PIF has created 500k jobs, aims to hit 1.8m: Governor Al-Rumayyan

PIF has created 500k jobs, aims to hit 1.8m: Governor Al-Rumayyan
Yasir Al-Rumayyan speaking at the FII Priority Summit in New York (Screenshot)
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Updated 22 September 2022

PIF has created 500k jobs, aims to hit 1.8m: Governor Al-Rumayyan

PIF has created 500k jobs, aims to hit 1.8m: Governor Al-Rumayyan

RIYADH: Saudi Arabia’s Public Investment Fund has created half a million jobs through its 54 companies operating in 10 different sectors, according to its governor, Yasir Al-Rumayyan. 

While speaking at the FII Priority Summit in New York on Sept. 22, Al-Rumayyan, who is also the chairman of the Future Investment Initiative, said the ultimate aim of PIF is to generate even more employment opportunities.

“We want to create 1.8 million jobs, and these are quality jobs. It is not only the figures we are looking at, but the quality of these figures, the quality of these jobs,” said Al-Rumayyan.  

He added that PIF is playing a major role in stimulating the Saudi economy.

Al-Rumayyan further noted the PIF has a dedicated initiative to ensure that targets outlined every five years are being fulfilled, and it will also outline goals for the upcoming half-decade cycle.

“We assure every five years; the first time in 2017 and the second time in 2021, and it is something called the Vision Realization Program,” said Al-Rumayyan, adding: “It is a public document that we have on our website, and in this document, we put our focus on what exactly we want to do in the coming five years.” 

“We have achieved the first targets for the first Vision Realization Program,” he said.

The PIF governor noted that the Saudi wealth fund has six pools of investments; four pools that invest domestically and two pools that invest internationally. 

He pointed out that PIF has promising Giga projects, along with strategic investments and a balanced portfolio. 

According to Al-Rumayyan, global warming is not the only concern that should be addressed, as importance should be given to the worldwide ecosystem. 

“You cannot say that the fossil fuel industry is evil and bad for the world because without it the world would stop moving. The agriculture sector emits a lot of carbon dioxide, does that mean agriculture is an evil thing? Of course not. We should find the right solutions to mitigate these risks,” said Al-Rumayyan. 

He revealed that Saudi Aramco — of which he is also chairman — is one of the least emitting oil and gas producers in the world. 

“We emit 10.5 kilograms of carbon dioxide per barrel, while the average of the industry is 25 kilograms,” he added.


Global oil demand is expected to grow until 2030 and beyond, says Aramco CEO

Global oil demand is expected to grow until 2030 and beyond, says Aramco CEO
Updated 8 min 47 sec ago

Global oil demand is expected to grow until 2030 and beyond, says Aramco CEO

Global oil demand is expected to grow until 2030 and beyond, says Aramco CEO

RIYADH: Global oil demand is expected to grow until 2030 and beyond, as the world has a flawed plan for energy transition, according to Saudi Aramco CEO Amin Nasser.

Speaking at the Energy Intelligence Forum in London on Oct. 4, Nasser said alternatives to replace oil and gas are not ready yet, and he made clear that measures should be taken to decarbonize oil and gas, along with developing carbon capture and storage technology.

During the speech, he noted that ensuring excess production capacity and output is not the responsibility of Saudi Arabia alone, Reuters reported. 

Nasser also pointed out the oil market is focusing on short-term rather than long-term economics, and global spare capacity to raise oil production is very low.

“(The market is) focusing on what will happen to demand if a recession happens in different parts of the world, they are not focusing on supply fundamentals,” he said, putting spare capacity at 1.5 percent of global demand.

Saudi Aramco, which is one of the biggest players in the global oil market, is now planning to maintain its Asian market, despite rising European demand, Nasser added.

He noted that Aramco is on track to increase its capacity to 13 million barrels a day from 12 million by 2027, a project that is expected to cost billions of dollars.

Nasser warned that the space capacity of producers is running low, and added that there wouldn’t be any left once China ends its Covid Zero strategy.

“The world should be worried. This is where we are heading. If China opens up a little bit you will find out that spare capacity will be eroded completely,” he further said. 

During his speech, Nasser said that the primary problem Europe faces now is related to gas and liquified gas due to the lack of spare capacity.

“We need to build up some spare capacity in oil, gas and LNG. Otherwise, any outages or increased demand will seriously stretch producers and could cause more turmoil in markets,” he added.

Nasser further noted that Aramco is planning to begin gas exports including blue hydrogen, and talks are currently going on with customers in East Asia, Japan, and South Korea.

He made it clear that Aramco is targeting customers who are willing to sign offtake agreements with a validity of 15 to 20 years.

In September, while attending a forum in Switzerland, Nasser said that the insecurity in the energy sector is due to the lack of investments, and capping energy bills and taxing oil companies are not long-term solutions to the global energy crisis.


OECD inflation remains stable at 10.3% in August

OECD inflation remains stable at 10.3% in August
Updated 04 October 2022

OECD inflation remains stable at 10.3% in August

OECD inflation remains stable at 10.3% in August

RIYADH: The inflation rate across Organization for Economic Co-operation and Development countries remained broadly stable at 10.3 percent in August, 10.2 percent in July and 10.3 percent in June. 

According to a OECD press release, the headline inflation, based on the Consumer Price Index, in 16 of 38 OECD countries decreased between July and August, primarily driven by a slower increase in energy prices. 

In 15 OECD countries, the inflation rate continued in double digits, with the highest rates observed in Estonia, Latvia, Lithuania and Turkey, all above 20 percent. 

The press release further noted that energy price inflation in the OECD fell to 30.2 percent year-on-year in Aug. 2022, also down from 35.3 percent in July 2022, with declines in more than 60 percent of OECD countries.

However, both food price inflation and inflation excluding food and energy kept rising in the OECD in Aug. 2022. 


Riyadh Region Municipality offers 38 investment opportunities in private sector boost

Riyadh Region Municipality offers 38 investment opportunities in private sector boost
Updated 04 October 2022

Riyadh Region Municipality offers 38 investment opportunities in private sector boost

Riyadh Region Municipality offers 38 investment opportunities in private sector boost

RIYADH: Riyadh Region Municipality is offering 38 investment opportunities for investors in resident units, community centers, and gardens, according to the Saudi Press Agency.

The opportunities will cover an area of over 397,000 sq. m, with contracts raging from five to 25 years. 

The move is aimed at strengthening partnerships with the private sector, enabling them to participate in the economic development of the city, improving urban living, and contributing to the Kingdom's Vision 2030.

The Municipality stated that three of these investment opportunities cover a total area of 48,162 sq. m with a term of 25 years, spread across Mahdia, Al-Munsiyah, and Al-Rabie.

As well as three other opportunities in the residential and commercial fields totaling 2,607 sq. m The contracts last between 15 and 25 years and are distributed in the neighborhoods of Cordoba, Casablanca, and Deira.

Three opportunities are also available in community centers with a total area of 5,014 sq. m, with 15-year contracts, located in the gardens of Seville, Al-Olaya, and Al Manhal. 

There are also two kiosks with a total area of 37 sq. m and a term of 10 years for sale.

There is one opportunity in self-selling distributed across 20 sites within the secretariat's sites with a five-year contract, located across several areas, according to the Municipality.

 As well as 12 investment opportunities to construct car parks covering 46,863 sq. m and with ten-year contracts. 

The investment opportunities also included 14 industrial opportunities on a total area of 295,310 sq. m, for a period of 20 years, located in the neighborhoods east of Ramah Road, Al-Khair neighborhood.

Riyadh Municipality is in charge of developing Riyadh and achieving sustainable development of the region with an integrated national perspective.

 


Stocks, sterling rally after UK’s tax climbdown injects some confidence

Stocks, sterling rally after UK’s tax climbdown injects some confidence
Updated 04 October 2022

Stocks, sterling rally after UK’s tax climbdown injects some confidence

Stocks, sterling rally after UK’s tax climbdown injects some confidence

LONDON: Global stocks climbed for a second day on Tuesday, after Britain’s decision to ditch part of a controversial tax-cut plan and slightly paler expectations for aggressive central bank action returned some confidence to investors, according to Reuters.

UK Finance Minister Kwasi Kwarteng on Monday announced the government would back down on reversing a tax break for top earners that formed part of a package aimed at boosting growth.

This measure only makes up a small part of the £45 billion ($51b billion) in unfunded tax cuts that sent the pound crashing to record lows and wreaked havoc in the gilts market.

But it was enough to soothe some of the recent angst in the market and, together with emergency bond buying from the Bank of England, sterling was set to make up most of the losses incurred since the mini budget was unveiled on Sept. 23.

Adding to the sense of relief among investors, who endured one of the most volatile quarters in recent history in the three months to September, was Australia’s central bank, which lifted interest rates by far less than expected.

A weaker read of US manufacturing activity helped temper expectations for more hefty rate rises by the Federal Reserve.

However, some analysts said this optimism may be misplaced.

“My firm view, however, is that this will not be the case. While, technically, having a dual mandate, the Fed have effectively become a single-issue central bank; that issue being bringing inflation back to the 2 percent target,” Michael Brown, chief strategist at CaxtonFX, said.

“Unless we see a few months of consecutive improvement in inflation data, it’s tough to envisage any sort of pivot, with another 75 bps hike remaining my base case for next month’s decision. It’s tough to be long risk with that on the radar.”

The MSCI All-World index was last up 0.8 percent on the day, while stocks in Europe enjoyed a decent bounce, with the Stoxx 600 trading almost 2 percent higher and London’s FTSE gaining over 1 percent.

The pound, meanwhile, gained 0.6 percent against the dollar to trade at $1.1390. Sterling has risen by more than 10 percent since the mini-budget.

The dollar slid against a basket of major currencies, as the euro and the pound made upward headway and Treasury yields slipped in light of a shift in investor expectations for the path of US interest rates.

US benchmark 10-year yields fell by nearly 20 basis points on Monday, having topped 4.0 percent just last week. They were last down 7 bps at 3.5795 percent.

“Noticeably, that move lower was entirely driven by a fall in real yields, with inflation breakevens moving higher on the day, which is again a sign that investors are pricing in a much less aggressive reaction from the Fed,” Deutsche Bank strategist Jim Reid said in a daily note.

In trade thinned by holidays in China and Hong Kong, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.7 percent, led by gains in Australia.

After September, when global bonds witnessed one of the biggest sell-offs in decades and any currency other than the dollar appeared to crumble, market watchers said a snap back, aided by better sentiment in the UK market, was not unusual, but would likely be short-lived.

“The about-face ... will not have a huge impact on the overall UK fiscal situation in our view,” said NatWest Markets’ head of economics and markets strategy John Briggs.

“(But) investors took it as a signal that the UK government could and is at least partially willing to walk back from its intentions that so disrupted markets over the past week.”

S&P 500 futures rose 1 percent, following a 2.6 percent bounce for the index overnight, suggesting a second day of gains may be in the offing on Wall Street later.

Other indicators of market stress are still flashing red. The CBOE Volatility Index remains elevated and above 30. Shares and bonds of Credit Suisse hit record lows on Monday as worry about the bank’s restructuring plans swept markets, although some of these losses reversed on Tuesday.

Japan’s yen hit 145 to the dollar on Monday — a level that prompted official intervention last week — and was last at 144.65, while the euro was up 0.6 percent at $0.9878, about three cents above last week’s 20-year trough.

“More volatility is almost certainly assured as FX markets re-focus on US recession risks, which continue to build,” said ANZ senior economist Miles Workman, with US jobs data on Friday the next major data point on the horizon.

Oil held overnight gains on news of possible production cuts, and Brent futures were last up 43 cents to $89.29 a barrel.
 


Oil Updates — Crude up; OPEC+ cancels technical meeting; Norway posts soldiers at oil plants

Oil Updates — Crude up; OPEC+ cancels technical meeting; Norway posts soldiers at oil plants
Updated 04 October 2022

Oil Updates — Crude up; OPEC+ cancels technical meeting; Norway posts soldiers at oil plants

Oil Updates — Crude up; OPEC+ cancels technical meeting; Norway posts soldiers at oil plants

RIYADH: Oil prices edged up on Tuesday as expectations that the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, may agree to a large cut in crude output when it meets on Wednesday outweighed concerns about the global economy.

Brent crude futures rose 46 cents, or 0.5 percent, to $89.32 per barrel by 0629 GMT after gaining more than 4 percent in the previous session.

US crude futures rose 30 cents, or 0.4 percent, to $83.93 a barrel. The benchmark gained more than 5 percent in the previous session, its largest daily gain since May.

OPEC+ cancels technical meeting ahead of key meeting of ministers

OPEC+ canceled a meeting of its Joint Technical Committee set for Oct. 4 ahead of a key gathering of ministers from the producer group to set policy, three OPEC+ sources told Reuters on Monday.

The JTC advises the OPEC+ Joint Ministerial Monitoring Committee and the overall OPEC+ ministerial meeting on market fundamentals.

One of the sources said the decision to scrap the JTC meeting came from the JMMC, without elaborating.

Norway posts soldiers at oil, gas plants after Nord Stream leaks

Norway’s military said on Monday it had posted soldiers to help guard major onshore oil and gas processing plants, part of a wider effort to boost security amid suspicion that sabotage caused leaks in the Nord Stream gas pipelines last week.

Russia’s Nord Stream 1 and 2 pipelines burst on Sept. 26, draining gas into the Baltic Sea off the coast of Denmark and Sweden. Seismologists registered explosions in the area, and police in several countries have launched investigations.

Norway, Europe’s largest gas supplier and a major oil exporter, last week deployed its navy and air force to patrol offshore petroleum fields and announced it would receive assistance from Britain, Germany and France in doing so.

At the request of Norwegian police, the Norwegian Home Guard, a rapid mobilization force, on Monday began to deploy troops at plants responsible for processing and exporting oil and gas.

Although the Norwegian government has said it was not aware of any specific threats to oil and gas infrastructure, it still found it prudent to beef up security and sought to calm concerns among workers.

(With input from Reuters)