Strength in numbers: Saudi Arabia and China seal 35 deals worth $30bn during Xi Jinping’s visit

Special Strength in numbers: Saudi Arabia and China seal 35 deals worth $30bn during Xi Jinping’s visit
The agreements are worth about $30 billion, and come as China seeks to shore up its COVID-19-hit economy and the Kingdom continues to diversify its economic and political alliances in line with Vision 2030. (SPA)
Short Url
Updated 09 December 2022

Strength in numbers: Saudi Arabia and China seal 35 deals worth $30bn during Xi Jinping’s visit

Strength in numbers: Saudi Arabia and China seal 35 deals worth $30bn during Xi Jinping’s visit
  • Agreements range from green energy, technology, and logistics, to construction and manufacturing
  • Major ones include an alignment plan between the Kingdom’s Vision 2030 and China’s Belt and Road Initiative

RIYADH: China’s business links with Saudi Arabia have been significantly boosted thanks to the signing of 35 investment agreements involving organizations from the two countries.

The raft of deals came during the visit of Chinese President Xi Jinping to the Kingdom. They cover a range of sectors, including green energy, technology and cloud services.

Transportation, logistics, medical industries, construction and manufacturing are also covered by the deals, as is a petrochemicals project, housing developments and the teaching of the Chinese language.

The agreements are worth about $30 billion, and come as China seeks to shore up its COVID-19-hit economy and the Kingdom continues to diversify its economic and political alliances in line with Vision 2030.




One of the deals involved a memorandum of understanding with China’s Huawei Technologies on cloud computing and building high-tech complexes in Saudi cities. (Supplied)

The signing of the agreements was overseen by Saudi Crown Prince Mohammed bin Salman and President Xi, with the first an alignment plan between the Kingdom’s Vision 2030 and China’s Belt and Road Initiative.

Another deal saw a memorandum of understanding in the field of hydrogen energy signed by Prince Abdulaziz bin Salman, Saudi Arabia’s energy minister, and He Lifeng, chairman of the Chinese National Development and Reform Commission.

Walid bin Mohammed Al-Samaani, the Kingdom’s justice minister, and Wang Yi, China’s state councilor and minister of foreign affairs, inked an agreement for cooperation and judicial assistance in civil, commercial and personal status cases.

A memorandum of cooperation to teach the Chinese language was signed by Yousef bin Abdullah Al-Benyan, Saudi Arabia’s education minister, and China’s Wang Yi.

Direct investment is to be encouraged through an MoU penned by Khalid bin Abdulaziz Al-Falih, the Kingdom’s investment minister, and Wang Wentao, China’s minister of commerce.

An action plan to activate the provisions of the housing memorandum of cooperation was also agreed, and signed by Majid Al-Hogail, Saudi Arabia’s minister of municipal, rural affairs and housing, and China’s Wang Wentao.

The signing of these MoUs and agreements was followed by a ceremony during which the Chinese president received an honorary doctorate degree in administration from King Saud University.




The Saudi crown prince also held an official lunch in honor of the Chinese president. (SPA)

The Saudi crown prince also held an official lunch in honor of the Chinese president.

Saudi investment minister Khalid Al-Falih said that this week’s visit “will contribute to raising the pace of economic and investment cooperation between the two countries,” offering Chinese companies and investors “rewarding returns.”

One of the deals involved a memorandum of understanding with China’s Huawei Technologies on cloud computing and building high-tech complexes in Saudi cities, the government communication office said in a statement.

Saudi firm AJEX Logistics Services is one of the companies looking to benefit from the growing ties between the Kingdom and China.

The firm marked the visit of the Chinese leader by announcing the launch of two new services as part of its expansion strategy into China and the Middle East.

Customers will soon be able to send single-piece and multi-piece shipments from China to Saudi Arabia, the UAE and Bahrain in four to seven days.

Another deal, signed between the Saudi Investment Ministry and Shandong Innovation Group, involves the construction of an aluminum plant.

Chinese chemical company Kingfa, Shanghai-based wind turbines and energy management software firm Envision, and Beijing-headquartered CITIC Construction also penned MoUs.

The range of deals prompted the CEO of the Saudi Export Development Authority, Abdulrahman Al-Thukair, to hail the strong economic relations between Saudi Arabia and China.

Al-Thukair praised the growth and development of the volume of trade exchange between the two countries, noting that China is one of the Kingdom’s main trade partners, as total non-oil exports from the Kingdom to China reached SR36 billion ($9.57 billion) in 2021, mainly petrochemicals, which amounted to SR31.7 billion, and minerals, which amounted to SR2 billion.

Thursday’s developments prompted Hussain Al-Shammari, the Ministry of Media’s director of international media, to claim that Saudi Arabia is now a “hub” for Chinese industry.

Speaking to Arab News, he said: “Today they will open a regional center for all factories of China in Saudi Arabia that makes Saudi Arabia a hub for the industry for China. The Silk Road of China will be served with the Saudi Vision. Both countries are interested in strengthening these relations and we will benefit, both China and Saudi Arabia, from these visits.”

He added: “This second visit of the Chinese president is very important. We are signing a SR110 billion contract. We are signing more than 20 agreements — it is the deal of the decade for both countries.”

Al-Shammari highlighted the importance of the Chinese president’s visit to the Kingdom and the aligned goals of Saudi Vision 2030 and China’s Belt and Road Initiative.

“These important agreements will serve both purposes of Saudi Vision 2030 and will also serve the purposes of China,” Al-Shammari said, adding: “China needs the continuity of energy and oil going to their economy. We are important to China and China is also important to us.




China is the largest commercial partner of Saudi Arabia with a $67 billion interaction annually between the two countries. (Supplied)

“The Saudi-Chinese bilateral relations are very strong, China is the largest commercial partner of Saudi Arabia with a $67 billion interaction annually between the two countries, and both leaderships are looking forward to developing these relations even further.”

As China is the second largest economy in the world and Saudi Arabia is going through its Vision 2030 goals, a transfer of new technologies is required, said Al-Shammari.

“These summits come at an important time for both countries to further strengthen these bilateral relations,” he added.

As confirmed recently by Saudi Minister of Energy Prince Abdulaziz bin Salman, the Kingdom will host a regional center for Chinese factories owing to Saudi Arabia’s strategic location among the three continents of Asia, Africa and Europe.

The minister also reaffirmed collaboration with China’s Belt and Road Initiative, as well as investment in integrated refining and petrochemical complexes in both countries.

Cooperation between the two countries has witnessed remarkable growth during the past five years, Bandar bin Ibrahim Al-Khorayef, the minister of industry and mineral resources, told Arab News.




The raft of deals came during the visit of Chinese President Xi Jinping to the Kingdom. (SPA)

During the crown prince’s visit to China in February 2019, both countries concluded agreements to establish joint projects covering several sectors including manufacturing, petrochemicals, pharmaceuticals and others.

The countries already share a good history of cooperation, Al-Khorayef said, citing the example of seven Chinese factories operating in different fields in the Saudi Authority for Industrial Cities and Technology Zones.

In addition to this, there are 10 other factories at different stages of planning, construction and implementation.

Furthermore, there are about 12 projects for the Royal Commission for Jubail and Yanbu with Chinese companies at different stages, some of them in operation and others under procedure or design.

It is not just business groups that are benefiting from Saudi Arabia’s closer ties with China.

Saudi Arabian think tank King Abdullah Petroleum Studies and Research Center signed an MoU with China’s Economics and Technology Research Institute to exchange information around energy, economics and climate change.

Under the terms of the MoU, both entities will work hand in hand to allow for the exchange of research and the generation of actionable insights.

Some of the fields of common interest which will be prioritized as topics of research include energy, economics, climate change, sustainability, transition, productivity, hydrogen and carbon capture, among others.

The MoU falls in line with KAPSARC’s mission to utilize applied research and innovation to drive and propel the global energy sector, while the Chinese organization is affiliated with oil and gas firm China National Petroleum Corporation.


Closing bell: TASI plunges 143 points to close at 10,589 

Closing bell: TASI plunges 143 points to close at 10,589 
Updated 05 February 2023

Closing bell: TASI plunges 143 points to close at 10,589 

Closing bell: TASI plunges 143 points to close at 10,589 

RIYADH: Saudi Arabia’s Tadawul All Share Index on Sunday lost 143.21 points — or 1.34 percent — to close at 10,588.58. 

MSCI Tadawul 30 Index dropped 1.45 percent to 1,454.10, while the parallel market, Nomu, slipped 0.48 percent to 18,905.15. 

TASI’s total trading turnover of the benchmark index was SR3.77 billion ($1 billion), with 46 stocks of the listed 224 advancing and 172 retreating. 

The worst performer was Al Yamamah Steel Industries Co., which crashed 5.06 percent to SR22.90. Other stocks that performed poorly were Saudi Printing and Packaging Co., Saudi Arabian Amiantit Co., Halwani Bros. Co. and Arabian Pipes Co. — all falling in the 4 percent range. 

Americana Restaurants International PLC was the top gainer, rising 4.76 percent in the week's first trading session to SR3.74.  

The other top gainers were Makkah Construction and Development Co., Buruj Cooperative Insurance Co., Amana Cooperative Insurance Co. and Salama Cooperative Insurance Co. 

Among sectoral indices, 18 of the 21 listed on the stock exchange declined, while the rest advanced. 

The Software & Services Index took the biggest hit plunging 1,104.79 points to close at 39,941.28. 

On the announcements front, Etihad Atheeb Telecommunication Co. informed the stock exchange that it booked a net profit of SR13 million in the nine-month period that ended on Dec. 31, 2022, from a net loss of SR 29.2 million in the year-ago period.  

The profit was driven by higher revenue, lower allowance for impairment in trade receivables, lower general and administrative expenses, and financial charges. 

The telco turned to a net profit of SR 8 million in the third quarter of 2022-2023, against a net loss of SR7.37 million a year earlier. Its share price fell 0.14 percent to SR69.90. 

Al Moammar Information Systems announced that it was awarded a project with a legal entity on Jan. 29 for SR42.4 million, including value added tax.  

The project includes the renewal of the technical support service for infrastructure systems, and the company expects to sign the contract on Feb. 28, it said in a statement. Its share price fell 0.43 percent to SR93.60. 

Meanwhile, Saudi Industrial Investment Group disclosed that the unplanned maintenance works in its subsidiary, Saudi Polymers Co., are still ongoing due to the nature of the mechanical repairs, which require additional downtime to guarantee safe and reliable operations.  

SIIG said that it expects to restart its operation a week later. Its share price fell 2.71 percent to SR22.28. 

Meanwhile, Batic Investments and Logistics Co.’s fully-owned subsidiary, Batic Real Estate Co., said, on Feb. 2, that it received the approval of Madinah Municipality to develop the Al-Khuzama residential neighborhood community. Its share price stayed flat at SR23.44. 


Energy-rich countries should lead transition journey, says IAEE president

Energy-rich countries should lead transition journey, says IAEE president
Updated 05 February 2023

Energy-rich countries should lead transition journey, says IAEE president

Energy-rich countries should lead transition journey, says IAEE president

RIYADH: Stressing the need for cooperation in the journey toward energy transition, the president of the International Association of Energy Economics said the shift should be led by energy-rich countries.

“Energy tech is coming to strengthen energy transition. Oil and gas-rich countries are now building their own way for the energy transition. The energy transition is not coming from western countries or India or China, and it is being led by energy-rich countries, but we have to learn, what time, what speed, etc,” Jean-Michael Glachant said. He also made it clear that financing is the key to achieving these goals.

In an exclusive interview with Arab News, Glachant said it will take another 30-50 years to achieve a transition to green energy.

“We are not close. But we are really starting. For about 15 years, we discussed; should we start, and when should we start. And now we are all understanding, yes, we have to do it. It will take 30 to 50 years,” he said.

“As long as we stay together, we are able to contain the damage. We have to find a way to compensate for damages because some countries will suffer more, while other countries less.”

The IAEE official said his organization is not just grateful but also lucky to host its 44th conference in Saudi Arabia, as the country is one of the key players in accelerating the global energy transition.

Glachant said that in line with its Vision 2030 blueprint, the Kingdom is charting its national sustainability path and setting an example for the rest of the world.

“There are many many advantages for IAEE to have Saudi Arabia as the host country. We are an association for energy economics. Saudi Arabia is building its own national sustainability path with its 2030 agenda. It is not only a pleasure, but it is an honor to enter the Kingdom and to discuss and interact with open-minded people of the region,” said the IAEE president.

“Saudi Arabia is leading a voice of the developing world in energy affairs. And we, at IAEE, want to discover what we can learn from Saudi Arabia,” he added.

It should be noted that the 44th IAEE conference is taking place in Riyadh from Feb. 4-9, and this is for the first time this event is being hosted in the Middle East.

“In this program, you would see that no big region in the world has been left behind. Really, the Saudis have done their best to have all the relevant people and all the relevant issues being put together,” he said.

According to Glachant, Saudi Arabia has several ideas about sustainable energy transition to share with the world and the IAEE event will serve as the perfect platform to showcase and discuss those ideas.

“To learn something is the core of the IAEE conference. When we do not learn something, the event is a failure. This is the first event in Saudi Arabia. Saudi Arabia is becoming independent in the way it is seeing the future and becoming rich to finance the future. If we cannot learn from such a place, I think we are sick,” he noted.

Glachant noted that the Middle East and North Africa region is leading the energy sector in the world and that the Saudi capital Riyadh is one of the most prominent global destinations for business and finance.

“Saudi Arabia is the world’s No. 1 country in terms of growth these days; not just growth in the oil sector, but also in the non-oil sector. So, Saudi Arabia is doing the unexpected by exploring new paths,” added Glachant.

He also lauded the efforts of the King Abdullah Petroleum Studies and Research Center in Saudi Arabia in carrying out research and framing energy policies to support a sustainable transition to green energy.

According to Glachant, the IAEE conference in Riyadh will help exchange ideas with big names in the region, and added that MENA is the “hotspot of energy which is also building its own energy economy.”

Glachant pointed out that there are several pillars of the energy transition, which include technology and innovation, direct and indirect investments, etc.

“It (energy transition) is a kind of car race. When you see your neighbor driving faster, sometimes, you try to do better than your neighbor,” he added.

Glachant was of the view that more progress was needed in the maritime and aviation sectors to meet sustainable targets.

“It is about technology innovation. We have to find ways of having that (aviation and maritime sectors) sustainable in a different way. Some planes run on electricity for small distances. But for long distances, what do we do? For maritime, what do we do,” Glachant questioned.


Energy transition has different meanings for each country, says French AEE president 

Energy transition has different meanings for each country, says French AEE president 
Updated 05 February 2023

Energy transition has different meanings for each country, says French AEE president 

Energy transition has different meanings for each country, says French AEE president 

RIYADH: There are different solutions to make energy a strong tool for economic development, as energy sources to reach mass consumption have to be economically feasible too, said a top industry expert. 

As the world has gathered for the 44th IAEE conference in Riyadh, the president of the French Association for Energy Economics, Christophe Bonnery, told Arab News in an exclusive interview that “energy transition has a different meaning from one country to another.”  

For instance, France has a big portfolio of nuclear and this is developing the future of the French energy system. 

Talking about different renewable energies, he said the strongest one is solar PV. “This is because if you look at the radiation from the sun to the earth, it brings a lot of energy.”  

Bonnery pointed out that technology does matter, and so is how you transform it into a form of energy that can be used for different consumers.  

“If you look at what is efficient, what is existing today, clearly the most important renewable energy is the hydraulic industry that has been existing for decades, if not centuries.” 

According to him, this is the most important technology that is existing today.  

“The future also belongs to wind energy and wind has to be developed in countries where you have wind, and it is not the case in every place.” 

Bonnery said that all these technologies have come under the same characteristic, which is also the case for nuclear, that it consumes a lot of capital. 

“You have to put the capital cost upfront, and this is generating some financing issues, then only a few countries can come under.” 

Bonnery pointed out that Saudi Arabia has the chance to be able to finance it, to afford these new technologies. “In some developing countries, it’s more difficult to find financing solutions.” 

He said that the Kingdom can help other countries willing to go to energy transition programs to develop their own programs. 

The 44th IAEE conference which is taking place at King Abdullah Petroleum Studies and Research Center discussed seven key topics such as energy volatility, security and access, and energy transition and pathways in investment and financing. 


KSA to continue playing key role in traditional and renewables energy sectors: S&P Global top official

KSA to continue playing key role in traditional and renewables energy sectors: S&P Global top official
Updated 05 February 2023

KSA to continue playing key role in traditional and renewables energy sectors: S&P Global top official

KSA to continue playing key role in traditional and renewables energy sectors: S&P Global top official

RIYADH: Saudi Arabia is not just an oil-producing country, but also an unquestionable name in the entire energy sector, as the Kingdom hosts the 44th conference of the International Association for Energy Economics for the first time in the Middle East and North Africa region in Riyadh, according to a top expert. 

In an exclusive interview with Arab News on the sidelines of the conference, Daniel Yergin, vice chairman of S&P Global said that Saudi Arabia will continue to play a crucial role in both traditional energy sectors and renewables. 

“This conference is very important for the region and for Saudi Arabia. It underscores the fact that Saudi Arabia is not just a country for oil, but it is a country for energy, and Saudi Arabia’s role in energy transition as it continues to supply the oil the world needs,” said Yergin. 

He added: “Saudi Arabia is going to continue to be at the forefront as an oil producer. But also what you see in Saudi Arabia is much more use of renewables, particularly, solar for generating electricity." 

The S&P Global executive said that the big question before the global industry is the role of hydrogen, adding that if there is a global market for hydrogen, "Saudi Arabia will play an important role in that.” 

The IAEE conference comes at a time when Saudi Arabia is adopting several measures including the launch of the Voluntary Carbon Market to achieve the net-zero target by 2060. 

According to Yergin, the energy transition will not happen quickly, as the majority of the world countries are still dependent on hydrocarbon. 

“You just have to look at the numbers. Over 80 percent of world energy today is hydrocarbons. Energy transition, you are going to change it overnight. It will change. We have a developing world with 80 percent of the people that has far less energy, and they need energy for development,” added Yergin. 

He further noted that energy transition should be looked at from a global perspective rather than looking only through the lens of Europe and North America. 

“It (energy transition) takes time for it to happen. And there is a tendency to focus on the developed world and to underestimate the energy needs of the developing world where 80 percent of the people live, and their per capita income may be just five or 10 percent of the income in the developed world,” Yergin said. 

The S&P Global vice chairman noted that the mining sector will also have a crucial role to play in the energy transition, as the demand for minerals will witness a dramatic rise in the future. 

He added that the 44th IAEE Riyadh conference is highlighting the significance of minerals, which has not been part of the discussion in the event’s previous editions. 

“For instance, an electric car takes two and a half times more copper than a conventional car. That has to be mined, and it takes 16 to 25 years to open a new mine. I think, there is still an imbalance on how people are assessing the objective for energy transition, and materials needed for it,” he pointed out. 

According to Yergin, the economic growth in China and the way in which the Asian giant comes out of the Covid-related lockdown will have direct impacts in determining the price of oil. 

He further noted that the ongoing conflict in Ukraine has changed the global energy map, especially after the EU introduced a price cap on Russian oil. 

“It is unprecedented what is happening because Europe said no to Russian energy, and Europe has been the main market for Russian energy. You also have price caps on Russian oil. And this is not merely an economic experiment. This is a geopolitical development that is happening,” said Yergin. 

Talking about S&P Global’s economic forecast for 2023, Yergin said that this year will witness global economic growth of 1.9 percent. He added that there is a possibility of a mild recession in the US and Europe.

“In 2024, we see global growth going back to around 3 percent. So, 2023 is going to be a transitional year for the global economy. It is compounded by the uncertainties of the Ukraine war. If that escalates, then it will introduce new risks,” Yergin added. 


Call for unified efforts to achieve net-zero goals

Call for unified efforts to achieve net-zero goals
Updated 05 February 2023

Call for unified efforts to achieve net-zero goals

Call for unified efforts to achieve net-zero goals

RIYADH: Highlighting the challenges on the road to the energy transition, energy expert Daniel Yergin called for making concerted efforts and setting realistic goals to achieve success in this regard.

The vice chairman of the American finance and insurance company S&P Global was speaking at a plenary session titled “Energy volatility, security and access” at the 44th conference of the International Association for Energy Economics in Riyadh on Sunday.

Yergin identified the main challenges as energy security, the size and scale of the transition, net zero goals, and government intervention.

He expressed his concern over the different timeframes set by various countries to achieve net zero.

Yergin said it was confusing to note that some countries have set to achieve their net-zero goal by 2050 but China’s goal is 2060 and India seeks to achieve it in 2070.

He also laid emphasis on government intervention in effectively achieving the net-zero goals and fighting climate change.

“A good example of this is the British government’s windfall taxes on North Sea oil,” he stressed.

The S&P Global’s top official also highlighted the importance of increasing copper production to help the energy transition goal but he also expressed concern over different countries’ respective capacities to boost its production as “it takes a long time to open copper mines.”

He said in addition to these challenges, there is a lot of uncertainty nowadays. Yergin said nobody expected the outbreak of COVID-19 or the Russia-Ukraine conflict. It would be difficult to predict what lies ahead, he added.

“The IAEE was founded in 1977 which was a time of energy turbulence and time of energy uncertainty and here, we are in 2023 — a new age of energy turbulence and energy uncertainty,” Yergin said.

“The complexities in the energy transition calls for deeper thinking and analysis.”