The Saudi engineer who helped to turn Sabic into one of the world’s biggest industrial groups is taking the helm of the kingdom’s military industries corporation.
New Saudi King Salman appointed the Sabic chief executive Mohamed Al Mady to the role, according to a royal decree published on the state news agency SPA yesterday.
The statement said he would become the chairman of the General Organization for Military Industries with immediate effect.
It did not say if Mr Al Mady would be leaving his post at Saudi Basic Industries Corporation.
Mr Al Mady made headlines in 2013, when he said that compulsory military service could help to solve the Arab youth unemployment crisis.
The move would help to change the mindset of young people unwilling to consider certain jobs, he told a World Economic Forum meeting in Jordan in 2013.
“The problem is you have to tackle the cultural dimension of the labour force. People don’t accept jobs. They want the jobs that will give them higher money and stability. That’s not going to happen.
“They have to accept certain job categories that fit their situation,” he told a session about tackling joblessness in the Arab world.
Mr Al Mady joined Sabic in 1977, when there were only five other people working for it. Within three decades it had grown to become the world's biggest chemical maker. Today it has a market capitalisation of US$76 billion and employs 40,000 people.
He was one of a handful of young Saudis hand-picked by the kingdom’s ministry of education to learn chemical engineering in the US in the early 1970s at a time when Saudi Arabia did not have a single major chemical plant.
They were to learn how to turn the vast oil reserves lying deep below the kingdom's deserts into valuable chemicals using the waste gases that at that time were burned off at the wellhead during the oil drilling process, known in the industry as flaring.
The company was able to rapidly expand its operations in the kingdom and beyond, helped by its ability to tap cheap natural gas to manufacture plastics while competitors in Europe and the US struggled to compete and paying much more for the gas or oil feedstock needed to make ethylene – the building block petrochemical.
But the recent growth of the shale gas industry has dramatically revived the fortunes of many of Sabic’s competitors reducing the price advantage enjoyed by the Saudi company for decades.
Last month it reported a 29 per cent drop in fourth quarter profits.
scronin@thenational.ae
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