Since Saudi Arabia was selected to host the World Expo 2030 on 28 November, Chinese investors have been flocking to the kingdom looking for steel investments, Kallanish learns from investigation.

"Chinese steel companies' profit margins in China and their subsidiaries in Southeast Asia and the Far East, especially in recent years, have been eroded, so they were looking for new investment opportunities in the fossil fuel-rich Gulf Cooperation Council member states," opines an investment adviser and consultant in China.

The consultant will accompany senior officials of a Chinese steel company which specialises in pipemaking during a visit to Saudi Arabia to examine investment in the steel sector, with the trip scheduled for early April.

Saudi Arabia has the largest population, land area and highest GDP of any GCC country. Its Vision 2030 includes mega-projects for new cities, tourism resorts, recreational sites, infrastructure and transportation projects, renewable energy growth and the expansion of non-oil industries.

Led by government agencies and leading companies such as Aramco, many investment decisions in the steel sector and electric and combustion engine car manufacturing have been sealed and moved forward since the beginning of 2022. Also, since the West tightened sanctions on Russia due to its invasion of Ukraine, off-shore and on-shore drilling activities ramped up, and many water transportation and gas and oil pipeline projects have been awarded in the kingdom.

These have played a role, but Expo 2030 has now brought a new and robust motivation for steel investment, attracting Chinese tube and flat steel producers to invest in Saudi Arabia. They are encouraged by the country's initiatives to create an investment-friendly business environment and geopolitical rapprochement between China and the kingdom. Since early 2022, non-oil economic growth-oriented joint ventures have been established with major companies in the automotive and steel sectors.

A senior steel company official asks Kallanish: "I want to understand why four Chinese steel companies have visited me in the past two weeks to form a partnership or JV in the tube-making sector. What was their driving motivation that coincided in the past two weeks?"