The Ministry of SMEs and Startups and the Embassy of the Republic of Korea in Saudi Arabia announced today that they will begin recruiting companies for a groundbreaking “Middle East Market Entry Support Program for SMEs and Startups” starting Monday, July 7, marking an unprecedented collaboration with the Saudi government.

The initiative comes as Saudi Arabia emerges as a high-growth market through aggressive reform and opening-up policies, yet remains challenging for Korean small and medium enterprises to penetrate due to strict government regulations and significant cultural differences. Despite Saudi Arabia’s status as the Middle East’s largest economy with a GDP of $1.1 trillion, Korean SME exports to the kingdom totaled only $1 billion in 2024, representing just 0.9% of total SME exports worth $111 billion.

Recognizing that successful market entry requires active cooperation with local authorities, Korean officials have designed a unique program where the Saudi government directly selects companies for market entry. Since April, the Korean Embassy in Saudi Arabia has conducted over 20 visits and meetings with nine Saudi government agencies, explaining the strengths of Korean SMEs and the broader venture ecosystem while securing their participation in the program.

The Ministry of SMEs and Startups supported the initiative by collaborating with key organizations including the Global Business Center under the Korea SMEs and Startups Agency, the Korea Venture Business Association, and the Korea Federation of SMEs, while allocating budget through overseas expansion support programs.

The program will recruit companies across four strategic sectors: artificial intelligence, bio and health, tourism and entertainment, and smart city and construction. A total of 27 companies will be selected, with eligibility requirements specifying that only startups founded within the past 10 years may apply for the AI sector, while SMEs of any age may apply for the other three sectors.

The timeline for the program includes completing applications and submissions by July 24, conducting document reviews by the end of July, and holding in-person evaluations in August with participation from Saudi experts. Selected companies will visit Saudi Arabia at the end of September to pursue market entry, secure business contracts, and attract investment through meetings with local government agencies, investment promotion briefings, and networking events.

Saudi government ministries and agencies have shown strong interest in the collaboration, with HUMAIN, the Saudi agency overseeing artificial intelligence, expressing particular enthusiasm. The agency has indicated plans to provide up to $2 million per company through project contracts or equity investments, demonstrating an active commitment to partnering with Korean startups.

“Although there were many challenges along the way, I am very pleased that, after extensive discussions with the Saudi government, a cooperative program to support SMEs and startups is finally being launched,” said Byung-jun Moon, Chargé d’Affaires at the Korean Embassy in Saudi Arabia. “I hope this initiative will serve as a turning point, expanding Korean business presence in Saudi Arabia, previously led mainly by large corporations in sectors like construction and defense, into cutting-edge industries such as AI, led by SMEs and startups.”

Lee Soon-bae, Director General for Global Growth Policy, emphasized the strategic importance of the Saudi market. “Saudi Arabia is a market with size, purchasing power, and growth potential. It is a market that our SMEs and startups must enter to achieve globalization and diversify export markets,” he stated. “The Ministry will form a ‘K-One Team’ with key SME-related institutions, including the Korea Federation of SMEs, the Korea SMEs and Startups Agency, and the Korea Venture Business Association, as well as the Korean Embassy in Saudi Arabia and local support organizations, to actively support SMEs and startups in becoming the driving force behind a second Middle East boom.”

To enhance participating companies’ understanding of the program and Saudi market, preliminary briefing sessions will be held on Tuesday, July 8, 2025, from 2:00-3:30 PM at MARU180 in Seoul, and Thursday, July 10, 2025, from 2:00-3:30 PM at the KTX Conference Room in Daejeon Station. The sessions will cover the program’s background and direction, overview of the Saudi Arabian economy and major policies, introduction of participating Saudi institutions, and key elements of Saudi Vision 2030.

Companies interested in participating can find detailed information on the K-Startup portal and the Ministry of SMEs and Startups website, with applications accepted online via the SME Overseas Expo Portal from Monday, July 7 to Thursday, July 24.