International tourism body to work with new Saudi sustainability center as it pushes for net zero carbon roadmap

Special International tourism body to work with new Saudi sustainability center as it pushes for net zero carbon roadmap
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Updated 05 November 2021

International tourism body to work with new Saudi sustainability center as it pushes for net zero carbon roadmap

International tourism body to work with new Saudi sustainability center as it pushes for net zero carbon roadmap

The travel industry is launching a “net zero roadmap”, the head of the World Travel and Tourism Council (WTTC) told Arab News, adding that the organisation will work closely with Saudi Arabia’s new sustainability center in the battle against climate change.

Julia Simpson was speaking on the sidelines of the Future Investment Initiative in Riyadh last week, and set out the challenges facing an industry devastated by the Covid-19 pandemic.

Simpson praised the aviation and cruise liner industries for the steps they have already taken to reduce their carbon footprints, but argued the technology needed for significant reductions are still “further down the line”.

She also singled out the hotel industry as an area where more can be done to “decarbonize faster”.

Reflecting on the challenges the sector has faced since 2019, Simpson predicts tourism will be a “comeback story” as the world continues to open up after two years of restrictions. 

Discussing environmental issues, Simpson says: “What we're doing at the WTTC is we’re launching a whole sustainability, net zero roadmap. 

“The net zero roadmap would be the first time we’ve looked at the environmental carbon footprint of all our individual industries within travel and tourism and added it all up and said: ‘What is our contribution and what are our solutions?’ 

“But what I will say is we have some tough industries in terms of carbon in our industry. You know, the cruise liners and aviation, there aren't actually technical alternatives. There's hydrogen, there’s electrics, but some of these are further down the line and what those industries are doing in the meantime is incredible.”

“To be honest, when it comes to sustainability and preserving the environment, reducing the carbon footprint, I see that the tourism industry is doing that.”

She added: “But there are other sectors that can decarbonize faster, probably the hotel sector. I can give you my assurance, among all of the 200 CEOs that I talk to, sustainability is top of their agenda. And why is that? Because customers demand it.”

Saudi Arabia is aware of that demand, which led Crown Prince Mohammed bin Salman to launch the Sustainable Tourism Global Center at the Saudi Green Initiative Forum last week.

Global travel and tourism is responsible for 8 percent of the global greenhouse gas emissions, and the centre aims to work towards zero emissions across the industry.

Simpson reveals that the WTTC plans to “work side-by-side” with the new centre on several research projects.

The travel association will also hold its 22nd Global Summit of the World Travel and Tourism Council in the Kingdom at the end of next year, Simpson announced last week at the Future Investment Initiative.

She said that Saudi “has been instrumental in leading the recovery of a sector which is critical to economies, jobs and livelihoods around the world”.

Few industries have been hit harder by the pandemic than travel and tourism, but Simpson is confident that “we're beginning to see the light at the end of the tunnel”.

The head of the trade body says the industry has lifted by around 27 percent this year, compared to a 49 percent slump last year when Covid-19 lockdown restrictions closed borders, airports and hotels.

The travel sector represented 10.4 percent of global gross domestic product in 2019, yet this was slashed to 5.4 percent last year, according to WTTC annual data.

Simpson adds that during the height of the pandemic in 2019, global GDP fell by around 3 percent, while the travel industry revenues dipped by almost half.

In the Middle East, tourism as a contribution to GDP fell 51.1 percent to $138 billion last year, but this was a better performance than Europe, Asia-Pacific and the Caribbean.

Simpson says: “Our industry has been devastated. It's been turned inside out. But I'm very, very hopeful that it is going to come back. This will be a comeback story.”

She adds: “People are beginning to travel again because of higher vaccination rates. But there are still around four billion people who have not had any vaccinations at all – the young, those in parts of Africa and Asia. We must not forget about them.”

Her association backs the United Nation Covax plan to distribute millions of doses of free vaccines from rich countries to the developing world.

As you might imagine, Simpson has had plenty of practice travelling the world and speaking to movers and shakers in government and at the top of business.

She spent 14 years at British Airways parent International Airlines Group, leaving as chief of staff before taking up her post at WTTC in August. Before the travel business, she was a strategic communications adviser to then UK Prime Minister Tony Blair, responsible for counter-terrorism, home affairs, education and local government.

As the pandemic begins to ease, the travel boss says richer people in the US, Europe and around the world are proving the first ones to board planes and cross-border trains again.

She says: “The wealthy middle class have not had anywhere to spend their money, so there's pent up demand there. They want to go out.”

But Simpson doubts that the industry bounce back will be uniform.

She says: “The domestic markets have been very, very strong. If people have not been able to travel overseas, they've chosen to travel within their own countries. That's been the number one driver of growth.”

“Secondly, I think that family has been a strong reason to travel. There are a lot of people that have not been able to see their families, and that has driven a lot of international leisure travel.”

But she admits business travel will take longer to return to pre-pandemic levels. Some observers say that the meteoric rise of virtual meeting software such as Zoom and Microsoft’s Teams, means that this sector will never fully recover.

Simpson says: “I love Zoom. I use it. But you cannot do big deals and shake hands on this software.

“If I am an investor and want to invest in the NEOM [£500 billion mega-city] project, I need to come to Saudi and see it and see the country.”

The travel body forecast that business travel will rise by 26 percent this year and reach two-thirds of pre-pandemic levels by 2022, in a report this week. Business travel collapsed by 61 percent in 2020.

Global travel and tourism is on a long-haul journey back to recovery, but Simpson and Saudi Arabia are convinced they can see light at the end of the tunnel.


DCO startup passport cuts the red tape on cross-border trade

DCO startup passport cuts the red tape on cross-border trade
Updated 13 August 2022

DCO startup passport cuts the red tape on cross-border trade

DCO startup passport cuts the red tape on cross-border trade
  • Program helps startups do business across borders more efficiently while maintaining their local footprint

RIYADH: The Digital Cooperation Organization, a global initiative focused on improving the digital economy, is working toward encouraging fledgling companies to tap international markets through its startup program.

Called Startup Passport, the program helps startups do business across borders more efficiently while maintaining their footprint in their country of origin, said Hassan Nasser, vice president of international affairs of DPO.

The program has opened up potentially lucrative markets with a combined population of over half a billion people and a combined gross domestic product of nearly SR7.5 trillion ($2 trillion), reported the Saudi Press Agency.

Hassan Nasser

“By creating a new market expansion in DCO countries and beyond, you will positively impact these other markets,” said Naseer.

He said that the expansion of startups would create new economic entities, improve employment within DCO member states and nurture innovative solutions.

By creating a new market expansion in DCO countries and beyond, you will positively impact these other markets.

Hassan Nasser

According to Nasser, these innovative solutions could find wider acceptance with most startups focusing on sustainability and conservation.

In fact, the DCO Global Roundtable Series at the World Telecommunication Development Conference in June was meant to bring together global leaders to advance digital prosperity.

Naseer explained that the roundtable provides a platform for leaders worldwide to exchange perspectives on improving cooperation in the digital space and delivering an inclusive, sustainable digital economy.

The first roundtable had around 35 participants from 20 different countries.

FASTFACT

$2tr

The program has opened up potentially lucrative markets with a combined population of over half-a-billion people and a combined gross domestic product of nearly SR7.5 trillion ($2 trillion).

In Nasser’s view, cross-border cooperation is one of the critical reasons for the existence of DCO. “That’s one of the reasons DCO exists, to help on that and drive this cross-border cooperation,” he said.

Developing an efficient model requires cooperation, reducing costs and increasing return on investment by defining the best solution.

“There are a lot of challenges when it comes to digital investment, digital skills, digital empowerment, where we need more cooperation,” Nasser said.

As Nasser explained, DCO does not compete with anything but addresses a gap and complements a need.

The DCO will deliver its future roundtables in Latin America, Europe, Asia, and the United Nations General Assembly in New York.

Commenting on the UN General Assembly, he said it “will be a place where we get a global audience for this important session.”

He added: “A vital component of the organization’s mission is launching initiatives that will benefit all member states.”

With 11 member nations, DCO aspires to bring inclusive growth in the digital economy across its member nations, such as Bahrain, Djibouti, Jordan, Kuwait, Morocco, Nigeria, Oman, Pakistan, Rwanda, Saudi Arabia, and Cyprus.

The organization was launched in early 2022 at LEAP, a global event for future technologies held in Riyadh.


Acciona rejects carbon-intensive projects to meet environmental commitments

Acciona rejects carbon-intensive projects to meet environmental commitments
Updated 13 August 2022

Acciona rejects carbon-intensive projects to meet environmental commitments

Acciona rejects carbon-intensive projects to meet environmental commitments
  • The company is bidding for NEOM in the heavy civil area with hopes of contributing to the Kingdom’s projects

DUBAI: Spain's Acciona, a leader in sustainable solutions for infrastructure and renewable energy, has been rejecting projects that are not carbon neutral as part of its commitment to environmental protection.

According to a top executive, the company has been turning down projects directly involved in oil and gas extraction or production since they will add to the carbon dioxide emissions on its balance sheet.

Founded in 1931, the company has been carbon neutral since 2016, said Acciona's Middle East Director-General Jesus Sancho while speaking to Arab News.

Jesus Sancho

"That's something easy to say, but it is very difficult to achieve for a company which is present across 60 countries in the world," he said.

That’s something easy to say, but it is very difficult to achieve for a company which is present across 60 countries in the world.

Jesus Sancho

Sancho explained that one part of the company invests solely in renewable energy to achieve carbon neutrality. Acciona owns and operates its assets, including more than 12 gigawatts of renewable energy, contributing to negative carbon emissions.

As for renewable energies, the company has solar thermal, photovoltaic, concentrating solar-thermal power and wind farms, all of which are carbon-negative and offset the carbon dioxide generated by the other areas of the company, he added.

The challenge for Acciona, which has invested approximately SR1.8 billion ($500 million) in projects, is minimizing each project's carbon footprint to achieve carbon neutrality.

FASTFACT

$500m

The challenge for Acciona, which has invested approximately SR1.8 billion ($500 million) in projects, is minimizing each project’s carbon footprint to achieve carbon neutrality.

"We are focusing on projects aligned with our philosophy," he said, adding that his company's sustainability master plans were well aligned with Saudi Arabia's Vision 2030's goals.

The company's sustainability commitment has already invited the attention of the futuristic smart city, NEOM.

Acciona, according to Sancho, is bidding for NEOM in the heavy civil area with hopes of contributing to the Kingdom's projects.

The company is currently working on water treatment plant projects in the Kingdom. It has also set up desalination plants in Alkhobar 1, Alkhobar 2 and Shuqaiq 4.

Acciona also built the Shuqaiq 3 desalination plant to full capacity, producing 450 million liters of potable water daily. In addition, the plant is equipped with energy-efficient seawater reverse osmosis technology.

 


Five Chinese state-owned companies to delist from NYSE amid US tensions

Five Chinese state-owned companies to delist from NYSE amid US tensions
Updated 12 August 2022

Five Chinese state-owned companies to delist from NYSE amid US tensions

Five Chinese state-owned companies to delist from NYSE amid US tensions

SHANGHAI: Five Chinese state-owned companies, including oil giant Sinopec and China Life Insurance, said on Friday they would delist from the New York Stock Exchange, amid economic and diplomatic tensions with the US, according to Reuters.

The companies, which also include Aluminium Corporation of China, PetroChina and Sinopec Shanghai Petrochemical Co, each said that they would apply to delist their American Depository Shares this month.

The five, which in May were flagged by the US securities regulator as failing to meet its auditing standards, will keep their listings in Hong Kong and mainland Chinese markets.

Beijing and Washington are in talks to resolve a long-running audit dispute that could see Chinese companies banned from US exchanges if they do not comply with US rules.

Washington has long demanded complete access to the books of US-listed Chinese companies, but Beijing bars foreign inspection of audit documents from local accounting firms, citing national security concerns.

There was no mention of the auditing dispute in separate statements by the Chinese companies outlining their moves, which come amid heightened tensions after last week’s visit to Taiwan by US House of Representatives Speaker Nancy Pelosi.

“These companies have strictly complied with the rules and regulatory requirements of the US capital market since their listing in the US and made the delisting choice for their own business considerations,” the China Securities Regulatory Commission said in a statement.

The agency added that it would keep “communication open with relevant overseas regulatory agencies.”

The oversight row, which has been simmering for more than a decade, came to a head in December when the Securities and Exchange Commission finalized rules to potentially prohibit trading in Chinese companies under the Holding Foreign Companies Accountable Act. It said 273 companies were at risk.

Some of China’s largest companies including Alibaba Group Holdings, J.D Com Inc. and Baidu Inc. are among them. Alibaba said last week it would convert its Hong Kong secondary listing into a dual primary listing which analysts said could ease the way for the Chinese ecommerce giant to switch primary listing venues in the future.

In premarket trading Friday, US-listed shares of China Life Insurance and oil giant Sinopec fell 5.7 percent about 4.3 percent respectively. Aluminium Corporation of China dropped 1.7 percent, while PetroChina shed 4.3 percent. Sinopec Shanghai Petrochemical Co. shed 4.1 percent.

A spokesperson for NYSE declined to comment. A spokesperson for the Public Company Accounting Oversight Board, the audit watchdog overseen by the SEC, did not immediately provide comment.

Losing Patience? 

Market-watchers were split over what the delistings might mean for the audit deal, with some saying it was a bad sign.

“China is sending a message that its patience is wearing thin in the audit talks,” said Kai Zhan, senior counsel at Chinese law firm Yuanda, who specializes in US capital markets.

The companies said their US traded share volume was small compared with those on their other major listing venues.

PetroChina said it had never raised follow-on capital from its USlisting and its Hong Kong and Shanghai bases “can satisfy the company’s fundraising requirements” as well as providing “better protection of the interests of the investors.”

Global fund managers holding US-listed Chinese stocks are steadily shifting toward their Hong Kong-traded peers, even as they remain hopeful the audit dispute will eventually be resolved, Reuters reported this week.

“These companies are very thinly traded with very small US market cap so it is not a loss for US capital markets,” Brendan Ahern, CIO of Krane Funds Advisers, which has a New York-listed fund focused on Chinese tech plays, wrote in an email.

He and analysts said the delistings could pave the way for China to comply with the US requirements, since the five companies concerned likely have sensitive information China would not want exposed in an audit review.

“We see this as a positive sign. This is consistent with our view China will decide what companies would be allowed to be US-listed and thus subject to SEC’s audit investigations,” Jefferies analysts wrote in a note.

China Life and Chalco said they would file for delisting on Aug. 22, with it taking effect 10 days later. Sinopec, whose full name is China Petroleum & Chemical Corporation, and PetroChina said their applications would be made on Aug. 29.

China Telecom, China Mobile and China Unicom were delisted from the US in 2021 after a Trump-era decision to restrict investment in Chinese technology firms.

That ruling has been left unchanged by the Biden administration amid continuing tensions. 


US Stocks — Futures up as easing price pressures set Wall St. for weekly gains

US Stocks — Futures up as easing price pressures set Wall St. for weekly gains
Updated 12 August 2022

US Stocks — Futures up as easing price pressures set Wall St. for weekly gains

US Stocks — Futures up as easing price pressures set Wall St. for weekly gains

BENGALURU: US stock index futures rose on Friday, setting the S&P 500 and the Nasdaq for a fourth straight week of gains on easing bets of another super-sized interest rate hike by the Federal Reserve.

The S&P 500 is up 15 percent from mid-June, with the latest boost coming from a slower-than-expected rise in consumer prices and a surprise drop in producer prices in July.

The benchmark index is within sight of a 50 percent retracement of its bear market loss and investors are watching the 4,231 level. The index last closed at 4,207.27.

While policymakers remain firm about a further tightening in monetary policy until inflation pressures fully abate, traders see a 63.5 percent chance of the Fed raising rates by 50 basis points next month instead of a 75 basis points hike.

The Fed has raised its policy rate by 225 basis points since March as it battles to cool demand without sparking a sharp rise in layoffs.

High-growth and technology stocks such as Tesla and Nvidia rose 1 percent each in trading before the bell as investors flocked back to riskier assets.

Growth stocks have underpeformed their value counterparts so far this year on worries that rising Treasury yields due to aggressive rate hikes will pressure their valuation.

Investors bought $7.1 billion in equities in the week to Wednesday, according to a Bank of America note, with US growth stocks recording their largest weekly inflow since December last year.

Meanwhile, banks looked set to extend their rally for sixth straight week, with JPMorgan Chase & Co. and Goldman Sachs gaining 0.4 percent each in premarket trading.

At 07:28 a.m. ET, Dow e-minis were up 106 points, or 0.32 percent, S&P 500 e-minis were up 13.75 points, or 0.33 percent, and Nasdaq 100 e-minis were up 42 points, or 0.32 percent.

Rivian Automotive Inc. slipped 0.2 percent even as the electric-vehicle maker reported better-than-expected second quarter revenue.

The University of Michigan’s preliminary survey of consumer sentiment for August is expected at 10:00 am ET. 


Gold eyes fourth straight weekly gain on dollar weakness

Gold eyes fourth straight weekly gain on dollar weakness
Updated 12 August 2022

Gold eyes fourth straight weekly gain on dollar weakness

Gold eyes fourth straight weekly gain on dollar weakness

LONDON: Gold prices inched lower on Friday but were still on track for a weekly rise, as an overall weakness in the dollar offset pressure from an uptick in bond yields and expectations of further rate hikes from the US Federal Reserve.

Spot gold was down 0.2 percent at $1,786.06 per ounce, as of 1200 GMT.

Bullion was still headed for its fourth straight weekly gain, up nearly 1 percent in its longest weekly rally in almost a year.

US gold futures fell 0.3 percent to $1,801.10.

The dollar edged 0.4 percent higher on the day, but was down about 1 percent for the week.

A weaker greenback makes bullion less expensive for overseas buyers.

“Inflation easing a little has aided gold’s rally to $1,800. But risk assets were quickly preferred and gold’s rally stalled. If risk appetite fades over the next couple of weeks, that could support a move above $1,800,” OANDA analyst Craig Erlam said.

Market participants have toned down expectations of an aggressive rate hike by the Fed after cooler-than-expected inflation data released earlier this week.

However, recent comments by some Fed officials continue to highlight a hawkish tilt. Gold’s appeal tends to dim amid high-interest rate environment, as the metal yields no interest.

Fed’s Mary Daly said on Thursday that while a half-percentage-point interest rate hike in September “makes sense,” she is open to the possibility of a bigger hike.

“The ongoing tightening of monetary policy is still having a braking effect on gold... Market participants remain correspondingly cautious and have been withdrawing funds from the gold ETFs of late,” Commerzbank said in a note.

Weighing on gold, US Treasury yields hovered near a three-week high.

Spot silver fell 0.1 percent to $20.28 per ounce, palladium slipped 1.5 percent to $2,242.90. Platinum fell 0.8 percent to $948.29 per ounce.