Business and Entrepreneurship in Saudi Arabia. Burton Edward

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СКАЧАТЬ thanks to Mr. Richard Debs, advisory director of Morgan Stanley, member of its international advisory board, and chairman of Morgan Stanley Saudi Arabia, for his invaluable encouragement to me in this project and commentary on my manuscript. And, a special thanks to Lyn Doverspike for her encouragement and support.

      About the Author

      Edward Burton has actively advised thousands of companies engaged in international trade and investment in markets around the world for over 35 years. He currently serves as chief executive officer and president of the U.S. – Saudi Arabian Business Council, the premier U.S. – based private-sector organization promoting trade and investment between the United States and the Saudi Kingdom. Mr. Burton has counseled hundreds of Fortune 500 companies as well as thousands of small and middle-tier firms during the course of his professional career. Having lived and worked in Saudi Arabia as an American diplomat in the U.S. embassy in Riyadh, and the U.S. consulates in Jeddah and Dhahran, Mr. Burton has a unique insider's knowledge about the country, its business community, and how business gets done in the Kingdom.

      Mr. Burton is a frequent speaker at roundtables and panel discussions across the United States, Saudi Arabia, and the Gulf Cooperation Council (GCC) on Saudi Arabia's trade relations. He has had numerous television interviews and articles published by recognized industry magazines such as Fortune, Offshore magazine, Water World, and Nuclear Power International.

      Mr. Burton has accumulated over 27 years of experience in trade promotion and international business development. Before joining the Business Council, Mr. Burton served as the commercial attaché at the American embassy in Riyadh, Saudi Arabia. He managed a staff of 27 officers, commercial specialists, and other local direct hire personnel serving offices in the cities of Riyadh, Jeddah, and Dhahran. He was responsible for all U.S. Foreign Commercial Service (USFCS) operations in Saudi Arabia and had oversight of all USFCS management, administrative, and fiscal matters in the U.S. embassy and consulates in the Kingdom. He also supervised USFCS operations in Manama, Bahrain, through a partnership arrangement with the U.S. embassy in Manama. Mr. Burton was also appointed directly by former U.S. Commerce Secretary Donald Evans to serve as the USFCS regional coordinator for the agency's Iraq reconstruction regional initiative.

      Earlier in his career, Mr. Burton was the U.S. Department of Commerce Network Director of the U.S. Export Assistance Center (USEAC) in Philadelphia and as such had primary management responsibility for USEAC offices in seven northeast U.S. states. Before joining the U.S. department of commerce, he served former New Jersey Governor Christine Todd Whitman as the State of New Jersey's international trade director.

      Mr. Burton holds a bachelor of arts degree in political science from the University of Charleston and a doctor of jurisprudence degree from the Dickinson School of Law. He practiced law in New Jersey with the law firm Cooper Levenson. He also received certified international trade and management training at the Thunderbird School of International Business and the Harvard Business School of Publishing.

      Introduction

      There are many, many Saudi business people whom I greatly admire, few more than Sheikh Abdulrahman Al-Jeraisy, chairman of the Jeraisy Group, one of Saudi Arabia's most well-known and accomplished businessmen. His story and rise to the Kingdom's upper echelon of the Saudi corporate community is both instructive and illustrative of where Saudi Arabia has been and where it is going.

      Surely young Abdulrahman Al-Jeraisy could barely contain his sense of excitement and wonderment since the decision by his family was finally made to have him travel from his ancestral home in Raghbah to begin a young boy's life in the capital city of Riyadh with his uncle, Mohammad Bin Abdulrahman Al-Jeraisy. At the age of seven, he began the two-day journey to Riyadh by camel from Raghbah, 75 miles northwest of the capital city. The year was 1940. The trip to the city that would help define many of his personal and professional successes is one that has been made by scores of original founders, first-generation owners, and leaders of many of Saudi Arabia's most recognized family-owned businesses. The arduous journey from noble and humble villages and towns across Saudi Arabia, usually by camel or donkey in those days, but sometimes by car or truck, was one taken by many of today's corporate and government leaders whose names are instantly recognizable to those familiar with the Kingdom. So, the story of Sheikh Abdulrahman Al-Jeraisy, one of Saudi Arabia's most well-known and respected businessman, and the sights and sounds experienced during his journey to Riyadh is a notable one. It is noteworthy not only because of the compelling contrasts between modest beginnings and great achievements in business and in life over many decades for one man, but also because it is illustrative of the rapid rise of the city that young Abdulrahman walked through as a boy and the city Riyadh has become. Sheikh Abdulrahman Al-Jeraisy is one of many men in Saudi Arabia who have built some of the world's most successful family-owned businesses from scratch whose foundations have been built on dedication to Allah, family, and hard work. The captains of industry atop most of the Kingdom's family-owned businesses discussed in this book share these common values.

      As he moved closer to Riyadh, young Abdulrahman and his traveling companions seemed to be elevated from the vastness of the desert landscape, wadis (valleys, ravines, or channels that are dry except in the rainy season), and the foreboding pervasiveness of barren rock mountain ranges to a hilly dominated expanse of green trees and gardens drawing closer. They passed the date farms and orchards that led to the city of Riyadh. Soon, young Abdulrahman saw the great mud wall that encircled the city. The sights and sounds of the city, the circulation of people through its narrow streets, lines of merchant kiosks, and multi level dwellings soon dominated all that was visible. In 1940, the year of Abdulrahman's journey to Riyadh, the city had been the official capital of the Kingdom of Saudi Arabia for only eight years.

      Riyadh's modern history is closely associated with two dates, 1902 and 1932. The first, 1902, was the year in which King Abdul Aziz Bin Abdul Rahman Al-Saud reclaimed the city and launched his three-decade effort to unify the tribes of the Arabian peninsula. The second, 1932, saw the establishment of the modern Kingdom of Saudi Arabia and the beginning of a new era when the city was elevated to the status of capital city of a nation, covering most of the peninsula. The three intervening decades were a period of slow but steady growth for the city. The Riyadh of 1902 was no more than a mile across. It consisted of the Masmak, the citadel that was also the seat of government, a large mosque, a spacious marketplace, and several hundred houses, all built of mud brick. The entire city was surrounded by a thick mud wall ranging as high as 25 feet. The city's famous date gardens were mainly located outside the walls. Sheikh Abdulrahman recounts the story of his youth in Riyadh that when the end came for Isha prayer, the night-time and last of the daily prayers recited by practicing Muslims, the city would shut itself for the night by closing the main city gates to those outside.

      The Riyadh of the time of young Abdulrahman's arrival is not the Riyadh of today. In 1940, there were no overhead electricity transmission lines, no power stations, or state power regulator. No light bulbs were to be found in most Saudi homes, mosques, or commercial establishments. If one had looked in earnest, electricity could have been found in some of the palaces of the royal family. Electrical power generation and the mass distribution of electricity came to the Kingdom and Riyadh in 1951 with the establishment of the Kingdom's first public utility, the Riyadh Electricity Company. Responsible for building this power infrastructure were American companies Bechtel (then known as Bechtel Brothers McCone) and Thomson-Houston Electric Company (a merged entity with Societe Alsacienne de Constructions Mecaniques, which formed the French headquartered company Alsthom, today known as Alstom, which built the first gas turbine in 1951.) Following the European Union's final approval, General Electric, an American global powerhouse in the Saudi market, acquired Alstom in late 2015.

      At the time of Sheikh Abdulrahman's journey to Riyadh, the capital had fewer than 30,000 inhabitants and an economy that was primarily composed of merchant and agrarian commerce and local government. Today, the city of Riyadh has 5.7 million people and a population growth rate of 4 percent per annum. Its economy is one of the most industrially diverse in the Middle East, with real estate, manufacturing, СКАЧАТЬ