Jazan Economic City
KUALA LUMPUR, Nov 5, DRB-HICOM Bhd announced that it had signed an agreement Tuesday with the Jazan Economic City Land Limited (JEC), the Saudi Binladin Group (SBG) and GIIG International Holding Company Ltd(GIIG), to explore business prospects in respect of establishing an integrated automotive cluster project.
To be located in the Jazan Economic City in the Jizan Province of Saudi Arabia and called the Jazan Project, it comprises the assembly,manufacturing, production, sales, services, distribution and supply of commercial and passenger vehicles as well as motorcycle, light and heavy vehicles and automotive components.
In a filing to Bursa Malaysia, DRB-Hicom said the Jazan Economic City is located along the Red Sea, 60km north-west of Jizan City, and encompassing 113 sq km.
The economic city focuses on heavy industries, secondary industries, human capital and lifestyle.
Various industries such as a power plant, port, aluminium smelter and steel cluster have also been identified in the approved master plan for the economic city.
DRB-HICOM is an investment holding company with investments in the automotive, defence, services, property and construction sectors.
According to the statement, the parties shall, within one month from the date of the agreement, jointly undertake a detailed study to ensure that the Jazan Project is competitive.
The study is to identify among others, the incentives, grants, exemptions and benefits required from the Saudi Arabian government.It is to completed within 12 months.
DRB-HICOM shall take the lead in the study as well as the Jazan Project.
DRB-HICOM stated that JEC, SBG and GIIG are in the midst of incorporating a joint venture company in Saudi Arabia to undertake and implement the Jazan Project, which includes obtaining the license required from the Saudi General Investment Authority.
The statement said that SBG and GIIG will identify and invite a Saudi local partner for the project.DRB-HICOM on the other hand, will identify an international partner.
On the rationale for the project, the statement explained that the Jazan Project would enable the DRB-HICOM Group to seize opportunities arising from the growing Middle Eastern economies by leveraging on its core competencies in the automotive business sector.
The involvement of DRB-HICOM Group in the Jazan Project will be a significant step forward towards exploring international markets for its automotive sector.
JEC and SBG are Saudi Arabian companies while GIIG was incorporated in the Virgin Islands and is based in Kuala Lumpur.