An Analysis of the Promotion of Taiwan Products in the Saudi Arabian Market

Saudi Arabia is Taiwan’s largest trading partner in the Middle East and primary crude oil supplier. Its sovereign territory covers 2,250 thousand square kilometers, which is the largest among the Middle Eastern countries, and is approximately 62 times larger than that of Taiwan’s. Its population is approximately 30,770 thousand, gross domestic product is ranked first among all Middle Eastern countries, and per capita income exceeds USD 20 thousand—making it the largest economy in the Middle East. More importantly, Saudi Arabia’s oil reserve and oil production are both globally ranked among the best. It is veritably the largest consumer market in the Middle East, and possesses a great deal of potential for marketing. Because Saudi Arabia’s financial budget relies heavily on oil revenues, in order to reduce its reliance on oil, Saudi Arabia’s government has continually throughout the years promoted industry diversification and labor Saudization policies, invested heavily in basic infrastructure and social benefits, and planned the establishment of 6 new economic cities throughout the nation; an investment totalling USD 120 billion, providing immense business opportunities. Chiefly, the launch of the “2016-2020 National Transformation Program” and the “Saudi Vision 2030 National Development Plan”, which have recently received much attention, plan to sell partial shares of Saudi Aramco in order to establish a sovereign wealth fund with a scale of USD 2,000 billion to support the government’s finances, facilitate emerging industries, and develop industries such as manufacturing, technology, tourism and mining. For companies around the world, the aforementioned agenda indisputably is considerably attractive. In terms of Taiwan’s current foreign trading conditions, China, Europe, North America, and Japan are traditionally Taiwan’s primary exporting markets. However, due to factors such as the recent stagnation of global trading, inadequacy of industry transformation, excessive reliance on China’s market and competition from the red supply chain, Taiwan has experienced a decline in foreign trading since the previous year for 16 consecutive months, which is the longest record of reduction since the financial crisis of 2008. In pursuance of exploring new markets for exports and avoiding over concentration in a single market, Taiwan’s government is currently promoting a new southward policy in anticipation of strengthening trading ties with South East Asia & India and improving the structure and diversity of its foreign trades. Although Saudi Arabia is located in the Middle East, the country is now actively engaging in economic integrations with South East Asia and East Asia. For example, Saudi Arabia in the name of GCC has entered into a Free Trade Agreement (FTA) with Singapore and also joined the Asian Infrastructure Investment Bank (AIIB) launched by China. If Taiwan’s government and Taiwanese companies seize this opportunity and utilize this trend, not only may the South East Asia market and the Middle East market be integrated, but also Saudi Arabia may act as a bridge for further exploits into the European, African, and Middle Asia markets. Thus, this research was brought about in order to improve Taiwan and Saudi Arabia’s economic relationship and expand market shares, while the purpose of this research was to find suitable products for sale and applicable marketing strategies in Saudi Arabia. This research plans to investigate and analyze papers concerned with Taiwan’s current status of exports to Saudi Arabia, source and product structure variation of Saudi Arabia’s imports, overview of Saudi Arabia’s industry development, and Taiwan’s primary markets and product structure for exports, as well as to formulate and disclose suitable products for sale in Saudi Arabia’s market for Taiwan; moreover, through the aspects of analyzing market strategies of Saudi Arabia’s trading partners as well as global and Saudi Arabia marketing strategies of Taiwan, meeting and inquiring with companies in person, participating in various seminars, and examining the impact of FTAs signed by Saudi Arabia with major countries to Taiwan’s export products, this research aims to provide marketing strategies for Taiwan applicable to Saudi Arabia’s market and provide comprehensive recommendations in hope of facilitating companies in Taiwan with intentions of exploiting Saudi Arabia’s market.