Riyadh Cables Group eyes business in Bangladesh

Bangladesh is looking to encourage more foreign investment. (AFP)
Updated 19 October 2019

Riyadh Cables Group eyes business in Bangladesh

  • RCGC exports its electricity cables worldwide and the company is the fourth largest electric cable producer in the world

DHAKA: Riyadh Cables Group Company (RCGC), a Saudi cable producer, has expressed interest in expanding its corporate footprint in Bangladesh. A high-powered RCGC delegation completed a 6-day visit to Bangladesh on Thursday.

RCGC exports its electricity cables worldwide and the company is the fourth largest electric cable producer in the world.

The visiting delegation comprising Engineer Moaaz Ali Younes, business development manager at RCGC, and Bassam Maes, the marketing director, visited different government agencies in Dhaka with a view to exploring investment opportunities.

During their meeting with officials of Bangladesh Investment Development Authority (BIDA) on Wednesday, the RCGC delegation expressed potential interest in investing in the overhead electricity cable producing sector of the country.

“We had a successful discussion with the RCGC, although it is still at a primary level. We have briefed them about all the benefits for the foreign investors ensured by the Bangladesh government,” director of BIDA Mohammad Ariful Hoque told Arab News.

Hoque said that after returning to Saudi Arabia the RCGC will move forward with the investment proposal and submit the final idea to the Bangladesh embassy in Saudi Arabia.

“Most probably, it is going to be a joint venture form of investment with the state-owned Eastern Cable Company. If everything goes well, we hope the investment will start coming into Bangladesh by next year,” Hoque said.

“The amount of investment from RCGC is yet to be finalized. However, we can expect it will be around $30 million,” another source from BIDA said, requesting not to be named.

Bangladeshi economists said they welcomed the investment proposal from RCGC, stating it will work as a “confidence builder” and create a “signaling value” among other foreign investors.

Zahid Hussain, former lead economist of the World Bank in Dhaka, said that Bangladesh’s economy was expanding at a very fast rate and there was a huge internal demand for overhead cables for building new transmission and distribution lines.

“This new investment will help the country in rebuilding the image crisis in terms of FDI (foreign direct investment). We are still not doing very well in attracting FDI. If this sort of foreign investment starts coming here, it will definitely boost the economy at a significant level,” Hussain said.


Make or break days for global oil ahead of OPEC crunch meeting

Updated 08 April 2020

Make or break days for global oil ahead of OPEC crunch meeting

  • OPEC, led by Saudi Arabia, were on Thursday scheduled to take part in virtual discussions with non-OPEC members, led by Russia, about a possible deal to revive the OPEC+ alliance
  • On Friday, energy ministers from the G20 nations, under the presidency of Saudi Arabia, will convene in another digital forum that will bring in the third part of the global oil equation – the US

DUBAI: The global energy world, in the midst of crisis as demand slumps to unprecedented levels due to the coronavirus disease (COVID-19) pandemic, faces two days that could make – or break – the oil industry for months to come.
Leading producers from the Organization of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia, were on Thursday scheduled to take part in virtual discussions with non-OPEC members, led by Russia, about a possible deal to revive the OPEC+ alliance that fell apart in Vienna at the beginning of last month.
Then, on Friday, energy ministers from the G20 nations, under the presidency of Saudi Arabia, will convene in another digital forum that will bring in the third important part of the global oil equation – the US, currently the biggest oil producer in the world.
If no deal is reached from the two days of oil summits, the immediate prospect looms of a further fall in crude prices and, with global storage facilities already filling rapidly, the possibility of major exporters “shutting in” oil fields, jeopardizing future production.
Energy experts say the purpose of the meetings is two-fold: To reach agreement on how to limit the vast quantities of oil that are still being produced even as demand collapses; and to present some kind of united front in geopolitical terms in the face of the biggest economic recession since the 1930s.
The most visible immediate sign of any success from the meetings will be an increase in the price of crude oil on global markets. Brent crude, the Middle East benchmark, has lost nearly half its value in the past month.
The first aim – to try to balance oil supply and demand – is the more difficult. Global demand has fallen by at least 20 per cent from the usual daily consumption of around 100 million barrels, oil economists have calculated.
But, following the collapse of the OPEC+ deal that was putting a lid on supply, all producers have been pumping more crude. Saudi Arabia is producing more than 12 million barrels per day (bpd), a bigger volume than at any time in its history. All OPEC members, as well as Russia, have said they will increase output.
In this stand-off, US President Donald Trump intervened last week to say that he had spoken to Saudi and Russian leaders and that he “expected” a cut of 10 million, possibly even 15 million, bpd.
That looks like wishful thinking. For one thing, it would not rebalance markets. Anas Al-Hajji, managing partner of US-based Energy Outlook Advisers, said: “The amount of the cut is relatively small given the major drop in demand.”
There are also some difficult relationships to smooth over in the OPEC+ alliance. Saudi Arabia and Russia exchanged angry statements last weekend, each accusing the other of starting the oil price war. Iran, with big reserves but hampered by US sanctions from exporting in large quantities, said that it might not take part in the conference.
The choreography of the two meetings also presents hurdles. The US will not be present at the OPEC+ meeting, but American Secretary of Energy Dan Brouillette said he would take part in the G20 event.
Because it is a free-market industry, America cannot order its oil producers to reduce output, but most analysts are agreed any attempt to rebalance global supply would be impossible without a US contribution.
By going first, Saudi Arabia and Russia are “playing blind” without knowing what the Americans are thinking. Neither would want to agree big price-restoring cuts only for US producers – under big financial pressure at current levels – to swoop back into the market.
This week there have been some signs that the Americans are considering their own versions of cutbacks. The biggest US company, Exxon Mobil, said it would reduce capital expenditure on future projects by 30 percent; the US Energy Information Administration said oil production would fall by nearly 1 million bpd this year, in response to falling demand and financial pressures.
But even if the Saudis and Russians cut substantially alongside other big OPEC producers such as the UAE, and the Americans enter a long-term pattern of falling demand, it is still hard to see how cuts could reach the 10 million barrels Trump “expects,” let alone 15 million.
J. P. Morgan, the big US investment bank, said that it expects OPEC+ to come up with combined cuts of about 4.3 million barrels, most of that coming from Saudi Arabia, Russia and the UAE. “If it’s 4.3 million it only puts off the day when global storage gets filled completely,” said Robin Mills, CEO of Qamar Energy consultancy.
Storage facilities are nearly at the brim. Malek Azizeh, director of the premium facilities at the Fujairah Oil Terminal in the UAE, joked that he was going to hang a sign on the terminal gates: “Thanks, but no tanks.”