Trade minister: French companies committed to increase, diversify investments in Saudi Arabia

Franck Riester, French minister delegate for foreign trade and economic attractiveness (L) at an event with Khalid Al-Falih is Minister of Investment of Saudi Arabia (R). (Supplied)
Franck Riester, French minister delegate for foreign trade and economic attractiveness (L), at an event with Khalid Al-Falih, Minister of Investment of Saudi Arabia (R). (Supplied)
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Updated 07 April 2021

Trade minister: French companies committed to increase, diversify investments in Saudi Arabia

Trade minister: French companies committed to increase, diversify investments in Saudi Arabia
  • Saudi giga projects are a catalyst for French investments, says French Trade Minister Delegate Franck Riester
  • France would be keen to offer its proven expertise to design, build, and manage smart, sustainable cities

RIYADH: With direct investment amounting to more than €3.7 billion ($4.37 billion), France is one of the largest investors in Saudi Arabia. Projects relating to the Vision 2030 program to diversify the Saudi economy offer yet more opportunities for strengthening the bilateral partnership. France is keen to share its expertise in such fields as energy, water, transport, new technology, and aerospace.

For Saudi investors, France’s innovation ecosystem and location make it an ideal gateway for trade with the EU. Franck Riester, French minister delegate for foreign trade and economic attractiveness, touched on these issues and more during an exclusive interview with Arab News.

In particular, the minister said French companies are committed to increasing and diversifying their investments in the Saudi economy and have already identified significant opportunities, from renewable energy to healthcare to tourism.

Q. What are the key objectives of your current visit to Saudi Arabia?

A. France and Saudi Arabia have a long history of rich and fruitful cooperation, which we wish to further develop. I first visited the Kingdom in 2019 as minister of culture for the launch of the breathtaking AlUla project, highlighting the exceptional heritage of Saudi Arabia and the partnership with French cultural organizations.

I am here in Riyadh today to develop the economic relationship between France and Saudi Arabia, especially in the framework of the partnership agreed between President Emmanuel Macron and Crown Prince Mohammed bin Salman during his official visit to France on April 18, 2018.

Our two countries share the same ambition in key sectors such as the ecological transition and technological revolution. This common ground provides for concrete business opportunities. Together with my counterpart, Khaled Al-Falih, with whom I have had the pleasure to exchange regularly, we aim to give shape to the economic component of this partnership by discussing shared investment opportunities in both countries.

My current visit is another step forward in our enduring and flourishing economic relationship, and I already hope to come back to the Kingdom to fully grasp its beauty and potential.




Arab News Assistant Editor in Chief Noor Nugali presenting Minister Riester with a copy of Arab News en Francais 2020 landmark YouGov study on the status of French Arabs (AN photo)

Q. France is one of the largest investors in Saudi Arabia, with direct investment amounting to more than €3.7 billion. Do you see room for growth as Saudi Arabia diversifies its economy under Vision 2030?

A. French companies are committed to increasing and diversifying their investment in the Saudi economy, in line with the priorities of the Vision 2030 especially in renewable energy, hydrogen, water and environment, healthcare, digital economy, smart cities, and of course tourism services and infrastructure.

French companies are renowned all over the world for their know-how and expertise, which make them ideally suited to meet the high expectations of the Vision 2030 program. That includes the tech sector: I am well aware that the French tech ecosystem is not always well identified in the Middle East. And yet, our striving tech scene is one of the most innovative and dynamic in Europe and in the world, now counting 10 “unicorns” and aiming for 25 by 2022.

Q. At a time when many governments are tightening their belts, Saudi Arabia has launched projects across sectors in recent months totaling trillions of dollars. Do you see big opportunities for French companies?

A. Saudi Arabia has made the right call: The time to invest and prepare for the post-COVID-19 world is now. France is on the same page. We have launched a €100 billion recovery and investment plan to support the long-term economic development of our companies, including the green and digital transitions.

I note that France and Saudi Arabia have made the same choices for the future: Our priorities are aligned. Hence, French companies will find huge investment opportunities in those sectors in the Saudi economy.




Metro lines are seen parked at a parking station during an exclusive tour of the Riyadh Metro on April 1, 2021 in the Saudi capital. (AFP)

Q. Will French companies be investing in some of these projects, such as The Line in Neom, or do they primarily see themselves as bidders and executors of project contracts?

A. French companies have great ambition to be major partners in the giga-projects, among them, Neom, and more broadly the Red Sea Project, Amaala, Qiddiya, and AlUla projects. Unique in their scope, these projects act as a catalyst for French investments across many areas, covering new technology and innovative solutions, tourism and entertainment, arts, and culture. The unmatched track records of our industrial and technological flagships speak for themselves. Our companies offer a full array of expertise, from the early stages of any given project to its final implementation. They are used to partnering with foreign companies. I am therefore highly confident in their ability to meet the expectations of the Kingdom.

Q. The recently announced Saudi Green and Middle East Green initiatives call for cooperation to tackle the environmental challenges facing Saudi Arabia and the wider region. As a minister of a country that facilitated the landmark Paris Climate Agreement, what is your take?

A. We welcome and support the crown prince’s initiative. It is essential that Saudi Arabia becomes a regional and global beacon in the fight against climate change. The Green initiative sends a very positive signal in the perspective of the upcoming COP26. In recent years, France has been strongly committed to making globalization more sustainable. I believe that greening international trade is key to reach this goal, hence the need to put environmental considerations at the heart of the multilateral rules which organize trade. It is a priority we defend at the WTO with our European partners. 




French companies are committed to increasing and diversifying their investment  in the Saudi economy, in line with the priorities of the Vision 2030 especially in renewable energy, Franck Riester said. (Supplied)

Q. According to the UN Development Program’s top energy expert, Saudi Arabia could be the leader of the energy revolution of tomorrow. Do you see any role for French expertise and knowhow in such a revolution?

A. Absolutely. The French-Saudi partnership in the energy sector is deep-rooted and mutual trust in terms of expertise and innovation is high. French companies and researchers are working hard to develop with their partners the energy technologies of tomorrow, which will enable us to put the energy transition at the core of the world economic recovery, of our industrial diversification and our common strategies for massive decarbonization of our energy mixes.

For example, French firms have already had great success in accompanying Saudi Arabia with ambitious plans to massively develop renewable energies. Many more concrete joint projects are to come in the field of decarbonized energies, as we are allocating massive means in France to green our economy.

Q. Not many countries have a minister delegate for foreign trade and economic attractiveness. What do you consider to be the highlights of France’s economic attractiveness?

A. Foreign trade and economic attractiveness are two sides of the same coin: It means we implement a pro-business agenda making our economy, and the companies based in our country, more competitive, innovative, and ready to take on the world. This strategy is already bearing tangible results: In 2019, France became the leading country in Europe for inbound foreign investment, for the first time ever — and stayed strong in 2020 despite the global shock on foreign direct investment (FDI).

Investors choose France because of its core assets: A central geographical situation within the EU, a highly qualified workforce, world-class infrastructure, available and cheap energy, and a strong internal market. France is the number one country in Europe for FDI in research and development and in the industrial sector. The €100 billion “France Relance” stimulus package will make it the first green economy and innovation ecosystem in Europe. We work hard to make Saudi companies willing to expand to Europe elect France as their HQ and production hub.




Franck Riester said French companies are committed to increasing and diversifying their investments in the Saudi economy and have already identified significant opportunities. (AFP/File Photo)

Q. French expertise has traditionally been in such sectors as energy, water, transport, innovation, new technology, and aerospace. Are we missing out anything that Saudi Arabia could benefit from?

A. I am convinced that French expertise in healthcare and the dynamism of the health-tech ecosystem could greatly contribute to the Kingdom’s ambitious goals regarding the health sector, and set the foundations for a sustainable relationship between our countries. I know our companies are willing to go in that direction.

France is also one of the world’s leading agrifood exporters. Our products are renowned for their high quality, in both taste and health, as well as for their traceability. Finally, regarding Saudi Arabia’s strong ambitions in terms of urban development, France would be keen to offer more of its proven expertise and best technologies to design, build, and manage smart and sustainable cities, while meeting high environmental and quality standards.

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Twitter: @NoorNugali


Many global stocks lower after Wall St. decline

Many global stocks lower after Wall St. decline
Updated 21 April 2021

Many global stocks lower after Wall St. decline

Many global stocks lower after Wall St. decline
  • London and Frankfurt opened lower, while Shanghai and Tokyo also declined

BEIJING: Major global stock markets were mostly lower Tuesday after Wall Street retreated from record highs.

London and Frankfurt opened lower, while Shanghai and Tokyo also declined. Hong Kong and Seoul advanced.

Wall Street futures gained a day after the benchmark S&P 500 index lost 0.5 percent on declines for tech, bank and energy stocks.

Investor optimism has been boosted by higher corporate profits, US hiring and consumer confidence. Still, traders are uneasy about a rise in inflation and interest rates and renewed coronavirus infections that prompted some governments to reimpose anti-disease controls.

“Wall Street could be in for a few choppy trading weeks as more of the same strong earnings beats becomes the theme,” said Edward Moya of Oanda in a report.

In early trading, the FTSE 100 in London declined 0.3 percent to 6,982.77 and the DAX in Frankfurt lost 0.2 percent to 15,335.68. The CAC 40 in Paris shed 0.6 percent to 6,256.90. On Wall Street, futures for the S&P 500 and the Dow Jones Industrial Average were up less than 0.1 percent.

On Monday, the Dow lost 0.4 percent. Both the S&P 500 and the Dow hit highs on Friday.

Capital One lost 0.9 percent and Valero Energy slid 2.3 percent.

The tech-heavy Nasdaq composite slid 1 percent. Chipmaker Intel fell 1.7 percent.

In Asia, the Shanghai Composite Index lost 0.1 percent to 3,472.94 while the Nikkei 225 in Tokyo tumbled 2 percent to 29,100.38. The Hang Seng in Hong Kong gained 0.1 percent to 29,135.73.

The Kospi in Seoul rose 0.7 percent to 3,220.70 while the S&P-ASX 200 in Sydney sank 0.7 percent to 7,017.80.

India’s Sensex was up less than 0.1 percent at 47,978.05. New Zealand, Singapore and Jakarta declined while Bangkok advanced.

This week, 81 of the 500 members of the S&P 500 index are due to report earnings, as are 10 of the 30 members of the Dow, including Johnson & Johnson, Verizon Communications and Intel. On average, analysts expect quarterly profits across the S&P 500 to be up 24 percent from a year earlier, according to FactSet. In energy markets, benchmark US crude rose 82 cents to $64.25 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, used to price international oils, gained 90 cents to $67.95 per barrel in London.

The dollar advanced to 108.40 yen from Monday’s 108.11 yen. The euro gained to $1.2070 from $1.2039.


Surge in demand for companies looking to set up in KSA

Surge in demand for companies looking to set up in KSA
Updated 21 April 2021

Surge in demand for companies looking to set up in KSA

Surge in demand for companies looking to set up in KSA
  • Consultants have seen a 50 percent rise in activity in the first quarter of 2021

RIYADH: Sovereign AEI, a firm which specializes in helping companies set up operations in the Kingdom, has seen a spike in business activity.

“The beginning of this year has been very encouraging as we have seen a 40 to 50 percent increase in Saudi Arabia market-entry activity, when compared to pre-pandemic levels,” Stuart D’Souza, co-founder and CEO of Arabian Enterprise Incubators (AEI), one of the partner firms that makes up Sovereign AEI, told Arab News.

As part of the ambitious Riyadh Strategy 2030 announced by Crown Prince Mohammed bin Salman earlier this year, the government wants to attract up to 500 international companies to set up their regional bases in the city, create around 35,000 new jobs for Saudi locals, and double the capital’s population.

The strategy aims to invest up to SR70 billion ($18.67 billion) into the national economy by the end of the decade. The strategy is already paying dividends.

“Sovereign AEI is helping to facilitate this new strategy. Our products and services are conducive with Riyadh Strategy 2030 by helping new and existing businesses capitalize on the expected significant growth forecast for the Kingdom,” Paul Arnold, managing director of Sovereign Saudi Arabia, told Arab News.

BACKGROUND

• The government wants to attract up to 500 international companies to set up their regional bases in the city, create around 35,000 new jobs for Saudi locals, and double the capital’s population.

• The strategy aims to invest up to SR70 billion ($18.67 billion) into the national economy by the end of the decade. The strategy is already paying dividends.

“We are also encouraging businesses to look ahead and establish a physical presence in the Kingdom, while taking into consideration new criteria set to come into force by 2024, the specifics of which are yet to be formally announced,” he added.

Sovereign has been operating in Saudi Arabia for about 20 years and AEI since 2012. They formed their joint partnership in 2019.

In 2019, the company helped 600 businesses visit Saudi Arabia to investigate potential opportunities. Half were first-time visitors and over 70 percent went on to establish new business links in the Kingdom. AEI alone has helped over 1,500 foreign businesses to enter, establish or expand in Saudi Arabia since 2012.

Last year, despite the restrictions as a result of the pandemic, Sovereign AEI reported a 300 percent increase in corporate services in Saudi Arabia. The team is expecting this positive growth to continue in 2021.

“The Saudi market presents tremendous opportunities. Most companies are now aware of the potential of the market, the main pillars of Vision 2030 and the significant number of economic reforms carried out over the past 18 months. However, plotting a road map to success can be a challenge,” Arnold said.

“Our principles are to educate, de-risk and enable the client’s ability to enter, establish or expand in the Kingdom. Our robust performance in the first quarter is a testament to the attractive nature of the Saudi market and we continue to see a growing interest and increasing shift of client focus toward the Kingdom, as the country continues to unveil new strategic initiatives,” he added.


New oil price surge caps year of recovery since ‘Black Monday’

New oil price surge caps year of recovery since ‘Black Monday’
Updated 21 April 2021

New oil price surge caps year of recovery since ‘Black Monday’

New oil price surge caps year of recovery since ‘Black Monday’
  • Anniversary of US crude plunging to minus-$40 at start of pandemic recession

DUBAI: Oil prices resumed their surge on global markets on Tuesday as traders shrugged off the memory of “Black Monday” 2020, when some crude prices went into negative territory at the start of the pandemic recession.
Brent crude, the global benchmark, went above $68 a barrel for the first time in over a year, while West Texas Intermediate, which approached minus-$40 at the depth of the oil crisis exactly a year ago, leapt above $64.
The resurgence in the oil price — which has seen some experts suggesting the possibility of a “supercycle” in which crude goes back above $100 a barrel — is partly down to improved prospects as the global economy moves outs of pandemic lockdowns.
The global rollout of coronavirus vaccines has led economic experts to predict a sharp recovery in growth in 2021, with the International Monetary Fund recently forecasting a sharp rise in economic activity for the rest of the year. China last week said its economy had grown by 18.3 percent in the first quarter of the year.
But oil analysts believe the actions of OPEC+ — the producers’ alliance led by Saudi Arabia and Russia —had been the biggest factor in helping reduce the huge glut of oil that threatened to swamp the world market last spring.
Since last April, OPEC+ has taken more than 3 billion barrels of oil off the global market, through a combination of strong internal discipline and voluntary cuts by Saudi Arabia, the world’s biggest exporter.
Prince Abdul Aziz bin Salman, the Saudi Energy Minister and co-chairman of OPEC+, has repeatedly urged caution on the 23-member organization as COVID-19 cases re-emerge in some parts of the world. Europe and India are the latest causes of concern.
“The reality remains that the global picture is far from even, and the recovery is far from complete,” he told the last OPEC+ meeting.
The oil price bulls are encouraged by increasing demand from China, the biggest oil consumer in the world.
Figures from the country’s customs regulator, released on Tuesday, showed that crude oil imports from Saudi Arabia — its biggest supplier — had risen by nearly 9 percent in March, with strong domestic demand bolstered by a freeing up of supplies after port congestions.
Some analysts still believe Brent crude could hit $75 this year, and reckon $100 a barrel next year is a possibility.
But nobody appears to believe the volatile market conditions of last spring, and negative oil prices, will happen again.
Robin Mills, chief executive officer of consultancy Qamar Energy, told Arab News: “That was a pretty unusual set of circumstances.”
He added: “Never say never, and traders have short memories, but I think the fixes in place would make it unlikely to go negative again.”


Egypt targets investments of $80 billion

Egypt targets investments of $80 billion
Updated 21 April 2021

Egypt targets investments of $80 billion

Egypt targets investments of $80 billion
  • Plan forecasts 125 percent increase in funding for production sector

CAIRO: Egypt is aiming to raise EGP 1.25 trillion ($80 billion) as part of its investment plan for the fiscal year 2021/2022, according to the Egyptian Minister of Planning and Economic Development Hala Al-Saeed.

The investment plan forecasts a 125 percent increase in funding for the production sector, the minister said, along with a 30 percent increase for the country’s service sector.

Al-Saeed said the plan helps address the public spending commitments related to health and education and scientific research, as well funding for the continued efforts to combat the COVID-19 pandemic.

She said priority would be given to high-productivity sectors that drive sustainable economic growth in Egypt such as the manufacturing, communications, information technology and agriculture sectors.

According to the minister, the most important goals of the 2021/2022 sustainable development plan include addressing important social issues such as gender equality and public investments into green projects.


Korean envoy invites Saudi Arabia to GICC2021

Korean Ambassador Jo Byung-Wook during a meeting with Prince Saud bin Talal bin Badr and officials from Ministry of Municipal and Rural Affairs and Housing. (Supplied)
Korean Ambassador Jo Byung-Wook during a meeting with Prince Saud bin Talal bin Badr and officials from Ministry of Municipal and Rural Affairs and Housing. (Supplied)
Updated 20 April 2021

Korean envoy invites Saudi Arabia to GICC2021

Korean Ambassador Jo Byung-Wook during a meeting with Prince Saud bin Talal bin Badr and officials from Ministry of Municipal and Rural Affairs and Housing. (Supplied)
  • The annual conference provides an opportunity to present projects to potential Korean partners, and to hold personal consultations

RIYADH: South Korean Ambassador Jo Byung-Wook has invited Saudi Arabia to attend the Global Infrastructure Cooperation Conference (GICC2021).

The annual conference provides an opportunity to present projects to potential Korean partners, and to hold personal consultations.

The ambassador met Prince Saud bin Talal bin Badr, undersecretary at the Ministry of Municipal and Rural Affairs and Housing for housing subsidies, and general supervisor of the International Cooperation Department at the ministry in Riyadh.

GICC2021 is scheduled for “later this year,” the ambassador told Arab News, adding that the meeting “reviewed the close, friendly and cooperative relations” between the two countries, and “agreed to continue to expand bilateral cooperation in the housing sector.”

He said: “I commended the Saudi government’s efforts to help Saudi families own their house through the Sakani program, taking note of the signing of four agreements during the Sakani Forum held last Thursday in Riyadh.”

The Sakani program helped 70,000 families in the first quarter of 2021, surpassing its target of serving 51,000 families.

It was formed in 2017 by the Ministry of Housing and the Real Estate Development Fund, with the aim of facilitating home ownership in the Kingdom by creating new housing stock, allocating plots and homes to nationals, and financing their purchase. It has a goal of reaching 70 percent home ownership by 2030.

The program aims to serve 220,000 Saudi families this year by creating 50,000 housing units, facilitating the reservation of 30,000 residential land plots, and arranging 140,000 real estate loans. To date, Sakani has enabled more than 350,000 families to own homes.