NEOM CEO says 20 percent infrastructure works already completed 

NEOM CEO says 20 percent infrastructure works already completed 
The video includes real-world footage of the large-scale constructions across NEOM regions (NEOM)
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Updated 19 January 2023
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NEOM CEO says 20 percent infrastructure works already completed 

NEOM CEO says 20 percent infrastructure works already completed 

RIYADH: Nearly 20 percent of infrastructure works at NEOM, Saudi Arabia’s $500 billion megacity, have been completed, according to a top official.  

Nadhmi Al-Nasr, NEOM’s CEO, said that works are progressing in the futuristic city as per schedule in an interview with Al Arabiya TV.

The project is set to run on 100 percent renewable energy when completed, and will encompass several megaprojects.

To showcase the works, NEOM released a video earlier this week which shows the rapid progress being made on the project.  

The video includes real-world footage of the large-scale constructions across NEOM regions which includes The Line, Trojena, OXAGON, and the luxury island development project Sindalah.  

 

 

Crown Prince Mohammed bin Salman launched the Sindalah Island project, which will extend over an area of approximately 840,000 sq. m and the island will act as a main gateway to the Red Sea for guests from early 2024. 

The video sets out the key achievements made in 2022, including the launch of Tonomus, the first company to be established as a full-fledged subsidiary of NEOM that will integrate artificial intelligence technology in the buildings of the mega project.  

The three-minute clip also shows construction workers being deployed to lay the foundations for the megaproject.

“A project unique in scale, already being built in a place with 95 percent of the land protected for nature where rewilding is in motion, bringing animals back to their natural habitat,” the clip said.  

The video also portrayed the works which are currently underway in Trojena, the mountain destination which will host the 2029 Asian Winter Games.  

In December, during an exclusive interview with Arab News, Peter Fitzhardinge, head of Tourism Marketing at NEOM, said that the 2029 Asian winter games at Trojena will showcase how NEOM will use innovation to carry out the event in a meticulous manner.  

“NEOM is all about innovation. I think now, not only we have to launch Trojena to show the vision, but we have to also showcase how we can bring Asian winter games into reality for people to come and participate in winter sports in NEOM,” said Fitzhardinge. 

The clip also shows the works that are going on in OXAGON, a futuristic industrial city touted to be the largest floating industrial complex in the world upon completion.  

While speaking to Arab News at the World Travel and Tourism Council Global Summit in Riyadh on Nov. 30 Al-Nasr had noted that OXAGON also has all the potential to become a world-class tourist destination, where visitors can come and see how the future will be. 

“It is in OXAGON where all industries will be, and it is the port of NEOM. Yet, we would like to see tourists spending a day or two in OXAGON. They will see the future of industries in OXAGON. Everything in NEOM is built for the future era. We want them to come and see how future sea ports will operate,” said Al-Nasr. 

Another subsidiary that was launched in 2022 was Enowa, responsible for managing NEOM’S sustainable energy and water systems. Enowa will also have the world’s largest green hydrogen plant which will catalyze NEOM’s sustainability journey.  

“At NEOM, we are addressing some of the most pressing challenges facing humanity by bringing together a community of the brightest minds committed to reimagining what a sustainable future will look like in 20 to 30 years, and building it today. We are redefining the future now. NEOM is open for business,” Al-Nasr said in a separate statement. 

It also highlighted NEOM’s $175 million investment in “Volocopter, the next generation of transport.”

“It’s why athletes from 25 countries participated in the NEOM Beach Games and it’s why the planet’s fastest growing lifestyle brand, Ennismore, has become the first hotel partner for Trojena,” said the narrator in the video.

Saudi Arabia’s national carrier Saudia now also offers direct flights to NEOM from London and Dubai.

The video also highlighted NEOM’s growing media sector, which has supported 25 productions in 18 months, working with names such as the BBC, Apple TV and NBC.

NEOM also partnered with McLaren to drive innovation and talent development in electrical motorsport. The megacity, in cooperation with the Asian Football Confederation, also launched the Shuhub Community Program to “develop the next generation of Saudi footballers.”

The video also highlighted NEOM’s efforts to “protect the secrets hidden at the bottom of the Red Sea”  with OceanX.


ACWA Power’s major shareholder Al Rajhi Holding Group plans to transfer ownership of its shares

ACWA Power’s major shareholder Al Rajhi Holding Group plans to transfer ownership of its shares
Updated 10 sec ago
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ACWA Power’s major shareholder Al Rajhi Holding Group plans to transfer ownership of its shares

ACWA Power’s major shareholder Al Rajhi Holding Group plans to transfer ownership of its shares

RIYADH: Saudi ACWA Power is set for a change in its major shareholder list as Al Rajhi Holding Group, with an 11.205 percent stake, plans an internal transaction, transferring ownership to the investment portfolios of its affiliated companies. 

In a bourse filing, ACWA Power stated that it has received a letter from Al Rajhi expressing its intent to carry out the transaction to distribute its shares in the utility firm among the shareholders of its affiliated companies. 

The power company’s stock price on Tadawul experienced a slight increase of 0.09 percent, reaching SR234.60 ($62.55), as of Dec. 10 at 12:23 Saudi time. 


Moody’s upgrades Oman’s credit rating to Ba1, with stable outlook

Moody’s upgrades Oman’s credit rating to Ba1, with stable outlook
Updated 21 min 24 sec ago
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Moody’s upgrades Oman’s credit rating to Ba1, with stable outlook

Moody’s upgrades Oman’s credit rating to Ba1, with stable outlook

RIYADH: Further improvement in Oman’s debt burden led US-based Moody’s Investors Service to upgrade its credit rating for the second consecutive time this year from “Ba2” to “Ba1”. 

The upgrade in rating is attributed to improvements in debt affordability metrics, according to a statement. 

This positive shift primarily results from spending restraints and the utilization of additional revenues in reducing public debt. 

This reflects that the government’s adherence to fiscal prudence and its prioritization of debt repayments boosts the likelihood that the enhancements in debt metrics will be persistent and prolonged in the medium term.


stc group joins GCC telecom firms to enhance energy efficiency with Sustainability Innovation Hub

stc group joins GCC telecom firms to enhance energy efficiency with Sustainability Innovation Hub
Updated 10 December 2023
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stc group joins GCC telecom firms to enhance energy efficiency with Sustainability Innovation Hub

stc group joins GCC telecom firms to enhance energy efficiency with Sustainability Innovation Hub

RIYADH: The energy efficiency of telecom sector firms in Gulf Cooperation Council countries is set to improve, thanks to the collaborative efforts of regional operators in establishing the Sustainability Innovation Hub.

stc group has recently unveiled the initiative in collaboration with GCC telecom alliance members, including e&, Zain, Beyon, Omantel, du, Ooredoo, and other key regional and international partners.

This move aims to enhance the availability of affordable and dependable energy sources, significantly reducing their carbon footprint.

Given the substantial shifts in the global energy landscape, telecom operators are proactively investigating alternatives to enhance energy efficiency and diminish their carbon footprint.  

According to a press release, the Sustainability Innovation Hub endeavors to link technology, telecom innovation, and climate action, nurturing a low-carbon economy.  

The release also noted that by integrating cutting-edge technologies, the hub seeks to unite visionary experts and collaborative efforts to address a key challenge currently faced by the telecom industry.

By leveraging the potential of renewable energy sources, namely solar and wind energy, the hub will reduce reliance on traditional fuel sources as a step toward a greener future.

The institute will be equipped with state-of-the-art facilities for prototyping, testing, and validating innovative power solutions, according to the press release by stc.

Using GCC telecom networks, the hub will accelerate the development cycle and ensure the effective implementation of new technologies within the industry. 

It will further seek collaborations and partnerships with leading industry players, government entities, and regulatory authorities in order to foster a supportive ecosystem of best practices and standardization.

As part of its objective to revolutionize the telecom industry’s energy consumption and sustainability approach, the center will bring together operators, technology providers, and research institutes to further the shared knowledge, resources, and expertise, driving the development of solutions tailored to the needs of the telecom industry.

Recognizing the role of skilled professionals in driving innovation, the hub will also offer training programs and workshops to enhance the competencies of individuals involved in designing, installing, and maintaining power solutions within the telecom sector.


Saudi FDI reforms poised to deliver transformative impact

Saudi FDI reforms poised to deliver transformative impact
Updated 09 December 2023
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Saudi FDI reforms poised to deliver transformative impact

Saudi FDI reforms poised to deliver transformative impact
  • Main contributors to investment surge include France, Japan, Kuwait, Malaysia, Singapore, the UAE, and the US

RIYADH: Saudi Arabia continues to vigorously pursue its reform agenda, with a focus on bolstering foreign direct investment inflows and diversifying investment strategies despite a recent deceleration in its financial account as reported by the Saudi Central Bank and the Ministry of Finance.

In the second quarter of 2023, FDI inflows experienced a 21 percent decline compared to the same period last year, amounting to SR6.2 billion ($1.65 billion).

FDI outflows, which encompass the capital invested by Saudi entities in foreign countries, reached SR18.34 billion, a 53 percent decrease from the corresponding quarter of the previous year.

Albara’a Al-Wazir, an economist at the US-Saudi Business Council, said: “Despite the recent decline in FDI to SR6.2 billion, the number of investment licenses issued by the Ministry of Investment … reached 1,819 in Q2, marking a 94 percent increase compared to the previous year.”

He added: “Saudi Arabia has implemented significant legal, economic, and social changes to attract higher levels of foreign direct investment since the launch of Vision 2030.”

Al-Wazir highlighted that the Ministry of Investment granted licenses to 180 companies to establish regional headquarters in the Kingdom ahead of the January 2024 deadline.

The economist anticipates that the regional headquarters program will expedite FDI in Saudi Arabia.

“As companies seeking government projects will need to relocate, the full impact of this program is expected to manifest in the medium term, albeit with a potential lag,” he said.

Saudi Arabia has also announced tax incentives for foreign companies establishing their regional headquarters in the Kingdom, including a 30-year exemption from corporate income tax.

These measures also encompass zero income tax for foreign entities relocating their regional headquarters, effective from the issuance date of the license, as outlined by the Ministry of Investment. 

Riyadh has announced tax incentives for foreign companies establishing their regional headquarters in the Kingdom, including a 30-year exemption from corporate income tax. (SPA)

Al-Wazir said the newly introduced NEOM Investment Fund is strategically positioned to draw investors and play a role in the development of the new city.

Despite the decline in FDI in the second quarter of 2023, he emphasized that the Kingdom achieved the second-highest amount in the Middle East and Africa region during this period.

As per information disclosed by the Ministry of Investment, the FDI stock, representing the cumulative ownership stakes, equity, and financial interests held by the Kingdom’s residents in foreign enterprises, saw a 2.89 percent increase during this period.

The ministry highlighted that this rise signifies the growing confidence of foreign investors in the Saudi investment ecosystem.

Reforms to the Kingdom’s economy are not new, with a report from the World Bank issued in 2020 noting the significance of a series of measures primarily concentrated on starting a business, dealing with construction permits, and facilitating international trade.

Additionally, the report noted that protections for minority investors were strengthened, a value-added tax was introduced, and notable improvements in trading and contract enforcement were implemented.

These reforms collectively demonstrate Saudi Arabia’s commitment to creating a more efficient and investor-friendly business environment.

According to the International Bar Association report on the Kingdom’s FDI legal framework and outlook in April 2023, Saudi Arabia is witnessing an increasing flow of FDI across various sectors. The main contributors to this investment surge include France, Japan, Kuwait, as well as Malaysia, Singapore, the UAE, and the US.

As outlined in the report, key sectors drawing substantial FDI include the chemical industry, real estate, fossil fuels, as  well as automobiles, tourism, plastics, and machinery. This diversification indicates a growing interest and confidence from international investors in Saudi Arabia’s economic landscape.

Data from the Ministry of Investment indicated a 135.4 percent annual increase in the number of investment licenses issued, reaching 2,192 in the third quarter of this year.

According to the ministry, this surge underscores Saudi Arabia’s appeal as an attractive investment destination, offering competitive advantages within a stable and supportive business environment. 

FASTFACT

Data from the Ministry of Investment indicated a 135.4 percent annual increase in the number of investment licenses issued, reaching 2,192 in the third quarter of this year.

Gross Fixed Capital Formation, reflecting investment in tangible assets like buildings, machinery, equipment, and infrastructure for production, saw a notable 7 percent increase during this period totaling SR278.9 billion, as reported by the ministry.

Within this, non-government GFCF accounted for approximately 85 percent of the total, reaching SR236.6 billion. This marked a 7.6 percent growth compared to the corresponding period last year.

In contrast, government GFCF held a 15 percent share during this quarter, with a 3.5 percent increase, reaching a total of SR42.3 billion. This data underscores the significant role of both non-government and government sectors in driving capital formation within Saudi Arabia’s economy.

The Kingdom’s financial account, which includes net values for direct investment, portfolio investment, and reserve assets, amounted to SR42.97 billion. This figure represents a 70 percent decline compared to the corresponding period last year, according to the report from the Kingdom’s central bank.

Portfolio investment, the second component of Saudi Arabia’s financial account, experienced a 66 percent decrease, primarily attributed to the Kingdom’s increased borrowings.

Meanwhile, the net acquisition of financial assets showed a robust 25 percent annual growth in the second quarter, totaling SR50.14 billion. However, this increase was countered by a rise in the portfolio’s liability section, with debt securities increasing from -SR18.53 billion to SR25.69 billion during the same period.

According to Al-Wazir: “The Kingdom signaled that it would utilize debt markets to raise liquidity to fund its projects. The increase in borrowing via debt securities underscores its commitment to achieve its desired diversification goals.”

He added: “The Kingdom has more recently issued both external and domestic debt, with domestic riyal-denominated debt accounting for approximately 63 percent of the total. In H1 2023, the government issued SR23 billion in domestic debt, while growing total domestic debt from SR615 billion to SR624 billion.”

Reserve assets, encompassing special drawing rights and currency, deposits, and securities, witnessed a 70 percent decrease. This decline is attributed to the devaluation of securities within this category.

“The topic of drawing down reserves, in this case securities, is a strategic move to decrease SAMA’s reserve holdings and redirect cash across a diversified set of vehicles,” explained Al-Wazir.

“Saudi has been adjusting its investment strategy in recent years whereby it is allocating money to national funds like the Public Investment Fund and National Development Fund. An example of this is when SAMA transferred SR150 billion from its foreign reserves to PIF in 2020,” he added.

The economist concluded by asserting that public debt remains sustainable, comfortably staying below the 50 percent debt to gross domestic product ceiling, and the fiscal capacity is substantial. He emphasized that the government’s borrowing strategy primarily aims to lengthen maturities, reduce refinancing costs, and establish a yield curve.


Camel milk set to provide sustenance for Saudi Arabia’s economic transformation

Camel milk set to provide sustenance for Saudi Arabia’s economic transformation
Updated 09 December 2023
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Camel milk set to provide sustenance for Saudi Arabia’s economic transformation

Camel milk set to provide sustenance for Saudi Arabia’s economic transformation
  • Camels have long served as a crucial food, natural and cultural resource of the Middle East region

RIYADH: Saudi Arabia is currently one of the biggest producers of camel milk and a host of new ventures are making the business a lucrative one in the transformation of the country’s economy.

The Kingdom has an annual output of approximately 0.271 million tons of the product, and Saudi Arabia’s sovereign wealth fund has set up a new firm, Sawani Co., to catalyze the growth of the sector as part of its efforts to transform the country’s economy.

The move comes at a time when the Public Investment Fund’s various investments in the Saudi food and agriculture sector to support its produce industries gain momentum.

“Saudi Arabia has extensive experience and knowledge of the camel dairy industry, and enormous potential to expand its operational capabilities and wider ecosystem,” said Majed Al-Assaf, head of Consumer Goods and Retail in the Middle East and North Africa Investments Division at PIF, in a statement.

He added: “These factors represent a competitive advantage across the entire supply chain, which will enable significant growth of the industry, and eventually lead to the export of camel dairy products to regional and global markets.” 

Ahmed Gamaleldeen, CEO of Sawani, affirmed the company’s position in its sector, telling Arab News: “Sawani Co. has an essential role to play in elevating standards within the camel dairy sector. Based in Saudi Arabia with a global reach, our organization seeks to actively contribute to the development of the sector, highlighting the merit of camel-based products from both a health and commercial standpoint.”

He added: “We are committed to raising awareness of camel products through our operations and initiatives, helping to continue a longstanding tradition of sustainable camel milk production to serve Saudi Arabia, the region and other parts of the world.”

While seeking to become a leading producer of camel dairy products, the company will also place sustainability at the center of all stages of production, distribution, and marketing as well as raise awareness of the health benefits of camel dairy products among consumers.

Sawani looks to work with the private sector to boost production capacity and drive sustainable growth of the camel dairy industry.

This includes raising the standards of the domestic production ecosystem through modernizing operations and introducing best scientific practices, improving knowledge localization and transfer and investing in the sector’s latest manufacturing technologies. 

Saudi Arabia has extensive experience and knowledge of the camel dairy industry, and enormous potential to expand its operational capabilities and wider ecosystem.

Majed Al-Assaf, head of Consumer Goods and Retail in the Middle East and North Africa Investments Division at PIF

Highlighting the company’s aspirations within the camel dairy industry, Gamaleldeen said Sawani has both regional and international ambitions.

“With a myriad of health benefits associated with camel-based products, our aim is to showcase the product’s commercial viability as a solution for consumers who are lactose intolerant, diabetic or seeking nutrient-dense dairy products,” he said.

The CEO added that Sawani’s long-term strategy is rooted in “Saudi Arabia’s rich camel heritage and sustainable cohesion with one of nature’s most loyal and giving creatures.”

According to research company IMARC, the camel dairy market across the Gulf Corporate Council region reached a value of $702.4 million in 2022, and is expected to see a compound annual growth rate of 4.51 percent from 2023 to 2028.

Camels have long served as a crucial food, natural and cultural resource of the Middle East region.

They provide meat and milk as well as play a role in heritage rituals throughout Saudi Arabia and the greater Middle East. It is estimated that there are around 1.6 million camels in the Kingdom, with over half residing in the provinces of Riyadh, Makkah and the Sharqiya or Eastern Province.

Compared to cow’s milk, camel’s milk has lower levels of fat – perfect for those who are wishing to maintain a healthier lifestyle. 

Sawani looks to work with the private sector to boost production capacity and drive sustainable growth of the camel dairy industry. (Supplied)

It contains high amounts of vitamins A, B, E and C, and is also rich in calcium, iron, protein and antioxidants.

The UN Food and Agriculture Organization has endorsed products made from camel milk, saying such goods are greater in nutritional value than goat and cow’s milk in terms of vitamins, minerals and protein.

The Kingdom’s investment in the industry reflects Saudi Vision 2030 to diversify the economy away from its reliance on hydrocarbons.

In the Kingdom, three licensed projects are specializing in camel milk and its various uses, while three other initiatives have been granted preliminary licenses to manufacture consumable camel milk products. 

We are committed to raising awareness of camel products through our operations and initiatives, helping to continue a longstanding tradition of sustainable camel milk production.

Ahmed Gamaleldeen, CEO of Sawani

According to Shujaa Al-Bogmi, an associate professor at Imam Mohammad Ibn Saud Islamic University, Sawani’s investment in the camel industry will have a great impact on the growth of the market both locally and internationally.

It will not only raise the production standards for products made from camel milk, but also result in an increased demand for the products from the Gulf region.

An eagerness to make products from camel milk has already jump-started in the Kingdom.

In September, Sawani launched Noug, the first camel milk café opened in Riyadh, specializing in milk, cheese, butter and even gelato. 

HIGHLIGHT

The Kingdom has an annual output of approximately 0.271 million tons of the product, and Saudi Arabia’s sovereign wealth fund has set up a new firm, Sawani Co., to catalyze the growth of the sector as part of its efforts to transform the country’s economy.

As IMARC noted in its report, the increasing awareness of the health benefits of camel milk as well as the potential of the market for the product make it a favorable investment opportunity for government initiatives and a crucial catalyst for growth.

Investment in the market also has the potential to promote sustainable farming practices in the Kingdom.

To this end, Sawani is offering financial incentives and subsidies to encourage the growth of the camel dairy sector. Such support extends to both large-scale commercial farms and small-scale farmers, promoting inclusivity and sustainable growth in the industry.

As Gamaleldeen notes: “Sawani Company is dedicated to driving growth in Saudi Arabia’s camel dairy sector. As consumers become aware of the health benefits of camel-based dairy products, we aim to amplify awareness of products, ethically sourced from an animal that has remained a source of pride for the people of the Kingdom.”