Saudi Arabia’s ‘stc’ becomes one of Moody’s highest rated telecom operators 

Saudi Arabia’s ‘stc’ becomes one of Moody’s highest rated telecom operators 
The ratings agency factors in financial profile, market dominance, and liquidity in deciding on companies’ BCA. (Shutterstock)
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Updated 23 September 2021

Saudi Arabia’s ‘stc’ becomes one of Moody’s highest rated telecom operators 

Saudi Arabia’s ‘stc’ becomes one of Moody’s highest rated telecom operators 
  • The telecom company’s BCA was revised from a1 to a2, and Moody’s also affirmed its A1 long-term issuer rating

DUBAI: Bond credit rating firm Moody’s has upgraded the baseline credit assessment (BCA) of Saudi Arabia’s “stc”, saying it has maintained “very strong financial metrics.”

The telecom company’s BCA was revised from a1 to a2, and Moody’s also affirmed its A1 long-term issuer rating. 

“The upgrade reflects stc's leading position in the Saudi telecom sector, which has considerable growth opportunities,” Julied Haddad, a senior analyst at Moody’s, said in a recent report.

The ratings agency factors in financial profile, market dominance, and liquidity in deciding on companies’ BCA. 

According to the report, “stc” was able to maintain a conservative financial profile, as well as maintain strong metrics despite several economic factors, including an oil price crash and the COVID-19 pandemic. 

The company has sustained its debt to EBITDA ratio, and has built a strong balance sheet over the years, Moody’s said in a report.

This has given “stc” a headroom to grow organically through investments, the report explained, as well as develop its footprint outside the Kingdom through acquisitions.

“As of June 2021, stc had SR7.7 billion ($2.1 billion) in unrestricted cash and cash equivalents, in addition to SR2.9 billion ($0.8 billion) of short-term Murabaha and SR3.9 billion ($1.0 billion) in the form of investments in a sukuk issued by the Government of Saudi Arabia, which the company can liquidate, should the need arise,” it added. 

The BCA also looked at the competition within the telecom industry in the Kingdom, where “stc” holds 70 percent of market share. 

“Following the upgrade of stc's BCA to a1, the company is now one of the highest rated telecom operators on a stand-alone basis globally,” the report said.

The new “stc” rating could be affected positively if the sovereign rating of the Kingdom is upgraded, Moody’s said.


Red Sea Development Company signs deal to open 9 hotels

Red Sea Development Company signs deal to open 9 hotels
Updated 13 sec ago

Red Sea Development Company signs deal to open 9 hotels

Red Sea Development Company signs deal to open 9 hotels
  • The tourism development on Saudi Arabia’s west coast is set to be completed in 2030

The Red Sea Development Company (TRSDC) has signed a deal to operate nine hotels that will open in the first phase of the Red Sea development project next year.

The agreement was unveiled on the second day of the Future Investment Initiative in Riyadh and will see international hospitality firms run nine of the 16 properties under development taking over more than 1,700 hotel rooms of 3000 for the first phase of the project.

The agreements are with EDITION Hotels and St Regis Hotels & Resorts, part of Marriott International; Fairmont Hotel & Resorts, Raffles Hotels & Resorts and SLS Hotels & Residences, part of global hospitality group Accor; Grand Hyatt, part of Hyatt Hotels Corporation; Intercontinental Hotels & Resorts and Six Senses, part of InterContinental Hotels Group (IHG); and the Jumeriah Group.

The tourism development on Saudi Arabia’s west coast is set to be completed in 2030 and will offer 50 hotels with up to 8,000 hotel rooms and around 1,000 residential properties across 22 islands and six inland sites.

The site will also host a luxury marina, an 18-hole golf course, entertainment and leisure facilities, as well as an international airport that is expected to serve up to one million passengers a year by 2030.

The complex covers 28,000 square Km, including an archipelago of more than 90 islands, spanning an area the size of Belgium.

The project has so far handed out 800 contracts to firms worth over SR 20 billion.

TRSDC chief executive John Pagano said the first phase of the project is on track for completion by the end of 2023, with a total of 16 hotels set to offer 3,000 hotel rooms across five islands and two inland sites.
 

Pagano said: “Saudi Arabia is accelerating its development of a new tourism offering in the Kingdom, fuelled by the ambitious Vision 2030 program.
 

“We are proud to unveil our collection of unique and diverse hospitality brands that cater to this growing market and underpin our commitment to creating a world-leading barefoot luxury destination which will soon serve as a gateway to one of the last undiscovered places on the planet.”

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Covid a ‘wake-up call’ for inequalities, say business leaders at Future Investment Initiative Forum

Covid a ‘wake-up call’ for inequalities, say business leaders at Future Investment Initiative Forum
Updated 8 min 4 sec ago

Covid a ‘wake-up call’ for inequalities, say business leaders at Future Investment Initiative Forum

Covid a ‘wake-up call’ for inequalities, say business leaders at Future Investment Initiative Forum

Covid was a “wake-up call” for inequalities in the workplace and highlighted the insecurities women in particular face, the founder of global communications consultants APCO Worldwide has claimed.

Speaking at the Future Investment Initiative Forum in Riyadh, Margery Kraus claimed that women were 22 percent more at risk of losing their jobs during the pandemic, and 15 million found themselves out of work.

She said that 90 percent of those women “wouldn’t come back to the workforce”, adding: “We need to find new ways to engage women and give them opportunities along with men.”

Khalid Al Hussain, CEO of Tadawul Group, used the same session to discuss inequality more broadly, and called for the issue to be looked at in a different way.

“If we keep looking at inequality as a challenge we keep reacting to solve the problem but looking at it as an opportunity to add more to business, from a business perspective, this is the way to tackle it,” he said. 

Hussain also argued that inequalities across the globe are exacerbated by people being excluded from the digital world.

“Lack of digital inclusion translates to financial exclusion,” he said, adding: “Covid-19 proves digital is the new norm.”


RCU signs strategic partnerships with AECOM and Egis-led French consortium

RCU signs strategic partnerships with AECOM and Egis-led French consortium
Updated 18 min 18 sec ago

RCU signs strategic partnerships with AECOM and Egis-led French consortium

RCU signs strategic partnerships with AECOM and Egis-led French consortium
  • The first phase of the development will see in excess of SR75 billion ($15 billion), to be invested in AlUla

RIYADH: The Royal Commission for AlUla (RCU) has signed two landmark strategic partnerships, to accelerate the regeneration of the historic city in Saudi Arabia's northwest.

The agreement with Saudi IT firm AECOM and an international French consortium comprising Egis, Assystem and Setec set out a development timeline, based on three phases that lead up to 2035, as it moves from the planning stage to implementation following the launch for redevelopment in April this year.

The first phase of the development will see over SR75 billion ($15 billion) invested in AlUla.

This will include social, economic, and sustainability projects in five unique hubs, with a focus on hospitality, infrastructure, arts and culture, and social and community development.

The agreements were signed today at the Future Investment Initiative Forum currently taking place, in Riyadh, Saudi Arabia.

RCU chief executive Amr Al-Madan said.“These new long-term strategic partnerships are critical to realizing our ambition of creating a global benchmark for sustainable tourism.

“Our new partners will be instrumental in helping us deliver a detailed and certified plan, while our focus is set on phase one we will ramp up our integrated approach towards the development of phase 2 and 3, to drive traffic, and sustain a regular flow of tourists in the long run.”


‘I don’t mind missing 2060 net-zero target as long as we stay on green path’ says senior PIF official

‘I don’t mind missing 2060 net-zero target as long as we stay on green path’ says senior PIF official
Updated 11 min 28 sec ago

‘I don’t mind missing 2060 net-zero target as long as we stay on green path’ says senior PIF official

‘I don’t mind missing 2060 net-zero target as long as we stay on green path’ says senior PIF official

A leading figure in Saudi Arabia’s sovereign wealth fund says he does not mind if the country misses its goal of net zero by 2060, as long as it pushes ahead with environmentally-friendly policies.

The Kingdom’s Crown Prince Mohammed bin Salman bin Abdulaziz announced on Sunday his country would cut carbon emissions to net zero within 40 years — a move that received widespread praise from world leaders.

Speaking at the Future Investment Initiative Forum in Riyadh on Wednesday, Fahad AlSaif, head of Global Capital Finance at Saudi’s Public Investment Fund (PIF), said it would be “shameful” if the Kingdom missed the target by reneging on environmental commitments.

AlSaid said: “What we are planning to do in the Kingdom is to ensure there’s affordable energy, commitment to climate change and also affordable communities and cities. 

“This is all summed up by all of the initiatives that the Kingdom is taking, more precisely the Public Investment Fund, the NEOM, the Red Sea, the renewable energy sector, the 2060 zero-emission carbon target, the 278 million tons of carbon emissions reduction that we are actually aspiring to as a KPI by 2030.   

“The Kingdom of Saudi Arabia is playing a major role to ensure that we are able to collaborate and to ensure that we are able to set a new benchmarks. 

“We are willing to take that challenge. The intent is there, the capacity is there, the trajectory is there, and we have to prove that we are able to progress.

“I don’t mind not achieving the target, but I would be very shameful if I were not able if I have taken dramatic decisions by taking u-turns.”


Chinese industrial profits surge; mixed signals from Western Europe's consumers: Economic wrap

Chinese industrial profits surge; mixed signals from Western Europe's consumers: Economic wrap
Getty Images
Updated 27 October 2021

Chinese industrial profits surge; mixed signals from Western Europe's consumers: Economic wrap

Chinese industrial profits surge; mixed signals from Western Europe's consumers: Economic wrap
  • Compared to January, profits in the coal mining and washing industries surged by 172.2 percent in September

The industrial sector’s profits in China saw a year-on-year jump of 16.3 percent in September to reach CNY738.74 billion ($115.5 billion), official data revealed. This is higher than last month’s gain of 10.1 percent.

While the sector faced rising prices and disruptions in the supply chain, mining and raw materials industries still grew at significantly high rates, pushing the entire sector’s profits up. 

Compared to January, profits in the coal mining and washing industries surged by 172.2 percent in September while profits of the fuel processing industry soared by 930 percent over the same period. On the other hand, power firms experienced a decline in profits, falling by 24.6 percent.

Consumer Confidence in Western Europe

France’s official statistics agency said that consumer confidence declined to 99 points in October, down from 101 points in September. It was below the long-term average of 100. 

Households were mainly worried about the impact of increasing prices on their ability to save in the future. They also seemed to have a negative outlook for their future financial situation and standard of living.

Germany's GfK consumer climate index unexpectedly jumped to 0.9 heading into November 2021. This is the highest level since April 2020. However, rising prices could pose risks to consumer confidence if they were to persist.

The GFK Group added that Germans seem to make more purchases now in a bid to avoid surging prices in the future.

Australia’s Inflation Rate 

Year-on-year inflation rate in Australia was down to 3 percent in the third quarter of 2021 from a 12.5-year high of 3.8 percent in the previous quarter, official data showed. 

Transportation costs slowed to 10.4 percent in 3Q of this year compared to 10.7 percent in the previous quarter. Similarly, price inflation for tobacco and alcohol products reached 4.4 percent, falling from the previous period’s 6.7 percent rise.

Turkey’s trade deficit and economic confidence

The trade deficit in Turkey sharply narrowed to $2.55 billion in September, down from a deficit of $4.86 billion in the same month last year, Turkish Statistical Institute said.

Exports jumped by a significant 30 percent year-on-year in September to reach $20.8 billion. Exports for manufactured products rose by 29.7 percent while sales of mining and quarrying activities leaped by 38.8 percent.

Meanwhile, imports rose by a lower 11.9 percent to be valued at $23.3 billion in September. This was mainly driven by a rise in purchases of intermediate goods, which increased by a 16.5 percent annual rate.

Turkey’s economic confidence index lowered to 101.4 in October. This is a 1 percent decrease from September’s reading of 102.4, the highest since April of 2018. 

Consumers and manufacturers’ sentiment got more pessimistic but service providers, retailers and constructors had a more favorable outlook. 

France’s producer prices

Industrial producer prices in France increased by 1.7 percent month-on-month in September, up from August’s 1 percent rise, official data showed.

Sources of inflationary pressures included rises in mining and quarrying activities prices as well as hikes in the costs of utilities.

In addition, producer prices rose annually by 11.6 percent in September compared to the same month in 2020. 

Indonesia’s FDI

Indonesia's foreign direct investment inflows fell by 2.7 percent on an annual basis to IDR 103.2 trillion ($7.3 billion) in the third quarter of 2021, official data revealed. This is a sharp decline when compared to the previous quarter’s 19.6 percent gain. Also, this was the first decrease since the second quarter of 2020.