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Saudi: GAMI Signs MoUs to Establish Military Industrial Facilities

Representatives of Saudi General Authority for Military Industries (GAMI), Ministry of Industry and Mineral Resources, and the Royal Commission of Jubail and Yanbu (RCJY) sign the agreements (Asharq Al-Awsat)
Representatives of Saudi General Authority for Military Industries (GAMI), Ministry of Industry and Mineral Resources, and the Royal Commission of Jubail and Yanbu (RCJY) sign the agreements (Asharq Al-Awsat)
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Saudi: GAMI Signs MoUs to Establish Military Industrial Facilities

Representatives of Saudi General Authority for Military Industries (GAMI), Ministry of Industry and Mineral Resources, and the Royal Commission of Jubail and Yanbu (RCJY) sign the agreements (Asharq Al-Awsat)
Representatives of Saudi General Authority for Military Industries (GAMI), Ministry of Industry and Mineral Resources, and the Royal Commission of Jubail and Yanbu (RCJY) sign the agreements (Asharq Al-Awsat)

Saudi Arabia has concluded a number of agreements to establish military industrial facilities to help stimulate the industry and enable the local manufacturing of military products.

The Saudi General Authority for Military Industries (GAMI) signed two memoranda of cooperation with the Ministry of Industry and Mineral Resources, and the Royal Commission of Jubail and Yanbu (RCJY) to stimulate, empower, and localize military industries in the Kingdom. 

The agreements provide a comprehensive governance of supply chains for the military and civil industrial sector, enhance coordination, and unify efforts and effective joint action to support the development of military industries.

The governor of GAMI, Ahmed al-Ohali, stressed the importance of localizing the military industry and called for enhancing joint operation between all parties to ensure the sustainability of the sector and raise levels of transparency and efficient spending.

Under this agreement, local and international manufacturers will have the appropriate investment environment to build Saudi Arabia’s targeted industrial capabilities, according to Ohali.

He noted that this will lead to a large supply chain that serves the military and civil industrial sectors.

Deputy Minister of Industry and Mineral Resources Osama al-Zamil stressed that GAMI will govern and unify the procedures of factories that manufacture both civil and military products.

Zamil also indicated that cooperation and coordination will be ensured to serve the supply chains of military industries, promote local content, and provide incentives for investment.

The deputy minister noted that the agreements will be established after determining the requirements for issuing industrial licenses to military factories, and customs exemptions for production in the military industries sector.

Military expert retired Major General Mohammed al-Ghamdi indicated that such cooperation is vital.

Ghamdi told Asharq Al-Awsat that the cooperation between the Authority, the Ministry, and the Royal Commission in Jubail and Yanbu increases the Kingdom’s military power and contributes to the localization of the military industry, which is one of Vision 2030’s goals.

The expert stressed that such a step enhances Saudi Arabia's strategic independence and raises its military and security preparedness.

He added that increasing levels of coordination and joint efforts will contribute to establishing successful military industrial facilities.

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Dollar Tumbles as Investors Seek Safe Havens after US Tariffs

US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
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Dollar Tumbles as Investors Seek Safe Havens after US Tariffs

US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

The dollar weakened broadly on Thursday, while the euro rallied after President Donald Trump announced harsher-than-expected tariffs on US trading partners, unsettling markets as investors flocked to safe havens such as the yen and Swiss franc.

The highly anticipated tariff announcement sent shockwaves through markets, with global stocks sinking and investors scrambling to the safety of bonds as well as gold.

Trump said he would impose a 10% baseline tariff on all imports to the United States and higher duties on some of the country's biggest trading partners.

The new levies ratchet up a trade war that Trump kicked off on his return to the White House, rattling markets as fears grow that a full-blown trade war could trigger a sharp global economic slowdown and fuel inflation, Reuters reported.

The dollar index, which measures the US currency against six others, fell 1.6% to 102.03, its lowest since early October.

The euro, the largest component in the index, gained 1.5% to a six-month high of $1.1021.

Trump has already imposed tariffs on aluminium, steel and autos, and has increased duties on all goods from China.

"Eye-watering tariffs on a country-by-country basis scream 'negotiation tactic', which will keep markets on edge for the foreseeable future," said Adam Hetts, global head of multi-asset and portfolio manager at Janus Henderson Investors.

The risk-sensitive Australian dollar added 0.56% to $0.63365, while the New Zealand dollar climbed 0.9% to $0.5796.

The yen strengthened to a three-week high against the dollar and was last up 1.7% at 146.76 per dollar, while the Swiss franc touched its strongest level in five months at 0.86555 per dollar.

"Negotiations are now going to be front of mind. This is probably the other big part of why we're seeing some of these currencies outperform," said Nicholas Rees, Head Of Macro Research at Monex Europe.

"It's very difficult actually to see how other countries make concessions that would encourage the US to lift these tariffs. And I think that's a big underpriced risk."

Investors are worried that some US trading partners could retaliate with measures of their own, leading to higher prices.

EU chief Ursula von der Leyen described the tariffs as a major blow to the world economy and said the 27-member bloc was prepared to respond with countermeasures if talks with Washington failed.

Worries about a global trade war have intensified since Trump stepped into the White House in January, combining with a slew of weaker-than-expected US data to stoke recession fears and undermine the dollar.

The dollar index is down more than 5.7% this year.

"These tariffs have certainly significantly increased the risks to the downside for global growth, so on balance we think that will eventually start to become more supportive again for the dollar," said Lee Hardman, senior currency analyst at MUFG.

In Asia currencies, China's onshore yuan slid to its weakest level against the dollar since February 13. China's offshore yuan also hit a two-month low.

The Vietnamese dong slumped to a record low.

Elsewhere, the Mexican peso and Canadian dollar strengthened.

Canada and Mexico, the two largest US trading partners, already face 25% tariffs on many goods and will not face additional levies from Wednesday's announcement.