Saudi boom from pilgrims, leisure and business visitors

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The view from the Edge of the World north of Riyadh, Saudi Arabia, part of the Tuwaiq escarpment. (Shutterstock)
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Coral reef in the Red Sea, Saudi Arabia. (Shutterstock)
Updated 10 July 2019
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Saudi boom from pilgrims, leisure and business visitors

  • Travelers from US, UAE and UK top list for travel demand into the Kingdom in 2018, Expedia says

LONDON: Saudi hotels are expected to benefit from an upswing in tourism, driven by pilgrims as well as leisure and business visitors, according to bookings website Expedia.

Travelers from the US, UAE and UK topped the list for travel demand into the Kingdom in 2018, the company said. The US saw more than 110 percent year-on-year growth in demand compared to the same period in 2017 with almost 45 percent share of total room nights, while UAE visitors grew 140 percent accounting for almost a fifth of total room nights.

The data also revealed strong growth in package demand from travelers in India and Spain, both growing 200 percent on a year earlier. “Major hotel groups are driving construction trends across the country as they aim to meet the demands of an ever-increasing number of domestic tourists and international visitors,” said Paula de Keijzer, a regional senior director of market management at Expedia Group.

Saudi Arabia plans to open up its tourism sector to international tourists as part of its economic reform agenda, which also includes major investments in new resorts along the Red Sea coastline such as the 30,000 square km NEOM mega project.

Real estate consultancy Colliers expects international arrivals to Saudi Arabia to increase by about 5.6 percent annually from 17.7 million in 2018 to 23.3 million in 2023.The growth is expected to be driven by religious tourism, with the aim of extending pilgrim visits. The Kingdom aims to attract 30 million pilgrims by 2030, an increase of 11 million from the 19 million Hajj and Umrah pilgrims in 2017.

Despite expectations for rising visitor numbers, hotels remain under short-term pressure as new room supply awaits expected future demand. 

More than 5,000 keys are forecast to be delivered to the market by 2022, according to CBRE’s market snapshot as more international chains open properties.

Among the most recent arrivals is China’s Oyo Hotels & Homes, which has struck an initial agreement with the Kingdom’s Public Investment Fund to open 50 hotels across seven cities.

It is also establishing two training schools in Riyadh and Jeddah to train Saudi graduates in hotel management.


Funds managing $2 trillion urge cement makers to act on climate impact

A general view of Gulf Cement Company in Ghalilah, Ras al Khaimah, United Arab Emirates July 16, 2019. (REUTERS)
Updated 23 July 2019
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Funds managing $2 trillion urge cement makers to act on climate impact

  • The cement industry produces 7 percent of the world’s carbon dioxide emissions, according to the International Energy Agency, meaning that if it were a country, it would be the third largest emitter, behind the US and China

LONDON: European funds managing $2 trillion in assets called on cement companies to slash their greenhouse gas emissions on Monday, warning that a failure to do so could put their business models at risk.
Some asset managers are ramping up engagement with heavy polluters to demand a faster transition to a cleaner economy.
“The cement sector needs to dramatically reduce the contribution it makes to climate change,” said Stephanie Pfeifer, CEO of the Institutional Investors Group on Climate Change, which has more than 170 members, mainly European pension funds and asset managers. “This is ultimately a business-critical issue for the sector,” Pfeifer said in a statement.
The group said investors had written to cement or construction materials companies including Ireland’s CRH, Franco-Swiss group LafargeHolcim and France’s St. Gobain to demand they achieve net zero carbon emissions by 2050.
They also noted that Germany’s HeidelbergCement had already adopted the target. The funds urged all cement companies to align themselves with the 2015 Paris agreement to combat global warming, engage with policymakers to ensure an orderly transition to a low carbon economy, and increase their reporting of climate risk.
“Construction materials companies may ultimately risk divestment and lack of access to capital as an increasing number of investors seek to exclude highly carbon-intensive sectors from their portfolios,” said Vincent Kaufmann, CEO of the Ethos Foundation.

FASTFACT

The cement industry produces 7 percent of the world’s carbon dioxide emissions, according to the International Energy Agency.

Signatories collectively manage assets worth $2 trillion and include Aberdeen Standard Investments, BNP Paribas Asset Management, Sarasin & Partners and Hermes EOS.
Although funds are increasingly engaging with companies from airlines to carmakers on emissions, few are calling for the systemic transformation of the global economic system that scientists increasingly argue is needed to prevent runaway climate breakdown.
The cement industry produces 7 percent of the world’s carbon dioxide emissions, according to the International Energy Agency, meaning that if it were a country, it would be the third largest emitter, behind the US and China.
With climate campaigners traditionally focused on fossil fuel companies, the European cement sector has received comparatively little scrutiny until recently.
On Tuesday, police arrested six climate activists from civil disobedience group Extinction Rebellion at a protest aimed at disrupting a site in east London belonging to London Concrete, a unit of LafargeHolcim.
In June last year, a report from think-tank Chatham House concluded that although there was no “silver bullet” to reduce emissions from cement, it should be possible to deploy a range of policies and technologies to achieve deep decarbonization.