Saudi authorities taking steps to prevent artificial price hike, says minister

Saudi Minister of Commerce Majid Al-Qasabi. (Supplied)
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Saudi Minister of Commerce Majid Al-Qasabi. (Supplied)
Special teams have so far carried out 640,000 inspection tours across the Kingdom to ensure availability of essential commodities at government rates.
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Special teams have so far carried out 640,000 inspection tours across the Kingdom to ensure availability of essential commodities at government rates.
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Updated 06 July 2022

Saudi authorities taking steps to prevent artificial price hike, says minister

Saudi Minister of Commerce Majid Al-Qasabi. (Supplied)
  • After 13 months — specifically March 2021 — there were growing signs of economic recovery, Al-Qasabi said, but warning that there was an increase in demand versus supply

JEDDAH: Major events including the COVID-19 pandemic and war in Ukraine have caused price hikes around the world, Saudi Minister of Commerce Majid Al-Qasabi said in a periodic government communication conference on Tuesday.

The press conference discussed four key areas: Global events that led to price increases, the Saudi leadership’s guidance to address the effects of the hikes, repercussions of global events on prices, as well as a question and answer segment.

“Let us rewind two years and a half back to February 2020. The COVID-19 pandemic was an economic, social and mental tsunami. It was the biggest economic crisis in the world,” Al-Qasabi said.

“This pandemic affected the whole world all at once, and suddenly without any warning. We are still suffering from its effects,” he added.

“We stayed in the pandemic for 13 months, and after that, it was the beginning of recovery.”

After 13 months — specifically March 2021 — there were growing signs of economic recovery, Al-Qasabi said, but warning that there was an increase in demand versus supply.

“The demand was more than the supply, and this causes an imbalance in the market, when the demand exceeds the supply. Of course, the result will be that prices have risen,” he added.

Al-Qasabi pointed to the Suez Canal obstruction in March 2021 as another event that added to global economic woes.

“We saw the blockage of the navigational movement and the cessation of the navigational movement in the Suez Canal, then after three months — in July 2021 — the second variant of the virus appeared and imposed a curfew again, which caused the closure of some ports and some cities,” he said.

In February 2022, the Russia-Ukraine conflict began. The minister said that the war affected transportation, too.

“We had a crisis between Russia and Ukraine, and we still do not know how long this crisis will last. These events combined, overlapped and completed, leading to a crisis in transportation and supply chains,” he said.

The transportation and supply chain crisis includes the disruption of some transportation ports, such as the main port of Shanghai, a sixfold increase in the cost of transportation, as well as surging freight insurance rates.

Al-Qasabi hailed King Salman’s royal order on Monday that approved the allocation of SR20 billion ($5.32 billion) to help citizens mitigate the impacts of rising global prices.

Half of the allocated money will go to social insurance beneficiaries and the Citizen Account Program.


Saudi Arabia’s PIF ‘to become first sovereign fund to issue green bond’

Saudi Arabia’s PIF ‘to become first sovereign fund to issue green bond’
Updated 15 sec ago

Saudi Arabia’s PIF ‘to become first sovereign fund to issue green bond’

Saudi Arabia’s PIF ‘to become first sovereign fund to issue green bond’

RIYADH: Saudi Arabia’s Public Investment Fund will be the world’s first sovereign wealth fund to issue green bonds with its assets expected to exceed $1 trillion by 2025, the head of Debt Capital Markets and Funds at the London Stock Exchange told Al-Arabiya.

“The issuance of green bonds by the Public Investment Fund in Saudi Arabia is an important event not only for the Arab region, but also for the green bond market,” Shrey Kohli said.

The fund currently manages assets of over $600 billion. The PIF targets those sectors for investment that are in line with the framework of green bonds and the fund offers complete transparency to investors, he added.

As of now, the framework and prospectus of the PIF are available on the London Stock Exchange platform, which allows investors to gain an understanding of the fund’s strategy.

The fund has hired a large group of banks including Citi and JPMorgan to arrange a debut issuance of multi-tranche US dollar-denominated green bonds.

BNP Paribas, Citi, Deutsche Bank, Goldman Sachs and JPMorgan, mandated as joint global coordinators and active book runners.

A debut issuance in tranches of five, 10 and potentially a longer-dated tenor will follow, subject to market conditions. The issuance will be under GACI First Investment Co. and guaranteed by the PIF.

Credit Agricole, First Abu Dhabi Bank, HSBC, Mizuho, SMBC Nikko, SNB Capital, Societe Generale and Standard Chartered are also active book runners, while ANB Capital, BofA Securities, Bank of China, GIB Capital, ICBC, IMI Intesa Sanpaolo, Morgan Stanley, MUFG, Natixis, Riyad Capital and Saudi Fransi Capital are also on the deal.


SAGO buys 5k tons of wheat for $2.3m from local farmers

SAGO buys 5k tons of wheat for $2.3m from local farmers
Updated 39 min 12 sec ago

SAGO buys 5k tons of wheat for $2.3m from local farmers

SAGO buys 5k tons of wheat for $2.3m from local farmers

RIYADH: The Saudi Grains Organization has bought the 16th batch of wheat worth SR8.84 million ($2.35 million) from 18 local farmers.

It is part of the organization’s arrangements to ensure adequate wheat supply by procuring grain from abroad and through local farmers. 

The current batch of local wheat weighed 5 tons, according to a SAGO statement.

Since the beginning of the current season, it added, wheat worth SR823.53 million has been bought from local farmers.


UAE In-Focus — Dubai Metaverse Strategy aims to create 40,000 jobs; Egis completes WME acquisition

UAE In-Focus — Dubai Metaverse Strategy aims to create 40,000 jobs; Egis completes WME acquisition
Updated 02 October 2022

UAE In-Focus — Dubai Metaverse Strategy aims to create 40,000 jobs; Egis completes WME acquisition

UAE In-Focus — Dubai Metaverse Strategy aims to create 40,000 jobs; Egis completes WME acquisition

RIYADH: The Dubai Metaverse Strategy is aiming to create 40,000 virtual jobs in the next five years, as the city aims to become one of the top 10 global metaverse economies.

Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum the Chairman of Dubai Executive Council and Crown Prince of Dubai, who officially launched the Metaverse Strategy said that metaverse will shape a new digital future for humanity, news agency WAM reported.

“Dubai is emerging as a major contributor to shaping a new global vision for advanced technology and a pioneer in adopting next-generation digital innovation,” said Sheikh Hamdan.

The Metaverse Strategy also aims at attracting over 1000 companies in the significant field of blockchain and metaverse.

Virtual Reality and Augmented Reality are the two main enablers of the metaverse, and it has created 6,700 jobs, along with contributing $500 million to the economy of the UAE.

Egis completes WME acquisition

French firm Egis has completed the acquisition of Dubai-based engineering consultancy WME, according to a MEED report.

The deal was initially announced in March and with its completion, WME’s managing director Peyman MoHajjer will lead the newly formed Building Engineering practice for Egis in the region.

“The joining of WME into Egis Group opens the door to create substantial growth opportunities and deliver greater benefits for customers in our key Middle East and India markets, in line with our global strategy to enhance our international presence,” said Laurent Germain, Egis Group CEO.

Alaa AbuSiam, CEO of Egis Middle East said, “Together with WME, we’re now well positioned to help our clients successfully navigate the transition to a more efficient and sustainable built environment.”

WME is a firm known for providing civil, structural, mechanical, electrical, plumbing, audio-visual, information technology, security, and infrastructure engineering services.


Qatar Investment Authority invests $2.43bn to accelerate RWE’s green energy strategy 

Qatar Investment Authority invests $2.43bn to accelerate RWE’s green energy strategy 
Updated 02 October 2022

Qatar Investment Authority invests $2.43bn to accelerate RWE’s green energy strategy 

Qatar Investment Authority invests $2.43bn to accelerate RWE’s green energy strategy 

RIYADH: The Qatar Investment Authority has agreed to invest $2.43 billion in Germany’s largest power producer RWE AG, to help it buy US firm Con Edison Inc’s Clean Energy Businesses subsidiary for $6.8 billion.

According to a Reuters report, RWE will issue a mandatory convertible bond to a QIA subsidiary, through which Qatar’s sovereign wealth fund will become a 9.1 percent shareholder in RWE.

By acquiring Con Edison’s Clean Energy Businesses, RWE is expected to become one of the major players in the US renewable energy sector.

The transaction will nearly double RWE’s US renewables portfolio to more than 7 gigawatts and grow its regional project pipeline by 7 GW to more than 24 GW.

Following the takeover, solar will account for 40 percent of RWE‘s US portfolio, up from 3 percent now, according to presentation slides.

“Our equity capital measure is the basis for financing the acquisition of Con Edison CEB and of the additional green growth in the years to come,” RWE Chief Executive Markus Krebber said in a statement late on Saturday.

He added: “I am delighted that the QIA is supporting RWE’s accelerated growth ambitions with their capital commitment.”

The deal, the biggest for RWE since the breakup of former division Innogy announced in 2018, will be earnings accretive right away, giving RWE additional core earnings of $600 million a year.

Mansoor bin Ebrahim Al-Mahmoud, CEO of QIA, said that the fund is proud to support RWE’s vision to become a leader in the global renewable energy market.

“QIA is actively investing in companies that can have a positive impact on society and shape the future of sustainability by making the energy transition a reality,” he added.

The deal comes nearly a year after RWE fleshed out its global renewables roadmap, which includes $49 billion of gross investments by 2030, with 15 billion earmarked for the US.

The transaction, which is expected to close in the first half of 2023, will make RWE the fourth-largest renewables player in the US market.

The deal plays a key role in the company’s green expansion, though still far behind the largest player NextEra with some 58 GW of generating capacity. 

Barclays and Latham and Watkins advised Con Edison on the deal.

(With input from Reuters) 


IMF plans regional office in Saudi Arabia

IMF plans regional office in Saudi Arabia
Updated 02 October 2022

IMF plans regional office in Saudi Arabia

IMF plans regional office in Saudi Arabia

RIYADH: The International Monetary Fund is considering opening a regional office in Saudi Arabia as both parties prepare to sign a memorandum of understanding in this regard on Oct. 3 in Riyadh. 

The MoU, to be signed between the Saudi Arabian ministry of finance and the IMF, will be followed by a joint press conference at Ritz Carlton in Riyadh, a ministry release said. 

The opening of a new regional office in Saudi Arabia holds significance as the IMF expects the Kingdom to become one of the world's fastest-growing economies, recording a growth of 7.6 percent in the gross domestic product this year.

It should be also noted that credit rating agency S&P has affirmed Saudi Arabia’s rating at “A-/A-2” with a positive outlook citing higher oil revenues, rising oil production, and the government’s robust reform program.