Saudi Arabia’s GDP to surge by 4.4% in 2024: report
Updated 02 January 2024
ARAB NEWS
RIYADH: Saudi Arabia’s economy is likely to grow by 4.4 percent in 2024, Aljazira Capital has predicted in its year-end report.
The forecast is in line with the Kingdom’s Finance Ministry’s projection for the current year, whereas Moody’s predicted a 4.6 percent increase in 2024.
In the report, the financial brokerage firm highlighted that Saudi Arabia’s economic acceleration is expected to be propelled by the execution of megaprojects, Vision 2030 initiatives, government spending, and increased participation of the private sector.
On a broader economic scale, the firm added that increasing consumer spending, a decrease in the unemployment rate, and the expansion of non-oil private sector activity signal favorable economic conditions.
Additionally, it noted that control over inflation further supports the positive economic outlook.
Aljazira Capital stated: “Saudi Arabia’s GDP (gross domestic product) is expected to expand by 4.4 percent in FY24E on the back of growth in the private sector amid the implementation of programs under Saudi Vision 2030. Weak oil revenues would be offset by growth in non-oil revenues.”
It expects interest rate cuts to free up liquidity among international investors, possibly bringing in foreign inflows.
The firm also anticipates that the main Saudi stock market will achieve gains of around 10 percent in 2024, supported by increased liquidity.
The report highlighted a set of economic factors supporting its outlook for the new year, both globally and locally. These factors include interest rates reaching their peak in advanced economies, coinciding with a decline in inflation.
This is expected to result in a global economic slowdown, achieving a soft landing without entering a recession in 2024, it added.
The Saudi brokerage house also added that expectations indicate the US Federal Reserve will cut interest rates by 100 basis points this year.
Consequently, it is expected that the Saudi Central Bank, known as SAMA, will follow the same approach as the Federal Reserve. This expectation arises from the pegging of the Saudi riyal to the US dollar, with plans to reduce the repo rate by 100 basis points to 5 percent in 2024.
Despite the negative impact of slowing economic activities globally on oil demand and concerns about oversupply in 2023, Aljazira Capital expects the average Brent crude oil price to remain above $80 per barrel in 2024.
It noted that the policies of the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, will play a crucial role in determining oil market trends amid concerns about increased US supply.
Analysts at the firm wrote in their report that the Tadawul All Share Index, also known as TASI, in the main Saudi market, is likely to rise in 2024, supported by corporate profit growth and increased liquidity in the stock market.
“Our earnings estimate for FY24E translates into an EPS (earnings per share) of SR691 ($184) and a fair value of 13,123 points for TASI, implying an upside of 13.1 percent for the current level,” the analysts wrote.
The research document indicated positive expectations for the banking sector, along with specific stocks in retail, applications, and technology. Additionally, it anticipates favorable performance in stocks related to communication services and tourism.
Saudi startup investment shifts focus to AI, enterprise software, and SMEs
Updated 28 December 2024
Nour El-Shaeri
RIYADH: Saudi Arabia’s startup ecosystem is gaining momentum, propelled by government-backed initiatives and an influx of investor interest. While the fintech sector remains a primary focus, emerging opportunities in artificial intelligence, enterprise systems, and small-to-medium enterprise investments are drawing attention.
As part of its Vision 2030 initiative to reduce its dependence on oil, Saudi Arabia is positioning itself as a regional hub for innovation, creating fertile ground for startups and attracting significant venture capital flows.
Why fintech?
Tushar Singhvi, deputy CEO of Crescent Enterprises and head of its investment platform, CE-Ventures, discussed the enduring potential of the fintech sector in an interview with Arab News. He pointed to the Kingdom's robust national strategy, which aims to establish 525 fintech companies by 2030, as a key driver behind sustained growth.
“Saudi Arabia’s fintech sector is set for sustained growth, driven by a clear national strategy to have 525 fintech companies by 2030,” Singhvi said.
In 2023, Saudi Arabia captured 58 percent of all fintech venture capital in the Middle East and North Africa. Singhvi also highlighted pivotal moves like the acquisition of Tweeq by Tabby and the launch of Samsung Pay, both of which support Saudi Arabia’s goal of becoming a cashless society.
“These efforts position Saudi Arabia as a leader in fintech innovation, making the sector highly attractive to investors,” Singhvi stated.
He added that this fintech momentum is aligned with the broader push for economic diversification. Vision 2030, Saudi Arabia’s ambitious roadmap for its post-oil economy, is channeling investments into long-term growth sectors like fintech, logistics, and healthcare.
“Investors are focusing on sectors with long-term growth potential, like financial services, healthcare, and renewable energy,” Singhvi said, emphasizing a rising interest in ESG-aligned investments that prioritize sustainability and social impact.
The fintech sector’s growth is further accelerated by the relative underdevelopment of traditional financial services in the region, according to Khaled Talhouni, managing partner at Nuwa Capital. He noted that the services available to both consumers and businesses from traditional financial institutions remain limited compared to the maturity of the overall economy.
“The availability and depth of services to both consumers and firms from traditional financial institutions like banks remains woefully under-developed relative to the maturity of the overall economy,” Talhouni explained.
This gap presents significant opportunities for fintech startups. However, Talhouni anticipates market consolidation, with smaller companies potentially being acquired by larger players. “I do suspect some consolidation in the space with smaller players folding into larger ones,” he said.
The rise of AI
AI is another area where Saudi Arabia is positioning itself for major growth. Singhvi pointed to the partnership between the Saudi Data and Artificial Intelligence Authority and NVIDIA to build one of the largest high-performance computing data centers in MENA.
“Saudi Arabia is rapidly aligning with global AI trends, aiming to be a top 15 AI leader by 2030,” Singhvi explained. Along with such investments, there is a concerted effort to build a skilled workforce, ensuring that the Kingdom can adopt AI and enterprise technologies to fuel its digital transformation.
Talhouni, however, sees the real opportunity for startups in integrating AI into day-to-day business operations rather than in large-scale AI infrastructure.
“Rather than investing in AI infrastructure/LLMs (large language models) etc., startups will incorporate AI into their normal course of business naturally across the region,” he said. “AI will become embedded in the offerings of all startups,” but he does not expect many companies in the region to invest deeply in large-scale AI or deeptech, except for specific use cases.
Talhouni emphasized that AI will likely serve as an enabling technology, integrated into existing business models, rather than being the primary focus for most startups.
Shifting focus
Singhvi anticipates a shift in investor attention toward enterprise systems as Saudi companies scale up and strive for global competitiveness. He highlighted that enterprise software will play a pivotal role in the Kingdom’s broader digital transformation efforts.
“We are seeing more and more SaaS (Software as a Service) companies emerge from the region and the Kingdom,” Talhouni observed. However, scaling such businesses can be challenging, given the relatively small number of large companies in the region. “SaaS/Enterprise requires a large number of firms and a relatively large economy to flourish,” he said. Despite these hurdles, Talhouni noted that niche opportunities exist for creating regional champions in the sector.
Why not oil and gas?
While the oil and gas sector has traditionally been the cornerstone of Saudi Arabia’s economy, it poses significant challenges for startups. Singhvi explained that the sector’s complex regulations and high capital requirements create barriers to entry for smaller companies. Established industry giants dominate research and development, making it tough for new players to break into the space.
“The oil and gas sector’s complex regulations and high capital requirements create significant barriers for startups,” Singhvi said.
However, Singhvi noted the growing opportunities for energy-tech startups, particularly those focused on digital transformation and sustainability, through partnerships with oil and gas companies.
“There has been a rise in strategic collaborations between oil and gas companies and energy-tech startups, which is accelerating the shift toward digital innovation,” he said.
Talhouni offered a broader perspective, suggesting that much of the innovation in the oil and gas sector requires specialized research and development infrastructure, which the region still lacks.
“Most innovation in the oil and gas sector is in engineering, material science, and deeptech,” he explained, adding that these fields require strong research-driven universities and a grant system, which are not yet widespread in the region.
“Unlike consumer internet startups that require, as an example of the opposite side of the spectrum, much easier entry with existing cloud infrastructure and limited technical/research-driven processes required,” he added.
This, he believes, makes it harder for new startups to break into the oil and gas industry, compared to the more accessible fintech sector, where cloud infrastructure allows companies to scale with fewer resources.
The growing SME sector
According to Ibrahim AbdelRahim, managing partner at Moonbase Capital, Saudi Arabia’s SME sector has experienced impressive growth, largely driven by government support and Vision 2030 initiatives.
“As of the fourth quarter of 2023, the number of SMEs in the country reached 1.31 million, reflecting a 3 percent quarter-on-quarter increase,” AbdelRahim noted, referencing a report by the General Authority for Small and Medium Enterprises.
This marks a staggering 179 percent increase in SME numbers over the last eight years. While most of these SMEs are micro-sized, they are well-positioned for further growth.
AbdelRahim also highlighted the rising interest in search funds, a new asset class in the region that aligns well with Saudi Arabia’s economic landscape.
“Many investors are eager to diversify their portfolios with search funds due to their potential for steady returns that surpass those of real estate investments or forex trading,” he said.
Moonbase Capital, one of the pioneers in search funds in the region, has seen growing interest from high-net-worth individuals and family offices in Saudi Arabia.
From an entrepreneurial perspective, AbdelRahim believes search fund-backed ventures will thrive in the coming decade, thanks to the rapid growth and transformation of the SME sector.
Edtech in Saudi Arabia: revolutionizing education through innovation
Updated 28 December 2024
Reem Walid
RIYADH: Edtech, short for educational technology, refers to the use of technology—hardware, software, and digital resources—to enhance teaching, learning, and educational outcomes.
It encompasses a wide range of tools and techniques aimed at improving the educational experience, including online learning platforms, educational apps, digital textbooks, virtual reality simulations, gamified learning experiences, and more.
Edtech is utilized in schools, universities, corporate training settings, and lifelong learning environments to make education more engaging, accessible, and effective.
When it comes to Saudi Arabia specifically, investing in edtech aligns with the Kingdom’s Vision of establishing a knowledge-based economy.
The edtech market size in Saudi Arabia is projected to exhibit a growth rate of 13.3 percent during 2024-2032, according to global management consulting firm imarc.
This comes as the market is being propelled by a surge in demand for tailored education to meet individual student needs, a heightened emphasis on digital literacy and tech competencies, and a growing recognition of the value of adaptable and convenient learning options.
Saudi efforts
There is no doubt that the Saudi Ministry of Education isn’t just talking about the future—they’re building it, step by step, with initiatives designed to transform their classrooms into cutting-edge hubs of AI and digital mastery.
“Take their ‘Future Intelligence Program,’ for example, which aims to empower 30,000 students with skills in AI, machine learning, and smart technologies. Imagine a generation of Saudi youth who can program self-driving cars before they even graduate high school,” Ian Khan, a technology futurist and author who writes on the subject of AI, told Arab News.
“This is more than just an upgrade in skills—this is about shaping a workforce ready to dominate the tech economy. Layer on top of that the SAMAI initiative, where 1 million Saudis will gain expertise in AI and digital tools, and it becomes clear that Saudi Arabia isn’t just keeping up with global tech trends—they're aiming to lead them,” Khan added.
He went on to note that this bold vision is intricately aligned with Saudi Vision 2030, which strives to create a knowledge-driven economy.
“This AI-driven, personalized learning experience is where the future of education meets the individual’s unique strengths and needs, gearing up the country for its next leap forward,” Khan concluded in that regard.
Initiatives
There is no doubt that the Kingdom is actively integrating AI into its education system to create a future-ready workforce.
“Programs such as the Future Intelligence Programmer aim to train thousands of students in AI, equipping them with the skills to innovate in a rapidly digital world. AI is being used to personalize learning experiences, automate administrative tasks for educators, and enable more tailored educational pathways,” Samer Bohsali, Middle East head of government & public sector practice, Bain & Co., told Arab News.
“These efforts are part of a broader vision to transform the Kingdom’s education system, setting new standards for digital literacy and student engagement,” Bohsali said.
On behalf of PwC Middle East, Partner at Education and Skills Ayham Fayyoumi told Arab News that the Kingdom is adopting a cautious yet forward-thinking approach to AI in education, with initiatives focusing on several key areas.
Samer Bohsali, Middle East Head of Government & Public Sector Practice, Bain & Co. (Supplied)
“One notable example is the implementation of adaptive learning systems, which use AI to analyze individual student performance and tailor educational content accordingly. These systems can identify students’ strengths and weaknesses, offering personalized learning experiences that enhance educational outcomes,” Fayyoumi said.
“Additionally, AI-powered virtual assistants are being introduced to support both teachers and students in managing routine tasks, such as administrative work or grading, allowing educators to dedicate more time to core instructional activities. These AI tools are designed to streamline workflows, enhance productivity, and improve engagement in the classroom,” he added.
Global partnerships
Global EdTech partnerships are crucial for the Kingdom for several reasons including access to innovation, enhanced learning opportunities, cross-cultural exchange, among several others.
“When Saudi Arabia decided to revolutionize its educational landscape, they didn’t go it alone—they teamed up with global powerhouses like Google, Microsoft, and Coursera. This collaboration isn't just window dressing. It’s a deliberate strategy to equip students and educators with the latest tools in AI, cloud computing, and data science,” Khan said.
“Google Cloud’s Elevate Program, for example, has trained over 25,000 Saudi women in cloud technologies. This is more than just a skillset boost—this is building a tech-savvy workforce that can compete on a global stage,” he added.
The technology futurist continued to highlight that these partnerships give Saudi educators access to AI-powered platforms that personalize learning and streamline assessments, ultimately creating more engaging and efficient classrooms.
“The future of education isn’t just digital—it’s adaptable, global, and responsive. And Saudi Arabia, through these forward-thinking collaborations, is leading the charge toward a tech-dominant educational future,” Khan said.
Saudi Arabia’s collaboration with global tech leaders also empowers the nation to adopt advanced educational tools that inspire innovation in the classroom.
From Bain & Co.’s side, Bohsali explained that these partnerships provide access to AI-driven platforms that foster personalized learning and critical thinking.
“This digital transformation is not just about adopting technology but also about reshaping how education is delivered, making learning more engaging and aligned with the future needs of the global economy ,” he said.
Saudi Arabia’s educational technology firms are using AI and technological advancements to revolutionize conventional educational approaches and enhance student achievements. Taking cues from effective programs in the UK and elsewhere, Saudi Arabia is directing significant resources into AI-infused tools across various sectors, particularly education.
Consequently, this initiative is fostering expansion in the education sector and sparking creativity within private enterprises, which is positively impacting more than 6 million students in the nation.
In that regard, PwC partner Fayyoumi said: “Several EdTech companies are at the forefront of this revolution, incorporating advanced AI technologies into their products and services to enhance learning experiences.”
“These companies are providing products utilizing AI to offer personalized learning pathways, adaptive assessments, and real-time feedback to better meet the unique needs of individual students. Such tools not only improve engagement but also boost academic performance by catering to diverse learning styles,” he added.
Saudi Vision 2030
“Saudi Vision 2030 isn’t just about a shift in economic strategy—it’s a transformation in mindset. At the heart of this vision is the move from a resource-based economy to one driven by knowledge, innovation, and technology,” Khan said.
“By embedding AI and digital learning in classrooms, programs like SAMAI and the Future Intelligence Program are crafting a new generation of thinkers, doers, and creators. The ripple effects will be profound. Think about it—students will be more engaged because their learning is tailored to their strengths,” he added.
The technology futurist emphasized that the education system will be more efficient, and graduates will emerge prepared for high-demand sectors like AI, cybersecurity, and digital industries.
He underlined that this is the essence of future readiness—where a nation’s educational foundation aligns perfectly with the demands of tomorrow’s economy.
On Bain & Co.’s behalf, Bohsali said: “By embedding AI and advanced technologies into the curriculum, the Kingdom is fostering a generation of learners who are not only technologically adept but also equipped to lead in innovation.”
Ayham Fayyoumi, Partner, Education and Skills, PwC Middle East.
“The expected outcomes are profound—enhanced digital literacy, improved educational outcomes, and the positioning of Saudi Arabia as a global leader in the knowledge economy,” Bohsali added.
Education is a key pillar, for both youth and above in achieving the goals of Vision 2030. This comes as the median age of Saudis is 22 years, and 63 percent of the Saudi population is below the age of 30.
Furthermore, PwC’s 2024 Hopes & Fears survey shows that nearly three-quarters of people surveyed in Saudi foresee the growing importance of digital skills in their roles over the coming five years.
“Incorporating digital tools within the education ecosystem can help boost the overall student learning experience and prepare them for their future work environments,” Fayyoumi said.
The PwC partner concluded by emphasizing that by enhancing the education sector using digital technologies such as AI, Saudi Arabia stands to build a globally competitive society, and to become the hub for the next generation of digitally equipped leaders in the Kingdom.
“Thus, the digital transformation of the education sector is another important part of Vision 2030’s success, to ensure young people in the Kingdom have the right skills for the future world of work,” he said.
Saudi Arabia’s oil legacy fuels shift to renewable energy hub
Updated 28 December 2024
Nirmal Narayanan
RIYADH: Saudi Arabia’s established prowess in crude oil production could help the Kingdom emerge as a global leader in the renewable energy sector, experts suggest.
Paul Sullivan, an energy and environment expert at Johns Hopkins University, emphasized that Saudi Arabia possesses the technical and engineering skills necessary to become a central hub for renewable energy.
Speaking with Arab News, he explained that the Kingdom’s vast experience in energy production could be leveraged to accelerate its transition toward cleaner energy sources.
Bolstering renewable energy capacity is critical for Saudi Arabia as it aims to generate 130 gigawatts of clean energy by 2030 and achieve net-zero emissions by 2060.
At the center of this ambitious plan is NEOM, a flagship project through which Saudi Arabia intends to become a leading manufacturer and exporter of green hydrogen. NEOM, in partnership with ACWA Power and Air Products, aims to export up to 600 tonnes of hydrogen per day by 2026.
“Saudi Arabia has many technical, business, and engineering skills that can spill over from oil and gas to renewables. One obvious one is drilling. Advanced drilling techniques can be used to develop geothermal energy in many places in the Kingdom,” said Sullivan.
He further noted: “Saudi Arabia has massive potential for geothermal energy. Skills in developing pipelines, refineries, ports, pumping stations, and more could also be transferred to geothermal.”
Sullivan also pointed out that expertise in electrical engineering and the construction industry, honed through Saudi Arabia’s legacy oil business, can be used to build new energy systems, including wind, solar, geothermal, and nuclear power.
“Saudi Arabia has a lot of financial clout from its oil business that could be redirected, but properly, to green energy and other environmental industries such as advanced desalination,” he added.
Technical and commercial expertise
Peter Brishimov, a partner in Energy and Process Industries at Kearney Middle East and Africa, echoed similar sentiments, emphasizing that Saudi Arabia’s experience in crude oil production provides a solid foundation for future renewable energy projects.
“In terms of technology, it is leveraging its track record in effectively deploying large-scale capital projects. On the commercialization front, given that the market for renewable energy is not yet as global as the one for oil, the Kingdom is building the bridge to make renewable energy commercially viable in both the short term and long term,” Brishimov explained.
He noted that Saudi Arabia is also focused on expanding its interconnection infrastructure and advancing green hydrogen production, which would enable the Kingdom to meet its own renewable energy needs while positioning itself as a global player.
Sullivan suggested that Saudi Arabia could quickly transform its traditional energy infrastructure into facilities capable of producing green energy.
“All over the world, traditional energy systems are being transformed into green energy hubs. The knowledge is out there. Saudi Arabia can build on that with its excellent energy research institutes, universities, and think tanks. KAPSARC comes to mind,” he said.
In August, a collaboration between KAUST, NEOM’s Education, Research, and Innovation Foundation, and ENOWA was announced to accelerate the development of Saudi Arabia’s hydrogen economy. As part of the agreement, ERIF will sponsor three strategic projects focused on hydrogen research, working in partnership with KAUST researchers to advance the development of hydrogen as a renewable energy source.
Human capital development
Sullivan also emphasized the importance of retraining the Kingdom's workforce to support the green energy transition.
“The traditional energy workforce will need retraining for the skills that are not transferable. Some people may not move that easily to newer ways of doing things, and some may be left behind. Younger people should be educated in the new opportunities. The training and education systems for traditional energy can be developed alongside the same for the new systems,” he said.
Brishimov highlighted that human capital development is crucial for the energy transition, often overshadowed by factors such as natural resources and capital availability.
“Based on its track record in building an oil industry, the Kingdom is in a strong position to do the same in the renewable energy domain. Through its national policies for enabling human capital development and Saudization requirements, Saudi Arabia is positioning itself to successfully transition its workforce,” he added.
Potential challenges
Discussing potential obstacles, Sullivan pointed out that some critical minerals and metals required for green energy production, particularly in electric vehicles, will need to be imported. However, he noted that Saudi Arabia is making strides in developing its mining sector, which could mitigate this issue in the future.
“The fact that it is so inexpensive to get the oil out of the ground can hamper the development of green energy. Legacy systems that are cash cows can slow down the development of new industries,” Sullivan said.
However, he also noted that, as seen in China’s transition, the development of green energy does not necessarily hinder the growth of new energy sectors.
“The development of green energy as the Chinese used coal to develop their green energy. So, it is not necessarily the case that being successful in legacy energy will slow down the growth of new energy,” he explained.
Saudi Arabia has set a bold target of deriving 50 percent of its power generation from renewables by 2030. According to Brishimov, this goal presents significant challenges, especially in terms of the speed of infrastructure deployment. “In excess of 100 GW of renewable capacity will need to be deployed by 2030,” he said.
He further noted that Saudi Arabia is addressing this challenge by using a combination of renewable energy auctions and direct deployment by the Public Investment Fund (PIF) to ensure rapid progress. Additionally, the Kingdom is pursuing ambitious localization targets within the renewable energy sector. “These targets must be achieved in parallel, without hindering the speed of deployment or the commercial attractiveness of renewable energy projects,” Brishimov explained.
Balancing old and new energy systems
Energy experts have long emphasized the importance of a gradual transition to renewables, rather than a sudden shift away from traditional energy sources. Haitham Al-Ghais, secretary- general of OPEC, stated in July that oil will continue to play a crucial role in future energy pathways, particularly as petroleum products remain essential for various industries, including electricity generation.
“Oil will continue to play a pivotal role in future energy pathways,” Al-Ghais said. He added that OPEC member countries, including Saudi Arabia, are developing clear national electrification plans that align with efforts to reduce emissions.
Sullivan shared a similar perspective, arguing that the future energy landscape should incorporate both traditional and renewable energy systems to ensure energy security. “For energy and economic security, resilience, and reliability, both new and old systems need to be developed. Oil will be needed for a long time to come,” he said.
He concluded: “Saudi Arabia and many in the GCC can also gain by jumping onto the new energy train. If anything, it brings business and economic diversification for a risky future of change.”
ISLAMABAD: Short-term inflation, measured by the Sensitive Price Index (SPI), has risen to 5.08 percent in Pakistan on a year-on-year basis, the country’s statistics bureau said this week, with an increase observed in prices of edible items.
The SPI, which comprises 51 essential items collected from 50 markets in 17 cities, is computed on a weekly basis to assess the price movement of essential commodities at shorter interval of time so as to review the price situation in the country.
The SPI for the week ending on Dec. 26 increased by 0.80 percent as compared to the previous week, according to the Pakistan Bureau of Statistics (PBS). This is the third time short-term has increased in the South Asian country. Weekly inflation last decreased by 0.34 percent in Pakistan in the week ending on Dec. 5.
“During the week, out of 51 items, prices of 17 (33.33 percent) items increased, 10 (19.61 percent) items decreased and 24 (47.06 percent) items remained stable,” it said in a report.
Major increase was observed in prices of chicken (22.47 percent), tomatoes (20.75 percent), sugar (2.19 percent), vegetable ghee 1 kilogram (1.17 percent), firewood (0.95 percent), cooking oil 5 liter (0.74 percent), cooked beef and mustard oil (0.69 percent) each, liquefied petroleum gas (0.18 percent) and washing soap (0.09 percent).
The items that recorded a decrease in prices included onions (8.13 percent), potatoes (2.38 percent), bananas (0.68 percent), rice (0.50 percent) and eggs (0.30 percent).
Pakistan’s annual consumer inflation slowed to 4.9 percent in November, lower than the government’s forecast, according to the PBS. The finance ministry had projected inflation would slow to 5.8 percent-6.8 percent in November and ease to 5.6 percent-6.5 percent in December.
Consumer inflation cooled from 7.2 percent in October, a sharp drop from a multi-decade high of nearly 40 percent in May 2023.
Suzuki Motor former boss Osamu Suzuki, who turned minicar maker into global player, dies at 94
Suzuki was known for his candid remarks and friendliness, calling himself an ‘old guy from a small to mid-size company’
Born on Jan. 30, 1930 as Osamu Matsuda, Suzuki worked in banking after graduating from Tokyo’s Chuo University School of Law
Updated 28 December 2024
AP
TOKYO: Osamu Suzuki, the charismatic former boss of Suzuki Motor Corp. who helped turn the Japanese mini-vehicle maker into a globally competitive company, has died, the company said Friday. He was 94.
Suzuki was known for his candid remarks and friendliness, calling himself an “old guy from a small to mid-size company.” He became CEO of Suzuki in 1978 and was leading the company when it became the first Japanese automaker to start local production in India, where its cars proved hugely popular.
Born on Jan. 30, 1930 as Osamu Matsuda, Suzuki worked in banking after graduating from Tokyo’s Chuo University School of Law. He joined Suzuki Motor, which is based in the central Japanese city of Hamamatsu, in 1958 when he married a daughter of the company’s then-president Shunzo Suzuki, who belonged to the company’s founding family. As is sometimes the custom in such situations, Matsuda adopted his wife’s maiden name.
In 1979, a year after he became Suzuki Motor’s fourth company president, he launched an affordable minicar, which became a big hit and was promoted to world markets.
Under Suzuki’s leadership, the company’s sales grew more than tenfold to 3 trillion yen ($19 billion) in the 2000s.
Suzuki also led business tie-ups with other global leaders such as General Motors and Volkswagen AG in the 2000s. Amid intensifying competition and industrial transformation, Suzuki also formed a capital alliance with Toyota Motor Corp. in 2019 to co-develop self-driving vehicles.
While other Japanese automakers have expanded in the US and Chinese markets, offering a wide range of vehicles, Suzuki has stuck with mini and compact cars, mostly in South and Southeast Asia.
Suzuki stressed the importance of understanding the grassroots level.
“Making good quality and low-price products is the basis of manufacturing,” Suzuki once told an interview with the broadcaster NHK television. “We cannot lower costs while sitting in the offices of president or chairperson, so I have to be in a factory to understand the work and get ideas.”
Suzuki stepped down as president at age 85 in 2015, handing the post to his son, Toshihiro Suzuki. He served as an adviser to the company after resigning as chairman in 2021.
The company said Suzuki died Wednesday of malignant lymphoma.
