Private funds to expand Saudi water plant investments

Environment, Water and Agriculture Minister Abdul Rahman Al-Fadli visits the exhibition stand after the inauguration of the Water Investment Forum in Riyadh.
Updated 28 November 2016

Private funds to expand Saudi water plant investments

RIYADH: Environment, Water and Agriculture Minister Abdul Rahman Al-Fadli says that the volume of desalinated water produced in the Kingdom will be doubled during the next 15 years to cater to the growing demand. 
At present, the Kingdom is producing 4.6 million of cubic meters of desalinated water daily from its 29 desalination plants spread throughout the Kingdom.
The minister was delivering the keynote address at the inauguration of the two-day Water Investment Forum 2016 in Riyadh on Saturday.
A top official said Saudi Arabia could need more than $53 billion in water sector investment supported by private funds as demand grows.
“Future plants will be tendered to the private sector,” Ali Al-Hazmi, Saline Water Conversion Corporation (SWCC) governor, told the Water Investment Forum.
“We have everything ready for privatization,” AFP quoted him as saying.
Saudi water demand is increasing by more than five percent annually, Al-Hazmi said.
By 2020 Saudi Arabia is targeting 52 percent of desalinated water production through “strategic partners.”
Saudi Arabia obtains most of its water from desalination and the rest from ground sources.
“This requires a lot of money and a lot of capital investment,” Mansour Al-Mushaiti, a deputy minister with the Ministry of Environment, Water and Agriculture, told the forum. “We are envisaging that the capital requirements in the next five years will reach up to SR200 billion ($53.3 billion),” AFP quoted him as saying.
Five agreements on water related projects between private enterprises were signed at the event under the supervision of the minister. 
Following the inauguration of the forum, the minister also opened an exhibition that highlighted the investment opportunities in the Kingdom.
More than 350 experts, international specialists, local and foreign investors were present at the forum.
The forum is being held under the slogan, “Building a strategic partnership for promising opportunities,” aimed to promote investment and partnership with the private sector in the field of water in various competencies (production, processing, transportation and distribution) and presenting investment opportunities in the water sector in the Kingdom and the exchange of ideas with government agencies and private organizations at the regional and global level.
The minister said that the meeting is organized to achieve the goals of Vision 2030 and the National Transformation Program (NTP 2020).
The Water Investment Forum 2016 acts as a platform that brings together investors and key national and global water players to promote investment opportunities in the Kingdom, he said.
Some of the many venture prospects include new IWPPs (Independent Water & Power Producers), renewable technologies in desalination, O&M contract for water production and transmission, externalization of shared services, localization of manufacturing, and research partnerships.
In addition, the forum will also announce facilities offered to investors, and highlight the substantial advantages of investing in the Kingdom.
It will emphasize public-private-partnerships (PPP), sharing many successful PPP stories in the Saudi water sector.
SWCC, created in 1974, is the world’s largest producer of desalinated water. It operates 28 plants and as part of the process is able to generate electricity for the national power grid.

Davos organizer WEF warns of growing risk of cyberattacks in Gulf

Updated 16 January 2019

Davos organizer WEF warns of growing risk of cyberattacks in Gulf

  • Critical infrastructure such as power centers and water plants at particular risk, says expert
  • Report finds that unemployment is a major concern in Bahrain, Egypt, Morocco, Oman and Tunisia

LONDON: The World Economic Forum (WEF) has warned of the growing possibility of cyberattacks in the Gulf — with Saudi Arabia, the UAE and Qatar particularly vulnerable.

Cyberattacks were ranked as the second most important risk — after an “energy shock” — in the three Gulf states, according to the WEF’s flagship Global Risks Report 2019.

The report was released ahead of the WEF’s annual forum in Davos, Switzerland, which starts on Tuesday.

In an interview with Arab News, John Drzik, president of global risk and digital at professional services firm Marsh & McLennan said: “The risk of cyberattacks on critical infrastructure such as power centers and water plants is moving up the agenda in the Middle East, and in the Gulf in particular.”

Drzik was speaking on the sidelines of a London summit where WEF unveiled the report, which was compiled in partnership with Marsh and Zurich Insurance.

“Cyberattacks are a growing concern as the regional economy becomes more sophisticated,” he said.

“Critical infrastructure means centers where disablement could affect an entire society — for instance an attack on an electric grid.”

Countries needed to “upgrade to reflect the change in the cyber risk environment,” he added.

The WEF report incorporated the results of a survey taken from about 1,000 experts and decision makers.

The top three risks for the Middle East and Africa as a whole were found to be an energy price shock, unemployment or underemployment, and terrorist attacks.

Worries about an oil price shock were said to be particularly pronounced in countries where government spending was rising, said WEF. This group includes Saudi Arabia, which the IMF estimated in May 2018 had seen its fiscal breakeven price for oil — that is, the price required to balance the national budget — rise to $88 a barrel, 26 percent above the IMF’s October 2017 estimate, and also higher than the country’s medium-term oil-price target of $70–$80.

But that disclosure needed to be balanced with the fact that risk of “fiscal crises” dropped sharply in the WEF survey rankings, from first position last year to fifth in 2018.

The report said: “Oil prices increased substantially between our 2017 and 2018 surveys, from around $50 to $75. This represents a significant fillip for the fiscal position of the region’s oil producers, with the IMF estimating that each $10 increase in oil prices should feed through to an improvement on the fiscal balance of 3 percentage points of GDP.”

At national level, this risk of “unemployment and underemployment” ranked highly in Bahrain, Egypt, Morocco, Oman and Tunisia.
“Unemployment is a pressing issue in the region, particularly for the rapidly expanding young population: Youth unemployment averages around 25 percent and is close to 50 percent in Oman,” said the report.

Other countries attaching high prominence to domestic and regional fractures in the survey were Tunisia, with “profound
social instability” ranked first, and Algeria, where respondents ranked “failure of regional and global governance” first.

Looking at the global picture, WEF warned that weakened international co-operation was damaging the collective will to confront key issues such as climate change and environmental degradation.