THE PARTNERSHIP
The founder hopes to create a successful strategic partnership between leading infrastructure Saudi and American group of companies. As such, he wants to make sure that the partnership strengths, weaknesses, expectations, limitations, responsibilities and accountabilities are carefully discussed and looked after. He also wants to ensure fair negotiations between partners on issues such as capital shares, board and management contributions, among other things.
WHY PARTICIPATE IN THE PARTNERSHIP ?
Listed below are a number if “justifications” why a company may consider joining the Saudi American Partners in Development:
- Perform business internationally by being part of a strong partnership comprised of highly qualified American and Saudi groups.
- Seize the opportunity to be part of a partnership targeting Saudi Government supported and fully financed development projects of different sizes in a number of major sectors, oil and gas, power, petrochemicals, urban transport, construction, water, mining, water, healthcare, alternative energy among many other social infrastructure projects.
- Be among a partnership that plans to consider not only investing in the Saudi infrastructure projects, but in US infrastructure projects as well. The founder plans to introduce to the SAPD board this two-way investment formula for study and possible implementation. This is a unique stand that will be definitely appreciated by both governments and business communities. After all, this goes in line with the mission of solidifying the bilateral economic relations.
- Take advantage of available private and Government financial institutions credit facilities to finance awarded contracts and/or newly introduced technologies.
- Be part of a partnership that will strategically benefit from excess to Saudi markets, incentives, commitments, and the positive regulatory environment.
- Take advantage of being present in the Saudi market right after the initial offering of 5% of the largest oil company in the world, the giant Saudi Aramco. The aftermath of the offering is expected to bring about a huge rise in government spending on all sorts of economic and social development programs throughout the kingdom. This will undoubtedly result in ample opportunities for locally established infrastructure development groups of all specialties. This, in addition to what is available prior to the Aramco offering, will make Saudi Arabia a land of projects, in all sectors and in all sizes.
- Do business in a country that has announced in 2019 its largest budget in history; a country whose growth projection has been recently raised by the International Monetary Fund (IMF), whose fiscal deficit drop has also been praised by the IMF, and who has succeeded in its crackdown on corruption by redirecting a minimum of $100 billion to its economy.
- Be part of and invest in a partnership that partially bases its creation on the results of a survey administered by the Washington DC based US Chamber of Commerce, with positive perceptions of American companies doing business in Saudi Arabia.
- Benefit from going global by taking advantages resulting from being in a partnership which includes availability of more capital; greater borrowing capacity and possibility of expanding at home, due to generation of more revenues from abroad.
- Generate subcontracting business by belonging to a partnership that will be in a position to bid on big size projects in various infrastructure fields. Such awarded contracts normally results in the subcontracting of no less than 25% of those contracts, due to local requirements or non-company specialties. Partners within SAPD will definitely have “first refusal” at such subcontracting business opportunities, for the simple reason of, being part of the SAPD.
- A number of Saudi mega projects has been delayed for a number of years now. The government plans to finance those projects once the … is available, as such, this is working in favor of SAPD as the partnership will hopefully be operational at that time, taking advantage of bidding mega projects like the ones named above.
- Saudi Arabia has always been the jewel in the crown for international contractors. Locally, there are only a handful of Saudi contractors that are capable of carrying out the kingdom’s mega projects such as Neom and Qidyah. As such, the timing for setting up the SAPD partnership is positive. It is perfect timing for ASPD to come in and begin preparations for participating in the upcoming infrastructure business.
To invest and be part of an alliance that partially bases its creation on the results of a survey administered by the US Chamber of Commerce based in Washington DC, on perceptions of American companies doing business in Saudi Arabia. Some of the perceptions indicated that
- Benefiting from going global by taking advantages resulting from being in a partnership which include low cost of starting up internationally; availability of more capital; greater borrowing capacity and possibility of expanding at home due to generating more revenues from abroad.
- KSA continues to play a significant role for many US companies.
- US companies are eager to take advantage of the business opportunities available in KSA.
- 81% of US companies polled by the survey perceive Saudi Arabia favorably – the overall perception is positive.
- 74% of US companies indicated that local financing constraints are not a significant issue.
CREATING A MUTUALLY BENEFICIAL PARTNERSHIP
To forge an effective strategic partnership, the partners need to support the founder in achieving the following aims:
- Identifying potential partners
- Creating a shared vision and mission
- Setting partnership goals
- Identifying resource contributions of partners
- Creating a business plan – a strategy
- Presenting the project to interested partners
- Spelling out the advantages of the partnership
- Addressing partners expectations
- Identifying partnership strengths and weaknesses
- Supporting efforts to override limitations
- Defining roles, responsibilities and accountabilities
SAPD CORE VALUES
SAPD key core values include but not limited to:
- Respect.
- Accountability.
- Integrity.
- Ethical and professional standards.
- Transparency and open dialogue
SAPD YEARLY EVENT ON KSA USA ECONOMIC RELATIONS
A yearly event emphasizing Saudi American economic cooperation will be organized. Government officials and business leaders from both countries will be invited. It is an occasion during which the partnership will acknowledge the support it is getting from both governments and the business community, and where a number of leaders will be awarded for such service. Leading ASPD partners will also be recognized as well. It is expected that the event will be rotated between Saudi Arabia and the United States on a yearly basis.
SAPD CORPORATE SOCIAL RESPONSIBILITY
It is essential for SAPD to have a solid CSR engagement within both the United States and Saudi Arabia. For the Saudi Arabian side, the founder proposes the following working groups as a social responsibility gesture from the partnership, in support of the local community. The working groups proposed are:
- Saudi Vision 2030 Support Working Group
- Saudi Infrastructure Technology Transfer Working Group
- Saudi Youth Infrastructure Training & Development Working Group
As for the United States, it is left for the board to find the best way SAPD can socially participate thru identified projects and programs.
Undoubtedly, this move from SAPD will be highly appreciated by both governments as well as the social and business communities.