Most people around the world think that all Saudi exports are measured in barrels. It is remarkable how few realize that there is more to the Saudi economy than oil, let alone that Saudi products are becoming known worldwide. Even more remarkable, many in the Kingdom are unaware of it as well. They may know something about Saudi petrochemical production and exports — but air-conditioners, pipes, steel and cement? They are exported, along with a growing number of other products.
Nor is the Kingdom’s growing manufacturing clout limited to the domestic arena. “How many people know that a lot of Saudi companies have gone beyond the frontiers and set up elsewhere?” asks Abdul Rahman Al-Zamil, whose own Zamil group now manufactures in several countries. “Amiantit is in Europe and Latin America. We are in Vietnam and India, Saudi Basic Industries Corp. (SABIC) is all over the world.”
Of the Top 100 Saudi companies, 20 percent are now international operations, he says. “Some have gone international by themselves, some have done so in partnership with other companies.” The Saudi private sector cannot be compared to that anywhere else in the Middle East, he says. It is a remarkable success story. It is far more dynamic, far more globally focused.
That is because, thanks to its managerial skills and professionalism, it is dominant in its own market. Saudi plants can stand up to the best foreign competition, he says. The Japanese, the Americans, the Europeans never thought that Saudi Arabia would be the major manufacturing base it has become. “Despite their brand appeal, foreign products are unable to compete with Saudi products in the domestic market,” he says. Saudi business has learned not just to survive but to flourish — and, says Al-Zamil who is also chairman of the Saudi Export Development Center, look to the wider world markets.
The Zamil group is itself a prime example of Saudi entrepreneurial flair, of “a local company gone international,” as Al-Zamil puts it.
A trip to Vietnam is proof of that. Landing at Hanoi airport one of the first things one sees, even while taxiing to the terminal, is a factory next the airport bearing the Zamil logo.
Zamil Steel saw the opportunities in Vietnam at the beginning of the 1990s when the country was in the first stage of industrialization. That led to the setting up of a representative office in Ho Chi Minh City in 1993 and then, in 1997, Zamil Steel Vietnam was established to manufacture pre-engineered steel buildings for use as factories, warehouses, workshops, showrooms, hangars, schools, sports halls, supermarkets, office buildings, car parking sheds — virtually anything that required one-, two- or even three-story buildings. Today, Zamil Steel dominates the steel structure industry in Vietnam and from there exports to Japan, China, Korea and Southeast Asia. A second plant near Ho Chi Minh City (formerly Saigon) opens next year. The company is probably the leading steel supplier in the region, according to Al-Zamil — and highly appreciated too. When there were floods in Vietnam a few months ago, “Zamil Steel buildings were left standing; others were damaged,” he said. So far it has sold thousands of steel buildings and the names of its customers read like a list of global super-industries: Bechtel, Procter & Gamble, General Electric, Coca-Cola, Pepsi Cola, Toyota, Nestle, BMW, Mitsui, Mitsubishi, Sanyo, Toshiba, Shell, LG, DaimlerChrysler and many more.
Whether it is in Egypt (where Zamil Steel also manufactures and plans further expansion), the UAE (further expansion also planned), India (there is a new steel buildings plant near Mumbai) or China (a new plant is planned), there is an aggressive, “go-get” ethos driving Zamil’s international presence. The aim is to go where Zamil can dominate the market. “We will build plant in any market where we can dominate,” he says.
Within the Kingdom, Zamil is mostly known for air-conditioning, steel and glass, activities mostly coming under Zamil Industrial Investment Company, listed on the Tadawul. There are several other operations within the wider group, however: Plastics, IT, construction and architectural materials, the National Power Company, Zamil Travel, industrial maintenance, coatings, partitions, foodstuffs. But, as with the rest of the country, the future is seen in hydrocarbon. “Zamil has made a strategic decision to concentrate on downstream,” Al-Zamil told Arab News. Zamil is already a founder shareholder in Saudi International Petrochemical Company (now publicly listed) and in Sahara Petrochemicals (established in 2004); the chairman of both is Abdul Aziz Al-Zamil. Both are involved in mega developments in Eastern Region. Another Zamil move into petrochemicals is the joint venture with Huntsman for a world-scale ethyleneamines manufacturing facility in Jubail, to be operational in 2009. A contract was signed earlier this month with California-based Jacobs Engineering for the development of the new complex. The Zamil Group has also just signed an agreement with Connecticut-based Chemtura Corporation to study the construction of a joint venture aluminum alkyls plant at Jubail.
Al-Zamil is bullish about both the group’s achievements and Saudi Arabia’s. Both have been “incredible,” he says. Petrochemical companies are queuing up to set up shop in the country; it will, he believes, become the dominant force worldwide in petrochemicals. Likewise, the group, which once had to rely on foreign technologies has developed its own and has established research centers in the UAE, Jordan, Egypt and India. It is a face of Saudi enterprise not just at home but abroad as well. Some of that success may be due to the Aramco-inspired work ethic; even in Riyadh the noticeably unpretentious company offices testify to a lean, no-nonsense approach, where business comes first. It is a business that is going from strength to strength.
