Saudi Binladin Group ‘still a private sector company’

Saudi Bin Laden Group Company (SBG) has asserted that it remains a private sector company owned by its shareholders. ​(Archive)
Updated 14 January 2018
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Saudi Binladin Group ‘still a private sector company’

JEDDAH: Saudi Binladin Group (SBG) on Saturday said it remains a private sector company owned by its shareholders, according to a statement sent to Arab News.
Earlier unconfirmed reports issued by some media outlets suggested that the Saudi government had taken over SBG, the Kingdom’s construction giant which has worked on dozens of megaprojects over the decades.
SBG also confirmed that contracted work with the government, which remains a significant part of its activities, is ongoing. This includes projects currently operating in the two holy mosques and the Zamzam rehabilitation project, which began months ago and is expected to end before Ramadan 2018.
Based on information available to SBG management, some shareholders may have agreed a settlement that involves transferring some SBG shares to the government of Saudi Arabia against outstanding dues.
SBG said this was a positive step and is currently restructuring its governance and executive management team to meet its commitment toward all stakeholders, according to the statement.
Restructuring efforts started two years ago with the objective of separating ownership from management in accordance with best governance standards.
To support those efforts, a supervisory committee was created. The committee is composed of five members, including three independent members — Dr. Abdulrehman Hamad Al-Harkan, Dr. Khaled Hamza Nahas and Khaled Mohammed Al-Khowaiter — and two members from the shareholders group, Yahia Mohammed Binladin and Abdullah Mohammed Binladin.
The committee will restructure the group and empower the new executive management to lead the projects and overcome the current challenges, leading the company to be profitable again, the statement said.
SBG, which had more than 100,000 employees at its height, is the biggest builder in Saudi Arabia. It was hit hard after the crash in oil prices, which led to construction projects and government contracts being scrapped or delayed. The company was forced to lay off thousands of workers.
The contractor also suffered a temporary exclusion from new state contracts after a crane accident killed 107 people at Makkah’s Grand Mosque in 2015.


Asia air cargo market gets e-commerce boost as US-China trade war yet to bite

Updated 19 min 21 sec ago
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Asia air cargo market gets e-commerce boost as US-China trade war yet to bite

  • E-commerce is growing at pace in populous Asia, driven by Chinese behemoth Alibaba Group and rival JD.com
  • Boeing on Monday forecast air cargo traffic would double over the next 20 years
JEJU, South Korea: Strong e-commerce demand is fueling Asia’s air freight market, with the US-China trade war having minimal negative impact so far and in some cases even boosting shipments, industry executives said on Friday.
E-commerce is growing at pace in populous Asia, driven by Chinese behemoth Alibaba Group and rival JD.com, as well as others such as Japan’s Rakuten, sponsor of Spanish soccer giants FC Barcelona.
But the flow of goods has been threatened this year by the United States imposing import tariffs on billions of dollars worth of Chinese goods to redress what it regards as unfair trade relations — with China’s government responding in kind.
“I think right now we are probably going to see a pretty strong fourth quarter,” Randy Tinseth, Boeing Co’s vice president for commercial airplane marketing, said on the sidelines of an industry conference.
“The economy today has been very, very strong. Frankly in anticipation of this geopolitical situation I think people are just going out and moving (cargo) quickly.”
Asia-Pacific air cargo volume rose 4.8 percent in January-August, showed data from the Association of Asia Pacific Airlines (AAPA). That was lower than last year’s 9.8 percent but came off a higher comparison base at a time of record shipments, said AAPA Director-General Andrew Herdman.
“Given this short-term effect of scrambling to meet deadlines for tariff imposition and so on we are seeing pockets – lanes and channels – where demand is stronger than expected. For the next several months the cargo picture remains relatively robust. The question is what will the outlook for next year be.”
Asian airlines have an outsized role in air freight, accounting for nearly 40 percent of the global market as the region is a major manufacturing hub and e-commerce is growing.
“E-commerce is changing the way people are buying stuff, especially in countries such as Indonesia and the Philippines,” said Jean-Francois Laval, Airbus executive vice president, Asia sales. “It is coming from China, from Korea, it is coming from other parts of the region. You need a huge amount of cargo space.”
Boeing on Monday forecast air cargo traffic would double over the next 20 years, growing at an average rate of 4.2 percent a year.
To meet that demand, the aircraft manufacturer expects the world freighter fleet to expand over 70 percent to 3,260 planes. Around half of air cargo is carried in the bellies of passenger jets, with the remainder flown on dedicated freighters.
Some large Asian cargo carriers including Cathay Pacific Airways and Korean Air Lines rely on freight for around a quarter of revenue.
“Last year the cargo market was extremely hot. In 2018 it still grew. The trade tensions in the world will have some effects but we haven’t seen it yet. I see constraints coming in a very short time. However, we are preparing for it,” Korean Air President Walter Cho told reporters on Friday.
“Anything from the US to China and vice versa is going to be affected. We are looking at alternate markets to China and the US as well.”
Japan Airlines President Yuji Akasaka said the trade war had made no change to the cargo market to date and he only expected an impact if “extremes” occurred.
“If it does happen it may affect us in the future but as of right now we haven’t seen it and hope it will cool down and go back to normal,” he said through a translator.
In the short term, trade war impact has not been too visible because initial tariffs were on items not typically transported by air such as metals, AAPA’s Herdman said. That is starting to change, however, as duties apply to more goods.
“I heard one example ... Seafood from the US to China is subject to retaliatory tariffs, so demand in China is down. Guess what? Demand for Canadian seafood is doing just fine.”