Localization advances business and society in line

The Saudi Vision 2030 is providing the momentum to propel Saudi Arabia towards a new era of prosperity. The government is therefore working even closer with the private sector to achieve the ambitious yet achievable goals of the Vision and the related targets of the National Transformation Program. Currently, the Kingdom’s private sector contributes 40% to its Gross Domestic Product and the goal is to increase this to 65% by 2030. The focus is on growing and further localizing priority sectors of the Saudi economy which covers energy, including renewables, as well as manufacturing, transport and healthcare. 

Arja Talakar, CEO of Siemens Saudi Arabia, however says, “Siemens has been at home in the Kingdom for over 85 years. The one who is at home contributes towards the development and well-being of the household. Siemens was born in Germany, grew up in Europe and is at home in the world. With our majority Saudi employees and a strong local manufacturing and value chain footprint, we are a truly local company in the Kingdom.” 

While important factors such as price, technology and organizational capability continue to drive competition, the localization of value chains in the Kingdom’s key economic sectors has become the major source of competitive advantage and this trend will continue. Localization is good for business and for the Saudi society. 

As one of the oldest Fortune 100 companies, Siemens makes societal value contribution as one of its main missions. “Siemens exists to continuously contribute to the well-being and progress of societies around the world. This is a long-term commitment also in Saudi Arabia, that is honored in a sustainable way every day, every year and for an entire lifetime.”, according to Talakar.

Saudi Arabia has the largest and fastest growing manufacturing and production base in the GCC and is continuing to industrialize. Practically, that means more plants, more local manufacturing, and more local training and job opportunities. That is why Siemens chose to build the first gas turbine plant in Saudi Arabia. In addition to building the largest turbine manufacturing facility in the Middle East, a massive training program was initiated in 2012 together with the Saudi Petroleum Services Polytechnic (SPSP) to train young Saudi talent to become gas turbine experts. When the plant, known as the Siemens Dammam Energy Hub, opened its gates late in 2014, Siemens began to build gas turbines for the Integrated Gasification Combined Cycle (IGCC) power plant in Jazan with Saudi talent leading to the production of the first-ever “Made in KSA“ gas turbine earlier this year.

The Siemens Dammam Energy Hub is expanding its capabilities which requires even more local suppliers, and with that comes supplier development and joint expansion initiatives to increase local value add. Collectively, these initiatives support the ramping up of resources and capabilities to build new industries and drive economic diversification in line with Vision 2030. 

Arja Talakar concludes, “Siemens makes real what matters, and what is important to the Kingdom, matters to Siemens. By sustainably developing local capabilities, we are jointly shaping an even more prosperous future.”