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First Apple Store in Saudi Arabia is expected to be made in 2019

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Author Published 1:30 PM

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Apple and Amazon are in discussions with Riyadh on investment in Saudi Arabia. This is part of Crown Prince Mohammed bin Salman plan to turn the conservative kingdom forward.

The third informant confirmed that Apple was in talks with SAGIA, Saudi Arabia's foreign investment agency. Both Apple and Amazon are currently selling their products in Saudi Arabia via third parties, it's just that, they and other big technology companies - have not officially entered the country.

The Amazon discussion is led by cloud computing division Amazon Web Services (AWS), which can make the competition in the cloud market more stringent. Now, the cloud market in Saudi Arabia is still controlled by local players like STC and Mobily.

Over the past two years, Riyadh has been trying to overhaul its regulations, including the restrictions on foreign ownership that has long since discouraged investors from entering the country.

The reason is because oil prices are down and Saudi Arabia, which has been dependent on oil, should be able to find other sources of income. Pulling Apple and Amazon into Saudi Arabia is part of Prince Mohammed plan for reform.

It will also benefit both companies, given Saudi Arabia is a relatively young market with people showing interest in smartphones and the internet. About 70 percent of Saudi citizens are under 30 and often use social media.

The license agreement for Apple Store with SAGIA is expected to come out in February, with the first retail store planned to be built by 2019. While discussions with Amazon are still in its infancy. 

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