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SAUDI ARABIA - Industry

Majed Rafed Al-Argoubi

CEO, MODON

Bio

Engineer Majed R. Al-Argoubi is one of Saudi Arabia’s leading executive leaders with over 23 years of experience in the public and private sectors in a number of areas, most notably executive management, capital project management, infrastructure and logistics projects and public-private partnerships. The engineer Majed R. Al-Argoubi’s expertise also extended to many vital sectors in the Kingdom, most notably the energy, transport, logistics and construction sectors. Majed R. Al-Argoubi holds a master’s degree in business administration from the Arab Academy of Science and Technology with honors, and a bachelor’s degree in mechanical engineering from King Fahd University of Petroleum and Minerals with honors.​

"Since its inception in 2001, MODON has positioned itself as an ideal destination for business growth and investment."
TBY talks to Majed Rafed Al-Argoubi, CEO of MODON, about the National Industrial Strategy (NIS), SMEs in Saudi Arabia, and products on offer.
MODON plays a vital role in shaping Saudi Arabia’s industrial landscape. Could you please share with us the evolution of MODON and the objectives it aims to achieve?

Since its inception in 2001, MODON has positioned itself as an ideal destination for business growth and investment. We started with our core mandate to develop industrial lands and integrated infrastructure, and, as such, we assumed a relevant regulatory role. With the growth of our business from managing an initial 33 mil. m2 to the current 200 mil. m2, came an expansion of our scope and capabilities, and our cities became increasingly successful in nurturing industrial growth. Easily available industrial land at very affordable prices (starting at 0.3$ per m2) and 1,263 ready-built factories (RBF) are paired with financing solutions, high livability standards, Industry 4.0 and Smart Cities programs, logistics solutions and, last but not least, long-term regulatory stability and a simplified set of procedures. For example, obtaining a construction permit in MODON takes on average five business days. In line with the success of the Kingdom in terms of the ease of doing business and digital transformation, and with the objectives of the Smart Government Strategy, our service delivery embraces the principles of digitization, short response times and customized experience, and relies on a complex portfolio of partnerships with various public and private stakeholders. Ideally illustrating this very point, MODON’s partnership with the Saudi Industrial Development Fund (SIDF) develops a series of financing products allowing investors to apply for bank financing and for allocation of MODON products via one single window. All our products and services are accessible through the appropriately named “Shareek” portal (Partner in Arabic) where tenants can apply according to their needs and strategy and collaborate with MODON on a wide range of matters relevant to them. Our success is reflected in the increasing share of value-added companies attracted and retained in MODON as well as in the diversification of activities. We aim to enable further revolution of the manufacturing in KSA and help framing the country as the most important industrial and logistics hub in the region.

How is MODON positioned to support KSA’s National Industrial Strategy (NIS)?

MODON provides land and infrastructure in the 36 industrial cities it manages in all provinces of Saudi Arabia, and incentivizes localization of successful business ventures, emergence of clusters, streamlining of domestic value chains and integration into globalized ones. We have reached 6,000 factories in MODON and we aim to increase our role in supporting new factories enabled by the NIS. We facilitate innovation-based productivity growth, while maintaining job creation as a priority target. Tenants in MODON have created over 500K jobs in the last 20 plus years. Our Oases Cities, dedicated to light industry, are situated close to urban agglomerations, and provide a lot of services to local entrepreneurs. In May 2023, our Oasis in Qassim was awarded the title of best business initiative by the local government. Over 1,200 foreign enterprises are present in MODON, some in several cities. We enjoy a favorable international reputation as a welcoming ecosystem providing access to exceptional opportunities on the Kingdom of Saudi Arabia and international markets.

SMEs are the backbone of any economy. How is MODON facilitating the growth of the SME ecosystem in KSA?

the availability of logistic solutions, and innovation facilities and services, are only the most obvious advantages that SMEs enjoy when locating in our industrial cities. We enhance this potential further with dedicated products and services and continuous and seamless process of support. Our functional business ecosystem addresses the main pain points of SME growth in Saudi Arabia and elsewhere: high upfront capital investment (through the availability of RBFs), integration into value chains (through a dedicated B2B platform, InDeal), access to finance (through dedicated financing products), skilling (through the presence of training centers), and so on. Majority of our clients are SMEs, with many success stories. They cover a multitude of profiles and sectors, from the socially motivated investor to the top innovator.

What are your specific ambitions and what are you currently working on?

MODON’s priority is to accommodate significant future industrial growth, with available developed land, increased sophistication, and outstanding delivery of our services. We aim to double the offer of RBFs within a few years and reach different segments of enterprises. MODON’s portfolio has included until 2022 RBFs of 1,500 m2 and 700 m2, currently extending the offer with smaller (350 m2) units, a multistory factory, and even 225 m2units for workshops in engineering, repair and maintenance, and laboratories. A particular ambition of my leadership is to increase the share of projects implemented through PPPs. We already have PPPs ranging from the provision of basic services such as water, to RBFs, medical centers, laboratories, and an internal mechanism to identify opportunities for PPP. Several projects in MODON are worth singling out. We are designing and developing the biggest Food Cluster in the World, equipped with facilities and amenities, including R&D and labs, and accommodating crucial parts of the supply chain. MODON has attracted data centers in several industrial cities, and several bonded zones. The Smart Cities program, started in 2017 is currently focusing on supporting and complementing Industry 4.0 applications, enabling AI, and tracking the products along the value chain as well as reducing environmental footprint. We also plan to continue our highly successful National Productivity Program (NPP) which provided in its first phase Industry 4.0 transformation plans to 100 factories and will reach a total of 400 lighthouse factories inspiring others to embrace digital transformation. A recent white paper was published by C4IR-WEF that showcases the NPP effort to boost the Industrial Sector.

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