Saudi Arabia has potential to be hub for green finance: KPMG

Michael Hayes, global head of renewables, KPMG International.
Updated 20 November 2019

Saudi Arabia has potential to be hub for green finance: KPMG

Saudi Arabia can become the center for green finance for emerging markets, which will bring huge economic and commercial benefits to the economy in line with Vision 2030, according to Michael Hayes, global head of renewables, KPMG International.
“The amount of capital required to support the energy transition is vast and it is for this reason that a whole new sector called green finance has emerged in recent years delivering new products such as green bonds and green insurance. Much of the expenditure in renewables over the next 20 years will be in emerging markets and so Saudi Arabia should concentrate on creating a center for green finance for emerging markets,” he said.
The Saudi government intends to attract between $30 billion and $50 billion in new investments into renewables by 2030, as it plans to tender around 9.5GW of solar and wind capacities by 2023. Furthermore, the International Renewable Energy Agency (IRENA) predicts that nearly $148 billion will be required each year until 2050 to meet the goals of the Paris Agreement and limit global temperature increases to 1.5 C above pre-industrial levels.
Given these investment projections, Hayes believes it is an absolute necessity for GCC governments to invest in renewables, which is one of the key goals of governmental visions across the GCC. 
“Climate change is now recognized as the most significant risk on the planet and is likely to dominate the political and economic landscape for many years to come. While there are many different ways to help in the fight against climate change, transitioning from conventional power usage to renewable power is still one of the best and most effective solutions available,” Hayes said.
The Middle Eastern countries are well aware of their strong dependence on fossil fuels to drive economic growth. Therefore, in an era when the long-term viability of fossil fuels is under question, it is critical that these economies diversify as soon as possible. 
“Renewable generation represents an ideal way to do this and over time, I expect to see Saudi Arabia and other GCC countries take a leading role in the growth of renewable energy across the region and even into Sub-Sahara Africa,” he said.
 


SAGIA, Xylem ink $50m MoU to advance water security

Updated 05 December 2019

SAGIA, Xylem ink $50m MoU to advance water security

Water technology firm Xylem has signed an MoU with the Saudi Arabian General Investment Authority (SAGIA), representing an investment of $50 million. The agreement aims to expand Xylem’s manufacturing footprint into the Kingdom, and to better serve its portfolio of customers in Saudi Arabia and across the region.

Under the MoU, Xylem will work with SAGIA to develop and localize advanced water and wastewater products and technologies to address water challenges in Saudi Arabia, as well as increase its footprint of service points and rental fleets across the Kingdom. A core objective of the MoU is to accelerate adoption of digital water solutions and optimize utility networks across the Kingdom.

The proposed multimillion-dollar investment will not only help build a vibrant local supply chain, but also see Xylem bringing additional commercial opportunities into the Kingdom, with the wider aim of improving water solutions locally. The agreement is in line with the goals of Saudi Vision 2030 to promote economic diversification through investments in localization that will also contribute to the export of “Made in Saudi” products across the world.

The MoU was signed on the sidelines of the Future Investment Initiative (FII), commonly known as the “Davos in the Desert,” by Ibrahim A. Al-Omar, governor of SAGIA, and Steven Leung, senior vice president and president, emerging markets of Xylem, in the presence of senior officials of both entities and Frank Ackland, managing director Xylem Middle East.

Al-Omar said: “As Saudi Arabia welcomes investors and decision-makers from across the globe to this annual global investment platform, the agreements exchanged here reflect the strength and diversity of the economy. Under Saudi Vision 2030, Saudi Arabia is undergoing an ambitious program of economic reform, and the world is taking notice. This month, Saudi Arabia climbed 30 places in the World Bank’s Doing Business 2020 report, becoming the most improved economy globally. The indicators are
clear: Saudi Arabia is not only open for business, it’s the economy of the future.”

Leung added: “As Xylem continues to lead the water sector’s digital transformation globally, this MoU presents an opportunity to leverage our market-leading portfolio and application expertise to advance water security in Saudi Arabia. Through our investment of $50 million, and with our strong presence in Saudi Arabia, backed by our dedicated office and team, we are committed to creating in-Kingdom value through our investments and partnerships. We are thankful to SAGIA for the opportunity to directly contribute our expertise to the development vision of the leadership, as the Kingdom embarks on its ambitious transformation program.”