraction this quarter unless the Middle East conflict is resolved swiftly.

German service sector growth slows

Meanwhile, business activity growth in Germany's service sector abruptly lost momentum in March as demand weakened amid fallout from the war in the Middle East, the survey also ‌showed on Tuesday.

PMI for Germany fell to 50.9 in March from 53.5 in February, marking its lowest reading since September and slightly below a preliminary reading of 51.2.

Phil Smith, economics associate director at S&P Global Market Intelligence, cited higher prices at the petrol pumps and heightened uncertainty as leading to the slowdown.

Despite the sharply rising costs, however, service providers have not been able to pass on greater price increases to customers due to the weaker demand environment, he added.

“Inflows of new business have fallen for the ‌first ⁠time since last September in a clear sign of the Middle East war's immediate impact on demand, whilst a notable drop in business expectations underlines how higher energy prices, supply chain disruption and generally ⁠elevated levels of uncertainty are set to stifle growth in the year ahead,” said Smith.

Business expectations dropped to a three-month low in March, ⁠to 53.4, and slipped below the long-run average of 56.7.

The final S&P Global composite PMI, which includes manufacturing and services, ⁠ticked down to 51.9 in March from 53.2 the previous month, a three-month low driven entirely by the downturn in the service sector.

France's services sector contracts

Also, France's services sector contracted further in March as client spending weakened due to the war in the Middle East and caution among ‌businesses in the run-up to last month's local elections, a business survey showed on Tuesday.

S&P Global said the final services PMI for March fell to 48.8 points from 49.6 points in February, marking ⁠a slight improvement from the flash March services figure of 48.3 points.

The final March composite PMI - which includes both the services and manufacturing sectors - also came in at 48.8, down from 49.9 in February. S&P Global said this marked the ‌quickest ⁠drop in private sector business activity since October.

S&P Global added that the US-Israeli war on Iran was impacting French businesses both in terms of inflation and customers postponing ⁠orders or delaying investments.

“Much uncertainty lies ahead, a condition which French businesses have become rather accustomed to in recent years ⁠given the domestic political environment. Uncertainty is bad for growth, and the inflation impulse stemming from the ⁠war raises the risk of stagflation in France,” said Joe Hayes, principal economist at S&P Global Market Intelligence.

Business

China’s Xi Urges Demand‑Driven Growth in Services Sector

People visit a shopping center in Beijing on April 7, 2026. (AFP)
People visit a shopping center in Beijing on April 7, 2026. (AFP)
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China’s Xi Urges Demand‑Driven Growth in Services Sector

People visit a shopping center in Beijing on April 7, 2026. (AFP)
People visit a shopping center in Beijing on April 7, 2026. (AFP)

China's President Xi Jinping has called for a demand-driven approach coupled with reform and technological empowerment to develop the service sector, the official Xinhua news agency reported on Wednesday.

China will expand and upgrade the services sector, cultivate more "China service" brands and push production-oriented services toward specialization and higher positions in the value chain, Xinhua quoted Xi as saying in a directive to ‌a two-day national ‌service industry conference in Beijing ‌that ⁠began on Tuesday.

China will “emphasize ⁠demand-driven development, push forward reform breakthroughs, harness science and technology to drive growth, and expand openness and cooperation,” Xi said.

China should expand the supply of upgraded services and improve its consumption structure in line with demographic shifts to ⁠meet increasingly diverse consumer demand, Premier ‌Li Qiang said at ‌the meeting, according to Xinhua.

He added that China ‌should accelerate the growth of technology services ‌by moving R&D and design toward greater specialization and higher value-added segments.

Beijing has been signaling a policy shift to focus on services this year as it ‌tries to redirect some stimulus from sometimes-wasteful investments on transport, housing and industrial ⁠infrastructure ⁠to potentially more productive areas.

Soft consumer demand has hobbled the economy and Beijing's measures so far haven't turned it around. Per-capita services consumption was 46.1% in 2025, well below the 70% in the US.

China's new five-year plan pledged to "significantly" raise the share of household consumption in the economy over the next five years from around 40% at present, though it stopped short of setting a specific target.

Business

Saudi Fund Injects $1.7 Bn to Boost Food Security

The fund financed agricultural projects worth 7.1 million dollars to support afforestation and expand vegetation cover. SPA
The fund financed agricultural projects worth 7.1 million dollars to support afforestation and expand vegetation cover. SPA
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Saudi Fund Injects $1.7 Bn to Boost Food Security

The fund financed agricultural projects worth 7.1 million dollars to support afforestation and expand vegetation cover. SPA
The fund financed agricultural projects worth 7.1 million dollars to support afforestation and expand vegetation cover. SPA

Saudi Arabia’s Agricultural Development Fund is stepping up efforts to bolster food security and sustain the Kingdom’s agricultural sector, raising self-sufficiency and strengthening strategic reserves.

The push is part of a broader strategy balancing support for domestic production and supply chains with external programs to import targeted products and invest in cross-border agriculture.

Habib Al-Shammari, the fund’s official spokesman, told Asharq Al-Awsat the approach aligns with the national agriculture and food security strategies. He said the fund continues to promote modern technologies in agricultural projects to preserve natural resources and boost productivity.

In 2024, the fund disbursed more than 1.2 billion riyals (about 300 million dollars) for projects that used modern technologies. These helped save nearly 4 million cubic meters of water and cut energy consumption by about 330,000 megawatt hours, Al-Shammari said.

He added that such technologies also reduce greenhouse gas emissions by improving efficiency, in line with the Saudi Green Initiative. The fund financed agricultural projects worth 26.6 million riyals (7.1 million dollars) to support afforestation and expand vegetation cover.

Al-Shammari said the fund has also backed biodiversity protection by financing programs supporting beekeeping and honey production, developing rose cultivation and rain-fed crops, and extending loans totaling more than 12 million riyals to central nurseries.

Loan approvals reached about 6.47 billion riyals (1.72 billion dollars) by the end of 2025, he said. The fund also signed a memorandum of understanding last year with the International Fund for Agricultural Development (IFAD) in Rome to support sustainable rural agricultural development and exchange expertise.

Al-Shammari said such agreements strengthen the agricultural sector, pointing to deals with local entities, including Jazan City for Primary and Downstream Industries, to enhance integration into food-sector investment opportunities and maximize the impact of the fund’s programs for investors and farmers.

The fund also signed an agreement with the National Center for Palms and Dates to support the sustainability of the sector and related industries, financing operating costs for date purchases and offering tailored financing solutions.

Another agreement with the Imam Abdulaziz bin Mohammed Royal Reserve Development Authority focuses on vegetation development, ecosystem sustainability, and support for local communities within the reserve.

To strengthen the livestock sector, the fund signed a deal with Al-Raie National Livestock Company to finance a sheep farming project in Hail valued at 1.106 billion riyals (295 million dollars), with a total investment cost of 2 billion riyals (533 million dollars). It also signed an agreement with the Center for Support and Liquidation (Infath) to regulate the sale of seized real estate and share expertise.