DUBAI: Saudi Arabia has the biggest slice of unawarded projects worth $250 billion across the entire Gulf Cooperation Council (GCC), according to a report released by MEED.
The projects that are yet to have their main construction contracts awarded, account for 39 percent of the GCC market. And the Kingdom hopes the projects will help provide a much-needed jumpstart to the economy.
The Kingdom’s energy sector accounts for 33 percent of the total, worth $82 billion, while the construction sector claims the second-biggest segment at 29 percent, with the transport sector third at 27 percent, according to information from the database MEED Projects.
After a year of uncertainty in 2016 as Riyadh formulated its response to lower oil prices, the 225-page Saudi Arabia 2017: Delivering Vision 2030 report said that 2017 will be the year the Kingdom starts to deliver on its promises.
With the blueprint drawn up for economic transformation in its Vision 2030 document, Riyadh is now setting about implementing the reforms to reposition the country, so it can contend in the low oil price era.
According to the report, one of the first major steps has been the establishment of the National Center for Privatization to plan and oversee the procurement of public-private partnerships (PPPs) and other private sector initiatives.
Four PPPs have already been awarded this year to develop airport projects at Yanbu, Taif, Qassim and Hail. Saudi Arabia wants to privatize the operations of all airports by 2020. Advisers have also been enlisted to develop plans to engage private investors in other sectors such as health care.
The Ministry of Health is currently seeking advisers to help it draft a framework to build about 3,000 mega and primary medical centers with the participation of the private sector.
Richard Thompson, MEED editorial director, said the report confirmed that despite the challenges over the past two years, caused by falling oil prices “Saudi Arabia continues to be the biggest and most important market in the region.”
He added: “Anybody serious about growing their business in the region needs to understand the fundamental changes taking place in the Kingdom… In particular, it is vital to understand how Riyadh will implement its plans to increase private sector participation in the implementation of its strategic plans.”
In early February, the Ministry of Energy, Industry and Mineral Resources announced it was establishing the Renewable Energy Project Development Office (Repdo) to head the National Renewable Energy Program (NREP). The same month, Repdo issued prequalification documents for the first 700 megawatts (MW) of solar schemes.
RAK Ceramics Saudi business booms on anti-dumping move
- Net profit rose to 60.6 million dirhams compared to 25.7 million dirhams in the year earlier period
DUBAI: RAK Ceramics, one of the world’s largest tile makers, reported a jump in Saudi sales as it benefited from anti-dumping measures on imports from China and India in the Kingdom.
The company’s wider business surpassed pre-pandemic levels in the first quarter, as it recorded its strongest start to a year since 2016.
“Looking ahead for the remainder of 2021, our priority will be to invest in brand equity, grow our business in Saudi Arabia and protect our market share in the UAE and Bangladesh,” said CEO Abdallah Massaad.
Net profit rose to 60.6 million dirhams compared to 25.7 million dirhams in the year earlier period.
Total gross profit margin also reached an all-time high of 35 percent driven by an increase in revenue, an improvement in efficiencies and the optimization of production lines. Total revenues were also at a five-year high, rising almost 22 percent to reach 722.8 million dirhams.
Revenue growth was strongest in Saudi Arabia where sales jumped by 78.5 percent, followed by India with sales growth of 67 percent.
“In Saudi Arabia, the Company’s strategy continues to yield results,” the company said in a statement. “The imposition of anti-dumping duties on tiles from India and China in the Kingdom initially led to an increase in demand for RAK Ceramics’ products. Capitalizing on this demand, the company invested in differentiated tiles and new showrooms, developing significant brand equity in the market,” it said.
In the UAE, despite the impact of COVID-19, workforce was not reduced, and production reached the highest level in five years due to increased demand from Saudi Arabia, it said.
Emaar Malls Q1 profit falls 16% but sees retail on recovery path
- Profits improved on a quarter-on-quarter basis as net income gained 169 percent from the previous three month period
DUBAI: Dubai operator Emaar Malls said first quarter profit fell 16 percent from a year earlier to 318 million dirhams ($86.6 million).
However the company behind the world's most visited shopping mall highlighted a recovery in the retail sector.
Profits improved on a quarter-on-quarter basis as net income gained 169 percent from the previous three month period.
The retail group said that its e-commerce subsidiary Namshi recorded sales of 258 million dirhams, as it continues to grow in other Gulf markets such Saudi Arabia, Kuwait, and Qatar
The operator has also focused on expansions and new developments to buffer the blow of the pandemic, Emaar boss Mohamed Alabbar said in a statement.
“We are committed to delivering transformational retail and entertainment experiences that exceed expectations of constantly evolving customer demands,” he said.
The retail and entertainment sector in Dubai has been seeing positive signs of recovery as the emirate embarks on a massive vaccine program which has helped to buoy consumer confidence.
Emaar expanded its Dubai Mall Village in February, bringing in 21 new sports and lifestyle stores with an additional gross leasable area of 79,000 square feet.
It also partnered with Time Out Group to open the region’s first Time Out Market in the emirate’s downtown area.
A new mall – Dubai Hills Mall – is in the works, the Dubai Financial Market filing said. It will have a gross leasable area of 2 million square feet that will feature about 600 shops. It will open in the second half of the year.
Tenant rental performance improved over the period with overall occupancy at 91 percent.
Saudi property liquidity higher ahead of Eid
- The market primarily benefited from a 15.6 percent weekly increase in the value of the commercial sector deals
RIYADH: The Saudi real estate market recorded a 6.2 percent rise in weekly activity to reach SR4.1 billion ($1 billion) after earlier declines.
The market primarily benefited from a 15.6 percent weekly increase in the value of the commercial sector deals, to just under SR1.2 billion by the end of last week, Al Eqtisadiah reported.
Housing sector deals recorded a 2.8 percent weekly increase to nearly SR2.6 billion.
Agricultural and industrial deals also increased by 2.3 percent to SR344 million.
The number of real estate transactions gained 1.4 percent to 5,600, the newspaper reported.
Riyadh to get ten BinDawood superstores over five years
- The company said it would open the branches over five years from 2022 to 2027
DUBAI: BinDawood Superstores said it would open ten new branches in Riyadh as the retailer expands its footprint in the Kingdom.
The company, a unit of BinDawood Holding, said in a stock exchange statement that it would open the branches over five years from 2022 to 2027.
BinDawood Holding on Monday said first-quarter profit fell by more than half to SR62.1 million ($16.5 million) compared to a year earlier.
Revenues declined by a fifth to SR1.12 billion because of “non-recurring pantry buying” at the start of the pandemic when consumers stocked up on purchases.
That rush was not repeated in the first quarter of this year.
“It has been a tough start to the year as the local Saudi grocery retail market continues to remain subdued.It is heartening to see some green shoots of recovery but overall, we see a return to pre-COVID sales only in the second half of 2021,” said Ahmad AR. BinDawood, CEO of BinDawood Holding.
However the group remains cautiously optimistic as its sales in Makkah and Madinah pick up and are expected to benefit from the gradual return of pilgrims to the Kingdom.
At the same time it has been able to reduce its costs associated with COVID-19, it said.
BinDawood said the company’s store opening program would result in more jobs for Saudis in the supermarket sector.
Oil gains after cyberattack forces closure of US fuel ‘jugular’ pipeline
- Pipeline moves 2.5 million bpd of gasoline and other fuels
- Network is source of nearly half of the US East Coast’s fuel
TOKYO: Crude prices rose on Monday after a major cyberattack forced the shutdown of critical fuel supply pipelines in the United States and highlighted the fragility of its oil infrastructure.
Brent crude was up by 38 cents, or 0.6 percent, at $68.66 a barrel by 0443 GMT, having risen by l.5 percent last week. US West Texas Intermediate futures rose by 34 cents, or 0.5 percent, at $65.24 a barrel, after gaining more than 2 percent last week.
Signaling the seriousness of the situation, the White House was working closely with Colonial Pipeline to help it recover from the ransomware attack, which forced the biggest US fuel pipeline operator to shut a network supplying populous eastern states.
“The major takeaway is the bad guys are very adept at finding new ways to penetrate infrastructure,” Andrew Lipow, president of Lipow Oil Associates told Reuters. “Infrastructure has not developed defenses that can offset all the different ways that malware can infect one’s system.”
Colonial’s network is the source of nearly half of the US East Coast’s fuel supply, transporting 2.5 million barrels per day of gasoline and other fuels, and the company had to shut all its pipelines after the cyberattack on Friday, which involved ransomware.
US gasoline prices jumped nearly 2 percent on Monday, while heating oil was up by more than 1 percent.
It was not clear who carried out the attack, but sources told Reuters the hackers were likely a professional cybercriminal group.
Colonial said on Sunday its main fuel lines remain offline but some smaller lines between terminals and delivery points are now operational. It didn’t say when the network might return to full operational capacity.
A prolonged shutdown of the line, described as the “jugular of infrastructure” in the United States by one analyst, would cause retail prices to spike at gasoline pumps ahead of peak summer driving season, a potential blow to US consumers and the economy.
“The big unknown is how long the shutdown will last, but clearly the longer it goes on, the more bullish it will be for refined product prices,” ING Economics said in a note.
The attack has prompted calls from American lawmakers to strengthen protections for critical US energy infrastructure from hacking attacks.
The Department of Energy said it was monitoring potential impacts to the nation’s energy supply, while the US Cybersecurity and Infrastructure Security Agency and the Transportation Security Administration told Reuters they were working on the situation.