Saudi Arabia aims to have one of the world’s top 25 defence companies by 2030 as it seeks to add thousands of manufacturing jobs.
The kingdom’s sovereign wealth fund established the company to help reduce its reliance on foreign purchases and to diversify the economy away from oil.
The Saudi Arabian Military Industries, or Sami, will manufacture products and provide maintenance services across units, including air and land systems, weapons and missiles, and defence electronics, the Public Investment Fund said on Wednesday. The company is wholly owned by the government.
“While the kingdom is one of the world’s top five spenders on security and defence overall, only about two per cent of our military procurement is domestic,” said deputy crown prince Mohammed bin Salman, who is also the country’s defence minister.
He added: “By partnering with universities, Sami will provide students with apprenticeships and careers in cutting edge technologies, which were previously unavailable in the kingdom.”
The new venture will establish companies through joint ventures with global original equipment manufacturers, as well as co-operating with local military companies.
The company will consider creating new business units, to ensure it is aligned with the latest developments in the military industries sector, it said.
The company is part of prince Mohammed’s plan to wean the Saudi economy off its reliance on revenue from oil exports by 2030. The wealth fund said Sami will directly contribute around 14 billion Saudi riyals (Dh13.71bn) to the Saudi GDP by 2030, invest more than 6bn riyals in research and development “and create over 40,000 jobs, many of which will be in the engineering and technical fields.”
Under prince Mohammed ’s Vision 2030, 50 per cent of Saudi Arabia’s military “procurement spending will be localised,” PIF said.
* With agencies
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