Sourcing in China for KSA metalworking industry

 China's vast mineral wealth makes it a veritable resource for global steel, metal, aluminium and metalworking equipment industries and its huge domestic requirements make it also the world's biggest market.
 Given the robust growth of its economy, China plays a balancing act between servicing its substantial domestic needs and maximising its potential as a leading exporter to the rest of the world. Its exports have been tapering off as the world's economy teeters, but investment and domestic consumption remained strong.
 China remains the largest market for machine tools, followed by Japan, Germany and the United States. While it is becoming more self-sufficient in the machine tool industry, it still lags far behind the export powerhouses of Japan and Germany in technology and quality.
 Sales growth of machine tools in China is seen averaging above 10% to reach Rmb850 billion (US$134 billion) by 2015. Its heavy industries, in particular, the automobile, aviation, energy, shipbuilding and railroad construction industries will drive the demand for machine tools.
 China, being the largest consumer and major producer of aluminium, remains the growth engine for the global aluminium industry. Its aluminium demand outstripped the domestic supply in the last few years. The growth has been driven by rapid industrialisation, economic growth and growth in the end-user segment.
 It is expected that from 2008 to 2018, the aluminium industry in China will grow by 12.5% outpacing the global industry growth of 7% for the period. But many experts are now predicting China will gradually become a net importer of the metal with shortages seen as high as 5 million tonnes by 2015.
 The Chinese construction industry continues to boom. It uses half the world's concrete and a third of its steel for its numerous ambitious projects and spends about US$375 billion (16% of GDP) on construction.
 Rapid urbanisation and a construction boom has also been driving steel consumption in the Kingdom of Saudi Arabia, one of China's biggest trading partners in the Middle East.
 Economic growth and rising investments in property and reliable gas and energy supply have also substantially raised domestic consumption. These have fuelled the consumption of iron and steel in the Kingdom to reach around 14.8 MMT in 2009.
 At present, the steel industry in Saudi Arabia is highly import oriented. In 2008, it imported around 6.3 MMT of steel, accounting for majority of domestic steel consumption.
 Saudi Arabia's trade with China is seen to exceed US$60 billion by 2015 with growth in the past years ranging from 30 to 50%.
 China exports textiles, mechanical and electrical products to Saudi Arabia, and imports crude oil, which led to a huge trade surplus in favour of Saudi Arabia.
For Saudi companies planning to source from China, the potential to obtain cost savings because of the country's lower cost base, particularly for labour is a major advantage. One can use the "China price" to negotiate reduced prices from existing domestic suppliers.
Impressive economic growth throughout the years has given rise to a new Chinese middle class with increasing purchasing power. Saudi companies can take advantage of this and see China not only as a cost-saving solution but also as a new source of revenue.

 Chinese Visa Schedule of Fees
(in Saudi Riyals)
● Single Entry Visa 250. Double Entry 380. 6-month Multiple Entry 500. 12-month Multiple Entry 750.
● Express Service additional 80 (3-day service)
The Chinese Embassy in Riyadh is no longer accepting Chinese Visa application from Saudi citizens and foreign residents in Saudi Arabia. Applicants should apply for Chinese or Hong Kong visa through the Chinese Competitive Spirit Co. and Alsandross International Est. for visa service.
Service fee of two visa agenAir Jordan