Saudi food security and investment abroad

Amal Abdulaziz Al–Hazani
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Saudi Arabia is a desert country. Its water resources are limited: either the waters of the Red Sea and the Arab Gulf or the groundwater replenished by similarly limited rainwater. The Ministry of Environment, Water, and Agriculture has estimated annual rainfall in the Kingdom at 103 mm and the annual precipitation volume at 166 billion cubic meters, of which 8 billion cubic meters come in the form of floods. Even in the intermittent heavy rain seasons, Saudi Arabia tries to conserve dam water through its 521 surface reservoirs and groundwater dams. Still, this issue warranted more comprehensive solutions. So, how did the Saudi government act?

With such a vast surface and a population of nearly 35 million people, decision-makers needed an effective, sustainable strategy to ensure the provision of agricultural supply, especially wheat and barley. The Kingdom has previous experience in both wheat and barley cultivation, but this experience was more harmful than beneficial as it drained the groundwater through well digging.

The experiment failed, but it was vital to realizing the importance of taking a more realistic approach to food security. Who can believe that Saudi Arabia used to export wheat to a country like Egypt or flowers to the Netherlands? What a bizarre situation. In short, we benefited from the experience, and perhaps the biggest lessons learned are that realizing ambitions should be a multifaceted plan and that goals must be achieved with minimum damage.

The government’s new idea was to choose countries with rich agricultural activity to import its basic needs, foremost of which is wheat, from them without compromising quality. The Saudi Grains Organization (SAGO) acts as the buyer on behalf of the government. It is no secret that the purchase and transport costs are high, but the damage from local wheat cultivation would be even higher.

With this innovative new strategy, the government transferred agricultural activity to other countries from which crops are then imported. Furthermore, the government established the Saudi Agriculture and Livestock Investment Company (SALIC), whereby agricultural land in supplier countries, such as Ukraine and Australia, as well as countries in the EU and the Americas, is owned by Saudi investors who cultivate crops according to SAGO specifications and in SAGO-defined quantities before exporting them to the Kingdom. In other words, the supplier is the Saudi government and the exporter is the Saudi private sector.

This smart and vital strategy spearheaded the objectives of securing food supplies and preventing shortages in markets or interruptions in the food pipeline due to environmental or political reasons. This is evident from the government’s decision to select states from all the world’s continents. The private sector’s involvement in the industry was remarkable, and Saudi ports in Jeddah, Yanbu, Dammam, and Jazan now receive pre-scheduled shipments from Australia, Europe, America, and elsewhere.

Though agriculture and livestock investment abroad was the best strategy the government adopted to achieve food security in the Kingdom, local agricultural activity and livestock raising have not stopped. However, crops like wheat and barley, which are considered basic needs, required expansion in terms of agriculture, hence the opportunity given to Saudi investors abroad as government partners to meet this need and achieve public benefit.

This article was originally published in, and translated from, the pan-Arab daily Asharq al-Awsat.

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Disclaimer: Views expressed by writers in this section are their own and do not reflect Al Arabiya English's point-of-view.
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