Saudi Arabia, South Korea sign deals worth $30bn during crown prince’s visit

Saudi Arabia, South Korea sign deals worth $30bn during crown prince’s visit
Saudi Arabian Crown Prince Mohammed bin Salman, left, shakes hands with South Korean President Yoon Suk Yeol to leave the presidential residence after a meeting in Seoul, South Korea, Thursday, Nov. 17, 2022. (South Korean Presidential Office/Yonhap via AP)
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Updated 18 November 2022

Saudi Arabia, South Korea sign deals worth $30bn during crown prince’s visit

Saudi Arabia, South Korea sign deals worth $30bn during crown prince’s visit
  • Some 26 agreements signed, including on energy, NEOM
  • Korean president seeks to take bilateral relations to new level through Saudi Vision 2030

SEOUL: Saudi Crown Prince Mohammed bin Salman held talks with South Korean President Yoon Suk-yeol in Seoul on Thursday, paving the way for multibillion-dollar bilateral cooperation in space technology, energy, infrastructure, and NEOM, the Kingdom’s giga-project.

The Saudi crown prince was on a two-day official visit to South Korea, arriving straight from the G20 Summit in Bali, Indonesia. He was accompanied by a high-profile delegation, including the ministers and heads of top government institutions related to investment and commerce.

The South Korean president said there were plans for more cooperation as it was time to “take the relationship to a new level through Saudi Vision 2030.”  

A strategic framework, Vision 2030 is an effort to pivot Saudi Arabia away from oil dependency and establish it as a global investment powerhouse with a sophisticated digital infrastructure. The Kingdom is estimated to have mobilized around $500 billion to achieve its goals, including the development of new cities.  

“In the future, Korea hopes to expand and develop cooperation in investment in new growth areas, and participation in megaprojects such as NEOM,” Yoon said in a press release after the meeting.

 

The presidential office said that in the field of energy the two leaders discussed projects related to hydrogen fuel, carbon capture technology, and small reactor development.

In the field of infrastructure, the talks covered the involvement of Korean companies in Vision 2030 projects, while in the field of defense they focused on cooperation in the development of hardware and software to strengthen Saudi security capabilities.

The two sides also agreed to develop the bilateral relationship into a “future-oriented strategic partnership,” and the Saudi crown prince said the Kingdom would seek to intensify coordination to boost its ambitions toward it.

“We look forward to raising the pace of investment coordination and strengthening the partnership between the public and private sectors,” the crown prince said, as quoted by the Saudi Ministry of Foreign Affairs.

“We stress the importance of benefiting from the promising commercial and investment opportunities available for cooperation between our two countries.”

The visit coincided with the Korea-Saudi Investment Forum, in which 26 agreements were signed by Saudi companies and their Korean counterparts to cooperate on clean energy projects, transportation, housing, and construction in NEOM — the Saudi smart city project overseen by the crown prince.

The memoranda of understanding included a $7 billion plan by Saudi Aramco, the Kingdom’s state oil and energy company, to expand a petrochemicals refinery of its South Korean affiliate S-Oil Corp.

The project, Shaheen, is the biggest foreign investment into South Korea, said Trade, Industry and Energy Minister Lee Chang-yang during the forum.

He said: “It is a representative success story leading the low carbon and high value-added oil industry by utilizing the complementary energy and industrial structure of Korea and Saudi Arabia.”

The South Korean minister told the forum’s participants that the partnership between the two countries has opened a new horizon for expanding and developing into “global economic cooperation.”

Just weeks ahead of the investment forum, South Korea launched a council involving both government and private sectors to promote corporate advancement into the Middle East, especially Saudi Arabia.

The Kingdom and South Korea took a historic step in their relationship when the crown prince made his first official trip to Seoul in 2019.

Steady growth

According to an economic report issued by the Federation of Saudi Chambers, the Saudi-Korean Joint Committee and the Saudi-Korean Vision 2030 includes as many as 40 projects and initiatives across the targeted sectors.

The report also indicated steady growth in the volume of trade exchange between both countries which amounted to SR470 billion ($12.5 billion) over the past five years.

In 2021 alone, the volume of trade exchange hit SR100 billion, SR87 billion of which were exports to Korea and SR13 billion were Korean imports to the Kingdom.

Earlier, South Korea’s industry ministry said companies including Samsung C&T Corp. and POSCO Holdings Inc. had signed over 20 agreements with Saudi counterparts in fields such as energy cooperation, railways, chemicals, pharmaceuticals and gaming.

Saudi-based Asharq TV quoted the Kingdom’s investment minister as saying deals signed on Thursday were worth $30 billion. It also quoted the Saudi Venture Capital Company as saying it had agreed to establish seven specialized funds.

Among the agreements, Korea Electric Power Corp. and four other Korean firms signed a memorandum of understanding with Saudi Arabia’s Public Investment Fund to build and operate a hydrogen and ammonia production plant in the Kingdom, the company said.

The project will be worth about $6.5 billion, said a source with knowledge of the deal, who was not authorized to speak with media on the matter and declined to be named.

The plant is expected to produce 1.2 million tons of green hydrogen and ammonia annually, KEPCO said. It is to be built over 2025-2029 and operate for 20 years, the Yonhap news agency reported on Thursday, citing industry sources.

Another pact is Hyundai Rotem Co’s memorandum of understanding with Saudi Arabia to cooperate on a railway project for the Middle Eastern country’s $500 billion NEOM economic zone and smart city, the ministry said. It did not disclose the potential dollar amount of this agreement.

“The (South Korean) government will actively support the successful implementation of cooperative projects which apply Korea’s state-of-the-art architecture ... in NEOM,” said South Korea’s trade minister, Lee Chang-yang.

Hyundai Rotem shares rose 8.5 percent, versus a 1.1 percent drop in the wider market. Shares in Lotte Fine Chemical , which signed an agreement for chemical industry cooperation with the Saudi Ministry of Investment, rose 2.1 percent.

(With Reuters)


Almana set to expand network of hospitals outside of the Eastern Province: CEO

Almana set to expand network of hospitals outside of the Eastern Province: CEO
Updated 03 February 2023

Almana set to expand network of hospitals outside of the Eastern Province: CEO

Almana set to expand network of hospitals outside of the Eastern Province: CEO

RIYADH: As part of its five-year plan, Almana Group of Hospitals, one of the oldest and largest medical groups in Saudi Arabia, is set to expand its network of hospitals, its CEO told Arab News in an exclusive interview. 

Being the first private medical center established in the Eastern Province, the group’s initial focus will be on exploring opportunities for a new hospital outside of the eastern region within the next few years with the view to expanding into other areas following that, Mana Almana informed.

“We are strongly aligned with the vision of our great leaders and stand ready to support the government to build capacity within the sector due to our expanding facilities and offerings tailored to the evolving needs of our communities,” he said.

Almana added: “We recognize that to meet the future needs of the medical sector, we need to partner with world-renowned healthcare institutions to help us accelerate and further develop the Kingdom’s healthcare system.” 

Not surprisingly, the group is also seeking to partner with the Ministry of Health under public-private partnerships to deliver advanced and specialist services.

As the only dedicated oncology unit in eastern Saudi Arabia, the group has recently expanded its specialists department in Dammam to cater to cancer patients’ mounting needs in the region. 

CEO Mana Almana. (Supplied)

“When it comes to oncology, Almana’s goal is to provide cancer patients with the highest international standard of care and cater to the growing need for cancer care in the Kingdom,” Almana said. 

“As such, in addition to our existing seven hospitals and clinics, we decided to create a dedicated space where patients could receive individualized and tailored treatment within a centralized and fully-fledged unit.” 

The new oncology center has been designed with the complexity of cancer in mind. By bringing the group’s 70 specialized oncologists under one roof, it can provide personalized treatments and precision fit for specific types of cancer. 

The new unit will include four new clinics specializing in medical oncology, radiation and surgical oncology in addition to four chemotherapy treatment rooms. 

“Besides providing exceptional treatment for patients, we also focus our efforts on preventive cancer care measures,” Almana explained. 

“Our efforts include free year-round breast-cancer screenings at all branches of Almana hospitals in Dammam, Alkhobar, Ahsa, Jubail and Rakah,” he continued. “Over the years, our free screening has touched the lives of over 10,000 patients, potentially helping to save even more lives.” 

In line with the ambition of Saudi Vision 2030 to unify patient care records and improve health information exchange, the group is investing heavily in technology within its hospitals to ensure all services will be automated while providing seamless service for its patients.

“We are also establishing a new central command center to improve patient outcomes by coordinating care between our hospital locations,” Almana informed. 

“As a group of hospitals, we continuously foster a culture of innovation to create value in areas of high unmet medical need across the Kingdom. For example, we’ve created unique offerings where they currently don’t exist such as our foot disease and diabetes center, the only one in the region,” he continued.

In addition, the group is also taking several steps to train and recruit medical professionals. 

“We also share the ambition of Saudi Vision 2030 to increase the number of females within the workforce,” Almana said. “Already, we have females leading our medical departments and are looking to increase this even further by 20 percent over the next five years.” 

“Over the last 10 years, we’ve also helped develop the next generation of doctors and nurses in the Kingdom through our official healthcare training academy, Mohammed Almana College for Medical Science, which contributes to over 180 Saudi graduate nurses each year,” he pointed out.


Global Markets: Stocks, bonds tumble as stellar US jobs report may force Fed rethink

Global Markets: Stocks, bonds tumble as stellar US jobs report may force Fed rethink
Updated 03 February 2023

Global Markets: Stocks, bonds tumble as stellar US jobs report may force Fed rethink

Global Markets: Stocks, bonds tumble as stellar US jobs report may force Fed rethink

LONDON: Global stocks and Treasury prices tumbled on Friday after an unexpectedly strong US jobs report indicated the Federal Reserve may need to keep interest rates elevated to control inflation, according to Reuters.

This placed another roadblock in the way of a weeks-long markets rally that stumbled in US after hours trading on Thursday over disappointing earnings from Google, Apple, and Amazon.

S&P 500 futures slid 1.1 percent, contracts on the tech-heavy Nasdaq 100 dropped 1.8 percent.

The MSCI index of global shares fell 0.3 percent, having hit its highest level since August on Thursday in a rebound buoyed by optimism that central banks are close to the end of their aggressive rate hiking cycles.

The keenly-watched US nonfarm payrolls report showed US employers added 517,000 new workers in January, vastly overshooting expectations of economists polled by Reuters for a 185,000 gain.

Average hourly wages, which analysts and investors focus on for clues about whether a tight labour market may continue to fan the flames of inflation, rose 0.3%, matching economists' forecasts.

The yield on the 10-year Treasury, which underpins borrowing costs worldwide, added 11 basis points to 3.51 percent after the jobs data. The two-year Treasury yield, which follows traders' expectations of Fed fund rates, rose by 12 bps to 4.24 percent.

The Fed hiked its main interest rate by 25 bps to a range of 4.5 percent to 4.75 percent on Wednesday, taking benchmark borrowing costs to their highest since late 2007, and signalled more hikes to come. The European Central Bank and the Bank of England also raised rates on Thursday to contain inflation.

"In a year when the economic data is more important than the Fed, the January employment report clearly justified the Fed having tightened by 425 bps over the past 10 months," said Jack McIntyre, portfolio manager at Brandywine Global.

Ahead of the nonfarm payrolls data, markets had priced two US rate cuts by year-end on hopes the US economy was cooling enough to quell inflation but not on course for a downturn that could reduce companies’ earnings more than markets were already counting on.

US tech shares took a beating in after-hours trading on Thursday after Apple projected another revenue decline in the start of the year, Amazon warned that its operating profit could fall to zero in the current quarter, and Google parent Alphabet missed fourth-quarter profit and revenue expectations.

"We will see headwinds from further earnings downgrades, but we have incorporated quite a lot (of this) already so I think markets can hold here if we are indeed right on the Fed,” said Willem Sels, global chief investment officer at HSBC's private bank, who expects the US central bank to raise rates just one more time in 2023.

An index measuring the dollar against major currencies stood at 102.53, rising further from recent nine-month lows of 100.80.

In Europe, the Stoxx 600 share benchmark fell 0.4 percent. Germany's benchmark 10-year bond yield rose 13 bps to 2.14 percent, having on Thursday dropped by the most since 2011 as prices shot higher.

The euro traded at $1.0841, down 0.65 percent and pulling further away from Thursday's 10-month top of $1.1033.

 


World food prices decline for 10th month running in January, says UN Food Agency

World food prices decline for 10th month running in January, says UN Food Agency
Updated 03 February 2023

World food prices decline for 10th month running in January, says UN Food Agency

World food prices decline for 10th month running in January, says UN Food Agency

ROME: World food prices fell in January for a 10th consecutive month, and are now down some 18 percent from a record high hit last March following Russia’s invasion of Ukraine, the UN's food agency said on Friday.

The Food and Agriculture Organization’s price index, which tracks the most globally traded food commodities, averaged 131.2 points last month against 132.2 for December, the agency said on Friday. It was the lowest reading since September 2021.

The December figure was revised down from an original estimate of 132.4.

Falls in the prices of vegetable oils, dairy and sugar helped pull down the index, while cereals and meat remained largely stable, the FAO said.

In separate cereal supply and demand estimates on Friday, the FAO raised its forecast for global cereal production in 2022 to 2.77 billion tons from a previous estimate of 2.76 billion tons.

The FAO cereal price index rose just 0.1 percent month-on-month in January to give a 4.8 percent increase on the year.

International wheat prices declined 2.5 percent as production in Australia and Russia outpaced expectations. Rice, by contrast, jumped 6.2 percent, driven in part by strong local demand in some Asian exporting countries.

Vegetable oil prices fell 2.9 percent in January, the dairy index dipped 1.4 percent and sugar declined 1.1 percent. Meat slipped a mere 0.1 percent.

Looking at supply and demand for cereals, FAO said it expected a record global output of wheat in 2022 thanks to revised crop forecasts from Australia and Russia.

The forecast for world rice production was revised down on the back of lower-than-expected output in China, and is now predicted to decline 2.6 percent from its all-time high in 2021.

Looking ahead to 2023, FAO said early indications pointed to a likely expansion of winter wheat cropping in the northern hemisphere. However, it warned that high fertilizer costs may impact yields.

World cereal utilization in 2022/23 was forecast to dip 0.7 percent from the previous year to 2.78 billion tons. The estimate for world cereal stocks was pegged at 844 million tons, pushing down the world stock-to-use ratio for 2022/23 to 29.5 percent from 30.8 percent in 2021/22


Oil steadies with spotlight on EU embargo, US jobs data

Oil steadies with spotlight on EU embargo, US jobs data
Updated 03 February 2023

Oil steadies with spotlight on EU embargo, US jobs data

Oil steadies with spotlight on EU embargo, US jobs data

LONDON: Oil prices steadied on Friday as investors sought more clarity on the imminent EU embargo on Russian refined fuels, with prices set for a second weekly loss in the absence of clear signs of demand recovery in top consumer China.

Brent crude LCOc1 futures gained 15 cents, or 0.2 percent, to $82.32 a barrel by 1301 GMT, having dropped by about 1 percent in the previous session. US West Texas Intermediate crude CLc1 futures were up 12 cents, or 0.2 percent, at $76.00.

Brent is poised to register close to a 5 percent decline this week while WTI is on course for a 3.6 percent drop.

Investors are eyeing developments on the Feb. 5 EU ban on Russian refined products, with EU countries seeking a deal on Friday to set price caps for Russian oil products.

The Kremlin said on Friday that the EU embargo on Russia's refined oil products would lead to further imbalance in global energy markets.

"The exact details around what the cap will be and how they will implement it are still unclear," Capital Economics commodities economist Bill Weatherburn said, adding that the uncertainty is keeping a lid on prices.

"There hasn't been any data out of China to indicate the extent of the recovery in China's crude demand."

ANZ analysts noted a sharp jump in traffic in China's 15 largest cities after the Lunar New Year holiday but said that Chinese traders had been "relatively absent".

Markets now await US payrolls data due at 1330 GMT. US job growth in January is likely to have remained strong thanks to a resilient labour market, but expectations of a continued slowdown in wage gains offer the Federal Reserve some comfort in its fight against inflation, a Reuters survey showed.

The US central bank scaled back to a milder rate increase than those over the past year, but policymakers also projected that "ongoing increases" in borrowing costs would be needed.

Increases to interest rates in 2023 are likely to weigh on the US and European economies, boosting fears of an economic slowdown that is highly likely to dent global crude oil demand, said Priyanka Sachdeva, market analyst at Phillip Nova.

 


Who is Hindenburg, the firm targeting India’s Adani?

Who is Hindenburg, the firm targeting India’s Adani?
Updated 03 February 2023

Who is Hindenburg, the firm targeting India’s Adani?

Who is Hindenburg, the firm targeting India’s Adani?
  • Hindenburg is an investment research firm with a focus on activist short-selling. It looks for corruption or fraud in the business world, such as accounting irregularities and bad actors in management, and It can make money out of its work

NEW YORK: Hindenburg Research, the financial research firm with an explosive name and a track record of sending the stock prices of its targets tumbling, is taking on one of the world’s richest men.
Hindenburg is back in the headlines after last week accusing Indian conglomerate Adani Group of “a brazen stock manipulation and accounting fraud scheme.” It cited two years of research, including talks with former Adani senior executives and reviews of thousands of documents.
The Adani Group has blasted the accusations, calling them “a malicious combination of selective misinformation and stale, baseless and discredited allegations that have been tested and rejected by India’s highest courts.”
Nevertheless, Hindenburg’s scorching allegations have caused the fortune of Adani Group’s founder, Gautam Adani, to slide by nearly $47 billion in just over a week, according to the Bloomberg Billionaires index. Here’s a look at the firm behind all the movement:
What is it?
Hindenburg says it specializes in “forensic financial research.” In layman’s terms, it looks for corruption or fraud in the business world, such as accounting irregularities and bad actors in management.
Hindenburg has even come to be known as Ponzi hunters in some circles, according to the Washington Post, which detailed how it helped bring down an alleged $500 million scheme that targeted Mormons.
Where did its name come from?
The firm says it sees the Hindenburg, the airship that famously caught fire in the 1930s to the cry of “Oh, the humanity,” as the “epitome of a totally man-made, totally avoidable disaster.” It says it looks for similar disasters in financial markets “before they lure in more unsuspecting victims.”
Who else has Hindenburg gone after?
It’s perhaps most famous for a 2020 report on Nikola, a company in the electric-vehicle industry whose founder Hindenburg said made misleading claims to ink partnerships with top auto companies hungry to catch up to Tesla.
Among its allegations, Hindenburg accused Nikola of staging a video to calm skepticism about its truck, one that showed the vehicle cruising on a road. Hindenburg said the video was actually just showing the truck rolling down a hill after getting towed to the top.
What has come of such accusations?
For Nikola, quick scrutiny from the government and investors.
The company and its founder, Trevor Milton, received grand jury subpoenas from the US Attorney’s office for the Southern District of New York and the N.Y. County District Attorney’s Office shortly after Hindenburg released its report.
The Securities and Exchange Commission also soon issued subpoenas to Nikola’s directors.
Milton was convicted this past October of charges he deceived investors with exaggerated claims about his company’s progress in producing zero-emission 18-wheel trucks fueled by electricity or hydrogen.
And Nikola in late 2021 agreed to pay $125 million to settle SEC charges that it defrauded investors by misleading them about its products, technical advancements, and commercial prospects.
What does Hindenburg get out of this?
It can make money. In its Adani report, it said that it had taken a “short position in Adani Group Companies” through bonds that trade in the US and other investments that trade outside India.
It has made similar “short” bets against other companies it published unflattering reports on. A “short” trade is a way for someone to make money if an investment’s price falls. Afterward, if the price of a company’s stock or bonds falls because of the negative attention from the report, Hindenburg can profit.
Such short sellers have been criticized for unfairly pushing down prices of stocks with potentially unfounded allegations. But proponents also call them a healthy part of a stock market, keeping stock prices in check and preventing them from running too high.