How Is an IKTVA or ICV Score Calculated? The Local-Content Formula, Component by Component
IKTVA and ICV both turn a supplier’s local footprint into a single certified percentage, and both build that percentage the same way: add up the value the supplier creates inside the country, divide it by total revenue, and have an approved body audit the result. This dossier breaks the calculation down component by component, shows where a score leaks, and explains why the number a supplier certifies before a tender is the number that decides the award.
- It is a ratio, not a rating. Local value created, divided by total revenue, equals a certified percentage. Everything in the calculation is about moving value into the numerator (local) and off the imported side of the ledger.
- The numerator has four broad buckets: local goods and services, local manufacturing and work, local capital investment, and the salaries and training of nationals. IKTVA and ICV weight and label them differently, but the buckets rhyme.
- People are weighted deliberately. Both programmes reward employing and training nationals; the UAE formula credits Emirati salaries and applies bonus factors, so an all-expatriate firm hits a structural ceiling on its score.
- It is audited, not asserted. Scores are calculated from audited financial statements and certified by an approved body — Aramco-administered certification for IKTVA, a MoIAT-authorised certifying body for ICV — and expire with the financial year, so the number must be refreshed.
- The formula is a plan, not a form. Because each input is a lever, the score is something a supplier engineers over a multi-year localisation plan — local manufacturing, local procurement, joint ventures, national hiring — and certifies before the tender, not after.
Start with the ratio
Every local-content score, whether Aramco’s IKTVA or the UAE’s ICV, resolves to one fraction: the value a supplier creates inside the country, divided by its total revenue for the business being measured. Get the fraction clear and the rest of the programme becomes legible. A company that buys locally, builds locally, invests locally and hires locally pushes its numerator up and scores highly; a company that imports finished goods and books the margin abroad has a small numerator against a large denominator and scores low. The whole apparatus of certification, weighting and bonus factors is machinery bolted onto that single idea.
Project 54How a local-content score is built: audited inputs — local spend, manufacturing, investment and the employment of nationals — certified into a single percentage.The numerator, bucket by bucket
The value counted in the numerator falls into four broad buckets that both programmes recognise, even where they name and weight them differently. Local goods and services is procurement spend directed at in-country suppliers — and it cascades, because the local content of what you buy is itself measured by your suppliers’ own certificates, so a supplier with a strong score is worth more to you than a cheaper one without. Local manufacturing and work is the cost of what is actually made or performed in-country rather than imported. Local investment is capital sunk into plant, equipment and facilities inside the country. Nationals is the salaries and training of Saudi or Emirati employees, the bucket both programmes weight to reward hiring and developing local people.
Local spend & work
Procurement from in-country suppliers plus the cost of manufacturing or work performed locally. It cascades: the local content of what you buy is set by your suppliers’ own certificates.
Local investment
Capital sunk into plant, equipment and facilities inside the country — the asset base that proves a durable presence rather than a sales office.
Nationals
Salaries and training of Saudi or Emirati employees, weighted to reward hiring and developing local people, with bonuses for growing national headcount.
Where IKTVA and ICV diverge
The programmes share the skeleton and differ in the muscle. IKTVA measures local content as a share of a supplier’s Aramco supply-chain revenue and is certified through Aramco’s own process; the headline programme score reached about 70 percent in early 2026, up from 35 percent at launch in 2015, with a 75 percent target for 2030.
ICV measures local content as a share of total company revenue, is certified by a MoIAT-authorised body against audited statements, and layers on defined bonus factors — for example credit for investment, for Emiratis in senior positions, and for a company’s own export revenue — that can lift the certified number above the raw ratio. The practical upshot for a supplier selling into both markets: two formulas, two certificates, two priorities, and a score that does not travel from Dhahran to Abu Dhabi or back.
Why it is audited, and why it expires
Neither score is a self-assessment. Both are computed from a supplier’s audited financial statements and signed off by an approved certifying body, and the certificate is tied to the audited financial year — so the score lapses and has to be renewed.
That has two consequences. First, the number is only as current as the last audit, which is why a supplier’s certificate date matters as much as its percentage in a live tender. Second, because the inputs are audited financial line items, the score cannot be gamed at bid time; it can only be raised by genuinely moving spend, investment and payroll in-country over the periods the audit covers.
Audited
Scores are computed from audited financial statements, not self-declared — the inputs are real financial line items.
Certified
An approved body signs off the number: Aramco-administered certification for IKTVA, a MoIAT-authorised body for ICV.
Time-bound
The certificate is tied to the audited financial year and lapses, so a supplier must re-certify to hold a current score.
Reading the score as a set of levers
Laid out as inputs, the calculation becomes a menu of moves. The table below maps each numerator bucket to what it rewards and how fast a supplier can realistically move it — the practical calculus behind a localisation plan.
| Numerator input | What it credits | Relative speed to move | Notes for an international supplier |
|---|---|---|---|
| Local goods & services | In-country procurement; cascades via suppliers’ own certificates | Fast–medium | Buy from certified local suppliers; capped by how much genuinely exists in-country |
| Local manufacturing / work | Cost of what is made or performed in-country | Slow | Biggest single lever; capital-intensive, often via joint venture |
| Local investment (assets) | Capital in local plant, equipment and facilities | Slow | Signals durable commitment; credited strongly, especially under ICV bonuses |
| Nationals (salaries & training) | Saudi/Emirati payroll and development | Medium | Faster to start than a factory; all-expatriate firms hit a ceiling |
| Denominator (total revenue) | The base the numerator is divided by | — | Growth without local content dilutes the score |
What the calculation means for how you sell
The reason the formula matters commercially is that it converts strategy into a single comparable number that sits inside the bid. Suppliers who win treat the score the way they treat price and delivery: they model where it leaks — imported versus local content, expatriate versus national payroll — and invest to close the gap before certification, not after the tender is lost.
That is also why the score is inseparable from the wider supplier-qualification picture: local content is the most consequential gate in Saudi Arabia and the UAE, but it sits alongside carbon-data and procurement-readiness gates that decide the same tenders.
Listen & take it with you
Prefer audio, or need the deck for an internal review? The full briefing is available as a podcast episode and a downloadable slide presentation.
When you model your own local-content score, which input would move it the most, and the fastest?
Frequently asked
IKTVA expresses local content as the value a supplier creates in Saudi Arabia — local goods and services, local work, in-Kingdom investment, and the salaries and training of Saudis — divided by its Aramco-business revenue, then certified through Aramco’s process. The programme and how the score is used are set out in our dossier on IKTVA and ICV.
ICV divides a supplier’s UAE-retained value — local goods and services, manufacturing, investment in UAE fixed assets and Emirati salaries — by total revenue, then applies defined bonus factors, all certified by a MoIAT-authorised body against audited statements.
IKTVA is certified through Saudi Aramco’s own administered process; ICV is certified by a MoIAT-authorised certifying body from audited financial statements. Both certificates are time-bound to the audited financial year and must be renewed.
There is no universal pass mark; the score is competitive, used as a weighting, threshold and tie-breaker in evaluation. Aramco’s programme-level IKTVA reached about 70 percent in early 2026. What “good” means in a given tender depends on the field — see the GCC oilfield services market in 2026.
By moving value into the numerator: local manufacturing or assembly, procurement from certified local suppliers, investment in local assets, and hiring and training nationals — sequenced into a multi-year plan and certified before the tender. The full playbook is in our IKTVA and ICV dossier.
Get the next intelligence drop
Join energy and industrial leaders getting our marketing, AI-growth and revenue-architecture intelligence, direct, no filler.
You're on the list
Welcome to The Energy Growth Brief, watch your inbox for the next dispatch.