Reflecting on crown prince’s interview, Saudi business leaders see great opportunities ahead

Reflecting on crown prince’s interview, Saudi business leaders see great opportunities ahead
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While the Kingdom has no plans any time soon to stop focusing on oil, it is looking to maximize the benefits it gets from the sector, such as the downstream industries. (File)
Reflecting on crown prince’s interview, Saudi business leaders see great opportunities ahead
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Waleed Bakarman, the CFO of Raseel Holding Co.
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Updated 29 April 2021

Reflecting on crown prince’s interview, Saudi business leaders see great opportunities ahead

Reflecting on crown prince’s interview, Saudi business leaders see great opportunities ahead
  • Experts praise the crown prince for his economic plans and execution thus far

RIYADH: Saudi experts across various fields welcomed comments made by Crown Prince Mohammed bin Salman in a televised interview on Tuesday to mark the fifth anniversary of the launch of Vision 2030. 

Naif Aldandeni, an energy strategy specialist, said the crown prince raised numerous points with regard to the future of oil as part of the Kingdom’s economic plans. 

“If we were to go back in history, oil no doubt has greatly served Saudi Arabia,” the crown prince said. “But we know that Saudi Arabia has been a country established before the oil.”

While the Kingdom has no plans any time soon to stop focusing on oil, it is looking to maximize the benefits it gets from the sector, such as the downstream industries, Aldandeni noted. 

“We should not rely on it,” the crown prince said during his 90-minute interview. “The other thing that is related to the oil sector, when you go to downstreaming your profitability increases.”

One of the highlights of the interview for energy analysts was when Crown Prince Mohammed bin Salman revealed that the Kingdom’s officials are in discussions to sell a 1 percent stake in oil conglomerate Saudi Aramco. Initial public offering in 2019 for the world’s biggest oil company was a cornerstone of the Kingdom’s economic diversification program, which also aims to boost foreign investment.

While the crown prince did not name the country or company involved in discussions, he said there were also huge opportunities for Aramco to prosper in different sectors — from shipping to pipelines and cables. 

“We want to increase the benefit we reap from the oil to manufacturing industries and others and then to produce other opportunities away from the oil sector to diversify our economy,” he said.

If the Aramco sale is finalized, Aldandeni said it would lead to great opportunities for Aramco and the Kingdom.

HIGHLIGHTS

• Analysts praise plans to sell Saudi Aramco’s 1 percent stake.

• Experts see the Shareek program as a catalyst to spur the private sector’s growth.

• Government efforts to boost the real estate sector praised.

Waleed Bakarman, the CFO of Raseel Holding Co., said the new Shareek program is expected to help private sector companies create growth and expansion opportunities by interacting more with the public sector to create employment.

The public sector can benefit from the technical and financial capabilities of the private sector to accomplish its goals in areas such as health, education, infrastructure and others, Bakarman said. However, he said, the public sector needs to offer incentives to stimulate and encourage private companies to join the program.

Khaled Al-Mobaid, the CEO of Menassat Realty Co., said the real estate sector is the second-largest economic resource after oil. The government issued more than 50 laws and regulations on real estate over the past four years to stimulate the sector and encourage it to contribute to resolving the housing crisis, he said.

He believes that there are still big opportunities in the housing market, which has huge demand. 

Dr. Abdullah Baeshen, a financial adviser, said the crown prince tackled employment systematically from different angles in his interview, pointing to his comment that human resources were the most important pillar of development in the Kingdom, next to water and natural resources.

“The crown prince bravely admitted that it was not acceptable to see unemployment hit 14 percent in an economy that boasts huge human resources,” Baeshen said. 

Faisal Al-Fadl, secretary-general of the Saudi Green Building Forum, stressed that the country’s capital Riyadh is quickly becoming “a world leader in solar production and consumption while making great strides in preserving open space.” 

He congratulated the crown prince for investing “hundreds of millions of riyals to revitalize its buildings, parks, and neighborhoods while building some of the Kingdom’s most eco-friendly projects.”

Abdul Aziz Aloqail, a member of the board of directors at the Environmental Green Horizons Society, concurred with the crown prince when he said man is not isolated from the environment where he lives, rather, he
is part of it.

“Every human being has the right to live in a clean and sustainable environment that guarantees the quality of life and protects the rights of future generations to live in a similar clean environment,” Aloqail said.


Egypt has given $9.87bn to low-income families

Egypt has given $9.87bn to low-income families
Updated 14 June 2021

Egypt has given $9.87bn to low-income families

Egypt has given $9.87bn to low-income families
  • The National Bank of Egypt topped the list of banks that provided the most funding for low-income people

CAIRO: Egyptian banks and mortgage finance companies have provided a total of EGP37.02 billion ($9.87 billion) in real estate financing to 364,900 low-income customers since the government launched the initiative seven years ago.

The Central Bank of Egypt launched a mortgage finance initiative in February 2014, offering subsidized low-interest mortgages to low-income citizens. Interest ranged from 5 to 7 percent, with the price of the homes provided to customers set by the Mortgage Finance Fund.

In total, EGP35.2 billion was provided by 22 banks to 348,700 customers, and EGP1.83 billion was given by eight mortgage finance companies to around 16,200 customers.

The National Bank of Egypt topped the list of banks that provided the most funding for low-income people, with a total of EGP9.85 billion given to 95,900 customers. Second on the list was Banque Misr with total financing amounting to EGP7.7 billion given to around 74,800 clients.

In third place was the Housing and Development Bank with EGP5.74 billion given to 63,700 customers, followed by Banque du Caire in fourth place with total financings amounting to EGP2.7 billion and 30,900 customers. Rounding out the top five was the Commercial International Bank with EGP2.04 billion and 17,700 customers. The Industrial Development Bank came in sixth, with total financing of EGP1.48 billion and around 14,000 customers, followed by the United Bank of Egypt with EGP967.5 million for about 7,900 customers and the Arab African Bank with EGP939.2 million for about 8,600 customers.

Qatar National Bank Al-Ahli contributed funds amounting to EGP881.8 million for 7,800 customers, followed by BLOM Bank Egypt in 10th place with total funds of EGP483.9 million provided to more than 4,600 customers.


Saudi Arabia’s female-only rival to Uber sees growth in first year of operations

Saudi Arabia’s female-only rival to Uber sees growth in first year of operations
Updated 14 June 2021

Saudi Arabia’s female-only rival to Uber sees growth in first year of operations

Saudi Arabia’s female-only rival to Uber sees growth in first year of operations
  • Leena started business June 2020 and has already seen average monthly growth of 25 percent

JEDDAH: June 24, 2018 was a changing point in Saudi Arabia. As the ban on women driving was lifted, and female drivers got behind the wheel, it was one of the standout moments for the Kingdom’s Vision 2030 program.

Female-only car showrooms followed; thousands of women signed up for lessons and driving licenses, Saudi women competed in professional racing competitions and American carmaker General Motors told Arab News last month that 65 percent of the buyers for one of its models were all women.

Therefore, with the advent of disruptive digital platforms like Uber and Careem, it was only a matter of time before a female-only version, with female drivers for passengers, was born.

Leena was officially granted a license by the Saudi government in April 2019 and began operations in June last year.

The company provides taxi services for women, and the drivers — named “Captainahs” — are, like global rival Uber, all freelance operators. However, the difference here is the passengers are all exclusively women as well.

Despite launching at the height of the coronavirus disease (COVID-19) pandemic, demand has been high, with the company reporting average month-on-month growth of over 25 percent.

Leena was founded by a small group of young colleagues whose primary objective was to offer women a comfortable alternative, while also maintaining their independence. 

“We came up with the idea in 2018, around the time women were granted the right to drive,” the CEO and co-founder of Leena, Mohammed Al-Aqeel, told Arab News. “We were debating all the pros and cons of creating an organization centered around women and driving, and found an overwhelming amount of pros — one of which would be to contribute in decreasing the percentage of unemployment among women.”

Despite all the positives, Al-Aqeel’s research found that common negatives from women were complaints about harassment, a lack of privacy and, at worst, even violence, when they took regular taxis.

While everything was ready to launch in 2019, Al-Aqeel said the pandemic did create a lot challenges, but the team has addressed them.

“Every registered ‘Captainah’ is immediately informed of the new regulations and terms related to COVID-19 that they must adhere to,” he said, adding that while the authorities have not made it mandatory for drivers to be vaccinated, Leena has encouraged all “Captainahs” to do so, and the majority have had their injections.

HIGHLIGHT

Leena provides taxi services for women, and the drivers — named ‘Captainahs’ — are, like global rival Uber, all freelance operators. However, the difference here is the passengers are all exclusively women as well.

Initial demand has proved positive, to the extent that the company often does not have enough drivers to meet the number of ride requests. “Our demographic of drivers are women and we have to understand that a lot of them have familial responsibilities which they will prioritize, and since ‘Captainahs’ are freelance workers, they have the freedom to choose their own working hours to help accommodate their personal lives,” Al-Aqeel said, adding that the company is working on this issue, and has a backlog of new drivers waiting approval to receive their licenses and join the team.

Leena is also planning to launch a marketing recruitment campaign soon to attract more drivers. “We expected to do well just based on the surveys and studies we did when Leena was only an idea, and we found an overwhelming majority of people like the idea and are in support of it,” Al-Aqeel said.

Leena has been self-financed but in order to expand to the next level it will need to look at external options. “As of today, all finances that have gone into Leena are from our own initial capital. The team and I are about to embark on an investment round to find investors to sell shares to,” Al-Aqeel said.

Looking to the future, regional rival Careem was bought by Uber for $3.1 billion. Al-Aqeel said he would be interested in an approach, but he is reluctant to sell Leena outright.

“Of course, if we had an offer we would consider it and discuss it as a team, but we won’t compromise or dispense Leena’s initial mission and cause.

We will have conditions, one of them being that Leena stays exclusive to women,” he said. “We have thought of an exit strategy, but we will preserve some shares in the company. We won’t sell the entire company.”


UAE’s RAW Coffee Co. expands to Saudi Arabia

UAE’s RAW Coffee Co. expands to Saudi Arabia
Updated 14 June 2021

UAE’s RAW Coffee Co. expands to Saudi Arabia

UAE’s RAW Coffee Co. expands to Saudi Arabia
  • The company is not planning to distribute through supermarkets but instead plans to replicate its business model in the UAE

JEDDAH: Saudi Arabia is the fastest-growing coffee market in the Middle East, expanding at an annual rate of 9.6 percent, according to research in late 2019 carried out by the organizers of the Middle East Coffee Conference held in Riyadh.

As a result, UAE-based RAW Coffee Co. has expanded its distribution network to Saudi Arabia and is eventually hoping to set up a physical presence in the Kingdom.

“We would say that the KSA specialty coffee scene is catching up to the more established UAE industry both in quality and knowledge, which is a very exciting time,” Kim Thompson, the co-owner and managing director of RAW Coffee Co., told Arab News. The company has teamed up with DHL to process its orders in the Kingdom.

“We have completed establishing our KSA business licensing and are currently exploring opportunities based out of Riyadh. At the moment, we roast and deliver fresh from our roastery in Dubai to the commercial customers in KSA that we supply, one of which is L’ETO Cafe, which has branches in Riyadh, Jeddah and Dammam,” Thompson said.

The company is not planning to distribute through supermarkets but instead plans to replicate its business model in the UAE, where it will distribute directly to customers and through third-party cafes, before eventually setting up its own operations in the Kingdom and potentially a chain of branded cafes.

RAW is not the first UAE-based coffee brand to announce expansion plans in the Kingdom this year. Emirati Coffee in April told Arab News it plans to open its first Saudi branch in July. CEO Mohammed Ali Al-Madfai reported that the company had seen a 3,135 percent increase in online sales in 2020.


Startup of the Week: Botola Meals offers healthy diets

Startup of the Week: Botola Meals offers healthy diets
Updated 14 June 2021

Startup of the Week: Botola Meals offers healthy diets

Startup of the Week: Botola Meals offers healthy diets

JEDDAH: Obesity is a growing issue in Saudi Arabia. A study by the Sharik Association for Health Research found that the rate of obesity among Saudi adults totaled 35.6 percent in 2020.

Besides health issues, another study by the US-based University of North Carolina at Chapel Hill, in collaboration with Saudi Health Council and the World Bank, found that obesity increases the risk of death by COVID-19 by 48 percent, and may make vaccines against the disease less effective.

In a bid to help those suffering with their weight, entrepreneurs Mohammad Faden, Nofal Al-Jefri and Mohammad Al-Harthi in November 2019 set up Botola Meals, a healthy meal-prepping service. 

Botola is the Arabic word for heroism. “It may directly symbolize athletes and achievements, but in fact it is a deep philosophy,” Faden told Arab News. “Whatever the individual’s ambition to reach that goal is, it is in itself an achievement and a mark of heroism,” he added. Al-Jefri highlighted the fact that consumers are prone to purchasing meals that are quick to prepare. “We believe that the market needs and lacks this type of project specialized in healthy fast food, and when you specialize in a particular field, it enhances consumer confidence in your product,” Al-Jefri said. “Clean Eating Matters” is the restaurant’s slogan. Al-Harthi said that Botola Meals offers healthy diets that are not about depriving yourself, but about balance. “We also want to educate people about the importance of investing in themselves and their health in an easy and convenient way,” he said. Botola Meals also prepares customized plans to cater to the specific needs of customers, such as monitoring ingredients that cause allergies and eliminating carbohydrates if a customer is following a paleo diet.

“We sit down with the customer and cooperate as much as possible in providing what suits them,” Faden said.

The startup meal service sold about 45,000 meals in 2020 — roughly 120 meals a day.Botola Meals has one branch in Jeddah’s Al-Salama district, and is planning to open a second branch in Riyadh in 2023. The startup’s long-term plan is to expand across the Gulf and beyond.


Saudi Arabia aims to be Egypt’s top trading partner

Saudi Arabia aims to be Egypt’s top trading partner
Updated 14 June 2021

Saudi Arabia aims to be Egypt’s top trading partner

Saudi Arabia aims to be Egypt’s top trading partner
  • Saudi investors are especially interested in the water desalination and water treatment sector, says Egyptian Trade Minister

RIYADH: Saudi Arabia plans to be Egypt’s top trading partner within five years, said Saudi Commerce Minister Majid Al-Qasabi.

He made the pledge at the Egyptian-Saudi Joint Trade Committee on Monday.

The minister highlighted the presence of 6,225 Saudi companies operating in Egypt with investments amounting to some $30 billion.

At the same time, 518 Egyptian are estimated to operate in the Saudi market, with 285 Egyptian brands in the Kingdom.

Saudi investors are especially interested in the water desalination and water treatment sector, Egyptian Trade Minister Nevine Gamea told Asharq Business.

She added that the cooperation between the two countries was reflected in the trade volume, which exceeded $5.5 billion in 2020.

The volume of Egyptian investments in the Kingdom reached $1.4 billion at the end of last year, she added.