Apple and Amazon In Talks to Enter Saudi Arabia
Apple and Amazon are in licensing discussions with Riyadh on investing in Saudi Arabia, two sources confirmed, part of Crown Prince Mohammed bin Salman's push to give the conservative kingdom a modern, high-tech look.
Amazon’s discussions are reportedly being led by cloud computing division Amazon Web Services (AWS), as the company seeks to compete in a market currently dominated by smaller local providers such as Mobily and STC.
A third source confirmed that Apple was in talks with SAGIA, Saudi Arabia's foreign investment authority.
Both companies already sell products in Saudi Arabia via third parties, but they and other global tech giants have yet to form a direct presence.
A licensing agreement for Apple stores with SAGIA is expected by February and an initial retail store targeted for 2019. Meanwhile, Amazon’s talks are at an earlier stage and no specific date has been set for investment plans, though.
Apple already holds second place in the Saudi mobile phone market behind Samsung, according to a market researcher.
Amazon acquired Dubai-based online retailer Souq.com earlier in 2017, opening access for Amazon retail goods to be sold in the kingdom.
Both companies declined to comment, while SAGIA was not immediately available to answer questions about the discussions.
Riyadh has been easing regulatory barriers for the past two years, including limits on foreign ownership, which had long kept investors away, since falling crude prices highlighted the need to diversify its oil-dependent economy.
Luring Apple and Amazon would further Prince Mohammed's reform plans and raise the companies' profile in a young and relatively affluent market, which already boasts some of the highest internet and smartphone use in the world.
About 70 percent of the Saudi population is under 30 and frequently glued to social media.
BWorld Finance provides you the latest and most up-to-date news about companies and the market. We provide useful insights about finance and business. Check us out at bworldfinance.com. Also, register an account now with BWorld and start your investment journey.