Saudi energy policy ‘geared toward supporting diversification and fiscal consolidation’

Saudi energy policy ‘geared toward supporting diversification and fiscal consolidation’
Updated 26 November 2016

Saudi energy policy ‘geared toward supporting diversification and fiscal consolidation’

Saudi energy policy ‘geared toward supporting diversification and fiscal consolidation’

JEDDAH: GCC countries are serious in negotiating an output cut coordinated between OPEC and non-OPEC countries, according to analysts from the Bank of America Merrill Lynch.
“In the case of Saudi Arabia, energy policy appears to be geared toward supporting diversification and fiscal consolidation,” they added in a report, released ahead of Wednesday’s OPEC meeting in Vienna.
“The near-term outlook for Saudi Arabia appears favorable, with a likely OPEC deal, improving domestic liquidity, lack of domestic debt issuance, repayment of government arrears and continued commitment to the dollar peg, the report added.
It said that the Cabinet’s empowerment of the Ministry of Finance to service up to SR100 billion in arrears to contractors is likely to boost spending in December and possibly in the first quarter of 2017, support deposit formation (to the extent debt is not serviced instead) and help narrow the Saibor-Libor and riyal-dollar swap spreads.
The report by Jean-Michel Saliba and the economics research team also said: “The adjustment burden of Saudi Arabia within the possible deal is key to watch to judge the sustainability of the agreement. On net, the coordinated nature of the potential cuts (which distributes the burden across several producers) could make the move revenue-positive for Saudi Arabia in the short-term.”
The researchers added: “The main current proposal to be discussed at the ministerial level on Wednesday is likely closer to the Saudi opening negotiation position, in our view.”
They also said: “We believe the gap to finalize the deal on current proposals is wider than suggested by the constructive official rhetoric. The current proposal likely amounts to a Saudi output cut of 0.5 million barrels per day, which is budget-positive.”
The economists estimate that Saudi Arabia could cut up to 0.75 million barrels per day of production while remaining marginally budget-positive or budget-neutral as the increase in the oil price will offset likely the increase in the fiscal breakeven oil price.
This would require an extra 0.25 million barrels per day cut by other Gulf countries but would accommodate an output freeze at October levels from Iraq and Iran.


Saudi Arabia’s female-only rival to Uber sees growth in first year of operations

Saudi Arabia’s female-only rival to Uber sees growth in first year of operations
Updated 3 min 37 sec ago

Saudi Arabia’s female-only rival to Uber sees growth in first year of operations

Saudi Arabia’s female-only rival to Uber sees growth in first year of operations
  • Leena started business June 2020 and has already seen average monthly growth of 25 percent

JEDDAH: June 24, 2018 was a changing point in Saudi Arabia. As the ban on women driving was lifted, and female drivers got behind the wheel, it was one of the standout moments for the Kingdom’s Vision 2030 program.

Female-only car showrooms followed; thousands of women signed up for lessons and driving licenses, Saudi women competed in professional racing competitions and American carmaker General Motors told Arab News last month that 65 percent of the buyers for one of its models were all women.

Therefore, with the advent of disruptive digital platforms like Uber and Careem, it was only a matter of time before a female-only version, with female drivers for passengers, was born.

Leena was officially granted a license by the Saudi government in April 2019 and began operations in June last year.

The company provides taxi services for women, and the drivers — named “Captainahs” — are, like global rival Uber, all freelance operators. However, the difference here is the passengers are all exclusively women as well.

Despite launching at the height of the coronavirus disease (COVID-19) pandemic, demand has been high, with the company reporting average month-on-month growth of over 25 percent.

Leena was founded by a small group of young colleagues whose primary objective was to offer women a comfortable alternative, while also maintaining their independence. 

“We came up with the idea in 2018, around the time women were granted the right to drive,” the CEO and co-founder of Leena, Mohammed Al-Aqeel, told Arab News. “We were debating all the pros and cons of creating an organization centered around women and driving, and found an overwhelming amount of pros — one of which would be to contribute in decreasing the percentage of unemployment among women.”

Despite all the positives, Al-Aqeel’s research found that common negatives from women were complaints about harassment, a lack of privacy and, at worst, even violence, when they took regular taxis.

While everything was ready to launch in 2019, Al-Aqeel said the pandemic did create a lot challenges, but the team has addressed them.

“Every registered ‘Captainah’ is immediately informed of the new regulations and terms related to COVID-19 that they must adhere to,” he said, adding that while the authorities have not made it mandatory for drivers to be vaccinated, Leena has encouraged all “Captainahs” to do so, and the majority have had their injections.

HIGHLIGHT

Leena provides taxi services for women, and the drivers — named ‘Captainahs’ — are, like global rival Uber, all freelance operators. However, the difference here is the passengers are all exclusively women as well.

Initial demand has proved positive, to the extent that the company often does not have enough drivers to meet the number of ride requests. “Our demographic of drivers are women and we have to understand that a lot of them have familial responsibilities which they will prioritize, and since ‘Captainahs’ are freelance workers, they have the freedom to choose their own working hours to help accommodate their personal lives,” Al-Aqeel said, adding that the company is working on this issue, and has a backlog of new drivers waiting approval to receive their licenses and join the team.

Leena is also planning to launch a marketing recruitment campaign soon to attract more drivers. “We expected to do well just based on the surveys and studies we did when Leena was only an idea, and we found an overwhelming majority of people like the idea and are in support of it,” Al-Aqeel said.

Leena has been self-financed but in order to expand to the next level it will need to look at external options. “As of today, all finances that have gone into Leena are from our own initial capital. The team and I are about to embark on an investment round to find investors to sell shares to,” Al-Aqeel said.

Looking to the future, regional rival Careem was bought by Uber for $3.1 billion. Al-Aqeel said he would be interested in an approach, but he is reluctant to sell Leena outright.

“Of course, if we had an offer we would consider it and discuss it as a team, but we won’t compromise or dispense Leena’s initial mission and cause.

We will have conditions, one of them being that Leena stays exclusive to women,” he said. “We have thought of an exit strategy, but we will preserve some shares in the company. We won’t sell the entire company.”


UAE’s RAW Coffee Co. expands to Saudi Arabia

UAE’s RAW Coffee Co. expands to Saudi Arabia
Updated 12 min 14 sec ago

UAE’s RAW Coffee Co. expands to Saudi Arabia

UAE’s RAW Coffee Co. expands to Saudi Arabia
  • The company is not planning to distribute through supermarkets but instead plans to replicate its business model in the UAE

JEDDAH: Saudi Arabia is the fastest-growing coffee market in the Middle East, expanding at an annual rate of 9.6 percent, according to research in late 2019 carried out by the organizers of the Middle East Coffee Conference held in Riyadh.

As a result, UAE-based RAW Coffee Co. has expanded its distribution network to Saudi Arabia and is eventually hoping to set up a physical presence in the Kingdom.

“We would say that the KSA specialty coffee scene is catching up to the more established UAE industry both in quality and knowledge, which is a very exciting time,” Kim Thompson, the co-owner and managing director of RAW Coffee Co., told Arab News. The company has teamed up with DHL to process its orders in the Kingdom.

“We have completed establishing our KSA business licensing and are currently exploring opportunities based out of Riyadh. At the moment, we roast and deliver fresh from our roastery in Dubai to the commercial customers in KSA that we supply, one of which is L’ETO Cafe, which has branches in Riyadh, Jeddah and Dammam,” Thompson said.

The company is not planning to distribute through supermarkets but instead plans to replicate its business model in the UAE, where it will distribute directly to customers and through third-party cafes, before eventually setting up its own operations in the Kingdom and potentially a chain of branded cafes.

RAW is not the first UAE-based coffee brand to announce expansion plans in the Kingdom this year. Emirati Coffee in April told Arab News it plans to open its first Saudi branch in July. CEO Mohammed Ali Al-Madfai reported that the company had seen a 3,135 percent increase in online sales in 2020.


Startup of the Week: Botola Meals offers healthy diets

Startup of the Week: Botola Meals offers healthy diets
Updated 17 min 6 sec ago

Startup of the Week: Botola Meals offers healthy diets

Startup of the Week: Botola Meals offers healthy diets

JEDDAH: Obesity is a growing issue in Saudi Arabia. A study by the Sharik Association for Health Research found that the rate of obesity among Saudi adults totaled 35.6 percent in 2020.

Besides health issues, another study by the US-based University of North Carolina at Chapel Hill, in collaboration with Saudi Health Council and the World Bank, found that obesity increases the risk of death by COVID-19 by 48 percent, and may make vaccines against the disease less effective.

In a bid to help those suffering with their weight, entrepreneurs Mohammad Faden, Nofal Al-Jefri and Mohammad Al-Harthi in November 2019 set up Botola Meals, a healthy meal-prepping service. 

Botola is the Arabic word for heroism. “It may directly symbolize athletes and achievements, but in fact it is a deep philosophy,” Faden told Arab News. “Whatever the individual’s ambition to reach that goal is, it is in itself an achievement and a mark of heroism,” he added. Al-Jefri highlighted the fact that consumers are prone to purchasing meals that are quick to prepare. “We believe that the market needs and lacks this type of project specialized in healthy fast food, and when you specialize in a particular field, it enhances consumer confidence in your product,” Al-Jefri said. “Clean Eating Matters” is the restaurant’s slogan. Al-Harthi said that Botola Meals offers healthy diets that are not about depriving yourself, but about balance. “We also want to educate people about the importance of investing in themselves and their health in an easy and convenient way,” he said. Botola Meals also prepares customized plans to cater to the specific needs of customers, such as monitoring ingredients that cause allergies and eliminating carbohydrates if a customer is following a paleo diet.

“We sit down with the customer and cooperate as much as possible in providing what suits them,” Faden said.

The startup meal service sold about 45,000 meals in 2020 — roughly 120 meals a day.Botola Meals has one branch in Jeddah’s Al-Salama district, and is planning to open a second branch in Riyadh in 2023. The startup’s long-term plan is to expand across the Gulf and beyond.


Saudi Arabia aims to be Egypt’s top trading partner

Saudi Arabia aims to be Egypt’s top trading partner
Updated 14 June 2021

Saudi Arabia aims to be Egypt’s top trading partner

Saudi Arabia aims to be Egypt’s top trading partner
  • Saudi investors are especially interested in the water desalination and water treatment sector, says Egyptian Trade Minister

RIYADH: Saudi Arabia plans to be Egypt’s top trading partner within five years, said Saudi Commerce Minister Majid Al-Qasabi.

He made the pledge at the Egyptian-Saudi Joint Trade Committee on Monday.

The minister highlighted the presence of 6,225 Saudi companies operating in Egypt with investments amounting to some $30 billion.

At the same time, 518 Egyptian are estimated to operate in the Saudi market, with 285 Egyptian brands in the Kingdom.

Saudi investors are especially interested in the water desalination and water treatment sector, Egyptian Trade Minister Nevine Gamea told Asharq Business.

She added that the cooperation between the two countries was reflected in the trade volume, which exceeded $5.5 billion in 2020.

The volume of Egyptian investments in the Kingdom reached $1.4 billion at the end of last year, she added.


Saudi Arabia’s FlyNAS to start direct flights to Seychelles

Saudi Arabia’s FlyNAS to start direct flights to Seychelles
Updated 14 June 2021

Saudi Arabia’s FlyNAS to start direct flights to Seychelles

Saudi Arabia’s FlyNAS to start direct flights to Seychelles
  • With the arrival of FlyNAS to our shores, the Ministry of Tourism is looking forward to (seeing) an increase in the number of visitors from the Saudi Arabian region

RIYADH: Saudi airline FlyNAS is starting direct flights to the Seychelles from July 1.

It will operate three times a week from Jeddah to Mahé, using an A320 Neo aircraft, on Tuesdays, Thursdays and Saturdays with up to 174 passengers. The flight time is five hours and 40 minutes.

Seychelles foreign affairs and tourism minister, Sylvestre Radegonde, said: “The destination has recorded approximately some 300 Saudi Arabians since January 2021. With the arrival of FlyNAS to our shores, the Ministry of Tourism is looking forward to (seeing) an increase in the number of visitors from the Saudi Arabian region. The three weekly flights to Seychelles from Jeddah represent another great opportunity for our destination, as not only will the Seychelles be accessible directly to Saudi Arabian nationals but also the expatriates living in the Kingdom.”

All passengers must present a negative PCR test and proof of valid travel health insurance covering any potential coronavirus-related costs as part of the Seychelles COVID-19 measures.