VENTURES AFRICA – South Africa and Saudi Arabia have strengthened their political and economic ties by creating a new company- Saudi Arabia-South Africa Holdings (SASAH). The company was launched during the fourth Saudi Arabian African Joint Committee held in Riyadh.
Present at the event were South Africa’s Trade and Industry Minister, Rob Davies; Saudi Arabia’s Commerce and Industry Minister, Tawfiq Al-Rabiah; the South African Deputy Minister of International Relations and Cooperation, Ebrahim Ebrahim and South African Ambassador in Riyadh, Sadick Jaafer. Also present at the ceremony were seventeen African companies, which formed the visiting delegation from South Africa.
The new company is entitled to free 5 percent equity in any joint venture initiated by SASAH. The partnership will help the two countries to invest in profitable business ventures and facilitate joint ventures.
The company will be a legally registered entity in their respective countries and fulfil the legal requirements of investment authorities and tax regimes of both countries. It may become a major shareholder in some strategic joint ventures, Saudi news agency said.
Al-Rabiah said, “The meeting of the joint committee is part of the constructive dialogue that binds the Arab Kingdom and South Africa to discuss ways to strengthen cooperation and push the level of current trade, which reached SR19.7 billion last year. Saudi’s exports to South Africa have also reached SR18.2 billion, while imports from South Africa to the Kingdom had reached SR1.5 billion.”
He stated that there is need for the improvement of bilateral agreement between the two countries. He said the political relations between the two friendly countries would contribute to strengthening bilateral cooperation in economy, trade and investment.
The creation of SASAH is expected to create mutual business opportunities in mining, petrochemical and agriculture. The partnership between the two countries will also contribute to increasing the volume and quality of the existing trade and discuss new prospects for expanding and strengthening it in several areas.
Describing the initial activities of the new company, Adnaan Grimsel, consultant to the Saudi-South African Business Council said the initial capital of SR10 million would be utilized to conduct the bankable feasibility studies for the initially identified sectors such as agriculture, mining and petrochemical downstream industries.
“SASAH aims to be a leading blue chip profitable investment company in the region capitalizing on the strength of Saudi Arabian and South African economies,” Grimsel said, adding that the two countries are keen on developing a strategic relationship to enhance the business opportunities, which has resulted in the formation of this new venture.
Dr. Robert Davis said South Africa depends on Saudi Arabia to meet 30% of its needs for oil and oil derivatives, calling at the same time for searching for the best ways to enter into new partnerships that contribute to strengthening the existing cooperation between the two countries.
Over two days in Riyadh, the joint committee will examine several topics on stimulating the quantity and quality of trade between the two countries; increasing trade delegations and participation in joint exhibitions; the need for goods coming from South Africa to meet Saudi Arabia’s standards; speeding up the procedures for activating the defence cooperation between the two countries; boosting military and security cooperation; calling on South African companies to attain exploration licenses for precious metals and associated minerals in the Kingdom and inviting South African specialized companies in the areas of mining to invest in the Saudi mining sector in addition to exchanging information and expertise between the two countries and cooperation in the field of aqua-culture, requesting an appointment to sign the agreement on maritime transport between the two countries and cooperation in the fields of ports, railways, higher education, health training, culture, media and other fields, the agency reported.