Russia fund boss sees no drop in foreign investment to Saudi Arabia

Kirill Dmitriev said FII is a great platform to drive opportunities and transformation. (SPA)
Updated 23 October 2018
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Russia fund boss sees no drop in foreign investment to Saudi Arabia

  • We believe Saudi Arabia has a lot of investment potential and supports the process of transformative and historical reforms in the Kingdom, said Dmitriev
  • From the Russian perception, Saudi Arabia is a great partner, said RDIF’s head

RIYADH: The head of the Russian Direct Investment Fund (RDIF) believes that the events of the past few weeks have made little impact on Saudi Arabia’s attractiveness to global investors, and is preparing to invest “billions of dollars” in the Kingdom.

Kirill Dmitriev, the RDIF chief executive, told Arab News on the sidelines of the Future Investment Initiative (FII) in Riyadh that the event was a big success and “a great platform to drive opportunities and transformation.”

He added that the FII’s opening day had been well attended by chief executives from across the Middle East, Europe and the US, with a “big Russian delegation.”

Dmitriev expressed his regrets at the tragedy in Istanbul, in which journalist Jamal Khashoggi was killed at the Saudi Consulate, and welcomed the actions taken by the Kingdom to investigate the case. 

“It is too early to talk about any kind of shortfall in Western investment in Saudi Arabia, despite the tragic events in Istanbul. The Saudi market is more attractive now than it was three or four years ago, and I don’t think there has been any change over recent weeks,” he said.

“We believe Saudi Arabia has a lot of investment potential and supports the process of transformative and historical reforms in the Kingdom. In particular, we support Vision 2030, which is significant not only for the economy and people of the Kingdom but for the Middle East region and the whole world.”

Earlier at the FII, Dmitriev told a gathering of business executives and policy-makers that the goal of the RDIF was “economic development through partnership.” He said such partnerships include links with Saudi Arabia’s PIF and Aramco, with which RDIF has embarked on a number of initiatives in energy and infrastructure.

Last year, the three established a platform for Russian-Saudi energy investment, which aims to identify attractive investment opportunities in Russia. This was accompanied by a joint platform for technology investment, Dmitriev explained.

“From the Russian perception, Saudi Arabia is a great partner. It is not just about energy and oil, but about the historic vision and transformation,” he said.

RDIF has been actively collaborating with PIF since 2015. They have invested over $2 billion together and are now considering over 10 new projects totaling more than $1 billion, Dmitriev said.

“The industries benefitting from these investments range from sectors including … petrochemicals, industrial manufacturing, logistics, infrastructure and technology,” he added.

“Currently, we are discussing the opportunity to jointly implement some projects in Saudi Arabia in different sectors. The projects are related to the localization of petrochemical production, the provision of service contracts and the subsequent creation of joint ventures. RDIF and our partners can bring billions of dollars of investment to the Kingdom.”


Emirates Airline half-year profit slides 86% on oil hike

Updated 15 November 2018
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Emirates Airline half-year profit slides 86% on oil hike

DUBAI: Emirates Airline on Thursday posted an 86 percent drop in half-year profits as the Middle East's leading carrier was hit by a hike in oil prices and currency devaluations.
The Dubai-based airline in a statement its net profit in the six months to September 30 was also impacted by other challenges and expected tough months ahead.
Emirates said it recorded a profit of just $62 million in the first half of the 2018-2019 fiscal year compared with $452 million in the same period last year.
"The high fuel cost as well as currency devaluations in markets like India, Brazil, Angola and Iran, wiped approximately 4.6 billion dirhams ($1.25 billion) from our profits," said Sheikh Ahmed bin Saeed Al-Maktoum, chairman and chief executive of Emirates Group.
Emirates, one of the world's biggest airlines, said fuel costs rose by 42 percent compared with the same period last year.
The company, which flies to more than 150 destinations, said the cost of fuel amounted to a third of its expenses.
Emirates is the world's largest operator of Airbus A380s with more than 100 of the superjumbos in its fleet.
"The next six months will be tough, but the Emirates Group's foundations remain strong," Sheikh Ahmed said in a statement.
In the six months to September 30, the airline carried 30.1 million passengers, a rise of three percent on the last fiscal year, the company said.
Emirates' revenues were 10 percent higher than the previous year at $13.3 billion.
"We are proactively managing the myriad challenges faced by the airline and travel industry, including the relentless downward pressure on yields and uncertain economic and political realities in our region and in other parts of the world," said Sheikh Ahmed.
Profit for the Emirates Group, which also includes Dnata, a leading air services provider, was also down by 53 percent to $296 million.