20 May 2017, Riyadh — U.S. and Saudi Arabian companies signed business deals worth tens of billions of dollars on Saturday during a visit by President Donald Trump, as Riyadh seeks help to develop its economy beyond oil.
National oil firm Saudi Aramco said it signed $50 billion of agreements with U.S. firms. Energy minister Khalid al-Falih said deals involving all companies totaled over $200 billion, many of them designed to produce things in Saudi Arabia that had previously been imported.
Business leaders on both sides were keen to demonstrate their talks had been a success, so there was an element of showmanship in the huge numbers. Some deals had been announced previously; others were memorandums of understanding that would require further negotiations to materialize.
Nevertheless, the deals illustrated Saudi Arabia’s hunger for foreign capital and technology as it tries to reduce its dependence on oil exports. Low oil prices in the past couple of years have slowed the economy to a crawl and saddled the government with a huge budget deficit.
“We want foreign companies to look at Saudi Arabia as a platform for exports to other markets,” Falih told the conference.
In March, Saudi Arabia’s King Salman toured Asia and his delegation signed similar agreements worth tens of billions of dollars there, including deals worth as much as $65 billion in China.
Top Saudi economic policy makers, including the finance minister and head of the kingdom’s main sovereign wealth fund, described investment opportunities in Saudi Arabia to a conference attended by dozens of U.S. executives on Saturday.
Saudi officials said they aimed to prepare new, streamlined rules covering direct investment by foreign firms within 12 months.
Among the deals signed on Saturday, GE (GE.N) said it reached $15 billion of agreements involving almost $7 billion of goods and services from GE itself. They ranged from the power and healthcare sectors to the oil and gas industry and mining.
Jacobs Engineering (JEC.N) will form a joint venture with Aramco to manage business projects in the kingdom, and McDermott International (MDR.N) will transfer some of its ship fabrication facilities from Dubai to a new shipbuilding complex which Aramco will build within Saudi Arabia.
Riyadh, one of the world’s biggest military spenders, is keen to develop a domestic arms industry rather than importing weapons, so several deals were in military industries.
Lockheed Martin (LMT.N) said it would support the final assembly and completion of an estimated 150 S-70 Black Hawk utility helicopters in Saudi Arabia.
*Reem Shamseddine & Katie Paul; Marwa Rashad & Celine Aswad; Andrew Torchia; Editing: Andrew Roche – Reuters
