PIF — driving force behind economic diversification: Year in Review

PIF — driving force behind economic diversification: Year in Review
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Updated 05 January 2022

PIF — driving force behind economic diversification: Year in Review

PIF — driving force behind economic diversification: Year in Review
  • Several non-oil sectors have been identified as priority sectors in the fund’s diversification plan

DUBAI: This was a crunch year for Saudi Arabia’s sovereign wealth body, the Public Investment Fund, as it announced a five-year strategy to push the Kingdom’s diversification drive.

It picks up from the body’s first five-year plan launched in 2017, when the Saudi government chose the PIF to “lead the charge in building a national economic transformation.”

The fund posted around SR1.5 trillion ($400 billion) in assets under management, at the end of 2020 — growing nearly threefold from SR570 billion from 2015.

The Saudi sovereign wealth fund aims to more than double this growth — targeting around SR4 trillion in assets under management by 2025, with a focus on contributing billions of dollars to the Kingdom’s non-oil gross domestic product.

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Several non-oil sectors have been identified as priority sectors in its diversification plan, such as housing, healthcare and financial services.

But it was tourism that saw the first major announcement from the PIF in 2021.

HIGHLIGHTS

In January, the fund launched Cruise Saudi, which bids to establish a leisure liner industry in the Kingdom.

Another major project in tourism, the Soudah Development Co. in the Asir region, was announced the following month with an investment of SR11 billion.

Other notable PIF announcements in tourism include The Rig — a 150,000 square meter offshore oil-themed tourism destination, the fund partnered with E1 Series to create the world’s first electric powerboat championship and two PIF-owned companies — The Red Sea Development Co. and Amaala — merged to create a Red Sea tourism powerhouse.

In January, the fund launched Cruise Saudi, which bids to establish a leisure liner industry in the Kingdom, in line with the government’s Vision 2030 aspirations of opening Saudi Arabia up to the world.

Another major project in tourism, the Soudah Development Co. in the Asir region, was announced the following month with an investment of SR11 billion.

Other notable PIF announcements in tourism include The Rig — a 150,000 square meter offshore oil-themed tourism destination, the fund partnered with E1 Series to create the world’s first electric powerboat championship and two PIF-owned companies — The Red Sea Development Co. and Amaala — merged to create a Red Sea tourism powerhouse.

The next few months saw the PIF make internal moves to expand its team to capture more domestic and international investment opportunities.

Two deputy governors joined the fund in June — Turqi Al-Nowaiser and Yazeed Alhumeid. Three other senior executives also came into the business — Eyas Al-Dossari, Omar Al-Madhi, and Abdulla Shaker.

Saudi Crown Prince Mohammed bin Salman said the fund invested around SR84 billion this year as it bids to boost the Saudi economy, which has run a deficit for several years and last year was hit by record-low oil prices.

In December, the crown prince announced that around SR75 billion will be invested in the project, led by the PIF’s Central Jeddah Development. The new destination will feature thousands of hotel rooms and residential units, surrounded by major lifestyle and tourism projects over 5.7 million square meters.  

This project aims to add SR47 billion to the Kingdom’s economy by 2030. 

This year also saw major movements in the PIF’s stakes in major companies — including acquiring a 25 percent share in Emaar The Economic City, and publicly offering some of its stake in stc, the Kingdom’s largest telecoms operator.

An eye-catching move saw the PIF, alongside other investors, finally seal a $410 million deal to buy English Premier League football club Newcastle United.

After the high-profile transaction, the Saudi fund assumed a dominant position in the North East club’s new ownership structure, owning 80 percent of shares.

The fund invests outside the Kingdom as a way of bringing value to the Saudi economy, and in 2021, it almost tripled its holdings of US-listed stocks to $43.45 billion in the third quarter – buying shares in retail giant Walmart and social media firm Pinterest among others.

The next four years will be key for the PIF as the Kingdom draws ever nearer to 2030.


Saudi Arabia witnessing massive transformation in tourism sector, says Dur Hospitality CEO

Saudi Arabia witnessing massive transformation in tourism sector, says Dur Hospitality CEO
Updated 9 sec ago

Saudi Arabia witnessing massive transformation in tourism sector, says Dur Hospitality CEO

Saudi Arabia witnessing massive transformation in tourism sector, says Dur Hospitality CEO

RIYADH: The efforts of the Saudi Tourism Ministry are a catalyst for the massive transformation of the hospitality sector in the Kingdom, said Sultan Bader Al-Otaibi.

Speaking at the Future Hospitality Summit in Riyadh, the CEO of Dur Hospitality said Saudi Arabia’s tourism and hospitality sector is witnessing a massive transformation and lauded the Tourism Ministry’s efforts in this regard. 

He also said events like Wold Hospitality Summit are very productive gatherings that help in learning and growing together. 

Dur Hospitality is a Saudi hospitality company established in 1976, recognized for its extensive record in managing, developing and operating a wide portfolio of hotels and residential compounds across the Kingdom of Saudi Arabia. 

 


Saudi tourism sector to create 1 million jobs by 2030, says top official

Saudi tourism sector to create 1 million jobs by 2030, says top official
Updated 4 min 44 sec ago

Saudi tourism sector to create 1 million jobs by 2030, says top official

Saudi tourism sector to create 1 million jobs by 2030, says top official

RIYADH: Saudi Arabia’s tourism sector will create 1 million jobs by 2030 and the Kingdom will welcome 100 million visitors, said Qusai Al-Fakhri, CEO of the Saudi Tourism Development Fund.

The sector will create one of every three new jobs in Saudi Arabia in the next decade, as the nation focuses more on the growth of non-oil sectors, said Al-Fakhri.

Talking about the progress of the Saudi tourism sector at the Future Hospitality Summit in Riyadh, he said: “Last year, with the support of the tourism ecosystem, and the larger government ecosystem and enablers, Saudi Arabia achieved record levels of domestic tourism that is remarkable globally.”

Al-Fakhri also noted that the tourism sector is expected to contribute 10 percent to the Kingdom’s gross domestic product by the end of this decade.

 

 

 


Submarine cable to link Algeria, Italy

Submarine cable to link Algeria, Italy
Updated 7 min 38 sec ago

Submarine cable to link Algeria, Italy

Submarine cable to link Algeria, Italy
  • EU-funded project will allow exchange of up to 2,000 MW of electricity
  • ‘It will certainly have a positive impact’ on both countries’ energy systems, ministry source tells Arab News

ROME: A submarine cable nearly 200 km long will soon link Italy and Algeria, allowing an exchange of up to 2,000 megawatts of electricity between the two countries.

The electrical interconnection project will link the Algerian region of El-Chafia, on the east coast, and the Italian island of Sardinia.

The project was discussed during a meeting in Rome between Mourad Adjal, CEO of Algerian state-owned natural gas company Sonelgaz, and Italy’s Minister of Ecological Transition Roberto Cingolani, before the start on Thursday of a two-day state visit by Algeria’s president.

A senior source in Italy’s Ministry of Ecological Transition told Arab News: “This project will be funded by the EU. It will certainly have a positive impact on the energy systems of Italy and Algeria, and we really believe it would help in the current situation when every country is working to increase its energy supply.”

Although a precise timeline is not known yet, Italy’s government is confident that “the activation of the electricity interconnection shouldn’t take long,” the source said.


Massive shift in retail experience after COVID-19 outbreak: Majid Al Futtaim Properties CEO

Massive shift in retail experience after COVID-19 outbreak: Majid Al Futtaim Properties CEO
Updated 53 min 35 sec ago

Massive shift in retail experience after COVID-19 outbreak: Majid Al Futtaim Properties CEO

Massive shift in retail experience after COVID-19 outbreak: Majid Al Futtaim Properties CEO

RIYADH: The retail experience has witnessed a massive shift after the outbreak of the pandemic, Majid Al Futtaim Properties CEO Ahmed Ismail told a gathering at the World Economic Forum Annual Meeting in Davos on May 24.

He said that this massive shift has come as people were confined to their homes due to the pandemic. As things have improved, the CEO said that human beings have now that hunger for a social experience — something that has opened up new possibilities. 

Talking about the retail sector, Ismail said that data has been a big challenge for their businesses as their new-age competitors are incredibly data-rich with the implementation of new technologies. 

He revealed that Majid Al Futtaim Properties has invested a lot in recent years in data collection through loyalty programs and partnerships. 

The company has also inked partnership deals with payment processors, telecom companies, and even with the Dubai government through the Dubai smart initiative to bridge this data divide. 

 


China In-focus: Tax relief worth $21bn unveiled to boost slowing economy; policymakers pledge more steps

China In-focus: Tax relief worth $21bn unveiled to boost slowing economy; policymakers pledge more steps
Updated 24 May 2022

China In-focus: Tax relief worth $21bn unveiled to boost slowing economy; policymakers pledge more steps

China In-focus: Tax relief worth $21bn unveiled to boost slowing economy; policymakers pledge more steps

RIYADH: China unveiled a major tax relief to help lift the world’s second largest economy. The country’s policymakers also pledged to take necessary measures to help the economy recover from the impact of the COVID-19 pandemic.

·      China unveiled a tax relief worth over 140 billion yuan ($21 billion) to help boost its slowing economy, Bloomberg reported. This comes as the extended lockdowns since March have hit the economic growth of the Asian country. The support is mainly targeting companies and firms rather than households. Other measures taken include additional tax rebates to firms as well as cuts of around 60 billion yuan on passenger-car purchase taxes, according to a decision from China’s State Council.

·      Chinese policymakers have vowed to help the world’s second largest economy get back on its feet by implementing the necessary steps, Reuters reported citing the Cabinet. The measures to be taken include broadening tax credit rebates, postponing social security payments as well as loan repayments, introducing new investment projects, among others.

·      Lockdowns in China are predicted to have a greater effect on global supply chains than the Russia-Ukraine war, Reuters reported citing the head of German logistics company DHL Group’s freight business. Global supply chain bottlenecks, as a result of the lockdowns, are expected to linger through Christmas this year and all of the next year as a huge part of the global economy highly depends on China, the head said.