Innovation holds key to emerging challenges

Updated 11 January 2013
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Innovation holds key to emerging challenges

DHAHRAN: A high-ranking Saudi academic has described innovation as a key pillar in the Kingdom’s march toward achieving knowledge economy goals.
Speaking at the inauguration of the Saudi-GE Innovation Center in Dhahran Techno-Valley earlier this week, Dr. Khalid S. Al-Sultan, rector and CEO, King Fahd University of Petroleum and Minerals (KFUPM), said innovation held enormous potential in addressing the emerging challenges in all sectors of growth.
“Our university is committed to promoting localized innovation and strengthening Saudi talent base through strong academia-industry linkages,” said Al-Sultan. “This association with GE is one example of that strategy.”
The Saudi-GE Innovation Center is expected to play a key role in identifying and nurturing localized solutions that will enhance energy efficiency. “The center will contribute to shaping a new generation of talented Saudi professionals who are involved in hands-on research,” said Al-Sultan.
What Al-Sultan said was echoed in a recent survey in which an overwhelming majority of businesses said innovation was the main lever for a more competitive economy. Eighty-six percent of Saudi respondents in the GE survey said innovation contributed to improving the products and services of their company.
Prominent among those who were present at the high-profile event in Dhahran were Saudi Aramco President and CEO Khalid A. Al-Falih, SABIC vice chairman and CEO Mohamed Al-Mady, GE Vice Chairman John Rice.
The center is to serve as an ideas incubator for GE and its partners to work together, share knowledge, collaborate and co-create — thus building localized solutions.
The unveiling of the new center is part of General Electric’s $1 billion investment commitment. The 2,200 sq. meter center aims at fostering homegrown innovation and is set to work closely with customers on addressing the Kingdom’s priorities in creating more energy efficient and affordable health care solutions.
Since the center is aligned with the Kingdom’s Vision 2020 which aims to boost Saudi entrepreneurship, manufacturing and exports to accelerate diversified and sustained economic growth, it will collaborate with partners, customers, key think-tanks and academic institutions to promote the country’s innovation ecosystem.
The center offers visitors a highly engaging and digitally interactive experience of GE’s accomplishments in the Kingdom over the past 80 years. The center highlights GE’s country partnerships and capabilities as well as examines key trends and issues in various sectors including energy, aviation and health care.
“The Saudi GE Innovation Center demonstrates our commitment to be a true partner in Saudi Arabia’s growth story,” said GE Vice Chairman John Rice. “The center will support the creation of localized solutions by working alongside Saudi professionals who best understand the Kingdom’s requirements.”
He described innovation as the game-changer and the driving force of economic development. “Creating a robust innovation environment will contribute not only to addressing local challenges but also to supporting the evolution of a talented pool of professionals and entrepreneurs,” said Rice. “We are thankful to KFUPM and Dhahran Techno Valley for their continuous support to the initiative and to all our partners in the Kingdom.”
Executives in the Kingdom rightly believe that it is important to encourage a stronger entrepreneurial culture in the education system through stronger linkages between students and business-savvy individuals, which is reflected in the operational ethos of the Saudi GE Innovation Center. They perceive that encouraging investments and promoting domestic technology development rather than imported solutions are main priorities to further progress innovation in the Kingdom.


Saudi stocks receive landmark emerging markets upgrade from MSCI

Updated 11 min 10 sec ago
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Saudi stocks receive landmark emerging markets upgrade from MSCI

  • Market authorities in Saudi Arabia have introduced a series of reforms in the past 18 months
  • MSCI’s Emerging Market index is tracked by about $2 trillion in active and global funds

LONDON: Saudi Arabian equites are poised to attract up to $40 billion worth of foreign inflows, following a landmark decision by index provider MSCI to include the Kingdom’s stocks in its widely tracked Emerging Markets index.

"MSCI will include the MSCI Saudi Arabia Index in the MSCI Emerging Markets Index, representing on a pro forma basis a weight of approximately 2.6% of the index with 32 securities, following a two-step inclusion process," the MSCI said in a statement late on Wednesday night Riyadh time.

“Saudi Arabia’s inclusion in MSCI’s EM Index is a milestone achievement and will likely bring with it significant levels of foreign investment,” Salah Shamma, head of investment for MENA at Franklin Templeton Emerging Markets Equity, told Arab News. 

“It is a recognition of the progress Saudi Arabia has made in implementing its ambitious capital markets transformation agenda. The halo effect of such a move will be felt across the stock exchanges of the entire Gulf Cooperation Council (GCC).”

Market authorities in Saudi Arabia have introduced a series of reforms in the past 18 months to bring local capital markets more in line with international norms, including lower restrictions on international investors, and the introduction of short-selling and T+2 settlement cycles.

Such reforms prompted index provider FTSE Russell to upgrade the Kingdom to emerging market status in March, opening the country’s stocks up to billions worth of passive and active inflows from foreign investors.

MSCI’s Emerging Market index is tracked by about $2 trillion in active and global funds. The inclusion of Saudi stocks in the index, alongside FTSE Russell’s upgrade, is forecast to attract as much as $45 billion of foreign inflows from passive and active investors, according to estimates from Egyptian investment bank EFG Hermes. 

The upgrade announcement was widely expected by the region’s investment community, following a similar emerging markets upgrade announcement by fellow index provider FTSE Russell in March. 

“MSCI index inclusion will be a historic milestone for the Saudi market as it will allow for sticky institutional money to make an entry in 2019 which will help deepen the market,” said John Sfakianakis, director of economic research at the Gulf Research Center in Riyadh.