General Electric Making Investment in Saudi Arabia of $1.4 Billion
General Electric Co announced on Monday a number of new investments that total over $1.4 billion in the Middle East country of Saudi Arabia, as the kingdom in the Persian Gulf looks to lower its dependence on oil by opening its economy further to international businesses.
The conglomerate based in Connecticut, said it would be teaming up with a pair of partners, which included Aramco the oil giant in Saudi that is state owned, to construct a manufacturing facility that costs $400 million for the new marine and energy sector that should help create over 2,000 jobs for the kingdom.
GE has signed of memorandum of understanding in which it will invest jointly $1 billion in a number of sectors like aviation and water between now and 2017, along with a entity in Saudi Arabia the comprises the biggest petrochemical business in the country, Aramco and its public investment fund.
GE also said it would consider another $2 billion in investments for the same sectors following 2017.
This joint collaboration and investment will change the game or the digital and industrial sectors of Saudi Arabia, said Jeffrey Immelt the CEO at GE.
Immelt’s comments came during his meetings on Monday in Jeddah a coastal city with business leaders and ministers.
The investments by GE come during a time when the government of Saudi Arabia is attempting to overhaul the economy that is too oil-dependent, following the collapse of prices of crude.
The Saudi economy has been straddled with a public sector that is bloated and is fueled predominantly by revenue from oil.
A one part of its new strategy for the economy, Saudi Arabia is attempting to attract international investors with expertise to help increase new jobs for the growing population.
At the same time, it is attempting to boost sectors that do not rely on the oil wealth in the country and envisages more of a role for its private sector in providing jobs for its citizens.
Abdullatif Al-Othman, the chairman of the entity known as SAIIC which GE is going to invest with, said that a strategic alliance together with GE was the ideal fit to help deliver on its goals and together would contribute to long term diversified growth and economic competitiveness of the economy of Saudi Arabia.
GE currently employs about 2,000 people in the kingdom with its three offices as well as seven facilities. The company in addition had the largest service facility for gas turbines in the world located in Dammam that was opened back in 2011.
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