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.


Gasoline price to shape EV demand in Kingdom: KAPSARC

Gasoline price to shape EV  demand in Kingdom: KAPSARC
Updated 6 min 6 sec ago

Gasoline price to shape EV demand in Kingdom: KAPSARC

Gasoline price to shape EV  demand in Kingdom: KAPSARC
  • KSA has implemented energy price reforms to unlock economic and environmental benefits for the country

RIYADH: Growing gasoline prices will play a significant role in increasing the demand for electric vehicles in the Kingdom, according to Anwar Gasim, a King Abdullah Petroleum Studies and Research Center researcher.

“The higher the domestic gasoline price, the more a consumer may be incentivized to switch to an electric vehicle,” he told Arab News.

According to Gasim, gasoline prices in the Kingdom seven years ago were a quarter of today’s prices.

“If you look at the 91-octane gasoline, it was SR0.45 ($0.12) per liter. Today, it’s SR2.18,” Gasim said in an exclusive interview with Arab News.

Since 2016, the Kingdom has implemented energy price reforms to unlock economic and environmental benefits for the country.

“Since gasoline prices ended up getting linked with the international price, the government had to put a cap on them when international prices went up very high last year,” said Gasim.

It means there is a limit that domestic gasoline prices will not surpass, no matter how high energy prices may hike internationally.

“I think it was becoming too high for people here, and then the government decided to put a cap,” he said.

According to Gasim, raising domestic energy prices can contribute to the Kingdom’s climate goals.

Saudi Arabia aims to reduce emissions and increase the share of renewables to 50 percent by 2030.

“Higher energy prices can incentivize more efficient behavior, more energy conservation, and therefore it can help save energy and reduce emissions,” he added.

KAPSARC was a part of the regulatory team led by the Ministry of Energy, which on Aug. 22 issued the completion of all legislative and technical aspects to regulate the EV charging market.

These stations will more likely charge the vehicles using the national grid. Still, there are possibilities that off-grid stations will be a requirement.

Some neighborhood distribution networks can no longer accommodate any additional load. They have reached the peak of the transformer capacity.

The only option is using off-grid solutions; renewable sources like solar and hydrogen can supply these off-grids.

Electromin, a wholly owned e-mobility turnkey solutions provider under Petromin, in May announced the rollout of electric vehicle charging points across the Kingdom.

In an earlier interview with Arab News, Kalyana Sivagnanam, the group CEO of Petromin, said that the network includes 100 locations across the Kingdom powered by a customer-centric mobile application.

Sivagnanam said that the company would set up most of its charging stations in Riyadh, Jeddah and Dammam and eventually branch out across the country.

Electromin’s charging network will offer a complete spectrum of services from AC chargers to DC fast and ultrafast chargers, catering to all customer segments.

The imports of EV charging equipment were permitted in the Kingdom in 2020.

As part of the Kingdom’s sustainability strategy, the Royal Commission of Riyadh launched an initiative last year to ensure that 30 percent of all vehicles in the capital would be powered by electricity by 2030.


Saudia to bring voice recognition technology, augmented reality on board: VP

Saudia to bring voice recognition technology, augmented reality on board: VP
Updated 30 September 2022

Saudia to bring voice recognition technology, augmented reality on board: VP

Saudia to bring voice recognition technology, augmented reality on board: VP

RIYADH: Saudia, Saudi Arabia’s national carrier, is aiming to integrate voice recognition technology and augmented reality to its services, the company announced during the second edition of the Global AI Summit held in Riyadh.

Saudia has signed an agreement, aimed at boosting artificial intelligence in the flight sector, with the Saudi Data and Artificial Intelligence Authority and the Saudi Company for Artificial Intelligence. Speaking to Arab News on the sidelines of the summit, Dr. Khaled Alhazmi, vice president of IT support and operations at Saudia, said that the agreement is the first step in introducing AI products to the airline’s services.

Alhazmi explained that the company is currently exploring voice recognition technology through one of SDAIA’s products, an app called SauTech.

“It is an amazing app; it currently gives accurate results for the recognition of the dialects of the Arabic language. And right now, we are trying to explore opportunities and use cases, to start implementing it in our services,” he said.

The company is also planning to adopt Internet of Things technology as well as augmented reality to ensure that they are first movers to implement AI into their services.

“Our strategic direction is to build an ecosystem of partners who would enable us to digitize our services to our customers. We are aiming to deliver a first-class experience to our customers,” he added.

Alhazmi believes that the digitalization factor currently in use at the airline such as downloading tickets to personal devices can be greatly expanded on, and that there are huge opportunities to integrate technology into the sector.

“We are digitizing everything under a program, which is adapting the digital first. Right now we believe that we need to put in use all the data science, all the technologies nowadays, and put them into the hands of the customer,” he said. The company wants to improve its self-service options by providing a personalized platform that will enable users to customize their journey according to their needs.

“That’s actually the main goal because we understand right now that we have a new generation of people who are more interested in technology, they are using technology every day,” he added.

Saudia has also recently partnered with agritech company Red Sea Farms to provide sustainable and high-quality meals for its customers.

“We can see that the adoption of technology in Saudi Arabia in general is getting more mature than other countries,” Alhazmi concluded.


Saudi budget surplus is calculated on $76 for brent price

Saudi budget surplus is calculated on $76 for brent price
Updated 30 September 2022

Saudi budget surplus is calculated on $76 for brent price

Saudi budget surplus is calculated on $76 for brent price
  • Real GDP growth is forecasted to increase by nearly 8 percent year-on-year in 2022 and 3.1 percent year-on-year in 2023

RIYADH: Based on the government budget figures, Al-Rajhi Capital assessed the government's 2023 budgeted revenues to likely be based on Brent at $76 per barrel.

Real GDP growth is forecasted to increase by nearly eight percent year-on-year in 2022 and 3.1 percent year-on-year in 2023, according to Al-Rajhi Capital.

Inflation is expected to be 2.6 percent and 2.1 percent in 2022 and 2023 respectively, Al-Rajhi said.

Revised 2022 revenues are mostly in line with estimates, however, the expenditure budget is much higher than from an earlier announcement, it said.

The 2023 spending budget was raised by 18 percent, with a slight fiscal surplus of SR9 billion expected for 2023.


Saudi Arabia to record a budget surplus of $24bn in 2022

Saudi Arabia to record a budget surplus of $24bn in 2022
Updated 01 October 2022

Saudi Arabia to record a budget surplus of $24bn in 2022

Saudi Arabia to record a budget surplus of $24bn in 2022
  • Total revenues expected to reach about SR1.12 trillion in 2023

RIYADH: Saudi Arabia is expecting its budget surplus in 2022 to hit SR90 billion ($24 billion), and another SR9 billion next year, the Ministry of Finance announced on Friday.

Looking at the full year 2022 projections, real GDP is expected to grow by 8 percent, while the inflation in 2022 may record about 2.6 percent.

Looking at the next year’s projections, Saudi total revenues are expected to reach about SR1.12 trillion in 2023, while reaching about 1.21 trillion in 2025, according to the Ministry of Finance's preliminary statement of the state's general budget for the year 2023.

Total expenditures are expected to reach about SR1.11 trillion in the next fiscal year 2023, and that the expenditure ceiling will reach about SR1.13 trillion in 2025.

The objectives of the state's general budget for the fiscal year 2023 come as a continuation of the process of work to strengthen and develop the financial position of the Kingdom, the finance minister said.

“The government attaches great importance to enhancing the support and social protection system and accelerating the pace of strategic spending on Vision programs and major projects to support economic growth,” Mohammed Al-Jadaan said.

The Kingdom’s economy has demonstrated its strength and durability by achieving high growth rates, after taking many policies and measures with the aim of protecting the economy from the repercussions of inflation and supply chain challenges, he added.

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Deals worth over $27bn available for Saudi businesses with leading national firms

Deals worth over $27bn available for Saudi businesses with leading national firms
Updated 30 September 2022

Deals worth over $27bn available for Saudi businesses with leading national firms

Deals worth over $27bn available for Saudi businesses with leading national firms

RIYADH: Saudi companies are being encouraged to tap into investment deals and contracts worth more than SR100 billion ($26.62 billion) with two of the Kingdom’s biggest firms.

Representatives from the Saudi Electricity Co. and the Saudi Basic Industries Corporation — also known as SABIC — unveiled various opportunities for firms in the Kingdom to work with them during workshops organized by the Federation of Saudi Chambers, according to Saudi Press Agency.

The Saudi Electricity Co. set out its strategy for the localization of the electricity industries, known as ‘Bena’, which aims to encourage and support local manufacturing.

It also includes three initiatives: to raise the percentage of localization in the company's projects; increase the purchases of materials from national factories; and identify investment opportunities required to be localized.

The firm indicated the volume of future demand for or purchases and contracts is expected to reach SR100 billion.

SABIC explained that the investment opportunities under the umbrella of its Nusaned initiative to enhance local content, contributed to supporting economic development with more than $1 billion of gross domestic product.

The company approved 43 investment opportunities, with the total investment opportunities amounting to 351 opportunities.

The number of investors has reached 183, while the number of feasibility studies has hit 74.