Aramco lifts spending plans to $414bn over next decade

Saudi Aramco CEO Amin Nasser, pictured here in 2016, said the state oil firm is ‘into so many sectors now.’ (Reuters)
Updated 13 December 2017

Aramco lifts spending plans to $414bn over next decade

DAMMAM: Saudi Aramco plans to raise its spending to $414 billion over the next 10 years, including on infrastructure and drilling, as the state oil giant moves into new businesses, executives said.
The spending plan is higher than Aramco’s projection last year of around $334 billion by 2025, as the oil producer has been expanding its businesses, the company’s chief executive Amin Nasser said on Tuesday.
“We are into so many sectors now,” Nasser told reporters on the sidelines of an industry conference aimed at promoting the Kingdom’s industrial base and the manufacture of a bigger share of products domestically.
Saudi Aramco’s plan includes $134 billion to spend on drilling and well services and $78 billion to maintain oil output potential, Nassir Al-Yami, general manager for procurement, told a conference in Dammam.
Aramco has already created a department for renewables to develop wind and solar projects and last month it signed a preliminary deal with petrochemical producer Saudi Basic Industries Corp. (SABIC) to build a $20 billion complex to convert crude oil to chemicals.
The project, which the partners said would be the largest crude-to-chemicals facility in the world and the first in the Kingdom, is part of the Saudi government’s effort to diversify the economy beyond exporting crude.
The Vision 2030 economic reform plan aims at ending its reliance on oil and to stimulate the domestic non-oil private sector. Its centerpiece is a plan to sell up to 5 percent of Aramco in an initial public offering (IPO) next year.
Saudi Aramco outlined a plan known as In-Kingdom Total Value Add (IKTVA) two years ago, aimed at doubling the percentage of locally produced energy-related goods and services to 70 percent of the total spent by 2021.
“Saudi Aramco is expected to spend more than 1 trillion Saudi riyals over the next decade. That has not changed, and we still want to see 70 percent of those riyals being spent locally,” Nasser said.
Supporting the growth of small and medium-sized enterprises (SMEs) is a main part of the IKTVA drive and Saudi Vision 2030, which would help create over 40,000 jobs and could add around SR30 billion to the Kingdom’s annual GDP, Nasser said.
Saudi Arabia’s Public Investment Fund (PIF) said in October it is creating a SR4 billion ($1.07 billion) “fund of funds” to support SMEs.
On Tuesday, Saudi Aramco signed 13 memoranda of understanding (MOUs) worth around SR6.3 billion with local and foreign companies as part a drive to expand the Kingdom’s industrial base and manufacture a bigger share of products domestically.
The MoUs signed were with companies such as China’s Sinopec, Dalma Gulf Drilling Co. and National Petroleum Technology.
Other agreements signed were part of the Kingdom’s plan to support the growth of small and medium enterprises (SMEs).
— REUTERS


US removes some Chinese furniture, modems from planned 10% tariffs

Updated 17 August 2019

US removes some Chinese furniture, modems from planned 10% tariffs

  • US President Donald Trump on Tuesday delayed more than half of the proposed tariffs until December
  • The $114 billion retail furniture industry has been among the sector’s hardest hit with price increases due to Trump’s tariffs

WASHINGTON: The Trump administration is sparing some Chinese-made household furniture, baby items and Internet modems and routers from its next rounds of 10 percent tariffs, it said on Friday.
The US Trade Representative’s office released a complete list of the items that were removed from $300 billion in tariffs scheduled to go into effect on Sept. 1 and Dec. 15, some of which had already been hit with 25 percent tariffs.
Trump on Tuesday delayed more than half of the proposed tariffs until December, saying it would help shield businesses and consumers from the US-China trade war fallout during the Christmas selling season.
The new list of 44 categories of spared imports, worth about $7.8 billion according to US Census Bureau data, also includes some chemical compounds used in the manufacture of plastics. Reuters previously reported that bibles and religious texts would be spared from the tariff list.
Modems and routers made in China were part of a $200 billion list of products hit with tariffs last September that have since been raised to 25 percent. Friday’s exclusion would avoid a further 10 percent hike as Trump imposes tariffs on Sept. 1 to products in the same broad customs category, including smart watches, smart speakers and Bluetooth headphones.
The bulk of the items removed from the tariff list were furniture products, including wooden- and metal-framed chairs and those made of plastics. Some of these were previously hit with tariffs as part of broader furniture categories.
Baby-related furniture items also were spared, including toddler beds, bassinets, cradles, strollers and children’s seats.
The $114 billion retail furniture industry has been among the sector’s hardest hit with price increases due to Trump’s tariffs, which rose to 25 percent in May.
The US Labor Department said on Tuesday that the price index for household furnishings rose 0.4 percent in July, marking its third consecutive monthly increase and contributing to broad-based growth in consumer prices during July.