"The economic cities helped the four regions draw a lot of foreign investments, in terms of funds invested by their developers and investments in various projects," said Amr Al-Dabbagh.
Saudi Arabia has become the eighth largest recipient of foreign direct investment (FDI) in the world in 2009, attracting $36 billion, according to the World Investment Report (WIR) of the United Nations Conference on Trade and Development (UNCTAD).
Last year, the Kingdom was placed 14th in a similar ranking published for the year 2008. The inflows in 2009 were lower by five percent than the total FDI inflows of $38.1 billion attracted in 2008.
He described economic cities as a new model for strategic partnership between public and private sectors. He said the economic cities would also contribute to developing under-developed areas in the country.
He attributed the delay in developing King Abdullah Economic City (KAEC) in Rabigh to the global economic crisis and some organizational matters. “KAEC is a huge city covering 168 million square meters and is bigger than Washington and Dubai. It cannot be established within a day or two," the SAGIA chief said.
He said the successful measures taken by the Kingdom to overcome economic crisis and the formation of an authority by the government would support economic cities. The first phase of the residential and industrial zones at KAEC has been completed.
“A number of Saudi and foreign companies have agreed to invest in the city and the company developing the city has allocated 829,000 square meters of land for them,” he said, adding that the International Tube and Conduit Company (ITCC) has started production.
Sanofi-Aventis has signed an agreement with Emaar Economic City to establish their manufacturing facility at the Industrial Valley. The plant, which is to be built on a 35,000 square meter land, will initially produce oral anti-diabetic and cardiovascular products. Saudi TOTAL Lubricants Company Ltd. has reached an agreement to establish a Lubricants manufacturing facility.
Speaking about progress of work at Jazan Economic City (JEC), Al-Dabbagh said an iron and steel factory will be established in JEC at a cost of SR1.5 billion.
“About 30 percent of the project has been completed and the plant is expected to start production in the third quarter of 2011,” he said.
Saudi Aramco has been entrusted with the task of building and financing the $10-billion refinery at JEC. The refinery will have a capacity of 250,000 to 400,000 barrels per day. Malaysian company MMC is building the city with Saudi Binladin Group.
Al-Dabbagh disclosed plans to establish branches of reputed international universities and institutes at the Knowledge Economic City in Madinah.
“We’ll announce some of these educational projects shortly,” he told Al-Riyadh Arabic daily.
Designs for the infrastructure and residential projects at the city have been completed.
He said a new airport would be established at Prince Abdulaziz bin Musaed Economic City in Hail in coordination with the General Authority of Civil Aviation. “Work on the airport project will start soon,” the governor said. A station of Northern Railway will also be established at the city. He expected construction works at the Hail city would speed up in the coming months.
Al-Dabbagh denied allegations that SAGIA was giving priority to foreign investors, ignoring their Saudi counterparts. “The licenses issued by SAGIA for foreign projects represent less than one percent of licenses issued by the government,” he said.