Frankly Speaking: Rising Saudi aviation sector will be catalyst for ‘entire GCC tourism market’s growth,’ says Dubai Airports CEO Paul Griffiths

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Updated 06 June 2022

Frankly Speaking: Rising Saudi aviation sector will be catalyst for ‘entire GCC tourism market’s growth,’ says Dubai Airports CEO Paul Griffiths

Frankly Speaking: Rising Saudi aviation sector will be catalyst for ‘entire GCC tourism market’s growth,’ says Dubai Airports CEO Paul Griffiths
  • Appearing on video interview show, Griffiths says development of the Kingdom’s tourism industry is good for Dubai
  • Sees Dubai Airports as “attractive candidate for IPO” in the future, highlights challenges of sustainable aviation fuel program

DUBAI: Saudi Arabia’s growth in the aviation sector will be an essential catalyst for growth of the entire GCC’s tourism market. That was the message of Paul Griffiths, the CEO of Dubai Airports, during an interview with Katie Jensen, the host of Frankly Speaking, the Arab News talk show that features interviews with leading policymakers and business leaders.

His words come in the wake of Saudi mega-city NEOM announcing earlier this month that it will launch the world’s first commercial flights from Neom Bay Airport at the end of June, with Dubai as its first destination and London to “follow shortly.”

Griffiths, who has been a key figure in the transformation of Dubai airport into the world’s busiest by international passenger numbers, said: “I think a lot of people will be expecting me to say, ‘Well, Saudi Arabia is going to be a competitor. Actually, the Saudi market is incredibly important for Dubai.

“It is our third largest market and it’s very, very important that we establish more and more air routes. It has massively expanded over the last few years. For Saudi Arabia to develop its tourism industry is good for Dubai.”

Similar sentiments were expressed at the World Economic Forum’s annual meeting in Davos last week.

Taking part in a panel discussion on “Saudi outlook,” Khalid Al-Falih, the Saudi investment minister, said: “A rising tide lifts all boats. Regional integration is more important to the smaller but very important economies next to us than it is to Saudi Arabia. So, I believe the Kingdom’s rise in its economic and competitive performance actually helps their competitiveness. It allows companies and enterprises and the governments of those countries to integrate with the larger global economy in Saudi Arabia.”

Another speaker in the same session, Haifa bint Mohammed Al-Saud, Saudi Ministry of Tourism’s assistant minister for strategy and executive affairs, said: “The region in its entirety is a hub, so once you arrive in the region, it becomes more appealing to visit different destinations. So, (competition is) absolutely to our benefit.”

It is a message that Griffiths echoes. “If you look at more established travel regions such as Europe and the US, people rarely go just to one city and then go home again,” he said.

“Having more travel options and more cities to visit in the Middle East, which includes cities in Saudi Arabia, will be very beneficial to all the GCC countries because people will be able to come to Dubai and go to Saudi Arabia, go to Oman, go to other cities in the region and do what lots of people do around Europe.

“You rarely go to London; you want to go to Paris, you want to go to Madrid, you want to go to Rome. So, I think it’s going to be very good for the region to have an increasing number of tourism options.”

As the first CEO of Dubai Airports, Griffiths has held the post for more than 15 years, launching Terminal 3 and successfully opening Dubai’s second airport, Dubai World Central (DWC).

Dubai International airport recently released its figures, showing that more than 13.6 million passengers traveled through it in the first quarter of 2022, during its busiest quarter since early 2020. He also expects the airport to return to pre-pandemic levels by the end of 2024, a year earlier than forecast.

So, with such solid growth, is it now the time for an IPO?

Griffiths was reserved in his answer, saying that Dubai Airports “would be an attractive candidate for IPO,” and adding that its figures and “track record, even throughout the pandemic, would support such a move.”

He said that he was optimistic that “at some stage in the near future there may be such a decision,” but added that the decision would ultimately lie with the government of Dubai.

This year, the Dubai government plans to list 10 government entities on the Dubai Financial Market. Local water and electricity firm DEWA issued the world’s second-largest IPO earlier this year, the first listing of its kind for the region and the largest locally since Saudi oil giant Aramco’s record-breaking initial public offering in 2019.

There are rumors that Dubai’s toll operator Salik and district cooling firm Empower could be next. Emirates has also discussed listing on the DFM, with the Dubai-based carrier’s chairman, Sheikh Ahmed bin Saeed Al-Maktoum, telling CNBC: “I am sure that maybe sometime in the future Emirates will be in the market.”

During an aviation summit in Manchester in April, Sir Tim Clark, president of Emirates, said that he had to disconnect his phones because every banker in the world “was on our door, saying ‘We’ve got investors who want to chuck money at you.’”

According to Griffiths, it is a “sign of maturity of many cities around the region that we’re now getting to a stage where we’ve got a great track record of strong growth, good performance, good financial controls and a sound strategy. Those are all good components for an IPO.”

While being bullish about the outlook for the aviation sector and for Dubai in particular, Griffiths acknowledges that some global geopolitical and economic concerns remain. With Emirates making up 60 to 70 percent of all passenger traffic at Dubai airports, he said that the “weakness in some of the transfer markets, particularly in Asia, notably China obviously, is of concern but we’re roughly 50 percent recovered in the transfer markets, and I foresee that, that’s going to improve over the next few months.”

He said that high fuel prices were “obviously a concern” but that Emirates’ position is “pretty strong at the moment.”

“They are taking advantage of some of the strong recovery in a lot of markets, particularly in the West. And I don’t think we’ve got anything to concern us about recovery over the next few months. A few economic signs perhaps, inflation globally and, by the end of the year, maybe things will be different. But, for the moment, recovery and travel are extremely strong, and I can’t see any signs of it weakening in the near future.”

Dubai International is the busiest international airport globally, with 58.3 million people forecast to pass through its terminals this year. Still, it is currently operating with a single runway owing to refurbishment works on its northern runway.

As a result, about 1,000 flights a week are affected, with most of them re-routed to DWC. Griffiths said that although the runway is “unlikely” to open earlier than planned, it will “definitely” do so on June 22 “as scheduled.”

He explained that most of the DXB refurbishment was technical, rather “than anything that passengers will notice,” but said the “touchdown of aircraft might be a little bit smoother on the newly refurbished tarmac.”

Griffiths said that it had not been a conscious decision to reroute the low-cost carriers to DWC to keep the high-paying customers at Emirates happy, adding that “not so many” of Emirates’ passenger flights had been sent to DWC.

“They’ve actually remained mostly at DXB,” he said, referring to Dubai International airport. “Emirates has coped with the reduction by reducing the number of services.”

While the renovation is “going very well so far,” according to Griffiths, he highlighted another continuing issue that the airport is facing, calling cybersecurity a “massive problem at the moment and the number of potentially malicious attacks is increasing almost by the day.”

“If you look at the number of emails, for example, that are malicious — and the traffic that has nothing to do with business — it’s up at 70 percent. So, it’s a huge amount of the total traffic that is not emails that are solicited or anything to do with running the airport.”

When asked whether the threat of cybersecurity and cyberattacks was more significant than physical attacks, such as the Houthi drone strike on Abu Dhabi airport earlier this year, he said that the airport cannot afford to “be complacent,” adding that this was why DXB is “constantly investing in training and technology to counter the changing threat.”

According to Griffiths, Dubai Airports is also investing heavily in sustainable initiatives, using solar panels to generate power and to keep vehicles cool inside car parks, banning single-use plastics and using electric or hybrid vehicles for its ground fleet.

He said that this was important because “consumers will not be wanting to patronize any airport or airline that’s not taking sustainability extremely seriously.”

The aviation hub is also working alongside Emirates to trial the use of sustainable aviation fuel in the third quarter of this year. IATA estimates that SAF can reduce the carbon emissions of flights by about 80 percent, but many airlines have been hesitant to launch trial flights owing to its prohibitively high cost.

Griffiths says that the potential for developing sustainable aviation fuel has been hindered by supply distribution challenges. He says that unless airports worldwide can supply SAF to planes when they land, carriers would have to transport the fuel with them from the origin, so “you’re eradicating a lot of the advantages.”

He said that the solution is to get SAF injected into the plane as close to the manufacturing source as possible, and also to ensure “there is some form of subsidy in place, so we are able to absorb the cost of producing sustainable aviation fuel across the entire jet fuel supply chain, so that no individual carrier will feel the pain of having to be more environmentally friendly than others.

“We all share the cost and we all reap the rewards,” he said.

He hinted that consumers might be forced to pay more for sustainable choices, saying these higher fuel costs “may have to be passed on in small increases in ticket prices, but sustainability’s got to happen and we’ve got to pay for it somehow.”

Looking to the future, Griffiths said that he feels very “positive” about the outlook for the year ahead and that “notwithstanding the potential turbulence of the economy and political events and recovery from COVID-19,” he is “very bullish about the aerospace sector in Dubai.”

He called the city’s tourism and hospitality infrastructure “some of the best in the world,” noting that they had seen “demand for Dubai absolutely skyrocket.”

“We were 111 percent ahead of our pre-pandemic visitor arrival traffic over the end of last year, and, at the moment, we are about 100 percent,” he said, adding: “Those are pretty strong figures.”

 


Summits in Riyadh reflect Kingdom’s desire to enhance relations with China: Saudi foreign minister

Summits in Riyadh reflect Kingdom’s desire to enhance relations with China: Saudi foreign minister
Updated 1 min 11 sec ago

Summits in Riyadh reflect Kingdom’s desire to enhance relations with China: Saudi foreign minister

Summits in Riyadh reflect Kingdom’s desire to enhance relations with China: Saudi foreign minister
  • Speaking as Chinese President Xi Jinping arrived in Riyadh for an official visit, Prince Faisal bin Farhan said bilateral relations are characterized by friendship, trust, cooperation and coordination
  • Xi is expected to attend a Saudi-Chinese summit, the Gulf-China Summit for Cooperation and Development, and the Riyadh Arab-China Summit for Cooperation and Development

RIYADH: Three summits due to take place in Riyadh in the coming days reflect the shared determination of the Kingdom, the other Gulf Cooperation Council nations and the wider Arab world to strengthen cooperation and enhance strategic relations with China in pursuit of greater growth and prosperity for all of the countries and their peoples, according to Saudi Foreign Minister Prince Faisal bin Farhan.

“The relations between the Kingdom and China are strategic and close in light of the international developments and changes taking place,” he said.

He added that the bilateral relationship is characterized by friendship, mutual trust, cooperation and continuous coordination, the Saudi Press Agency reported.

His comments came as Chinese President Xi Jinping arrived in Riyadh on Wednesday evening for a three-day official visit, during which he is expected to attend a Saudi-Chinese summit, the Gulf-China Summit for Cooperation and Development, and the Riyadh Arab-China Summit for Cooperation and Development.

Prince Faisal praised the contribution made by a high-level Saudi-Chinese joint committee to the development of relations between the two countries in many fields. He said the bilateral economic relationship is progressing rapidly against the backdrop of the Kingdom’s Vision 2030 development and diversification plan and China’s Belt and Road Initiative, which offer promising opportunities for cooperation, sustainable development and mutual benefits.

He added that China has ranked as the Kingdom’s top trading partner since 2018, and that the value of bilateral trade in 2021 was SR309 billion ($82.1 billion), an increase of 39 percent compared with the previous year.


Islamic school funded by Kuwaitis opens in Venezuela

Islamic school funded by Kuwaitis opens in Venezuela
Updated 14 min 55 sec ago

Islamic school funded by Kuwaitis opens in Venezuela

Islamic school funded by Kuwaitis opens in Venezuela
  • Establishment to teach Arabic, Islamic education, Venezuelan curriculum to more than 180 students

KUWAIT: The Venezuelan Islamic School, funded by Kuwaiti businessmen and overseen by Zakat House, has opened in the country’s capital Caracas, the Kuwait News Agency reported on Wednesday.

More than 180 students in kindergarten, primary, and secondary school will be taught Arabic, Islamic education, and the Venezuelan curriculum following Kuwait’s first charitable work in the country.

The inauguration was attended by Kuwait’s Ambassador to Venezuela Nasser Al-Enezi, Head of the Venezuelan Islamic Center Baligh Saeed, and a number of dignitaries, students and school staff.

Al-Enezi praised the Zakat House of Kuwait for sponsoring projects for the Arab community, and business for its contribution.

 


Culture can open the door to a ‘green’ future, says Saudi minister

Culture can open the door to a ‘green’ future, says Saudi minister
Updated 20 min 42 sec ago

Culture can open the door to a ‘green’ future, says Saudi minister

Culture can open the door to a ‘green’ future, says Saudi minister
  • Prince Badr met with a number of his counterparts on the sidelines of the forum
  • A number of agreements were signed during bilateral meetings to enhance cultural cooperation

RIYADH: Saudi Arabia’s Ministry of Culture, in cooperation with the Arab League Educational, Cultural and Scientific Organization, on Wednesday organized the 23rd Conference of Arab Culture Ministers in the capital, Riyadh, the Saudi Press Agency reported.

The event, which was held under the patronage of Prince Badr bin Abdullah bin Farhan, minister of culture, and chairman of the National Committee for Education, Culture and Science, was attended by ministers and officials from 20 Arab countries, as well as representatives of the Arab League, and regional and international organizations.

The minister of culture, who is also president of the 23rd session, said: “This year’s session, whose main theme is: ‘Culture and the green future,’ aims to make the cultural sector more sustainable, as we seek to make it the starting point of international efforts involving the cultural sector with its various branches, extending to cover all elements of its value chain.”

He added: “The utilization of culture toward the green future contributes to instilling culture in the global development debate, which receives the full attention of King Salman and Crown Prince Mohammed bin Salman, through the Kingdom’s participation in global cultural platforms, where the ‘Culture and the green future’ theme conforms to the goals of the Kingdom Vision 2030.”

He said that this, in return, highlights the Kingdom’s support of collective efforts to enhance knowledge, skills and practices related to making the cultural sector more sustainable and environmentally friendly.

During the conference, ministers focused on the role of culture in achieving sustainable development, while working to develop effective sectorial policies that bring added value to collective efforts to move toward a more creative and sustainable future.

Meanwhile, Prince Badr met with his Egyptian counterpart Nevin Al-Kilany on the sidelines of the forum, where the two sides signed a memorandum of understanding to enhance cooperation in the cultural field.

The memorandum included cultural fields, such as heritage, visual arts, performing arts, literature, books and publishing, Islamic decoration and other creative tracks.

It also included work to enhance the participation of Saudi and Egyptian intellectuals in festivals and cultural events held in the two countries, in addition to joint cooperation in training and qualifying local artistic cadres, and benefiting from experiences in the two countries in the fields of museums, urban heritage and handicraft industries.

Prince Badr praised the strong strategic relations that link the Kingdom with Egypt in all cultural fields. The two parties also discussed cooperation in the field of registering intangible heritage files with UNESCO, and cooperation in the field of exchanging expertise through cultural scholarship programs.

Prince Badr met with the Moroccan Minister of Youth, Culture and Communication Mohamed Mehdi Bensaid where another agreement was signed to enhance cultural cooperation in various fields, including literature, publishing and translation, heritage, architecture and design, museums, theater and performing arts.

The memorandum also included enhancing the participation of Saudi and Moroccan intellectuals in festivals and cultural events held in the two countries, in addition to exchanging expertise in organizations and cultural policies.

He also held similar meetings with the Director-General of the Islamic World Educational, Scientific and Cultural Organization Salem Al-Malik, and the Director-General of ALECSO, Mohamed Ould Amar, where they discussed the most prominent current cooperation programs between the organizations and the Kingdom, and memoranda of understanding were signed.

He also met with his Tunisian and Djiboutian counterparts, and the president of the Bahrain Authority for Culture and Antiquities.


Electric vehicles emerge as key driver of Saudi-China climate-change fight

Electric vehicles emerge as key driver of Saudi-China climate-change fight
Updated 1 min 40 sec ago

Electric vehicles emerge as key driver of Saudi-China climate-change fight

Electric vehicles emerge as key driver of Saudi-China climate-change fight
  • China is the world’s largest market for EVs, accounting for 53 percent of the global share 
  • Saudi Arabia has launched its own EV brand, Ceer, and owns a stake in US maker Lucid

RIYADH: China and Saudi Arabia are two of the energy powerhouses of the world and, as such, the world’s gaze turns to them in discussions around climate change.

While much of the focus is on the Kingdom’s oil production, or Beijing’s coal-mining activities, the two nations are only just starting to get recognition for their shared vision for decarbonization via electric vehicles.

This is an area of shared enthusiasm, and one where Saudi Arabia and China can further work together to lead innovation and implementation.

For its part, Saudi Arabia has handed the EV industry a prominent role in its economic diversification plan known as Vision 2030.

Tesla cars at a charging station in Beijing, main, and, below, a Lucid luxury electric vehicle on display. (AFP)

The world’s largest oil exporter has identified the sector as one on the cusp of a boom as the globe moves away from fossil fuels, and is investing not just in overseas firms, but also in homegrown products.

The overseas backing takes the form of the US-firm Lucid. In 2018, the Public Investment Fund poured $1billion into the company and now has a 60 percent stake. The investment prompted Lucid to announce in February 2022, that it would build its first international vehicle assembly plant in King Abdullah Economic City, north of Jeddah. 
To further underline its commitment to the sector, the Saudi government struck a deal with Lucid to buy up to 100,000 EVs over a 10-year period.

It is not just Lucid that will be producing EVs in the Kingdom. In October, Crown Prince Mohammed bin Salman unveiled Saudi Arabia’s own EV brand: Ceer.

Lithium batteries for electric vehicles on the inspection line at a factory in Nanjing in China’s eastern Jiangsu province. (AFP)

Like Lucid, this company will produce vehicles from a plant in KAEC, with construction on the $69 million facility due to begin in early 2023.

Ceer is a joint venture with FoxConn — the Taiwan-based firm that is the largest private sector employer in China — and will further cement the ties between Saudi Arabia and the economies of the Far East.

Ceer will license component technology from BMW to design and build vehicles, including sedans and sport utility vehicles, in the Kingdom while Foxconn will develop the electrical architecture of the vehicles, resulting in a portfolio of products that will lead in infotainment, connectivity and autonomous driving technologies.

Of course, the Kingdom is not turning itself into one of the leading EV producers in the world just to appease its domestic market. Exporting these vehicles is a key part of not just Saudi Arabia’s economic diversification strategy but in reducing global emissions.

Penetrating the Chinese market could prove a challenge. Beijing has been encouraging its citizens to switch to EVs by offering subsidies for purchases. This has helped China become the largest market for EVs, accounting for 53 percent of the global share.

US-based Lucid is planning to build its first overseas vehicle assembly plant north of Jeddah. (AFP)

The Chinese government forecasts that EVs will account for 50 percent of all new car sales in the country by 2035, suggesting the appetite for such vehicles will continue to be high.

Yet while firms such as Tesla are doing well in the market — selling 83,135 cars in September in what was its best month for sales in the country — China has a thriving production sector, meaning the reliance on imports is low.

However, as is the case in many countries, one of the main barriers for mass take-up of EVs is higher purchase price than for petrol vehicles.

Saudi Arabia could find itself in a position to use its growing EV production hub being built just north of Jeddah to make affordable vehicles for what is the largest market in the world.

Should it crack that nut, the Kingdom’s Vision 2030 goal of raising non-oil exports to 50 percent of GDP looks eminently reachable.
 


DP World Logistics opens 6,000 sq. m warehouse in Dubai’s Jebel Ali Free Zone

DP World Logistics opens 6,000 sq. m warehouse in Dubai’s Jebel Ali Free Zone
Updated 08 December 2022

DP World Logistics opens 6,000 sq. m warehouse in Dubai’s Jebel Ali Free Zone

DP World Logistics opens 6,000 sq. m warehouse in Dubai’s Jebel Ali Free Zone
  • The company said the storage facility has a monthly capacity of 6,000 twenty-foot equivalent units

DUBAI: DP World Logistics in Dubai has opened a 6,000-square-meter high-end warehouse offering new storage solutions at Jebel Ali Free Zone, the Emirates News Agency reported.

The facility has 12,500 pallet positions and can accommodate cargo up to 18 meters high using Very Narrow Aisle racking systems, the company said, and a monthly capacity of 6,000 twenty-foot equivalent units.

DP World Logistics highlighted its advantageous location in what it described as one of the world’s fastest-developing regions and said that it is able to leverage the capabilities and cutting-edge IT platforms of its parent company, DP World, to ensure goods are stored, distributed and delivered efficiently through a multimodal transportation model that combines port, shipping line, sea freight, air freight and trucking solutions.

The company said it offers container freight station operations, warehousing and supply chain solutions, and freight-forwarding operations from six facilities in Jebel Ali and its assets include extensive yard operations, cross-dock warehousing, and cold storage and cool storage solutions.

“As part of DP World, a global smart-trade enabler, DP World Logistics is continually on a journey of business transformation, with new product innovations and developments,” said Abdulla bin Damithan, the CEO of DP World UAE and Jafza.

“Our shared commitment to improve end-to-end logistics performance in moving cargo around the world, underpinned by innovations in logistics-led solutions, has maximized opportunities for our customers over the years.

“The new CFS 2 warehouse is yet another step in supporting our customers better, helping them explore varied business opportunities and move forward with tremendous growth potential in the region. As a reliable, trustworthy and time-bound logistics partner, we will continue creating a complete end-to-end logistics trade journey from and to high-growth markets for our clients.”