As FII finishes, preparations begin for G20 and women’s empowerment

Top finance moguls and political leaders attended the three-day Davos-style Saudi investment summit, which concluded on Oct. 31, 2019. (AFP / FAYEZ NURELDINE)
Updated 01 November 2019

As FII finishes, preparations begin for G20 and women’s empowerment

  • The final “deal value” of FII — the amount of money invested by Saudi Arabian and foreign companies during the week — reached $20 billion

RIYADH: The Future Investment Initiative forum in Riyadh closed with a total of $20 billion in financial deals signed and a commitment that Saudi Arabia would address the issues of social empowerment and sustainability when it hosts the G20 gathering of heads of state a year from now.

Saudi Minister of State Ibrahim Al-Assaf told a crowded closing plenary session that the Kingdom had been preparing for the G20 for some time, with a formal handover from Japan expected later in November.

“We have had high-level meetings headed by Crown Prince Mohammed bin Salman and also other committees preparing for that. On the agenda obviously are the outstanding issues — like dealing with the microeconomic challenges, dealing with financial regulatory issues, and dealing with structural reforms.

Al-Assaf added: “Each presidency there will be a specific area where the interests of the host will be focussed on. In the case of Saudi Arabia, I believe that one of the most important issues will be empowering women and youth. This is very important and although we have little experience, we have been successful in that. This is where the growth will be coming from.” 

The final “deal value” of FII — the amount of money invested by Saudi Arabian and foreign companies during the week — reached $20 billion with the signing of a $5 billion investment agreement between Al-Akaria, the Saudi real estate developer, and Triple Five group of Canada, to develop the Arabian Dream project, a world-class international tourist destination. 

SAGIA, the Saudi Arabian General Investment Authority, said the project would ultimately attract 70 million visitors and employ 25,000 nationals.

Al-Assaf joked: “Last year it (FII) was called ‘Davos in the Desert,’ and I believe in the future we should call the other one FII in the Snow.”

 


Turkey on brink of recession as economy collapses

Updated 13 August 2020

Turkey on brink of recession as economy collapses

  • Consumer debt has increased by 25 percent to more than $100 billion in the past three months

JEDDAH: President Recep Tayyip Erdogan’s popularity is plunging in lockstep with Turkey’s collapsing economy and the country is on the verge of a potentially devastating recession, financial experts have told Arab News.
The value of the Turkish lira has fallen to 7.30 against the US dollar and the central bank has spent $65 billion to prop up the currency, according to the US investment bank Goldman Sachs.
Consumer debt has increased by 25 percent to more than $100 billion in the past three months as the government moved to help families during the coronavirus pandemic, but the result has been a surge in inflation to 12 percent.
With the falling lira and increased price of imported goods, the living standards of many Turks who earn in lira but have dollar debts have fallen sharply.
The economy is expected to shrink by about 4 percent this year. The official unemployment rate remains at 12.8 percent because layoffs are banned, although many experts say the real figures are far higher.
To complete the perfect storm, tourism revenues and exports have been decimated by the pandemic, and foreign capital has fled amid fears over economic trends and the independence of the central bank.
Wolfango Piccoli, of Teneo Intelligence in London, said logic dictated an increase in interest rates but “this is unlikely to happen.”
Piccoli said central bank officials would strive to avoid an outright rate hike at their monetary policy meeting on Aug. 20. “A mix of controlled devaluation and backdoor policies, such as limiting Turkish lira’s liquidity, remains their preferred approach,” he said.
There is speculation of snap elections, and Erdogan’s view is that higher interest rates cause inflation, despite considerable economic evidence to the contrary.