In episode 108, Mansour El-Zahab and Zeynep Kösereisoğlu from Frontierview, a leading market intelligence and research company, join The 966 to discuss Saudi Arabia’s Regional HQ program (commonly referred to as the “RHQ” program) and dive into some of the legal and practical details ahead of the effective date of the program starting in 2024. The RHQ program is the requirement that companies seeking to contract with the Saudi government or its affiliates must have their regional headquarters within Saudi Arabia and not in any neighboring nations. That has posed some challenges but also opportunities for foreign investors ahead of a key deadline on January 1, 2024. What companies are subjected to this rule, and what defines compliance here? How have these requirements of compliances changed over time since they were announced? What are some challenges that MNCs are facing in their new HQ setting, or in their journey to get there? And how are neighboring states, like the United Arab Emirates (UAE), reacting to the policy? Mansour and Zeynep dive into these questions and much more.
Listen now:
Watch now:
Before the conversation, the hosts discuss Richard’s One Big Thing, which is Saudi Arabia’s investments into the development of its own local defense sector. The Kingdom is effectively seeking to build a local military industry from scratch – a tall order with a high price tag. But an even higher price tag for Saudi Arabia to-date has been its foreign military purchases from other nations, especially the United States. The hosts discuss the progress of the development of the sector, headed by GAMI and SAMI in Riyadh, ahead of the forthcoming World Defense Show in Saudi Arabia in 2024.
Next, the hosts discuss Lucien’s One Big Thing – a Goldman Sachs article that was published earlier this week on the progress and achievements of Vision 2030. The 154 year old financial services behemoth, maybe the most recognizable name in banking and financial services in the world, and the second largest investment bank by revenue in the world behind only JP Morgan Chase, published an article entitled “How Saudi Arabia is investing to transform its economy” and is available on the Goldman Sachs website. Goldman Sachs Research identifies as areas that are benefiting from increased investment and are likely to drive a “capex supercycle” through the end of the decade.
The hosts conclude as always with Yallah! 6 top storylines to get you up to speed on Saudi Arabia heading into the weekend.
•A week after revealing talks with Australia about bidding to co-host the 2034 World Cup, Indonesian soccer leader Erick Thohir said his federation is now supporting Saudi Arabia’s candidacy to host the tournament.
•The second edition of the “Made in Saudi Expo” exhibition will be held at the Roshn Front in Riyadh from October 16 to 19, 2023, under the patronage of Bandar Alkhorayef, Minister of Industry and Mineral Resources and Chairman of the Saudi Export Development Authority.
•Saudi Arabia’s crude oil exports in August hit their lowest level in 28 months as they fell for a fifth straight month, data from the Joint Organizations Data Initiative (JODI) showed on Monday.
•Saudi Arabia’s $700 billion Public Investment Fund has disclosed that Swedish venture capital fund Northzone has taken investment from its venture investment arm Sanabil — the only European VC firm known to have done so.
•Amin Nasser, said his company is looking at more investments in liquefied natural gas (LNG) to boost its plans to become a leading player in the seaborne gas market.
•A landmark report released during the Middle East and North Africa Climate Week, which ran here from Oct. 8 to 12, highlights the challenges that Saudi Arabia might face in a world that is warmer by 3 degrees Celsius.
