Red Sea Development to award contracts worth $267m per month in next phase

Red Sea Development to award contracts worth $267m per month in next phase
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Updated 28 August 2021

Red Sea Development to award contracts worth $267m per month in next phase

Red Sea Development to award contracts worth $267m per month in next phase
  • TRSDC is spearheading the diversification envisioned by Vision 2030

RIYADH: The Red Sea Development Co. will award SR1 billion ($267 million) of contracts a month as it moves to the next phase, including resorts, villas and hotels, Chief Administrative Officer Ahmed Darwish told CNBC Arabia.

Until now the company has been focused on infrastructure and related equipment, which make up most of its completed projects, he said, without saying how long it would maintain the new pace of spending.

The Red Sea Development Co/, wholly owned by Saudi Arabia’s Public Investment Fund, is building the Red Sea Project, a 28,000 sq. km sustainable tourism resort featuring more than 90 unspoiled islands along Saudi Arabia’s west coast. By completion in 2030, it will consist of 50 hotels with 8,000 rooms and 1,300 residential properties.

The first phase of 16 hotels across five islands and two inland sites will begin opening in late 2022. The destination will also include luxury marinas, golf courses and recreation facilities.

In June, the company signed a contract with Al-Seef Group to manage the administrative, civil and commercial facilities for over 14,000 employees. In the same month, it appointed Dutch contractor Archirodon to build a 1.2-km bridge linking Shurayrah Island, one of 22 islands in an archipelago, to the mainland.

Speaking at Dubai’s Arabian Travel Market in May, CEO John Pagano said the biggest challenge the developer has is not “messing up the place” and avoiding the “over-tourism” that has traditionally compromised nature-based tourist sites. “At the end of the day, our environment is our most valuable asset. It’s making sure that we balance the desire to build, and build it in a timely fashion, but never to the extent where we put at risk the very thing that will make this place so special,” he said.

To that end, the company hired the Middle East unit of global consultancy firm WSP to provide an environmental and social impact assessment for its Coral Bloom resorts project. WSP Middle East’s work includes identifying habitats affected during the project’s lifecycle to ensure sustainability, regeneration, and preservation.

So far, it has been achieving its goals in that regard, achieving an overall score of 84 out of 100 as part of an environmental assessment used as a benchmark by global investors.

Within the environmental category, the Global Real Estate Sustainability Benchmark awarded it 49 out of 51. The average score achieved is typically 34.

The developer was also awarded a Green Star for achieving a score higher than 50 percent in the management and development components of the assessment. With tourism representing the second most important sector in the Kingdom, TRSDC is spearheading the diversification envisioned by Vision 2030 through a unique, year-round tourism offering that promotes sustainability and environmental enhancement, cultural conservation and economic stimulation.


Market’s ‘negative’ response to Saudi Building Code is temporary

Market’s ‘negative’ response to Saudi Building Code is temporary
Updated 6 sec ago

Market’s ‘negative’ response to Saudi Building Code is temporary

Market’s ‘negative’ response to Saudi Building Code is temporary

RIYADH: The recently amended and implemented Saudi Building Code has slowed down the market, but experts and stakeholders see this downturn as a transitory period.

Ali Al-Saif, CEO of Tabuk Cement Co., said the negative impact is temporary and once the sector overcomes teething issues, the new regulations will have a positive impact on the construction sector.

Saudi Arabia’s Commerce Ministry amended the code last Friday to streamline the mechanism governing penalties against violators. It came into effect on Oct. 15, according to Umm Al-Qura newspaper. 

SBC National Committee General Secretary Saad bin Shuail told CNBC Arabia in an interview that the effective implementation of the amended code would guarantee the quality of buildings and construction work.


Subscription for Egypt’s e-finance IPO closes

Subscription for Egypt’s e-finance IPO closes
Updated 6 min 41 sec ago

Subscription for Egypt’s e-finance IPO closes

Subscription for Egypt’s e-finance IPO closes
  • The state-owned company is offering 1.61 percent of its shares to the public, or 25.78 million

DUBAI: The subscription period for the initial public offering of Egypt’s e-finance for Digital and Investments ended on Sunday.

The period started on Oct. 10, with a maximum price of $0.89 per share. 

The state-owned company is offering 1.61 percent of its shares to the public, or 25.78 million, in the transaction that is expected to reach 3.6 billion Egyptian pounds ($229 million).

Last week, e-finance raised the percentage of the institutional offering to 23.5 after a strong demand for subscription. 


Major Saudi retailers expect better days as Kingdom removes pandemic rules

Major Saudi retailers expect better days as Kingdom removes pandemic rules
Updated 15 min 15 sec ago

Major Saudi retailers expect better days as Kingdom removes pandemic rules

Major Saudi retailers expect better days as Kingdom removes pandemic rules
  • The government announced last week it will lift social distancing measures in public places, allow double-vaccinated residents to now wear masks

DUBAI: Saudi retail giants BinDawood and Arabian Centers are expecting better days ahead following the government’s easing of pandemic-related restrictions, including allowing establishments to operate at full capacity. 

The government announced last week it will lift social distancing measures in public places, allow double-vaccinated residents to now wear masks, and reopen holy sites for full capacity attendance. 

These rules will allow retail establishments to double down on efforts to recover from the months-long limited mobility for people, which affected their businesses. 

BinDawood Holding will particularly benefit from the new policy because of its presence in Makkah and Madinah.

“While difficult to estimate the size of the impact at present, the ease of social distancing restrictions and the expected return of Umrah pilgrims to Makkah and Madinah is expected to significantly positively impact the Company's financial results next quarter,” it said in a bourse filing. 

BinDawood has a total of eight stores in the two holy cities. 

Mall operator Arabian Centers also welcomed the new policy, announcing the return to operate with full capacity in all of its sites. 

It said the lifting of social distancing measures will “contribute in increasing the number of visitors to the Company’s commercial centers, which will positively affect their occupancy rates.”


China to keep up scrutiny of internet sector

China to keep up scrutiny of internet sector
Updated 40 min 20 sec ago

China to keep up scrutiny of internet sector

China to keep up scrutiny of internet sector

BEIJING: China will continue its scrutiny of the internet sector, rooting out practices including the blocking of site links by rival platforms and ensuring smaller players have room to develop, its industry minister said in an interview published on Sunday.

China has been engaged this year in a sweeping campaign across regulators to rein in its massive and free-wheeling online economy, led by giants Alibaba Group Ltd., Tencent Holdings Ltd. and others.

In July, the Ministry of Industry and Information Technology launched a six-month regulatory campaign aimed at tackling issues including disrupting market order, infringing on the rights of users, compromising data security and bombarding users with pop-up windows that could not be closed.

“Currently, corporates have increased their awareness of compliance, and some outstanding problems have been solved preliminarily,” Xiao Yaqing, China’s industry and information minister, told the official Xinhua news agency.

He said that the blocking of rivals’ links had been resolved, while uncloseable pop-ups had mostly been eliminated.

Xiao said the ministry will work with other government departments and the industry to ensure more space for the development of small- and medium-sized firms in the sector. 


Euro zone’s trade surplus narrows; supply bottlenecks continue: Economic wrap

Euro zone’s trade surplus narrows; supply bottlenecks continue: Economic wrap
Updated 55 min 55 sec ago

Euro zone’s trade surplus narrows; supply bottlenecks continue: Economic wrap

Euro zone’s trade surplus narrows; supply bottlenecks continue: Economic wrap
  • In addition, imports from Russia and the United States rose noticeably as they jumped by yearly rates of 107.1 percent and 18.4 percent respectively

 

The trade surplus of the Euro area steeply shrank to EUR4.8 billion in August, compared to EUR20.7 billion in the previous month. According to Eurostat data, this was mainly driven by a 26.6 percent surge in imports as energy prices rose. 

In particular, imports of fuels and lubricants soared by 84.4 percent year-on-year. Imports of crude materials also grew significantly in August, rising by a yearly rate of 65.4 percent.

In addition, imports from Russia and the United States rose noticeably as they jumped by yearly rates of 107.1 percent and 18.4 percent respectively.

Global inflation risks

Following elimination of pandemic-related restrictions, a rising global demand has been met with supply shortages all over the world. The Wall Street Journal reported that surging costs for energy and raw materials are the result of this clash.

While more than a dozen central banks have raised their interest rates, two of the most influential, the Federal Reserve and the European Central Bank, are yet to raise their rates. 

This likely means that different central banks have different views over the current inflationary fears. Some predict it to be temporary and will gradually taper off; others expect that it will feed into even more inflationary pressures and thus act accordingly with a contractionary monetary policy.

Italy’s growth forecasts

Italy’s business lobby, Confindustria, has favorably revised its growth outlook for the country. The lobby’s research unit now forecasts the economy to grow by 6.1 percent this year and 4.1 percent in 2022. 

In April, the forecast for 2021 was a lower 4.1 percent.

This means that GDP will be above pre-pandemic levels in the first half of 2022. Limited impact of the Delta variant and robust economic indicators were cited as reasons for this revision.

European Inflation 

Official data showed that France's consumer price inflation rate recorded its highest rate since October 2018, as it increased to 2.2 percent year-on-year in September, higher than last month’s 1.9 percent. Energy costs had the highest jump, growing by 14.9 percent. 

Moreover, according to Italy’s National Institute of Statistics, the country’s yearly inflation rate rose to 2.5 percent in September 2021, rising from 2% in August. Higher energy costs drove this increase as they rose by 20.2 percent. This is the highest inflation rate since November 2012.

However, Italian consumer prices declined by 0.2 percent month-on-month compared to a 0.4 percent rise in August.

Indonesian balance of trade 

In the 17th straight month of continued trade surplus, Indonesia's surplus expanded from $2.4 billion in September 2020 to $4.4 billion in this year’s September, data from Statistics Indonesia showed.

This was mainly due to significantly high export growth, as it increased by a yearly rate of 47.6 percent due to larger oil and non-oil exports. Imports also surged, albeit at a slightly slower pace, growing by 40.3 percent. Oil and gas imports soared by 59.2 percent while purchases of non-oil and gas rose by 38.2 percent.