Kingdom of Saudi Arabia: An introduction
Saudi Arabia offers significant opportunities for business. In recent years, the government has been taking steps to smoothen the process of setting up and conducting business in the nation. In fact, in 2017, the kingdom was ranked #92 among 190 economies in the world in terms of the ease of doing business by the World Bank.
Bordered by Kuwait to the northeast, Bahrain, Qatar and the United Arab Emirates to the east, Jordan and Iraq to the north, Yemen to the south and Oman to the south-east, the Kingdom of Saudi Arabia was founded on September 23, 1932, by Muhammad Ibn Saud. Saudi Arabia is the 12th largest country in the world, covering an area of nearly 830,000 square miles. The country occupies most of the Arabian Peninsula, the largest peninsula in the world. Riyadh is the capital of Saudi Arabia.
1. A Few Facts and Statistics about Saudi Arabia:
Did you know that the 12th largest country in the world doesn't have even a single river? Saudi Arabia is the biggest of 17 countries in the world operating without a permanent river. However, everybody gets water here. This amazing country is known to explore new methods and techniques to quench the thirst of its 33,000,000 people. Aquifers, underground water storage, and desalinized sea water are the primary sources of water in the kingdom.
A land that is 95% desert, Saudi Arabia is the largest and most important producer of oil in the world. The proven oil reserves in this land are the second largest in the world. Due to the low domestic cost of energy and generous subsidies and incentives, businesses here enjoy substantial cost advantages and quick access to industrial land.This also means that there are a large number of jobs in Saudi Arabia, due to the constant growth and evolution of its economy.
Over the years, Saudi Arabia has also become a popular destination amongst tourists. Every year, countless Muslims visit Mecca, Islam’s holiest city, where Prophet Muhammad was born. There are many other important Islamic sites in Saudi Arabia, which gives us a clear view of this land’s history.
2. Five Essential Tips for Doing Business in Saudi Arabia
Doing business in Saudi Arabia will require you to understand the nation’s deeply conservative culture, custom and etiquette. Saudi Arabia is a predominantly Islamic country, whose state religion is Wahhabism. Nearly 90% of Saudi Arabia’s population comprises Sunni Muslims, while the rest are Shias. However, the kingdom does have a large concentration of ex-pats, maximum of whom reside in Riyadh, the capital of Saudi Arabia.
If you too intend to do business in Saudi Arabia, you’ll have to apply for a Saudi Business Visa; here are a few things you should keep in mind.
Tip #1: Dress Respectfully
Although any kind of business environments does require you to dress appropriate to show respect to your work and co-workers, dress is taken very seriously in Saudi Arabia. People are expected to dress conservatively, with minimal or no skin show. Men are expected to wear long sleeved shirts and long trousers. The dressing rules are very strict for women. Females are required to wear the "Abaya" (long, black cloak) and cover their hair when they are out of their home.
Tip #2: Learn About Islam
“Islam” is a Arabic word that means submission to God to achieve peace.Living and doing business in Saudi Arabia will require you to have knowledge and deep understanding of the essential concepts of Islam. Saudi Arabia is a sovereign Arab State,with a majority of the population following Islam.
Tip #3: Understand Saudi Arabia's Business Methods and Styles
In Saudi Arabia, everything takes time. You cannot expect to plunge straight into business here. Saudi Arabians believe in dedicating time, effort and patience to building relationships and judge whether they can trust a person to do business with. You might need to visit the country personally to help the process along.
In Saudi Arabia, you cannot say no to an invitation. The people here are known for their hospitality and delectable cuisine. Never make the mistake of asking questions about the women in the family.Try to pick safe topics like health, family, home town and activities they like to make conversation. Don’t gesticulate wildly when trying to prove a point. You’ll be considered vulgar and shameless.
Immigration into Saudi Arabia is controlled, with most visitors outside of the Arab peninsula requiring a Saudi Visa inside their passport, which is obtained generally from their locally embassy.
Tip #4: Practice Punctuality
The people here are very particular when it comes to business meetings. Mornings are the preferred time for scheduling a meeting. Business meetings are often not impromptu here and are arranged a few weeks in advance. Remember, the people are very punctual and expect the same from others. However, they allow some flexibility in time and can run late for a meeting sometimes. During business meetings, avoid directly refusing or criticizing. No matter where you are, always be polite and respectful.
Tip #5: Everything Stops for Prayers
When the call to prayer is sounded from the local mosque(five times daily), most people in Islamic nations will stop what they're doing for 10-15 minutes and pray first. However, Saudi Arabia is the only country where everything,including shops, malls, restaurants, cafés, gas stations and many other facilities, shut down for the Muslim call to prayer. You will also have to adopt the same practice while doing business in Saudi Arabia.
In Saudi Arabia, men are not allowed to make contact or interact publicly with a woman who is not his wife or a blood relative. Doing so will be regarded as an offence. In addition, alcohol is illegal here. Homosexual activity is a criminal offense that can attract life imprisonment or even a death penalty.
Saudi Arabia is one of the best destinations to do business. However, foreigners do need to understand that the people here do not tolerate any kind of ignorance towards their culture, religion and practices.
Moreover, Saudis are known to be skilled negotiators and know how to get what they want. It’s better for you to start honing your own negotiation skills, if you want to excel in the local business environment.
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