Recently, the Saudi Arabian branch of Chengdu Building Materials Industry Design and Research Institute Co., Ltd. (referred to as "the Saudi Arabian branch of Chengdu Building Materials Institute"), a wholly-owned subsidiary of Sinoma International Engineering Co., Ltd. (referred to as "Sinoma International"), has officially signed the General Contract for Design, Construction, Procurement and Erection of the Lenovo Project with Lenovo (KSA) Innovation Technology (SILZ) LLC. The contract amount is tentatively set at US$263 million (approximately RMB 1.85 billion), including a fixed total price of US$261 million and an estimated furniture supply cost of US$2.6 million. This EPC (Engineering, Procurement, and Construction) general contracting project marks another important breakthrough for Chinese enterprises in the field of high-end manufacturing in Saudi Arabia. The Saudi Arabian branch of Chengdu Building Materials Institute will build a consumer electronics manufacturing base for Lenovo in the Special Integrated Logistics Zone of King Khalid International Airport in Riyadh, Saudi Arabia.

The project covers the entire process including license application, design and engineering, equipment procurement, construction, testing, and commissioning, and is expected to be completed no later than August 31, 2026. The new factory covers an area of approximately 200,000 square meters. In the initial stage, it will have an annual output of 2 million PCs and servers, and the planned output will be increased to 9 million units in the later stage. It will provide localized services for the Middle East and Africa (MEA) market.

The Deep Background of Lenovo's Layout in Saudi Arabia

This project is an important part of the strategic cooperation between Lenovo Group and Alat, a subsidiary of the Saudi Arabian Public Investment Fund (PIF).

On January 8, 2024, Lenovo announced the achievement of a cooperation agreement worth US$2 billion with Alat, including the issuance of zero-coupon convertible bonds and warrants, raising approximately US$212 million. Subsequently, the two parties officially established a partnership in May 2024. Lenovo plans to set up the MEA regional headquarters in Saudi Arabia and build a manufacturing base.

According to a report in the Financial Times, this cooperation not only provides financial support for Lenovo but also highly aligns with Saudi Arabia's goal of economic diversification under the "Vision 2030". It is expected to create thousands of job opportunities.

On February 9, 2025, Lenovo and Alat held a groundbreaking ceremony for the new manufacturing base in Riyadh, marking the project's entry into the substantive implementation stage. The Wall Street Journal pointed out that after the factory is put into operation, it will produce PCs, desktops, and AI servers, helping Lenovo to consolidate its position in the Middle East market.

Giovanni Di Filippo, President of Lenovo's Infrastructure Solutions Group for Europe, the Middle East, and Africa, said at the LEAP 2025 Technology Conference that this base will cover the countries of the Gulf Cooperation Council (GCC) and the African market, replicating Lenovo's successful global manufacturing model.

Strategic Significance under the Tariff War

Currently, the Sino-US trade friction and the intensification of global tariff barriers have put multinational enterprises' supply chains under the pressure of reconstruction.

According to an analysis by Bloomberg, Lenovo's choice to build a factory in Saudi Arabia is not only a consideration of costs and the market but also an active response to geopolitical risks. As an economic hub in the Middle East, Saudi Arabia enjoys a superior geographical location and lower trade barriers, which can effectively avoid the tariff restrictions of the European and American markets.

The South China Morning Post commented that Lenovo's move demonstrates the flexibility and forward-looking vision of Chinese enterprises in their global layout.

At the same time, Saudi Arabia's "Vision 2030" promotes the localization of the manufacturing industry, attracting high-tech enterprises including Lenovo to settle in. Sinoma International's winning of this bid not only reflects the international competitiveness of Chinese infrastructure enterprises but also injects new momentum into the economic cooperation between China and Saudi Arabia. According to a report by Xinhua News Agency, the cooperation between China and Saudi Arabia under the framework of the Belt and Road Initiative has been deepening in recent years, and this project is a microcosm of the mutually beneficial and win-win cooperation between the two sides. (This article is from the official website of Seetao.com, www.seetao.com. No reprinting is allowed without permission. Otherwise, legal liability will be pursued. If reprinting, please indicate Seetao.com + the original text link.) Editor of the Strategic Column of Seetao.com / Yin Shiqian