Business Travel

Business Customs
The official language of Saudi Arabia is Arabic, but English is
widely used in business and on signs and notices, making it easy
for the non-Arabic speaker to live and work in the Kingdom.
Modern Saudi Arabia has adopted many of the business methods and
styles of the West, but some differences remain.  Most important
is that business will only be conducted after a degree of trust
and familiarity have been established.  Considerable time may be
spent exchanging courtesies, and several visits may be needed to
secure business.  Business visitors should arrange their
itineraries to allow for long meetings, as traditional Saudis
often maintain an "open office" in which they will sign papers,
take telephone calls, and converse with friends or colleagues who
drop by.  Tea, soft drinks, and traditional Saudi coffee are
usually offered.  One to three cups of Saudi coffee should be
taken for politeness, after which the cup should be wiggled
between thumb and forefinger when returning it to the server to
indicate that you have finished.

Many Saudi businessmen have been educated or have traveled
extensively in the West and are sophisticated in dealing with
Americans.  For the most part travelers can rely on the usual
Western manners and standards of politeness to see them through,
with a few additional rules that may be observed.  One should eat
with the right hand and avoid sitting at any time with the sole
of the foot pointed at the host or other guest.  It may be
discourteous to ask about a man's wife or daughters; ask instead
about his family.  Shoes are sometimes removed before entering a
Saudi Majlis (living room).  If you are invited to the home of a
Saudi for a party or reception, a meal is normally served at the
end of the evening, and guests will not linger long after
finishing.  Customs and manners differ, so be observant and adapt
your behavior to that of your host.

Saudi Arabia is a Muslim country that requires strict adherence
to Islamic principles.  Five times a day Muslims are obliged to
pray in the direction of the holy city, Makkah.  The prayer times
are published in the newspaper and come at dawn, noon, afternoon,
sunset, and evening.  Stores and restaurants close for
approximately one-half hour at these times.  When staging
promotional events or product demonstrations, one must anticipate
these prayer breaks.

Dress is conservative for both men and women.  Men should not
wear shorts or tank tops, while women are advised to wear 
loose-fitting and concealing clothing with long skirts, elbow-length
sleeves, and modest necklines.  There is strict gender separation
in the Kingdom and restaurants maintain separate sections for
single men and families.  Wives are often excluded from social
gatherings or are entertained separately.

Business hours vary in different parts of the country.  Saudi
companies usually close for two hours in the afternoon and remain
open through the early evening.  Retail stores close for the noon
prayer and reopen around 4:00 P.M.  The normal work week runs
from Saturday through Wednesday with many companies also
requiring a half or full day on Thursday.  Friday is the Muslim
holy day.

Travel Advisories and Visas
Travelers may not carry alcohol, firearms, pork products,
religious items, or items deemed pornographic into the Kingdom.
On occasion catalogs and videos deemed appropriate in the West
are confiscated if they show men and women socializing together
or in revealing dress.  It is advisable to carry prescription
drugs in their original labeled containers.

Photography of sensitive installations such as airports,
seaports, oil and petrochemical facilities, and military bases is
prohibited, as is photography that constitutes an invasion of
privacy.

Theft or street crime is not a serious problem in Saudi Arabia,
but normal precautions should be taken.

Travel to Saudi Arabia is not allowed without a visa issued with
the assistance of a Saudi sponsor.  Visitor visas are currently
single entry and allow for a maximum 90-day stay.  However, Saudi
authorities may soon agree to issue multi-year, multiple-entry
visas on the basis of reciprocity.  Under present rules, to
obtain a visitor's visa for business purposes, each U.S. company
representative must have a letter of invitation from the Saudi
sponsor.  This letter must be in Arabic, the U.S. applicant must
have the original copy (no faxes allowed), the letter must be on
the Saudi company letterhead, and must bear an authenticating
stamp of the local Saudi Chamber of Commerce.  The visa applicant
must apply for and receive the visa prior to departing the United
States at either the Saudi Embassy in Washington or at Saudi
Consulates in Houston, Los Angeles, or New York City.  Business
travelers should ask their Saudi sponsor whether more streamlined
visa procedures announced in May 1998 have been put into
practice.

The letter should name the visa applicant, passport number,
company name and address, approximate dates of visit, and reason
for visit (e.g. business meetings).  The U.S. visa applicant may
hold the letter for up to 60 days prior to making application.
It is further recommended that the U.S. applicant's company use
the company's letterhead when requesting the Saudi
Embassy's/Consulates' cooperation in issuing the visa.  Once the
visa is stamped on the passport, it must be used or officially
canceled before a subsequent visa will be issued.

The visa may be extended at the discretion of the Saudi Embassy
or Consulate prior to the expiration date.  Occasionally, the
Saudi consular officer may require the applicant to obtain the
visa through a more time-consuming process involving approval by
the Saudi Foreign Ministry.  These procedures are well-known in
the Kingdom and will be handled by the Saudi sponsor.  Women
traveling alone, Americans of Arab origin, and private
consultants are often required to use this process.  Resident
visas also are available through a separate process.

If the U.S. applicant does not have a Saudi sponsor, 
the U.S.-Saudi Business Council may be able to assist 
(Tel: 202-638-1212).
U.S. Commercial Service offices also can advise on how to make
initial contacts with potential sponsors, but cannot arrange
visas for unofficial business travelers.

Contacting the American Embassy and Consulates
Americans arriving in Saudi Arabia are encouraged to register at
the Embassy or Consulates and obtain the most current security
information.  The Embassy in Riyadh is located at Collector Road
M, Riyadh Diplomatic Quarter.  The international mailing address
is:  P.O. Box 94309, Riyadh 11693, Saudi Arabia.  The APO address
is:  American Embassy, Unit 61307, APO AE 09803-1307.  The
Embassy telephone number is (966)(1) 488-3800; the fax number is
(966)(1) 488-7275.

The Consulate General in Jeddah is located on Palestine Road,
Ruwais.  The international mailing address is:  P.O. Box 149,
Jeddah 21411, Saudi Arabia.  The APO address is:  Unit 62112, APO
AE 09811-2112.  The telephone number is (966)(2) 667-0080; the
fax number is (966) (2) 669-3078.

The Consulate General in Dhahran is located between Aramco
headquarters and Dhahran International Airport.  The
international mailing address is:  P.O. Box 81, Dhahran Airport
31932, Saudi Arabia.  The APO address is:  Unit 66803, APO AE
09858-6803.  The telephone number is (966)(3) 891-3200; the fax
number is (966)(3) 891-6816.

Holidays
There are two Islamic religious holidays around which most
businesses close for at least three working days and all
Government offices close for a longer period.  During these
holidays, it is very difficult to make contacts and transact
business.  The Eid al-Fitr holiday occurs at the end of the holy
month of Ramadan (month of fasting).  Eid al-Adha celebrates the
time of year when pilgrims arrive from around the world to
perform the Hajj.  Their timing is governed by the Islamic lunar
calendar.

In 1999, the Eid al-Fitr holiday will begin on or about January
18 and the Eid al-Adha holiday on or about March 27.

Business travel to the Kingdom during the holy month of Ramadan
is also best avoided.  During Ramadan devout Muslims abstain from
food and drink during daylight hours.  Office hours are shortened
and shifted to the evening, and people may be affected by the
fasting and customary late night social gatherings.  During
Ramadan business travelers should not drink, eat, or smoke in
public during daylight or in the presence of fasting Muslims.
Hotels offer special daytime food services for their non-Muslim
guests.  In 1999, Ramadan will start on or about December 19,
1998 and end on or about January 17, 1999.  The Saudi national
day is celebrated September 22.  Almost all businesses and
Government offices remain open on this day, with the notable
exception of Saudi Aramco.

Business Infrastructure
The business centers of Riyadh, Jeddah, and Dammam/Al-Khobar/Dhahran 
each have an international airport served by a
variety of international airlines.  Air travel is preferred for
inter-Kingdom travel with public service restricted to the sole
national airline, Saudia.

The Kingdom has a good highway system and rental cars and
taxis/limousines are available at all airports; 
driving is U.S.-style, on the right.  
One rail line carries passengers and
freight between Dammam and Riyadh.  Jeddah and Dammam are the
main international seaports for moving containerized and bulk
cargo.

Modern communication facilities are available including
telephone, fax, telex, and courier services.  
U.S. database log-on is available through a PTT Ministry trunk 
line service, Al-Waseet.  
In addition, a number of agreements have already been
signed between various U.S. Internet service providers and Saudi
companies to launch the service in Saudi Arabia.   Use of private
satellite communication transponders is not allowed.  Facsimile
machines are heavily utilized in the conduct of business.  A
cellular phone system based on the GSM standard is operational,
while radiophones are restricted.  The Government is embarking on
a large-scale telecommunication upgrade program, and the shortage
is expected to be resolved by the end of 2002.  Internet service
is expected to be operational by year-end 1998.

Four and five star hotel accommodations are readily available in
the major business centers, and many of the better restaurants
are located in the hotels.  There are many excellent restaurants
in the three major population centers.  Well-known American fast
food restaurants are also very popular.  The food reflects the
diversity of the country's expatriate population and generally
can be considered safe.  Use of bottled water is preferred
although most tap water is potable in the major cities.
Supermarkets are well stocked with Western products.

Housing for expatriate employees residing in the Kingdom is
usually provided by the employer or through a housing allowance
given to the employee.  The major cities offer a wide variety of
houses and apartments for rents considered high by U.S.
metropolitan standards.

Most Western expatriates live in housing compounds that provide
additional services such as cable television, recreation
facilities, child care, limousine services for women (who are not
allowed to drive in the Kingdom), and security.

The quality of health care is variable, ranging from excellent to
poor depending on the region, hospital, and specialty.  Most
Western expatriates find it adequate for routine care and minor
surgery.  Only a few drugs available in the U.S. may not be
available in Saudi Arabia.

There is a good network of private American schools serving
communities with a high concentration of U.S. expatriates,
including all the major business and industrial centers.

The schools offer only grades K-9 as Saudi Government policy
requires expatriate children to receive their high school and
college education outside the Kingdom.

Temporary Entry of Goods
Temporary entry of goods is allowed provided that a guarantee of
12 or 20 percent of the value of the goods is deposited with
Saudi Customs.  A document and/or a  participation agreement is
needed to ascertain that the owner of the goods is officially
participating in a trade show.  If the goods are meant for
demonstration purposes to a Government entity, a letter from that
entity is required indicating the nature and purpose of the
goods.  The deposit will be reimbursed after Saudi Customs
attests that the goods have left the Kingdom.  Reimbursement may
take somewhere between two to four weeks.

Information on Typical Product Pricing Structures
A rate of exchange of the dollar to the riyal has been set at
3.7450 since 1987, a competitive dollar value compared to the
Japanese and European currencies, and reasonable interest rates
have greatly facilitated market penetration.  Thanks to this,
Saudi importers expect U.S. producers to practice a more stable
pricing policy than their foreign competitors.

Products are usually imported on a CIF basis, and mark-ups depend
almost entirely on what the vendor feels that the market will
bear relative to the competition.  There is no standard formula
to come up with the mark-up rates for all product lines at
different levels of the relatively short distribution chain.
Pricing is very important to the average Saudi.  Therefore, where
there are competitive products, Saudi buyers frequently will
compare prices before making a buying decision.

Stability of prices has been a policy of the Saudi Government for
years, and after rising to five percent in 1995 as a result of
the utility and gas rates hikes, inflation was down 0.4 percent
for the 12-month period ending in December 1997.

For the U.S. supplier, some give-and-take is expected in
preliminary negotiations.  The asking price is usually lowered
slightly to attract the client.