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Chinese firm wins $263m Saudi Lenovo plant contract

15 April 2025

 

Chinese firm China National Materials International Engineering (Sinoma) has won an estimated $263m contract to build a manufacturing facility in Riyadh for Chinese computer maker Lenovo.

The manufacturing facility will be constructed on a 200,000 square-metre site at the Special Integrated Logistics Zone at King Khalid International airport in Riyadh.

The plan is for the construction works to be undertaken in two phases, both of which are expected to be operational by 2026.

The project’s first phase involves the construction of the first plant building, main office building, warehouses, other buildings and associated infrastructure.

The second phase covers the construction of the second plant building and other associated buildings.

MEED understands that the proposals for the project, known as the Oasis Project, were submitted on 10 February.

The tender notice was issued on 3 January.

According to local media reports, Alat, a subsidiary of Saudi Arabia’s Public Investment Fund (PIF), and Lenovo broke ground on the manufacturing facility on 9 February.

Lenovo secured a $2bn investment deal with Alat to manufacture computer devices in the kingdom in January.

In May 2024, Lenovo signed a collaboration agreement with Alat to set up a manufacturing facility in Saudi Arabia.

The funding will also support Lenovo in establishing a regional headquarters for the Middle East and Africa market in Riyadh. The headquarters will include customer centres, research and development centres, and manufacturing facilities for personal computers and servers.

In February last year, the PIF unveiled its $100bn capital-backed company Alat, which aims to transform Saudi Arabia into a global hub for electronics and advanced industries. 

The company aims to create 39,000 direct jobs and achieve a direct non-oil GDP contribution of $9.3bn in Saudi Arabia by 2030.

It was reported that Alat would have seven business units focusing on areas such as semiconductors, artificial intelligence, next-generation infrastructure, and smart appliances and smart buildings.

According to the PIF, Alat will manufacture more than 30 product categories, including robotic systems, communications systems, advanced computers and digital entertainment products, as well as advanced heavy machinery used in construction, building and mining.

Alat is expected to focus on providing sustainable manufacturing solutions for international companies by accessing clean energy resources in Saudi Arabia to reach carbon-neutral goals by 2060, while the PIF’s own goal is to be carbon-neutral by 2050.

According to GlobalData, China is the largest producer of laptops, manufacturing a significant portion of the world’s supply. In recent years, it has faced challenges due to supply chain disruptions, including the impact of the Covid-19 pandemic and geopolitical tensions, particularly affecting markets like Ukraine and Russia.

Following China, the US also plays a crucial role in laptop production, with major companies like Dell and HP operating extensively within the country. South Korea, Japan and Taiwan are also notable players in the laptop manufacturing sector.

South Korea is reported to produce about 20% of the global supply of semiconductors, which are essential for laptop production, while Taiwan is recognised for its advanced semiconductor manufacturing capabilities. Additionally, India is working to enhance its domestic laptop production, although it currently imports over 80% of the laptops in use.

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Yasir Iqbal

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