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Exporting to Saudi Arabia, opportunities and requirements

Exporting to Saudi Arabia, opportunities and requirements

Exporting to Saudi Arabia is proving to be an interesting opportunity for Italian companies that want to expand internationally. Exports to the country are also favored by the relations between Italy and Saudi Arabia, which are in fact expanding and consolidating on various fronts.

Italy aims to establish a strategic partnership with the nation as well as with United Arab Emirates, extending cooperation to sectors such as renewable energy, digital and space, and taking advantage of the investment opportunities offered by Saudi Vision 2030. This ambitious reform program aims to transform the Saudi economy, reducing dependence on hydrocarbons and promoting a services- and knowledge-based economy. Particular attention is paid to tourism and the role of start-ups and SMEs in sectors with high added value.

Vision 2030 is therefore driving an economic transformation that offers numerous benefits, including the development of local production chains, large infrastructure projects and a young and growing population. Furthermore, the favorable business environment and tax advantages make Saudi Arabia an attractive destination for Italian companies seeking new international partnerships.

In 2023, Italian exports to Saudi Arabia are increased by 19%, reaching 4.9 billion euros, while Saudi imports decreased in 20%, reaching 5.9 billion euros due to the drop in oil prices.

This positive trend underlines the strategic importance of the Saudi market for Italian products, which are gaining market share compared to other European suppliers.

Among these, Italy ranks second, behind Germany but ahead of the United Kingdom, France and Spain.

Export to Saudi Arabia

 

Export to Saudi Arabia: what you need to know

Saudi Arabia is a member of the G20, which is a testament to its global economic importance. Its strategic geographical position, located between Europe, Asia and Africa, undoubtedly offers privileged access to these markets.

The Italian exports to Saudi Arabia are remarkably diversified, covering a wide range of sectors including chemical-pharmaceuticals, furniture, fashion and agri-food. The technology transfer is particularly popular, with machinery, transport vehicles, electrical and medical equipment accounting for almost 50% of overall exports.

Italian exports to Saudi Arabia, what are the prospects?

The increase in infrastructure and urban planning investments, in line with the mega-projects of Vision 2030 and the constant demographic increase (2% per year, exceeding 36 million inhabitants), suggests future growth in exports in the construction and design sectors. Other promising sectors include healthcare, with growing demand for pharmaceuticals and medical equipment, and fashion, where the Made in Italy continues to be a point of reference for Saudi consumers, especially among young people.

The business environment in Saudi Arabia is continually evolving, with reforms making business easier and attracting foreign investment. The country offers significant tax advantages, including no personal income tax, a 20% corporate income tax rate and a 15% VAT rate. Numerous agreements to avoid double taxation, including those with Italy, are in force. Furthermore, the country provides incentives for the import of materials and equipment necessary for new productive investments, facilitates obtaining visas and supports joint ventures and the localization of activities.

The certifications necessary to sell in Saudi Arabia

To export to Saudi Arabia it is essential to obtain certifications that meet specific requirements.

Since 2019, the country has replaced the Certificate of Conformity with the SABER Conformity Assessment Certificate. As part of the SALEEM product safety program, the Saudi Standards, Metrology and Quality Organization (SASO) introduced the electronic platform SABER. This initiative aims to simplify import procedures, reduce the entry of counterfeit products and ensure compliance with Saudi technical regulations and standards.

Consequently, importers are required to use the SABER electronic platform to register products and obtain the respective certificates of conformity.

The process involves the issuing of two main certificates:

  • Product Certificate of Conformity (PCoC): declaration of conformity for the product subject to the Regulation.
  • Shipment Certificate of Conformity (SCoC): Certificate of shipment compliance for the product

 
Let's see them in detail.

Selling in Saudi Arabia

 

Release of the Product Certificate of Conformity (PCoC)

The Product Certificate of Conformity (PCoC) is issued for each regulated product in accordance with the standards specified in technical regulations relevant and is valid for one year. The main steps to obtain the PCoC are as follows:

  • PCoC Request: The importer submits the request for the Product Conformity Certificate.
  • Entering information: Product information is added into the system by entering Saudi Customs tariff codes.
  • Choice of Certification Body: there is the possibility of choosing a Certification Body among those accredited by SASO (Comformity Assessment Bodies – CABs).
  • Fee Payment: The importer makes the fee payment for the PCoC.
  • Conformity check: the Certification Body evaluates the conformity of the product and presents the supporting documentation and the results of the checks.
  • Release of the PCoC: The PCoC is released via the SABER electronic platform.

 

Issuance of the Shipping Certificate of Conformity (SCoC)

For each regulated product included in the shipment, the validity of the Product Certificate of Conformity (PCoC) is verified. If confirmed, the Shipping Certificate of Conformity (SCoC), valid exclusively for that specific shipment.

The main steps in obtaining it are:

  • Request for the Shipment Certificate of Conformity (SCoC) from the importer.
  • Payment of the SCoC fee.
  • Check and confirm the validity of the PCoC for the product
  • Release of the SCoC.

 

The technical regulations cover several product categories, including lubricating oils, detergents, building materials, paints, elevators, vehicle components and textiles.

It is not necessary to use the SABER platform to export products such as cosmetics, perfumes, cigarettes, cigars, other tobacco products and pesticides. For these goods not subject to technical regulations, it is possible to request a self-certification and a Shipping Conformity Certificate via SABER.

The requirement of a bar code on packaging

As of January 1, 2020, all goods intended for export to Saudi Arabia must have a barcode on the packaging, which can be applied directly to the outer packaging or via stickers.

The barcode must consist of 13 digits and must be easily scannable. The rules for its creation are established by the manufacturer and may vary depending on the type of product or series of products.

With the right strategy, Italian companies can fully exploit the potential of the Saudi market, which offers a wide range of business and investment opportunities. Strengthening bilateral relations between the two countries can promote significant growth for Italian companies in an extremely dynamic context.

Octagona, with over twenty years of experience in strategies internationalization of companies, is able to provide the necessary support to companies wishing to export to Saudi Arabia and explore new opportunities.

Contact us for more information.

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