Saudi Arabia inks $5.6bn deal with Chinese EV brand Human Horizons

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Saudi Arabia’s Ministry of Investment has signed a $5.6bn (SAR21bn) deal with Chinese electric car maker Human Horizons to set up an automotive research, development, manufacturing, and sales joint venture.

The deal accounts for more than half of the $10bn investment agreements that were signed on the first day of an Arab-China business conference in Riyadh across different industries including technology, renewable energy, agriculture, real estate, metals, tourism and healthcare.

Prince Faisal bin Farhan bin Abdullah Al Saud, Saudi Arabia’s Minister of Foreign Affairs said the forum outlines methods for achieving mutual compatibility, exchanging experience and launching new opportunities that enable growth and investment.

Business-to-business deals that were signed on the sidelines of the event include a $533m deal between the AMR ALuwlaa Company and Zhonghuan International Group (Hong Kong) to build a factory to reduce iron ore and manufacture iron pellets for smelting plants in the kingdom.

Saudi Arabia’s ASK Group and the China National Geological & Mining Corporation inked a $500m cooperation agreement to develop, finance, construct and operate an Arabian Shield copper mining project.

The #ArabChinaConference sets the stage for growth & innovation with the signing of 23 MoUs, in the presence of HE @Khalid_AlFalih @MISA, across key sectors including tourism, energy, manufacturing & telecoms. Witness the significant moments of partnership that will shape… pic.twitter.com/RFSGXUyifY

— Arab China Business Conference (@ArabChinaConf) June 11, 2023

Mabani Al- Safwah, China Gezhouba Group International Engineering Company and Top International Engineering Corporation Arabia also signed a $266m framework agreement to advance building construction in the country.

Meanwhile, in addition to the deal with Human Horizons, Saudi Arabia sign several agreements including a $266m deal with Hong Kong-based Android developer Hibobi Technology to develop tourism and other apps.

The foreign ministry also facilitated a $250m deal between Saudi railway firm SABATCO and Chinese state-owned rolling stock manufacturer CRRC to manufacture rail wagons and wheels in the Gulf state.

Saudi Arabia’s ministries of industry, mineral resources and Chinese industrial manufacturer Sunda signed a $150m deal to produce soda, chlorine and derivatives, chlorinated paraffin, calcium chloride, polyvinyl chloride and related conversion products in the country.

Saudi Arabia- China business ties

Meanwhile, the deals that were signed at the China-Arab forum come as Riyadh and Beijing have stepped up their bilateral relations beyond energy amid a push to boost investments in non-oil sectors.

China’s foreign direct investment in the Arab world totalled $23bn in 2021 with $3.5bn invested in Saudi Arabia.

Last month, Saudi Aramco and Public Investment Fund (PIF) signed an agreement with Chinese steelmaker Baoshan Iron and Steel Company (Baosteel) to build a steel plate manufacturing complex in Saudi Arabia.

The steel production facility has a designed annual capacity of 2.5 million tonnes of direct reduced iron and 1.5 million tonnes of steel plate. Baosteel will reportedly own a 50 per cent stake in the joint venture, while Aramco and PIF will take a 25 per cent stake each.

Aramco, the world’s biggest oil producer, agreed to acquire a 10 per cent stake in China’s oil refining giant Rongsheng Petrochemical for $3.6bn in March – a deal that significantly expanded the energy giant’s refining presence in the country.

The oil company’s refining venture in China, Huajin Aramco Petrochemical Company, also unveiled plans to start the construction of a major integrated refinery and petrochemical complex in China’s northeastern Liaoning province in Q2 2023.