| Technology is the product design, production techniques and managerial systems needed to carry out production process. Transferring it is moving it from one set of users to another in such a way that enables the transferee to absorb it and adopt it to the local conditions. Saudi Arabia sought transferring petrochemical technology. The transfer aims to reduce the country's dependence on oil and to utilize national resources more efficiently. To investigate the factors affecting the transfer the conditions related to the technology in question and the receiving entity are analyzed. Multinational corporations play a major role in the transfer process. Economists are divided into three groups in this regard: Orthodox, Radicals and Reformists. The research shows that joint venture transfers more technology than direct foreign investment. Various economic models of transferring technology are discussed. Using regression analysis two models are tested. Four variables are involved: investment resources involved in the process, labor, material and transfer arrangement. Material advantage is the most significant factor in the Saudi case followed by transfer arrangement. Labor shortage slows the transfer. Four major policies are concluded from the study. (i) Additional effort is needed to recruit national workers; the number of expatriate is still large. (ii) Carefully planned and implemented R&D program is essential for the transfer to be successful. (iii) Starting some final products is due currently. It maximizes value added and it has better marketing conditions. (iv) The stage of establishing industrial projects independent of foreign partner is set. The Saudis should have acquired sufficient technical experience to do so. The impact of the transfer on the Saudi economy has been realized e.g., share of industrial sector in GNP, employment, government revenue from sale of petrochemicals and more efficient use of national resources. |
