RIYADH: Saudi Arabia has enacted over 600 economic reforms since the launch of the Vision 2030 blueprint in a bid to attract SR12.4 trillion ($3.3 trillion) of cumulative investment and SR1.8 trillion in foreign direct investment inflows between 2021 and 2030 as part of the National Investment Strategy, said a deputy minister from the investment ministry.
Speaking to Arab News, Saad Al-Shahrani, the acting deputy minister for investment promotion in the Ministry of Investment of Saudi Arabia, said the Kingdom achieved an 18 percent increase in foreign direct investment in 2020, even as the global FDI declined by 35 percent due to the pandemic.
FDI flow in 2021 increased by 257 percent compared to 2020 largely driven by a SR46.5 billion infrastructure deal closed by Aramco with a global investor consortium in Q2 2021.
If Aramco’s huge deal is excluded, the Kingdom attracted SR5.3bn in Q2 last year.
Al-Shahrani added that the NIS launched in 2021 is a blueprint for turning the Kingdom into a global hub for business and talent.
During the interview, the deputy minister revealed that FDI flow in the first quarter of 2022 increased 10 percent to SR7.4 billion compared to the same period last year.
He further stated that NIS helped MISA achieve 49 investment deals valued at SR3.5 billion in the second quarter of 2022, creating 2,000 jobs across industries.
“These figures are a testament to the sound execution of the government’s strategy and the impact of new reforms, initiatives and investment opportunities,” said the deputy minister.
He added: “The Kingdom has achieved remarkable progress in many economic and investment indicators, ranking third in Ease of Protecting Minority Investors Index out of 132 countries, for the year 2021.”
Fastest growing among G-20 countries
The deputy minister further noted that the Kingdom achieved the top spot among 22 countries in the May 2022 Ipsos’ Global Consumer Confidence Index.
Citing the International Monetary Fund’s World Economic Outlook 2022, Al-Shahrani said that the Kingdom is now the fastest-growing nation among the Group of 20 countries, with a growth rate of 7.6 percent.
“Saudi Arabia’s regulatory transformation is directly impacting the base economy. Alongside healthy demand and investor interest in the oil sector, our non-oil economy has shown strong growth,” he added.
The deputy minister said that flash estimates of real growth in the gross domestic product in the second quarter showed 11.8 percent year-on-year growth, the highest rate since 2011, supported by the growth in real GDP of oil and non-oil activities by 23.1 percent and 5.4 percent, respectively.
Industrial production on the rise
Commenting on the rise in Industrial Production Index, Al-Shahrani said: “The IPI expanded by 24 percent year on year in May 2022, with manufacturing growing by over 28 percent. These figures are a direct consequence of the government’s active diversification efforts.”
He also asserted that the Kingdom will become one of the world’s most competitive economies and attractive investment destinations by 2030.
The deputy minister further noted that digital transactions are rising in Saudi Arabia, aligning with the government’s goal of having 70 percent of all transactions are digital by 2025.
“Policymakers have listened to the needs of investors and have responded appropriately to create an investment ecosystem that rivals the best in the world,” he continued.
Saudi Arabia’s future is tourism
The deputy minister further conveyed that tourism will soon become one of the prime drivers of the Saudi economy as the economic diversification effort continues.
He revealed that the Kingdom has already issued over 3,500 tourism investment licenses, a crucial leap to achieving 10 percent of the national GDP from tourism by 2030.
Al-Shahrani added that the Kingdom will welcome over 100 million tourists by 2030 and generate one million jobs in the sector.
“NEOM, The Red Sea Project, AlUla, Soudah, AMAALA and Diriyah Gate are massive opportunities for investors,” he continued.
The deputy minister further divulged that the Kingdom’s flag carrier SAUDIA will add 94 new destinations to bring visitors to the Kingdom by 2030.
Apart from tourism, MISA is also signing deals with companies in the renewables, logistics, and pharmaceutical sectors, the deputy minister added.
“It is quite clear that the headwinds souring global investor appetite are not blowing in the direction of Saudi Arabia. Government strategy, inspired leadership, talent at every level, well-executed reforms and a clear vision for the future have combined to make the Kingdom an investment powerhouse,” Al-Shahrani said.
The year 2022 marks a decade of growth for the EDF Group in Saudi Arabia. Active in the Kingdom since 2012, the group’s initial focus was on a single line of business for the Saudi National Atomic Energy Project, as announced by the King Abdullah City for Atomic and Renewable Energy.
In line with the Saudi Vision 2030 and EDF’s 2030 sustainability strategy, the group began to diversify its lines of business, a total of five, and expand in the Kingdom to support its sustainability and energy transition objectives beyond the civil nuclear program.
In 2017, the EDF Group, through EDF Renewables, participated in all public renewable energy tenders organized by the Saudi Ministry of Energy to develop utility-scale projects in the Kingdom.
In 2019, EDF was awarded the development of the largest and most powerful wind farm in the Middle East: the 400 megawatts Dumat Al Jandal Wind Farm. The fully operational project provides clean energy to more than 70,000 Saudi households. In 2021, the 300 MW South Jeddah Noor Solar Project had also been awarded to the French giant, positioning EDF as the first non-regional foreign investor within the Saudi renewable energy market.
EDF’s growth and development in the Kingdom were further strengthened in 2021 by establishing the regional headquarters of the group’s energy services arm, Dalkia Middle East, in Riyadh. The group is also expanding its operations within the Saudi low-carbon energy services sector to incorporate energy efficiency, district cooling networks, operations and maintenance, and exploring the geothermal energy potential in the Kingdom.
Dalkia Middle East is currently in the execution phase of the District Cooling Project, based on a design, build and operate model with the Prince Mohammed Bin Salman Nonprofit City. In addition, the EDF subsidiary is actively involved in Tarshid’s Energy Efficiency Program and leading the operation and maintenance of the Kingdom Tower in Riyadh.
As one of the leading operators of hydropower plants in the world, through EDF Hydro, the group firmly believes in the NEOM landscape and considers it to be the perfect location to utilize pumped storage hydropower. “We have completed pre-feasibility site selection studies in NEOM and are eager to provide further support and expand our cooperation with this ambitious city.
The EDF Group has, beyond the technical services provided by EDF Hydro for PSH, the ambition to invest in such assets in the Kingdom,” said Omar Aldaweesh, EDF general manager for Saudi Arabia and Bahrain.
From low-carbon energy generation to energy services for industrial clients, the EDF International Network, which represents the EDF-owned French Distribution Service Operator on the international scale, is currently executing a project management office contract with the Saudi Electricity Co. to support the digitalization of their distribution network in the Kingdom.
The EDF Group has empowered its subsidiaries and various divisions’ expansion in the Saudi market while maintaining its mandate concerning civil nuclear energy and other complex projects in the Kingdom.
The EDF Group, alongside its partner MASDAR, is launching Emerge KSA, a 50 percent-owned joint venture between the two leading companies, with its ongoing pipeline, which will be officially established in the Kingdom by the end of 2022.
The JV, providing turnkey energy solutions, is currently active in the UAE to develop combined renewable power solutions alongside energy efficiency services within the commercial and industrial market, with major projects already in operation in Abu Dhabi.
“Emerge KSA has massive potential in Saudi Arabia, not only in the C&I market but in off-grid overall. We have seen many projects exceed dozens of MW capacity. The objective is to target more integrated solutions within Emerge KSA by enabling the hybridization of existing carbonized power systems,” said Aldaweesh.
The C&I market in the Kingdom is known to be the largest in the region, with various prospects presently under assessment by Emerge KSA.
EDF’s engagement across the Saudi energy value chain
The EDF’s “raison d’etre” aims to build a carbon-free future by generating clean electricity and offering innovative solutions to the global energy market. “The group’s targets are certainly in line with the Saudi Vision 2030 and the Saudi Green Initiative’s objectives,” said Aldaweesh.
“We are proud of our engagement throughout the entire Saudi energy value chain, from generation to end user, and our ever-expanding cooperation with the Saudi government in that regard,” he added.
Moreover, and with respect to low-carbon resources, the EDF Group is currently in discussion with the Saudi government on the development of geothermal energy and hydroelectricity in the Kingdom.
EDF is also exploring electrical network investments in the Kingdom, such as transmission and distribution.
The group is targeting opportunities for two of its main subsidiaries involved in smart city solutions: Urbanomy, for urban planning services to support the decarbonization of the Saudi real estate sector, and Citegestion, which has the expertise to provide city monitoring services that could be highly beneficial for projects under the Saudi Public Investment Fund.
Active in the global hydrogen value chain, EDF announced in April of 2022 a plan to develop 3 gigawatts of low-carbon hydrogen projects worldwide by the end of the decade, derived from renewable or nuclear power. “We believe that Saudi Arabia offers the perfect ground to be a worldwide hydrogen player, and the group is eager to be part of the Kingdom’s vision on that front,” confirmed Aldaweesh.
Challenges and opportunities
The current rise in oil prices does not seem to constitute a challenge. Aldaweesh believes there will be no impact on EDF’s activities in the Kingdom, as the Saudi government has already revealed its clear sustainability plans and will provide the necessary support to reach the set targets.
The first Saudi appointed general manager within EDF, added, “The group continues its commitment to support the decisive energy transition in Saudi Arabia, and we truly believe that we have merely begun scratching the surface in terms of our potential in the Kingdom, as well as our diverse wide-ranging capabilities which can position the EDF Group as an essential player in the Saudi energy sector.”
RIYADH: Bitcoin, the leading cryptocurrency internationally, traded higher on Thursday, rising by 6.13 percent to $24,406 as of 7:46 a.m. Riyadh time.
Ethereum, the second most traded cryptocurrency, was priced at $1,886 rising by 12.09 percent, according to data from Coindesk.
Binance wins crypto clients due to inflation
A high dollar and rising inflation, coupled with a depressed emerging market currency, are causing Binance, the world’s largest cryptocurrency exchange, to experience an uptick in clients, according to Reuters.
Maximiliano Hinz, who heads Binance in Latin America told Reuters: “Now that we are seeing inflation ramping up worldwide, we are seeing that more and more people are seeking cryptocurrency, like Bitcoin, as a way to protect themselves from inflation.”
As an example, Hinz cited Argentina, where annual inflation is 90 percent. Together with Brazil and Mexico, the country has become one of the company’s top markets.
A fall in cryptocurrency prices did not stop Argentina’s citizens from investing their savings in Bitcoin this year.
Hinz said that while El Salvador adopted Bitcoin as legal tender, other Latin American nations have not passed meaningful cryptocurrency laws, although that may not necessarily be bad for his company.
“Regulation is a framework, but it’s not always negative that something isn’t regulated,” he said. “If something isn’t banned, then it’s legal.”
As a result of President Nayib Bukele’s massive bet on Bitcoin, El Salvador has made the cryptocurrency legal tender and purchased more than $100 million worth of it.
However, Bitcoin has lost about 50 percent of its value amid a broader cryptocurrency selloff.
Cryptocurrencies have important roles in the metaverse, Bank of England Analysts say
Bank of England’s analysts said crypto assets could have important roles within the metaverse, according to Bitcoin.com.
They added that, “widespread adoption of crypto in the metaverse … would require compliance with robust consumer protection and financial stability regulatory frameworks.”
In a blog post published Tuesday, economist Owen Lock and policy analyst Teresa Cascino discussed crypto assets, the metaverse, and systemic risk.
“Cryptoassets could have important roles within the metaverse,” the blog said.
The risks associated with crypto assets may scale up to have a systemic financial stability impact if an open and decentralized metaverse grows.
“Widespread adoption of crypto in the metaverse, or any other setting would require compliance with robust consumer protection and financial stability regulatory frameworks,” they said.
In order for the open metaverse to exist, there needs to be a way to own and transact interoperable digital objects between virtual worlds, Lock and Cascino explained, noting that “cryptoassets are well suited to play an important role here.”
“If a sizable open-metaverse materialized, households may hold a greater share of their wealth in crypto assets to make metaverse-based payments or for investment purposes,” they said.
A growing open-metaverse may improve the investment prospects of crypto assets and their supporting infrastructure, according to the authors.
RIYADH: Oil prices slipped in Asia on Thursday after gaining more than $1 in the previous session, as concerns over supply disruptions eased and markets looked for evidence of improving fuel demand.
Brent crude futures dipped 18 cents, or 0.2 percent, to $97.22 a barrel by 0419 GMT.
US West Texas Intermediate crude futures fell 22 cents, or 0.2 percent, to $91.71.
Norway’s DNO raises its Tawke output forecast
Norwegian oil firm DNO raised its guidance on Monday for output from Iraq’s Tawke license and said the company now has more cash on its hands than debt for the first time since 2018.
Gross output from Tawke, located in the Iraqi Kurdish region, is now projected at between 107,000 and 109,000 barrels of oil equivalent per day in 2022, up from a previous forecast of 105,000 boed, the company said in a statement.
“DNO is committed to put its capital to work in its core competency and capture new opportunities created as peers and even some of the largest European companies scale back spending,” Executive Chairman Bijan Mossavar-Rahmani said.
“We believe in the oil and gas business and in our responsibility to all stakeholders, including host governments who want to capitalize on current prices and consumers who now call for more production, not less,” he said.
Brazil’s Bolsonaro pledges privatizations if re-elected
Brazil’s President Jair Bolsonaro did not mention privatizing state-controlled oil company Petrobras in his re-election plan released on Wednesday that promises to continue pursuing policies that reduce the size of the state.
“The government … will proceed with reordering the state’s role in the economy, through privatization and divestment of state-owned companies, to focus on state participation in essential activities and in promoting Brazil’s economic, social and sustainable development,” the plan said.
The document contrasts with his 2018 election plan that dedicated specific pages to Petrobras. The company was not even mentioned this time, despite Mines and Energy Ministry Adolfo Sachsida requesting its privatization be studied.
(With input from Reuters)
RIYADH: Gold prices fell on Thursday as the US dollar and Treasury yields rebounded after comments by Federal Reserve officials pointed toward further interest rate hikes, despite signs of slowing inflation in the world’s largest economy.
Spot gold was down 0.3 percent at $1,786.17 per ounce, as of 0422 GMT, after hitting its highest since July 5 at $1,807.79 on Wednesday.
US gold futures dipped 0.6 percent to $1,802.10.
Chicago corn and wheat futures retreated on Thursday after hitting more than one-week highs in the previous session on concerns over hot and dry weather conditions in key exporting countries.
Soybeans lost ground after closing almost unchanged on Wednesday.
The most-active corn contract on the Chicago Board of Trade was down 0.4 percent at $6.15-3/4 a bushel, as of 0049 GMT, and wheat fell 0.5 percent to $7.95-1/2 a bushel.
Soybeans slid 0.3 percent to $14.23-1/4 a bushel.
Argentine 2022/23 corn harvest seen at 55 million tons
Argentina’s corn harvest for the 2022/23 season is expected to be around 55 million tons, the Rosario Grains Exchange said on Wednesday.
Additionally, the exchange forecast soy production of 47 million tons for the 2022/23 season.
Argentina is a major world supplier of wheat and the second largest exporter of corn.
The exchange said it expects the country’s corn planting area to fall by 4.7 percent to 8 million hectares.
Copper prices climbed on Thursday to their highest in nearly six weeks, as lower-than-expected US inflation eased worries of aggressive rate hikes that could hurt growth and metals demand.
Three-month copper on the London Metal Exchange rose 0.1 percent to $8,090 a ton at 0300 GMT, while the most-traded August copper contract on the Shanghai Futures Exchange rose 1.3 percent to $9,215.37 a ton.
(With input from Reuters)
DUBAI: Tata-owned Air India plans to offer more flights to the UAE and Qatar as the FIFA World Cup frenzy culminates with the opening of the quadrennial football event in November, UAE daily Gulf News reported.
About 1.5 million fans are expected to arrive in Qatar for the world’s biggest football tournament.
The carrier said it will add four weekly flights between Dubai and Kolkata once the winter schedule starts Oct. 22.
Air India will deploy its Airbus A320Neo single-aisle aircraft, which has a capacity of 12 business-class seats and 150 economy seats.
It is currently operating 69 weekly flights to Dubai.
Additional frequencies to Qatar meanwhile could be determined later this month when flight slots to the World Cup host become clearer.
Air India is currently selling discounted one-way flight fares for passengers departing from its Gulf network to celebrate India’s 75th Independence Day. These seats are available until Aug. 21 on a limited basis and are valid for travel until Oct. 15 this year.
India’s aviation authority meanwhile is lifting the caps on air fares in the country from Aug. 31 as the domestic segment continues its recovery from the coronavirus pandemic.
“After review of the current status of scheduled domestic operations viz-a-viz passenger demand for air travel… it has been decided to remove the fare bands notified from time to time regarding airfares with effect from 31.08.2022,” Satyendra Kumar Mishra, joint secretary for civil aviation ministry, said in his order issued on Wednesday.
“The airlines/operators shall, however, ensure that the guidelines to contain the spread of COVID-19 are strictly adhered to and COVID-19 appropriate behavior is strictly enforced by them during the travel,” he added.
The limits on capacity and fares were imposed in May 2020, as air travel was reopened after a nationwide lockdown, mainly to prevent a spike in ticket prices due to increased demand for flights as movement restrictions were eased.
Under the existing policy, tickets sold in 0-15 days on a rolling basis must be priced within the minimum and maximum band, although airlines are free to set their own fares for journeys beyond 15 days.