Explication détaillée du taux de localisation en Arabie saoudite

The Local Content (LC) policy of Saudi Arabia is an important part of its "Vision 2030" strategy, aiming to promote economic diversification, reduce reliance on oil, facilitate the development of local industries, and create job opportunities. The following is a comprehensive analysis of the background, requirements, impacts, strategies for improving the localization rate, and failed cases of this policy.

Policy Background and Objectives: Saudi Arabia's local content policy is led by the "Local Content and Government Procurement Agency" (LCGPA), which was established in 2019 and is responsible for formulating and implementing policies and regulations related to local content. Local content is defined as the total expenditure generated within Saudi Arabia through the use of local labor, goods, services, assets and technologies. 

1.The core goals of this policy include:

• Increasing employment opportunities for Saudi citizens
• Promoting the development of local manufacturing and service industries,
• Enhancing the self-sufficiency of the national economy
• Reducing reliance on imported goods and services

Regarding the policy on localization rate, Saudi Arabia has a dedicated official website for detailed information:

2.Policy Requirements and Implementation Mechanism According to the regulations of the Saudi government, all government agencies and state-owned enterprises must give priority to local content in the procurement process. 

Specific requirements include:

Local content score:

• Suppliers are required to submit local content scores when bidding. Some projects have a minimum local content threshold.
• Mandatory local product list: For products with an adequate number of local suppliers, government agencies must purchase local products and prohibit imports.
• Small and medium-sized enterprises (SMEs) are given priority: State-owned enterprises should give priority to local SMEs when making purchases and report the usage of local content to LCGPA.
• Local content mechanism: This includes introducing local content requirements in the government Procurement Law, aiming to guide the country's purchasing power through local content, SMEs and strategic partnerships.

3.Calculation method of Saudi Localization rate

The localization rate (Local Content, LC) is calculated according to the following general formula: LC (%) = (Local expenditure ÷ Total Expenditure) × 100%

Where: Local expenditure: Expenditure generated by using local resources within Saudi Arabia, including:

• Saudi citizen wages
• local raw material procurement
• local service expenditure
• products manufactured in Saudi Arabia
• local asset investment (equipment, plants, etc.),
• local research and development expenditure.
• Total expenditure: The total amount of all expenditures incurred to complete the product/service (including import content)

4.How to Fill in Local Content in Supplier Bids？

 If you are a company that supplies goods to state-owned companies such as SEC (Saudi Electricity Corporation) or SABIC (Saudi Basic Industries Corporation), you need to fill in the LC score sheet when bidding:

Then, the localization rate = (5,400,000 ÷ 7,400,000) × 100% ≈ 72.97%

5. Some cases

Saudi owners have clear requirements for localization and qualifications in the bidding process. For some projects, they tend to prefer contractors who cooperate with local Saudi companies to participate in the bidding. Chinese-funded enterprises often have an advantage when they can offer quotations significantly lower than those of local enterprises in bidding projects that are highly specialized or for which local Saudi companies do not have the qualifications to participate, or in regular projects. For instance, a Chinese-funded enterprise held a quotation advantage in the bidding process of a certain large-scale project, but ultimately failed to win the bid due to a relatively low localization rate score.