What Are the Political, Economic, Social and Cultural Challenges That Face Pmg When Entering Saudi Arabia?

Strategic Management

Q: What are the political, economic, social and cultural challenges that face PMG when entering Saudi Arabia?

A:

• Political: Bureaucracy due to the ambiguity of government decisions, problems with applicaltions processed by Saudi authorities, and unrealiable government personal. The local lawyers were at many points of the establishment process, unable to advise us whether the requirements were satisfied or if there were further documents to deliver .

• Economic: Requiring the inclusion of a domestic partner for foreign investment and selling activities in the region. Market deregulation and increased competition. The risk of investing especially Small-and medium-sized companies are often more prone to risk while large-scale enterprises will have more complex financial and organizational arrangements. The unclearness’s communication of Saudi Arabian General Investment Authority (SAGIA).
• Social: The weakened law of Saudization which only requires corporations, employing 20 persons or more. Time is given a lower priority compare to other societies, which can lead to some frustration to westerners. The family is the central institution for most Arabian employees because of Arab are loyal to the circle they belong. Work-related migration from one part of the country to another. The risk factor terms of payment refers to unreliable payment schedules or defaults of payment by local customers for delivered goods and services which impedes the calculation of future cash flows.

• Cultural: Saud Arabia regards the resulting unemployment among young citizens as a problem. Thinking and work ethics is strongly influenced by religious beliefs and long-standing cultural values that date back to Bedouin traditions. The introduction of western work-effectiveness and efficiency metrics e.g. (English commutation, and presentations skills, flat hierarchies, on time execution of tasks, etc.).  Many local employees face problems in the work environment in terms of quality, time and motivation.