Cement sales up across Saudi Arabia as mega construction projects kick in 

Cement sales up across Saudi Arabia as mega construction projects kick in 
Cement companies have faced a mixed picture in the Kingdom so far in 2022. (Shutterstock)
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Updated 03 November 2022

Cement sales up across Saudi Arabia as mega construction projects kick in 

Cement sales up across Saudi Arabia as mega construction projects kick in 

RIYADH: Saudi Arabia’s local cement sales hit 1.45 million tons during the third quarter of 2022, up from 1.43 million tons in the corresponding period a year earlier, according to Southern Province Cement Co.’s CEO Aqeel Kadasah. 

The financial results in the three months to October indicate the cement sector’s recovery in the Kingdom Kadasah said. 

Given the pipeline of projects in the country, local demand is set to increase, thus improving cement’s selling price, he revealed. 

Profits of Southern Province Cement Co. dropped by 28 percent in the first nine months of 2022 to SR238 million ($63.3 million), down from SR331 million during the same period a year ago. 

This was coupled with a 12 percent decrease in revenue in the period ending Sept. 30, reaching SR887 million.  

The company attributed the lower profits to lower sales revenues due to the lower demand, lower selling prices, and higher production requirements prices. 

The results are in keeping with the mixed picture cement companies have faced in the Kingdom so far in 2022. 

Local Tabuk Cement revealed in a bourse filing that its profits declined 81 percent between January and September of 2022, falling to SR3.4 million.  

Despite lower profit, the cement producer Tabuk’s first-nine months revenues increased by 21 percent to SR210 million. 

Arabian Cement Co. reported a 6 percent profit increase for the first nine months of 2022 despite sales dropping 6 percent. The cement producer’s profits increased to SR146 million, up from SR138 million in the same period last year, according to a bourse filing, 

During the third quarter of 2022, Arabian Cement posted 57 percent growth in its profits to SR59 million supported by an 8 percent increase in revenue to SR241 million. 

Despite upheaval faced by the sector, its market value stands at SR50 billion, and it continues to contribute significantly to the Kingdom's economic development and Vision 2030 goals the head of the National Cement Committee Badr Johar said, according to Argaam.  

The Ministry of Industry and Mineral Resources is working to ensure the sector’s consistency by intensifying efforts in response to the many shifts occurring in the sector, Khalid Al-Mudaifer, vice minister for mining affairs at the ministry said after a meeting with Johar. 

A surge in construction activities due to The Red Sea Development Co., AMAALA and other development projects in Saudi Arabia such as NEOM and Qiddiya is expected to drive the recovery of the cement industry after the demand dwindled last year and early this year on account of the pandemic. 

 


Closing Bell: TASI arrests downward slide; closes up 38 points to 10,508 

Closing Bell: TASI arrests downward slide; closes up 38 points to 10,508 
Updated 16 sec ago

Closing Bell: TASI arrests downward slide; closes up 38 points to 10,508 

Closing Bell: TASI arrests downward slide; closes up 38 points to 10,508 

RIYADH: Saudi Arabia’s Tadawul All Share Index gained 38.22 points — or 0.37 percent — on Wednesday to close at 10,507.72. 

While MSCI Tadawul 30 Index edged up 0.21 percent to 1,439.54, the parallel market Nomu closed 0.76 percent higher to 19,212.09. 

TASI’s total trading turnover of the benchmark index was SR3.41 billion ($910 million), with 99 stocks of the listed 224 advancing and 100 receding. 

Saudi Public Transport Co. was the topmost gainer, soaring 6.56 percent to SR17.54.  

Bupa Arabia for Cooperative Insurance Co. was the second-highest grosser, rising 3.82 percent to SR157.80. The company on Tuesday received Saudi Central Bank’s approval to renew its insurance activities license. The license is valid for three years, starting from March 26, 2023, the insurer informed Tadawul. 

The other top gainers were Alkhaleej Training and Education Co., Savola Group and Sahara International Petrochemical Co. All three stocks advanced within the 3-4 percent range. 

The worst-performing stock of the day was Banque Saudi Fransi, which dropped 4.63 percent to SR37.05. 

Other poor performers were Saudi British Bank, Al Alamiya for Cooperative Insurance Co., Riyad Bank and Amana Cooperative Insurance Co. 

Among sectoral indices, 13 of the 21 listed on the stock exchange declined; one remained flat while the rest advanced. 

On the announcements front, Elm Co.’s wholly owned subsidiary, Saudi Company for Electronic Information Exchange, inked a revenue-sharing agreement with Zakat, Tax and Customs Authority. 

The agreement’s value exceeds 5 percent of total revenue as per audited financial statements for 2021. The contract has no fixed value. Instead, it depends on the number of executed transactions, and the company receives a percentage of the fees of such transactions. 

The five-year agreement will provide customs electronic and operational services, starting from the issuance of the effective date certificate. Its share price fell 0.37 percent to SR375.60. 

Al Moammar Information Systems Co. and Mobile Telecommunication Co. Saudi Arabia, also known as Zain KSA, signed, on Feb. 7 a non-binding memorandum of understanding. 

The 12-month MoU will be renewed based on the two parties’ agreement, MIS said in a statement on Tadawul. 

As per the MoU, MIS and Zain KSA will explore potential opportunities for cooperation through the design, launch, and offering of certain products and services.  

MIS also signed another MoU with the Ministry of National Guard to support the digital transformation journey of the ministry by developing a data center strategy, information security, artificial intelligence and other emerging technologies in the enterprise space. MIS’s share price rose 1.94 percent to SR94.50. 


Integration of zakat, tax bodies with customs to be completed in Q1: ZATCA governor 

Integration of zakat, tax bodies with customs to be completed in Q1: ZATCA governor 
Updated 53 min 36 sec ago

Integration of zakat, tax bodies with customs to be completed in Q1: ZATCA governor 

Integration of zakat, tax bodies with customs to be completed in Q1: ZATCA governor 

RIYADH: The complete merger of the General Authority of Zakat and Tax with the General Authority of Customs will be completed by the end of the first quarter of 2023, revealed ZATCA Gov. Suhail Mohammed Abanmi.  

While speaking at a panel discussion at the Zakat, Tax and Customs Conference in Riyadh on Wednesday, Abanmi said that ZATCA faced so many challenges to integrate these bodies, but it is successfully completing the process as the authority carried out several studies to understand the possible hurdles that may come up in the journey.  

The integration between Zakat, Tax and Customs bodies was happening in phases, and the merging process is now in its final stages.  

It was in 2021 that the Saudi cabinet approved the decision to merge the General Authority of Zakat and Tax with the General Authority of Customs, to form an umbrella authority named Zakat, Tax and Customs Authority, in line with the Kingdom’s efforts to restructure government agencies to speed the implementation of the goals outlined in Vision 2030.  

“The decision to integrate tax and customs bodies was taken in 2021, and it will be completed by the first quarter of this year,” said Abanmi.  

He added: “The integration of tax and customs bodies is a huge remarkable achievement. We faced so many challenges. But we successfully overcome those hurdles by conducting a study. The study was well detailed, and we found solutions for these challenges.”  

During the panel discussion, Abanmi also outlined the benefits of integration and noted that these efforts will mutually benefit both the customers and the government.  

“As customers use the same channel after the integration of tax and customs, it will increase the efficiency of the operations and enhance the satisfaction levels of the users. By integrating the two bodies; tax and customs, we reduced the cost of operational expenses and capital costs, and this will help the government,” he said.  

Abanmi further noted that integrating zakat, tax and customs bodies will also enhance cybersecurity, and added that it will also help reduce risks and tax evasion.  

Talking about the feasibility study conducted before taking the merging decision, Abanmi noted: “The decision to integrate tax and customs bodies under a single umbrella was decided after a study. This study looked into several international studies and analyzed previous experiences of integration that happened in UK, Estonia, Portuguese, and South Africa.” 


OECD’s 15% minimum tax rule should be implemented in every jurisdiction: KPMG expert

OECD’s 15% minimum tax rule should be implemented in every jurisdiction: KPMG expert
Updated 08 February 2023

OECD’s 15% minimum tax rule should be implemented in every jurisdiction: KPMG expert

OECD’s 15% minimum tax rule should be implemented in every jurisdiction: KPMG expert

RIYADH: The 15 percent minimum tax rule put forward by the Organization for Economic Cooperation and Development should be implemented on multinational companies in every jurisdiction, according to the managing director at KPMG US.

In an exclusive interview with Arab News on the sidelines of the Zakat, Tax and Customs Conference in Riyadh on Feb. 8, Alistair Pepper said that global firms should pay their fair share of tax wherever they do business.

“Pillar two of the OECD’s global tax agreement is focused on introducing global minimum effective tax rules. So, this is ensuring that large multinational companies that are in scope of these rules will pay a minimum level tax of 15 percent in every jurisdiction where they operate,” said Pepper.

Pepper noted that countries like South Korea and Japan have also made announcements regarding levying global minimum effective tax rules for multinational companies operating in these nations.

“What these countries are really saying is that we want to ensure that multinational companies that operate in our jurisdictions and other jurisdictions are paying effectively their fair share. And we think the fair share is 15 percent minimum tax across the board,” Pepper told Arab News.

During the interview, Pepper pointed out that higher domestic tax rules should be implemented in countries very carefully, as it will negatively impact the rate of investments in those nations.

“You also want to think about other economic factors. Obviously, higher taxes are going to place pressure on investments. So, you might want to think about other policy measures that are available to you to stimulate investments,” Pepper added.

Talking about the corporate taxation system in Saudi Arabia, he said: “For Saudi Arabia, the question is really: ‘Do I want to introduce or change my current tax rules, such that multinationals operating in my country always pay a 15 percent minimum tax rate?’ ‘Do I want to introduce a domestic minimum tax that tops them up to that rate?’”

During the World Economic Forum in January, Saudi Arabia’s Minister of Economy and Planning Faisal Alibrahim said that the Kingdom “broadly supports” global tax reforms, such as those tabled by the OECD.

In 2021, almost 140 countries agreed to sign up to the OECD tax reform deal, which aims to ensure multinational firms pay their fair share of corporate tax and prevent climate tax evasion.

Alibrahim said that despite some minor issues, the Kingdom regarded the OECD’s reform efforts as a “step in the right direction” as they were “underpinned by fairness.”

The minister further pointed out that it was also important that countries adhered to the time frame for the implementation of the OECD agreement, which was set as the start of 2024.


Saudi Arabia set to hold 2nd Financial Sector Conference to discuss economic uncertainty issues in March 

Saudi Arabia set to hold 2nd Financial Sector Conference to discuss economic uncertainty issues in March 
Updated 08 February 2023

Saudi Arabia set to hold 2nd Financial Sector Conference to discuss economic uncertainty issues in March 

Saudi Arabia set to hold 2nd Financial Sector Conference to discuss economic uncertainty issues in March 

RIYADH: Global and regional economic uncertainty will be one of the key themes of the second edition of the Financial Sector Conference 2023 set to be held in Saudi Arabia on March 15 to 16. 

The event will take place at the King Abdulaziz International Conference Center in Riyadh and is organized by Saudi Arabia’s Financial Sector Development Program partners, which are the Ministry of Finance, the Capital Market Authority, and the Saudi Central Bank. 

“The launch of the second edition of the Financial Sector Conference comes at a critical time in the world as the regional and international financial community seeks to overcome the current challenges of the global economy, including slow growth, high inflation, and uncertainty, which have affected the global supply chain,” Mohammed Al-Jadaan, Saudi Arabia’s Minister of Finance, said in a statement. 

The conference is set to host decision-makers in the financial sector, senior executives in local, regional, and international financial institutions, international investors, entrepreneurs, and prominent academics. 

Al-Jadaan added that the Kingdom is aiming to accelerate its structural reforms in line with Saudi Vision 2030 including the financial sector’s development. 

He stressed that the Kingdom is positioned to address the current global economic challenges and institute proactive policies which help limit their impact. He also pointed out that the Saudi economy has achieved tangible economic and financial improvements during 2022, exceeding local and international forecasts. 

The conference is set to build on the first edition in 2019, which sought integration between the financial sector ecosystem with its various means and tools, contributing to continuous growth within a framework of robust and solid fiscal stability, while employing innovative tools in the development and management of services. 

This year’s agenda includes discussion points regarding the aspirations and concerns of the financial community. Participants will discuss the challenges and opportunities facing the global economic downturn. 

Participants will also address increasing interest rates, market fluctuations, and other new challenges and opportunities that aim to achieve safe investments for tomorrow. 

The conference also contributes to the Kingdom’s Financial Sector Development Program and is one of the most important events in the financial sector in the Middle East thanks to its notable organizers. 


Simplified taxation system can help combat shadow economy, BNP Paribas tells ZATCA conference

Simplified taxation system can help combat shadow economy, BNP Paribas tells ZATCA conference
Updated 08 February 2023

Simplified taxation system can help combat shadow economy, BNP Paribas tells ZATCA conference

Simplified taxation system can help combat shadow economy, BNP Paribas tells ZATCA conference

RIYADH: Combating the shadow economy is key to meeting rising spending demands, according to the International Head of Economics at BNP Paribas Bank Marcelo Carvalho.

Speaking during a panel discussion on the first day of the Zakat, Customs, and Tax conference in Riyadh, Carvalho noted that addressing the shadow economy can help boost tax revenues.

When taxes are high and the system is complex, there is a perceived unfairness in the tax system and the shadow economy tends to occur, he simplified.

“The point is that if the system is too complex, if the cost of compliance is high, it means an incentive for the shadow economy to prosper. So, making sure that the system itself is not excessively burdensome is very important so that the cost of compliance is reduced,” Carvalho said during the panel discussion.

He went on to argue that the three most crucial drivers of a shadow economy are taxation, regulation, and incentives.

On the fiscal front, raising tax revenues is also “particularly important in today's global macroeconomic environment in which the costs of debt are rising and monetary tightening is happening across the globe,” the international head of economics explained.

This is evident by the fact that banks worldwide are hiking interest rates to fight inflation, thereby increasing the burden of interest payments, Carvalho clarified.

With regards to incentives, they are expected to be higher given the perception that economic agents will never get caught. That said, it is vital to have very clear penalties for non-compliance as well as a detection system that ensures enforcement of the rules, Carvalho emphasized.

Also speaking at the panel discussion, the Minister of Economy and Planning Faisal bin Fadel Al-Ibrahim described how, in addition to general finances, the shadow economy can also impact the competitiveness of the private sector as well as individuals, citizens, residents, and employees.

“When we address this phenomenon in general, this will serve the national economy and increase GDP. This can give us a chance and an opportunity to increase the financing capabilities,” Al-Ibrahim said.

The Zakat, Tax, and Customs conference aims to tackle global experiences in the fields and discuss the future of digitizing those sectors as well as propelling trade and protecting national security.