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On Wednesday, Saudi Arabia said 44 global corporations are moving their regional head offices to Riyadh, the capital.
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The kingdom boldly told companies in February that it wouldn’t do business with them if they didn’t shift their headquarters there.
In February, Saudi Arabia issued a daring ultimatum to multinational companies: shift your regional head office to the country by 2024, or the government stops doing business with you.
The announcement was part of a full-scale push by Crown Prince Mohammed bin Salman to turn the capital, Riyadh, into a global center for finance, business, and logistics, so the kingdom would be less reliant on the oil that makes up 70% of its exports, per OPEC.
Investors and expats balked at the idea at the time, with many saying it was a ploy to wrench business away from Dubai in the neighboring United Arab Emirates, where 90% of the workforce are foreigners. One veteran financier described it as “anti-competition” and “corporate bullying,” per CNBC.
But the tactic seems to be working. Saudi Arabia announced on Wednesday that 44 international corporations, including PepsiCo, Siemens, and Unilever, are establishing their regional headquarters in Riyadh, reported local news.
Hosam Alqurashi, the director of the kingdom’s Regional Headquarters Program, said at the announcement that its capital is now “witnessing the greatest art movement since the Renaissance,” per Arab News.
The new total is up from the initial 24 corporations who said in January that they would move their regional offices from Dubai to Saudi Arabia.
Back then, officials tried to entice businesses with a 50-year corporate tax holiday and waivers for employment quotas.
The February ultimatum took a different spin. “Everyone is freaking out. We are used to governments offering carrots, but this time a big stick has come out of the bag,” said…
Source : yahoo
