More than 100 of Aramco’s international suppliers on course to establish regional hubs in Saudi Arabia: Top official

More than 100 of Aramco’s international suppliers on course to establish regional hubs in Saudi Arabia: Top official
Salem Al-Huraish, vice president of procurement at Saudi Aramco, speaking at the In-Kingdom Total Value Add Forum in Dhahran (Screenshot)
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Updated 31 January 2023

More than 100 of Aramco’s international suppliers on course to establish regional hubs in Saudi Arabia: Top official

More than 100 of Aramco’s international suppliers on course to establish regional hubs in Saudi Arabia: Top official

RIYADH: Some 40 international materials suppliers for Saudi Aramco have already obtained certificates from the Kingdom’s Ministry of Investment to establish headquarters in Saudi Arabia, as localization efforts steadily continue, according to a top official.

Speaking at the seventh edition of the In-Kingdom Total Value Add Forum in Dhahran, Salem Al-Huraish, vice president of procurement at Saudi Aramco, said more than 60 other firms have put in the paperwork to begin the process of setting-up regional headquarters in the Kingdom.

“We are working hand-in-hand with the Ministry of Investment. And now, we are giving incentives for the companies when they move their regional headquarters to the Kingdom,” said Al-Huraish.

He added: “I am glad to highlight that 40 of our top suppliers, those are international suppliers, already obtained certificates from MISA which is the first step for their localization or migration of their regional headquarters in the Kingdom. Another more than 60 suppliers have already filed the request to get the license.”

According to Al-Huraish, these localization efforts and the migration of regional headquarters will definitely contribute to the economy of Saudi Arabia.

During the panel discussion, Al-Huraish noted Saudi Aramco is always focussing to ensure a sustainable supply chain within the Kingdom, and made it clear that this is in line with Saudi Arabia’s Vision 2030.

“ESG (environmental, social, and governance) was in the DNA of the company since its inception. We always realize the importance of ESG in our ecosystem, strategy, and all our business ethics. We are trying to establish a local platform here in the Kingdom to measure how much each company are contributing to ESG. Now, our suppliers are being rewarded for their ESG contribution locally,” Al-Huraish added.

Al-Huraish further pointed out that Saudi Aramco is very much focused on cybersecurity, and added that it is giving incentives to all the companies that meet these requirements as a part of the iktva program.

“All in all, we are on a continuous journey for improvement by keeping an eye on the market. Whenever we see an area of improvement, we will just capture it and have it part of our program,” said Al-Huraish.

Al-Huraish further pointed out that the iktva program achieved 63 percent local content in 2022, up from 35 percent in 2015 when it was initially launched.

On the first day of the iktva forum on Monday, Saudi Aramco signed over 100 agreements valued at $7.2 billion, primarily aimed at collective localization in key focus areas including digital space, sustainability, industrial, and manufacturing sectors.




Ayman Al Fallaj, CEO of Thiqah (Screenshot)

For his part, Ayman Al Fallaj, CEO of Thiqah, said that digitalization is needed to ensure a sustainable supply chain and localization.

“Without digitalization, we face tons of challenges, as we do not know where to start. We believe digitalization has played a crucial role in the smooth transition and transformation after the pandemic and in bringing more local content to the Kingdom of Saudi Arabia,” said Al Fallaj.

During the panel discussion, ACWA Power CEO Paddy Padmanathan said that the company has been very transparent in its investment plan which will in turn help to ensure a resilient and sustainable local supply chain.

“We are very transparent in our investment plans, and we show the path on where ACWA Power is going to invest, and what ACWA Power is going to invest in. And therefore, what are the areas in which they (companies) can reliably look at investing in the Kingdom in order to supply into the project that we procure,” said Padmanathan.

Padmanathan added that ACWA Power is investing around $13 billion every year in new capacities; roughly half of it is in the Kingdom and another half in other markets the company serves.

Paul Stanley, CEO of Achilles, said during the discussion that maintaining economic competitiveness is one of the main challenges faced as companies try to ensure sustainability.

“As you look at your supply chain, remember you are running a business, and it has to be sustainable economically as well. An ethically sustainable chain should be also commercially competitive, and that is where the real challenge is,” said Stanley.


Closing bell: Tasi slightly slips amid oil prices uncertainty  

Closing bell: Tasi slightly slips amid oil prices uncertainty  
Updated 22 March 2023

Closing bell: Tasi slightly slips amid oil prices uncertainty  

Closing bell: Tasi slightly slips amid oil prices uncertainty  

RIYADH: Saudi Arabia’s Tadawul All Share Index slipped slightly on Wednesday and lost 9.23 points – or 0.09 percent – to close at 10,350.51, as oil prices were down following fresh indications of weak demand and the market awaited a crucial interest rate decision by the US Federal Reserve.  

MCSI Tadawul 30 Index dropped by 0.12 percent to 1,408.99, while the parallel market Nomu gained 165.55 points or 0.87 percent to close at 19,094.44.  

The total trading turnover of the benchmark index on Wednesday was SR5.01 billion ($1.33 billion).  

The top performer of the day was Mouwasat Medical Services Co., as its share prices surged 10 percent to SR220.  

Other major gainers on Wednesday were Thimar Development Holding Co. and Alinma Tokio Marine Co., whose share prices surged 9.95 percent and 6.98 percent respectively.  

The worst performer of the day was Al-Etihad Cooperative Insurance Co. whose share prices dropped by 8.93 percent, after reporting a fall in total comprehensive income of 73.93 percent in 2022.  

Gulf Insurance Group is another company that saw its shares fall by 7.45 percent as it reported a decrease in net income of SR73.4 million, or 44 percent, in 2022, driven by a lower surplus from insurance operations.  

On the announcements front, Obeikan Glass Co. reported an annual profit of SR177.65 million in 2022, up 2.29 percent compared to 2021, driven by an increase in sales prices as a result of the rise in demand and the expansion of the company in new markets.  

Amid the marginal profit rise, Obeikan Glass Co.’s shares, which are listed in Nomu, dropped by 12.45 percent to SR76.20.  

Basic Chemical Industries Co. announced that its net profit hit SR70.4 million in 2022, up 21.97 percent from the previous year. Even as the profits soared, the share prices of Basic Chemical Industries fell 4.32 percent to SR33.20.   

Driven by the rise in profits, the board of directors of BCI recommended the payment of a cash dividend at 10 percent of capital, or SR1 a share, for 2022.  

Meanwhile, Saudi Printing and Packaging Co. also announced in its financial results that its losses narrowed to SR9.2 million in 2022, from SR59.3 million in the year-ago period. 

Despite narrowing the losses, the share prices of Saudi Printing and Packaging Co. went down 0.24 percent to SR16.86.  

Allied Cooperative Insurance Group also trimmed its loss to SR13.7 million in 2022, from SR114.6 million in 2021. The company’s share prices rose 1.31 percent to SR10.80 at the end of Wednesday’s closing.  

AME Co. for Medical Supplies reported an annual net profit of SR26.6 million in 2022, up 25.73 percent compared to 2021, due to the increase in net revenues driven by a rise in sales of medical supplies.  

As profits surged, AME Co. for Medical Services’ board of directors recommended a 20 percent dividend payout, or SR2 per share, for 2022. The company’s share prices also went up 2.55 percent to SR40.25 on Wednesday’s closing bell.  

Oil prices edged lower on Wednesday. At 04.10 p.m. Saudi time, Brent crude futures, which have risen by almost 3 percent this week, were down 11 cents, or 0.15 percent, at $75.21 a barrel.  

US West Texas Intermediate crude futures were down 9 cents, or 0.13 percent, at $69.58. 


World Bank approves $7bn financing program for Egypt

World Bank approves $7bn financing program for Egypt
Updated 22 March 2023

World Bank approves $7bn financing program for Egypt

World Bank approves $7bn financing program for Egypt

RIYADH: The World Bank has announced that it has approved a $7 billion financing program for Egypt that extends from 2023 until 2027, according to a statement.

The partnership framework is done in collaboration with the International Finance Corp. as well as the global insurance firm Multilateral Investment Guarantee Agency.

The financing program is projected to support green and inclusive developments as well as growth activities in the African country.

This money comes as Egypt is struggling with negative factors such as low foreign currency reserves, high interest payments, and high inflation.

It is also feeling the economic impact of the Russia-Ukraine war, as well as reduced tourism, and an increase in food insecurity.

In January, the International Monetary Fund stressed that despite Egypt seeing an “economic recovery” during 2021-2022, “imbalances also started building amidst a stabilized exchange rate.”

The source of World Bank approved funds will be split, with $1 billion annually coming from the International Bank for Reconstruction and Development, in addition to $2 billion over the entire Central Provident Fund period from the International Finance Corp.

In addition to this, the program will also provide Egypt with guarantees from the Multilateral Investment Guarantee Agency.

This is not the first time that the lender has approved a green scheme for Egypt.

In October 2022, it signed off on a $400 million development-financing agreement to help boost the African country’s logistics and transportation sectors and facilitate the transition to low-carbon technology along the Alexandria the 6th of October–Greater Cairo Area railway corridor.

In June last year the World Bank also approved a $500 million loan to help Egypt ensure an uninterrupted supply of bread as the country faced food security concerns amid rising prices and supply disruption due to the Russia-Ukraine war.


Saudi Arabia and China tourism officials discuss Kingdom’s ambitious tourism target

Saudi Arabia and China tourism officials discuss Kingdom’s ambitious tourism target
Updated 22 March 2023

Saudi Arabia and China tourism officials discuss Kingdom’s ambitious tourism target

Saudi Arabia and China tourism officials discuss Kingdom’s ambitious tourism target

RIYADH: Saudi Tourism Authority’s CEO has held a meeting with China’s Vice Minister of Culture and Tourism to discuss ways to elevate and enhance strategic collaborations in the tourism sector, Saudi Press Agency reported.

Fahd Hamidaddin held talks with Rao Quan amid the Kingdom’s efforts to attract more than 4 million Chinese tourists by the year 2030.

During the meeting, both sides agreed on the general terms of a Memorandum of Understanding to support this target. 

The two sides also settled to introduce and launch several joint tourism initiatives to develop human capacities working within the sector.

Saudi Ambassador to China Abdulrahman bin Ahmed Al-Harbi was also present during the meeting as officials discussed bilateral cooperation prospects in the sector.

In addition to this, the meeting also looked at ways to pave the way for a unified vision as well as efforts through relevant global organizations and associations.

Aside from tourism, the officials reflected on the outcomes of China’s President Xi Jinping’s visit to the Kingdom back in December 2022.

The latest meeting came as part of a promotional tour held by the Saudi Tourism Authority in collaboration with its partners from the Saudi tourism sector in China in an attempt to showcase Saudi tourist destinations and build partnerships between the tourism sectors of both countries.

The tour kicked off in Beijing before moving to Shanghai, and finally Guangzhou.

Earlier this month, the authority completed a successful three days at ITB Berlin, the world’s largest trade fair for the industry. 

Ahmed Al-Khateeb, Saudi minister of tourism and chairman of the authority’s board of directors, opened the Saudi pavilion at the fair, which received a number of presidents, ministers, leaders, and other key officials. 

Al-Khateeb also met officials of major commercial bodies such as TUI Group and FTI Consulting, in addition to leaders of the UN World Tourism Organization and the World Travel and Tourism Council.

The Saudi Tourism Authority is working to develop, promote, and distribute packages and products in partnership with the private sector.

The authority also participates in tourism events, exhibitions, trade shows, and roadshows both locally and globally to measure the tourist experience and suggest ways to enhance it to the relevant stakeholders.


Matarat Holding inks deal with Egis to serve 26 airports in Saudi Arabia 

Matarat Holding inks deal with Egis to serve 26 airports in Saudi Arabia 
Updated 22 March 2023

Matarat Holding inks deal with Egis to serve 26 airports in Saudi Arabia 

Matarat Holding inks deal with Egis to serve 26 airports in Saudi Arabia 

RIYADH: Saudi state-owned aviation management firm Matarat Holding Co. has inked a three-year contract with consulting company Egis to serve 26 airports in Saudi Arabia, as the Kingdom pushes to develop a global aviation hub in line with the goals outlined in Vision 2030.  

The contract was signed by Matarat’s CEO Mohammed Almaghlouth and Egis’ CEO in the Middle East and South Asia, Alaa AbuSiam, according to a press release.  

The three-year contract aims to establish phased project management portals, update airport project management policies and procedures, and provide technical support for planning and designing. The deal involved following up on the implementation of capital projects with Matarat subsidiaries including Riyadh Airports Co., Jeddah Airports, Dammam Airports, and Cluster2.  

“This contract focuses on providing support in several major areas and activities, which include strategic planning for projects, building an asset management guide, preparing a unified guide for engineering specifications for designing and implementing projects, and following up on continuous improvement of their performance,” said Turki Almubadal, executive vice president of Projects and Technical Affairs at Matarat.

He added that the signing of this contract will help the Kingdom achieve its National Aviation Strategy which aims to increase international destinations to 250 and passenger capacity to 330 million by 2030.  

“We are extremely delighted to be partnering with Matarat to be part of one of the most transformative projects in the Middle East region. The Kingdom’s strong commitment to the aviation sector as part of its 2030 Vision, will surely transform the country into a global hub connecting Asia, Europe and Africa,” said AbuSiam.   

Formerly known as Saudi Civil Aviation Holding Co., Matarat Holding Co. was established in 2013 by Saudi Arabia’s General Authority for Civil Aviation.  

The company aims to develop the Kingdom’s airports and improve their performance, along with contributing to Saudi Arabia’s sustainable development process in the aviation sector.  


OPEC+ likely to stick to its guns despite price slump, delegates say

OPEC+ likely to stick to its guns despite price slump, delegates say
Updated 22 March 2023

OPEC+ likely to stick to its guns despite price slump, delegates say

OPEC+ likely to stick to its guns despite price slump, delegates say

LONDON: The Organization of the Petroleum Exporting Countries (OPEC) and allies, known as OPEC+, is likely to stick to its deal on output cuts of 2 million barrels per day until the end of the year, even after a banking crisis sent crude prices plunging, three delegates from the producer group told Reuters.

Oil prices hit 15-month lows on Monday in response to the banking crisis that followed the collapse of two US lenders and resulted in Credit Suisse being rescued by Switzerland's biggest bank UBS.

Brent crude was trading around $75 a barrel on Wednesday morning.

Last October OPEC+, which includes Russia, agreed steep output cuts of 2 million bpd from November until the end of 2023 despite major consumers calling for increases in production.

That decision helped to push Brent close to $100 a barrel, but prices have come under pressure since then as rising interest rates to combat high inflation threaten to stymie oil demand growth.

Falling oil prices are a problem for most of the group's members because their economies rely heavily on oil revenue.

Russian Deputy Prime Minister Alexander Novak on Tuesday said that Moscow will continue with a 500,000-bpd production cut it announced last month, lasting until the end of June.

"This is only a unilateral cut of Russia," one of the delegates said.

"No changes for the group until the end of year," he added.

Another delegate added that no further cuts were planned by the group.

A third delegate said the recent slump in oil prices was related to speculation in the financial market, not market fundamentals.

The heads of top oil traders and hedge funds that spoke at an industry event this week said that they expected oil prices to strengthen by the end of the year as continued easing of COVID-19 restrictions in China drive up demand in the world's biggest oil importer.

Pierre Andurand, founder of hedge fund Andurand Capital, was the most bullish and forecast a potential Brent oil price of $140 a barrel by the end of the year.

In its most recent monthly report, OPEC upgraded its forecast for Chinese oil demand growth this year but maintained its projection for global demand growth at 2.32 million bpd.

OPEC+ is due to hold a virtual meeting of its ministerial committee, which includes Russia and Saudi Arabia, on April 3 before a full ministerial meeting in Vienna on June 4.