Saudi Arabia

01

Overview

Saudi Arabia is Canada's largest trading partner in the Arab world and one of the most consequential bilateral relationships in Canadian foreign and commercial policy — a relationship defined by tension between significant commercial opportunity and serious human rights concerns. The Kingdom holds approximately 17% of global proven oil reserves, produces roughly 9–10 million barrels per day, and is using the revenues from that production to fund a state-directed economic transformation under Vision 2030 that represents one of the largest sustained government investment programs in the world.

For Canadian companies, Vision 2030 creates procurement opportunities across cleantech, agri-food, technology, healthcare, education, and infrastructure that did not exist a decade ago and will not exist in the same form a decade hence. Saudi Arabia is actively seeking foreign expertise and foreign products to build domestic industrial capacity in sectors where it currently has none. Canadian companies are positioned to compete — through CETA-equivalent MFN access, through TCS Riyadh, and through the Canadian Arab Business Council — but must navigate a bilateral political context that is genuinely complicated.

The complication is direct: Canada's 2018 diplomatic crisis with Saudi Arabia — triggered by Canadian foreign ministry tweets criticizing the arrest of human rights activists — resulted in the expulsion of the Canadian ambassador, the cancellation of new Saudi students coming to Canadian universities, and a Saudi threat to sell Canadian assets. The crisis was not fully resolved before the 2018 murder of journalist Jamal Khashoggi in the Saudi consulate in Istanbul, which deepened international scrutiny of the Saudi government and created ongoing pressure on Canadian arms export policy. Canada has sold hundreds of millions of dollars of light armoured vehicles (LAVs) to Saudi Arabia through a General Dynamics Canada contract. The contract's continuation has been contested in Canadian courts and Parliament. This context is not separable from the commercial relationship — it is part of it.

02

Political Context

GovernmentAbsolute MonarchyAl Saud royal familyDe facto rulerCrown Prince MBSMohammed bin SalmanFTA with CanadaNoneMFN terms under WTODiplomatic statusNormalizedPost-2018 crisis resolvedOPEC+ roleSwing producerLargest OPEC+ memberG20 membershipYesSince founding in 1999

Crown Prince Mohammed bin Salman (MBS) has consolidated political authority to a degree unprecedented in modern Saudi history, centralizing decision-making, sidelining rival princes, and using Vision 2030 as the organizing framework for both economic reform and political control. His leadership style — combining genuine modernization in some areas (women's right to drive, entertainment sector opening, reduced religious police powers) with severe repression in others (the Khashoggi murder, imprisonment of women's rights activists) — creates a coherent picture for Canadian policymakers and companies: this is a reforming autocracy, and the commercial opportunity is real, as is the human rights risk.

Saudi Arabia's foreign policy is simultaneously diversifying away from exclusive US alignment — through its 2023 China-brokered normalization with Iran, its growing engagement with Russia on OPEC+ production decisions, and its pursuit of strategic autonomy — while remaining dependent on US security guarantees and Western technology for its military and economic transformation. Canada occupies a secondary but non-trivial position in this picture: significant as an arms supplier (the LAV contract), growing as a technology and agricultural supplier, and relevant as a Western voice on human rights that Saudi Arabia has occasionally singled out for criticism.

03

Vision 2030 — Where the Money Is Going

Vision 2030 is Saudi Arabia's state-directed economic diversification program, launched in 2016 under Crown Prince MBS. Its stated goals are to reduce the economy's dependence on oil revenues (currently ~60% of government revenue), increase non-oil GDP to 50% of total by 2030, raise the private sector share of GDP from 40% to 65%, increase foreign direct investment from 3.8% to 5.7% of GDP, and create millions of non-government jobs for Saudi nationals. The program is funded primarily by the Public Investment Fund (PIF), which manages approximately $770 billion in assets and is the primary vehicle for Vision 2030 capital deployment.

For Canadian exporters, Vision 2030 creates procurement demand in six specific areas where Canada has relevant capacity. Agri-food is the most immediate: Saudi Arabia imports approximately 80% of its food and is actively investing in food security through long-term supply agreements, agricultural land investments abroad, and domestic food processing. Canadian agri-food exporters — wheat, barley, pulses, processed foods — have a structural market in Saudi Arabia that Vision 2030 is deepening rather than reducing. Water and environmental technology is a second area: Saudi Arabia faces severe water scarcity (per capita water availability is among the lowest globally) and is investing in desalination, water recycling, and efficiency technology at scale. Canadian cleantech and environmental engineering companies have participated in Saudi infrastructure procurement and this market will grow. Healthcare and life sciences is the third: Saudi Arabia is building domestic healthcare capacity and importing medical technology, pharmaceuticals, and hospital management expertise as part of Vision 2030's health sector targets.

The NEOM megaproject — a $500 billion planned linear city in the northwest of the country — is the most visible symbol of Vision 2030's ambition and its contradictions. NEOM's procurement is real and enormous, covering construction technology, smart city infrastructure, renewable energy systems, and transportation. Canadian engineering and technology companies have been approached for NEOM procurement. The contradiction is that the land on which NEOM is being built was the ancestral territory of the Huwaitat tribe, members of which were forcibly displaced — with documented killings and imprisonments of those who resisted. Engagement with NEOM procurement requires a deliberate corporate decision about risk tolerance that goes beyond commercial analysis.

Agri-foodSaudi Arabia imports 80% of food. Long-term supply agreements for Canadian wheat, barley, and pulses. Vision 2030 food security programs increase procurement stability.Cleantech / WaterDesalination, water recycling, and efficiency technology. Saudi Arabia invests billions annually in water infrastructure. Canadian environmental engineering has established presence.Healthcare & Life SciencesMedical technology, hospital construction, pharmaceutical supply. Vision 2030 targets domestic healthcare capacity — imports are transitional demand.Education & TrainingSaudi Arabia sends students to Canada and imports curriculum and institutional partnerships. Canadian universities have active Saudi programs.Technology & DigitalSmart city infrastructure, cybersecurity, fintech. Saudi Vision 2030 digital economy targets create procurement for Canadian tech companies.NEOM InfrastructureEnormous procurement — but requires deliberate corporate human rights risk assessment given displacement of Huwaitat communities. See Bilateral Tensions section.04

Bilateral Trade

Total bilateral tradeC$4B (2024, Statistics Canada)CAD, 2024 (StatCan)Canadian exports$2.5BCAD, 2024Canadian imports$1.3BCAD, 2024 (primarily refined petroleum)Trade balance+$1.2BCanadian surplusTrade agreementNone (MFN/WTO)No preferential accessTrend (5-year)Growing+28% since 2019

Canada's exports to Saudi Arabia are dominated by defence equipment (light armoured vehicles, aircraft components), agri-food products (wheat, canola, pulses), machinery and industrial equipment, and pharmaceutical products. The defence equipment component makes headline trade figures politically sensitive — the LAV contract alone represents hundreds of millions of dollars annually that is simultaneously a commercial success and a reputational liability for the Canadian government and General Dynamics Canada.

Canadian imports from Saudi Arabia are primarily refined petroleum products, which is an anomaly — Canada is an oil exporter importing refined Saudi petroleum — that reflects refining capacity mismatches and regional logistics rather than strategic dependence. Bilateral investment is growing: Saudi sovereign wealth through PIF has invested in Canadian technology and resource companies, and Canadian pension funds (notably CPPIB) have invested in Saudi infrastructure assets.

05

Opportunity Assessment

Saudi Arabia's commercial opportunity for Canadian exporters is real, growing, and concentrated in specific sectors. The agri-food opportunity is the most structurally durable: Saudi food import dependence is not a Vision 2030 target — it is a geographic and hydrological reality that will persist regardless of Vision 2030's success or failure. Canada's ability to supply bulk agricultural commodities and processed food products at scale and quality positions it as a preferred supplier, particularly as Saudi Arabia diversifies away from dependence on any single source country.

The cleantech and water technology opportunity is the most underutilized relative to Canadian capacity. Saudi Arabia's water infrastructure investment is enormous and ongoing, Canadian environmental engineering firms have the relevant expertise, and the TCS Riyadh office has active commercial programs supporting Canadian companies in this sector. The barrier is market complexity — Saudi procurement processes for major infrastructure contracts are lengthy, relationship-dependent, and require in-country presence or a local partner.

Healthcare represents a medium-term opportunity tied to Vision 2030's timeline. Saudi Arabia is building hospitals, training healthcare workers, and importing medical technology as part of its domestic healthcare development targets. Canadian medical device companies, hospital management firms, and pharmaceutical exporters are active in this space, but the market requires SFDA (Saudi Food and Drug Authority) registration and local distribution partnerships that represent a meaningful market entry investment.

06

Bilateral Tensions — The Honest Assessment

The Canada-Saudi Arabia relationship requires honest engagement with facts that the commercial opportunity framing tends to minimize. Three issues are not resolvable through diplomatic management and are relevant to any Canadian company's market entry assessment.

Issue 1 — The Arms Export QuestionCanada's General Dynamics Canada contract to supply light armoured vehicles (LAVs) to Saudi Arabia has been contested since 2018 on the grounds that the vehicles have been used in Yemen, where Saudi-led coalition forces have been implicated in civilian casualties documented by UN investigators. The Canadian government has reviewed and continued the contract, citing economic costs of cancellation and contractual obligations. Canadian courts have reviewed export permit decisions without overturning them. This is a live political issue in Canada, not a resolved one. Canadian companies entering the Saudi market — particularly in defence-adjacent sectors — will be asked about their position on this question by investors, partners, and journalists.Issue 2 — Human Rights and the Khashoggi PrecedentThe 2018 murder of journalist Jamal Khashoggi in the Saudi consulate in Istanbul was assessed by US intelligence to have been ordered by Crown Prince MBS. The Canadian government condemned the murder and called for accountability. Saudi Arabia has not produced accountability in a form that international human rights organizations or most Western governments consider adequate. For Canadian companies, this creates a reputational risk that is not bounded by the specific commercial activity being contemplated — association with Saudi government-directed projects carries the association with the government's human rights record.Issue 3 — Vision 2030's Human CostVision 2030 megaprojects — particularly NEOM — have involved forced displacement of communities, documented killings, and imprisonment of those who resisted relocation. This is not alleged — it is documented by Human Rights Watch, Amnesty International, and Saudi government court records. Companies engaged in NEOM procurement are participating in a project whose land was acquired through what international human rights law would characterize as forced displacement. This is a business decision, not only an ethical one, given the reputational and legal risks under emerging supply chain due diligence frameworks in Canada, the EU, and the UK.

The honest commercial assessment: these tensions do not eliminate the Saudi market opportunity, but they define the terms on which it can be engaged. Canadian companies that are active in Saudi Arabia and manage their positioning carefully — focusing on agri-food, water, healthcare, and education rather than defence and megaproject infrastructure — can participate in Vision 2030 procurement without the same reputational exposure. Companies that have made this calculation are present and active in the market. Companies that have not made this calculation explicitly are making it implicitly through their market engagement decisions.

07

Risk Register

08

Corruption & Compliance Risk

TI CPI 202456 / 100Rank #48 globallyFATF StatusRegular ProcessNot grey/blacklistedWB Rule of Law55th pctileWorld Bank 2023Control of Corruption65th pctileWorld Bank 2023PEP ScreeningMandatory EnhancedRoyal family & state-linkedCTI Compliance RatingHigh RiskAs of Q1 2026

Saudi Arabia presents a high compliance risk for Canadian companies, driven by the opacity of government contracting, the dominance of royal family and state-connected commercial networks, and the absence of independent rule of law for commercial dispute resolution. Vision 2030 spending is channelled through ARAMCO, PIF, NEOM, and line ministries — all of which involve politically sensitive counterparties. While the anti-corruption campaign launched by Mohammed bin Salman (2017 Ritz Carlton detentions) reduced one form of elite extraction, it created a different compliance risk: the concentration of commercial decision-making in a small circle around the Crown Prince, reducing but not eliminating bribery at other nodes while creating opacity at the top.

PEP screening must be applied rigorously — virtually all significant Saudi counterparties have royal family connections or ministerial relationships that constitute PEP adjacency. Canadian companies must also be cognizant of human rights risks under the CFPOA's corruption provisions and Canada's Sergei Magnitsky Act obligations. FATF compliance is adequate. CTI rates Saudi Arabia High Compliance Risk requiring enhanced due diligence, senior-level compliance oversight, and legal counsel experienced in GCC commercial law before and during engagement.

09

Diaspora and People Flows

The Arab-Canadian community is approximately 700,000 strong, with a significant Saudi Arabian and Gulf Arab component concentrated in the Greater Toronto Area, Ottawa, and Metro Montreal. The Saudi component specifically is smaller — perhaps 50,000–80,000 Saudi nationals and Saudi-Canadians — but disproportionately represented in the educational and professional sectors given the historical pattern of Saudi government scholarship programs sending students to Canadian universities.

The Saudi student presence in Canada fluctuated significantly with the 2018 diplomatic crisis, when the Saudi government cancelled its scholarship program sending students to Canadian institutions. This was a significant financial impact for Canadian universities and a sharp reduction in people-to-people connections. The scholarship program was partially reinstated as bilateral relations normalized, but at lower volumes than pre-2018. The diaspora connection in Saudi Arabia's case operates differently from high-volume immigration countries: the relevant network is not a settled diaspora but a professional and educational alumni network — Saudis who studied or worked in Canada and maintain commercial and personal ties.

Remittance flows from Saudi Arabia to Canada are not significant in the direction they flow in most bilateral relationships — Saudi Arabians in Canada are primarily students and temporary residents rather than a permanent settlement diaspora. The relevant people flow for commercial purposes is Canadian professionals working in Saudi Arabia, particularly in engineering, healthcare, education, and project management roles connected to Vision 2030 infrastructure projects.

🤝Canadian Arab Business Council (CABC)Primary Canadian business organization for Arab world market engagement. Covers Saudi Arabia, UAE, and broader MENA. Organizes trade missions and provides member introductions to in-market partners. cabc.ca →10

Entry Points — Where to Start

🇨🇦Trade Commissioner Service — RiyadhCanada maintains a full Trade Commissioner office at the Embassy in Riyadh with sector-specific officers covering agri-food, cleantech/infrastructure, technology, and healthcare. The TCS Saudi Arabia team has active procurement intelligence on Vision 2030 programs and can provide qualified introductions to Saudi government procurement offices and private sector partners. Book a market briefing before any commercial engagement in the Kingdom. TCS Saudi Arabia →🏢Canadian Arab Business Council (CABC)Provides trade mission support, member networks, and introductions to Saudi Chambers of Commerce (the primary in-country business organization). CABC organizes periodic trade missions to Riyadh and can facilitate first meetings with Vision 2030 program offices that are difficult to access cold. cabc.ca →💰Export Development Canada — Middle EastEDC has active Saudi Arabia and Gulf programs covering political risk insurance, buyer credit for Saudi purchasers of Canadian goods, and accounts receivable insurance. For companies engaged in large Vision 2030 infrastructure contracts, EDC's bonding and surety capabilities are often required by Saudi government procurement rules. EDC Middle East →📋CanExport SMESaudi Arabia qualifies as a CanExport target market. The program funds market research, trade show participation (including Saudi mega-events like the Future Investment Initiative), and export contract development. Up to $50,000 non-repayable. CanExport SME →📌 NoteSaudi procurement processes require a local agent or partner registered with the Saudi Chamber of Commerce for most government contracts. Budget for in-country relationship development time (typically 12–18 months before first contract award) and factor local partnership costs into market entry projections. TCS Riyadh can advise on local partner due diligence.TARIFF REFERENCE

Look up import and export tariff rates for goods traded between Canada and Saudi Arabia.

Open Tariff Reference Tool →11

Sources

Trade data: Statistics Canada (2025). Bilateral trade data, Canada-Saudi Arabia. · Saudi Vision 2030: Kingdom of Saudi Arabia Vision 2030 Realization Program, vision2030.gov.sa. · Public Investment Fund: PIF Annual Report 2024, pif.gov.sa. · Arms export: Global Affairs Canada, Export and Import Controls, LAV contract assessments 2018–2025. · Human rights: Human Rights Watch, Saudi Arabia country reports 2023–2025, hrw.org. Amnesty International, Saudi Arabia 2024 annual report. · NEOM displacement: Human Rights Watch (2020, 2023), Saudi Arabia: Forcible Displacement for NEOM. · Khashoggi: Office of the Director of National Intelligence (US), Annex A: Assessments of the Murder of Jamal Khashoggi (2021). · EDC country risk: Export Development Canada, Saudi Arabia Country Risk Quarterly (2025).