By Canadian Press

Canadian firm WSP finding new work in Saudi Arabia despite diplomatic dispute

May 3, 2019 | 1:14 PM

OTTAWA — At least one Canadian-based company is optimistic about its prospects in Saudi Arabia, a bullishness that comes as businesses fret about their future in the kingdom following a diplomatic battle with Ottawa. 

WSP Global Inc., a construction and engineering firm headquartered in Montreal, has continued to land infrastructure work in Saudi Arabia even after a dispute erupted with Canada last summer, said Isabelle Adjahi, one of its senior vice-presidents.

The company’s pipeline of possible projects in Saudi Arabia is “promising,” she said.

“We’re knocking on wood — but we are positive on Saudi for the moment,” Adjahi said in an interview Friday. “We’re still cautious and we are looking at things carefully, but we … think that there are opportunities there for us.”

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Saudi Arabia retaliated against Canada last August following criticism Foreign Affairs Minister Chrystia Freeland levied on Twitter about the regime’s arrest of women’s-rights activists.

Infuriated by the statement, Riyadh reacted by suspending diplomatic ties with Canada, expelling the Canadian ambassador and calling its own envoy home from Ottawa.

Saudi Arabia also announced it would block new business deals with Canadian firms. Some companies have reported that they’ve already felt the sting.

The beleaguered firm SNC-Lavalin Inc. — which is also based in Montreal and one of WSP’s main rivals — has blamed some of its recent woes on the diplomatic conflict.

“Not just ourselves but many Canadian companies saw the slowdown in contract awards or the stopping of contract awards or investments into Saudi Arabia,” SNC-Lavalin’s CEO Neil Bruce told reporters Thursday in Montreal.

“We have seen a number of opportunities that we would normally expect to have a reasonable chance of success actually fall away. It’s had an effect, absolutely.”

SNC-Lavalin has also found itself at the centre of a political controversy that swamped the Trudeau government earlier this year, following allegations of political interference in the company’s criminal prosecution.

When it comes to its continued work in Saudi Arabia, Adjahi said WSP’s success, despite the diplomatic tensions, can be credited to its corporate structure.

WSP’s entities around the world work independently, she said. For instance, Adjahi said its Middle East operation is mostly made up of local employees and has its own CEO, chief financial officer and human-resources team.

“The work being done locally is not being discussed, assigned by the Canadian team here, it’s really a local team with a relationship with the clients,” said Adjahi. She said WSP’s corporate head office in Montreal has around 150 employees.

The company has been part of major infrastructure projects in Saudi Arabia such as the metro systems in Riyadh and Mecca, she said.

WSP is refurbishing its offices in Saudi Arabia and, following its December acquisition of Berger Group Holdings, Inc., the company now has close to 300 employees in the country, up from around 100 before the deal, she said.

The kingdom’s relationship with Canada came under further strain — as did its relations with many in the international community — as details emerged last fall about the murder of journalist Jamal Khashoggi inside the Saudi consulate in Istanbul.

Asked about ethical and public-relations concerns related to working in Saudi Arabia, Adjahi replied that WSP avoids getting involved in anything political and focuses solely on contracts.

“We leave the political discussions for the politicians,” said Adjahi, who noted that WSP is part of the consortium giving Parliament’s Centre Block a massive, decade-long makeover.

The Liberal government has said it’s disappointed by Saudi Arabia’s response to Canada voicing its concerns last summer about human rights.

A spokeswoman for International Trade Minister Jim Carr has said the government has had regular interactions with Saudi officials, including at the ministerial level, in an effort to resolve trade tensions.

Internal federal documents prepared for Carr have described how Saudi Arabia’s move to punish Canadian companies was swift and was felt less than a month after the diplomatic feud flared up.

Firms were forced to deal with visa rejections, a Saudi government ban on food from Canada and a blockage of shipments at the kingdom’s ports, according to a briefing note to Carr last September. The document was obtained under access-to-information law.

—With files from Christopher Reynolds in Montreal

Andy Blatchford, The Canadian Press