Saudi Arabia’s Industrial Production Index rises 7.3% y-o-y: GASTAT  

Saudi Arabia’s Industrial Production Index rises 7.3% y-o-y: GASTAT  
GASTAT report noted that the mining and quarrying sector rose by 4.3 percent in December 2022 compared to the same month in 2021. (Shutterstock)
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Updated 09 February 2023

Saudi Arabia’s Industrial Production Index rises 7.3% y-o-y: GASTAT  

Saudi Arabia’s Industrial Production Index rises 7.3% y-o-y: GASTAT  

RIYADH: Saudi Arabia’s Industrial Production Index rose 7.3 percent year-on-year in December 2022, primarily driven by high production in mining and quarrying, and manufacturing activities, a new report released by the General Authority for Statistics showed.   

After months of negative trends in 2019 and 2020 due to the COVID-19 pandemic, Saudi Arabia’s IPI turned positive in May 2021 and has been growing continuously since then.   

GASTAT report noted that the mining and quarrying sector rose by 4.1 percent in December 2022 compared to the same month in 2021.   

Saudi Arabia’s mining and quarrying activities also increased as the Kingdom raised its oil production to more than 10 million barrels per day in December 2022.   

The report further pointed out that manufacturing activities increased by 18.5 percent in December 2022, compared to December 2021.   

According to GASTAT, IPI is an economic indicator that reflects the relative changes in the volume of industrial output, and it is calculated based on the industrial production survey.   

The report said that the relative weights of the mining and quarrying, manufacturing and electricity and gas supply sectors in the IPI are 74.5 percent, 22.6 percent and 2.9 percent, respectively.  

“Thus, the trend of the industrial production index in the mining and quarrying sector dominates the trend in the general IPI,” it added.   

In December 2022, Saudi Arabia’s electricity and gas supplies decreased by 6.5 percent compared to the same month in 2021.  

The GASTAT report which was released on Feb. 9, however, noted that overall IPI decreased by 0.3 percent in December 2022 when compared with November 2022.   

This decline was due to the decrease in the mining and quarrying sector which fell by 0.3 percent, it added.   

According to the report, the manufacturing sector remained unchanged in December 2022 compared to the previous month, while electricity and gas supplies decreased by 5.3 percent.   

Even though Saudi Arabia’s IPI is still showing positive trends, its growth has slowed down for the eighth month in a row from a 26.7 year-on-year growth reported in April 2022. 

It should be also noted that Saudi Arabia’s IPI growth in December is the slowest in 2022 as it went below the 11.1 percent year-on-year growth reported in January last year. 

Saudi aviation sector set for efficiency boost with new company

Saudi aviation sector set for efficiency boost with new company
Updated 19 sec ago

Saudi aviation sector set for efficiency boost with new company

Saudi aviation sector set for efficiency boost with new company

RIYADH: Saudi Arabia’s Air Navigation Services Co. has announced the launch of a new firm in a bid to drive up efficiency in the Kingdom’s aviation sector.

The company, called Nera, will implement and manage projects in the field of civil aviation and air navigation in Saudi Arabia. 

According to the new firm’s official Twitter account, Nera will be “an innovative and technological solutions company that will lead the future of aviation in the Middle East and around the world by providing technical and operational solutions to improve efficiency, while complying with international safety standards.”

“Nera will provide many services in acquiring, defining and outlining the technical specifications and requirements for the automation and CNS systems as well as monitoring the entire installation process,” it added. 

This comes as Saudi Arabia earlier this month announced a $37 billion deal with US firm Boeing which will see the company manufacture up to 121 aircraft to help get the Kingdom's new airline off the ground.

The deal will see Boeing 787 Dreamliner planes with General Electric engines delivered to Saudi Arabia, with 72 of them set for Riyadh Air – the carrier announced by Saudi Crown Prince Mohammed bin Salman.

The aviation sector, rebounding now after the pandemic, will deliver SR280 billion ($75 billion) to Saudi Arabia’s national gross domestic product by 2030, said Faisal Al-Ibrahim, minister of economy in May of last year. 

While speaking at the Future Aviation Forum in Riyadh on May 10, the minister noted that the pandemic resulted in a loss of $52 billion to the aviation sector. 

The minister added that Saudi Arabia is aiming to host 330 million passengers by 2030. 

Al-Ibrahim also revealed that Jeddah to Cairo was the busiest route in terms of international flights, while Riyadh to Jeddah was the busiest domestic route. 

The Kingdom’s growth in the aviation sector is expected to be an essential catalyst for the growth of the entire Gulf Cooperation Council’s tourism market. 

That was the message of Paul Griffiths, the CEO of Dubai Airports, during an interview on the Arab News talk show Frankly Speaking.

Griffiths, who has been a key figure in the transformation of Dubai airport into the world’s busiest by international passenger numbers, said: “I think a lot of people will be expecting me to say, ‘Well, Saudi Arabia is going to be a competitor’. Actually, the Saudi market is incredibly important for Dubai.”

Similar sentiments were expressed at the World Economic Forum’s annual meeting in Davos a week prior. 

Taking part in a panel discussion on “Saudi outlook,” Khalid Al-Falih, the Saudi investment minister, said: “A rising tide lifts all boats. Regional integration is more important to the smaller but very important economies next to us than it is to Saudi Arabia." 

He added, “So, I believe the Kingdom’s rise in its economic and competitive performance actually helps their competitiveness. It allows companies and enterprises and the governments of those countries to integrate with the larger global economy in Saudi Arabia.” 

PIF-backed Rakiza raises $1bn to invest in Oman and Saudi Arabia 

PIF-backed Rakiza raises $1bn to invest in Oman and Saudi Arabia 
Updated 46 min 15 sec ago

PIF-backed Rakiza raises $1bn to invest in Oman and Saudi Arabia 

PIF-backed Rakiza raises $1bn to invest in Oman and Saudi Arabia 

RIYADH: Public Investment Fund-backed Rakiza has raised $1 billion to invest in three projects in Oman and is close to signing off on several deals in the Kingdom, according to a statement.

The fund has taken a 30 percent stake in telecom firm Omantel’s passive tower assets in the Sultanate, a majority stake in Khazaen Fruit and Vegetable Central Market, and an estimated 31 percent stake in the Oman International Container Terminal in the Port of Sohar.  

These mean that 25 percent of its acquired capital has already been deployed in Oman, Rakiza said in a statement.

The fund is co-managed by Oman Infrastructure Investment Management and London-based infrastructure equity manager Equitix. 

Rakiza aims to invest in infrastructure projects in Oman and the Kingdom to drive stable returns as well as a stake in sectors like renewables, power, water, telecommunications, and logistics. 

“Our target of raising over $1 billion is an important milestone, on which Rakiza hopes to build with similar future initiatives,” Rakiza founder and OIM CEO, Muneer Al-Muneeri, said. 

The company is also close to sealing investment deals in Saudi Arabia as well as securing its first acquisition in the Kingdom, no further information about these deals was disclosed. 

“The Gulf Cooperation Council is an attractive home for smart capital and an exciting investment destination for those with local access,” said Hugh Crossley, Equitix co-founder and CEO. 

Last year, Saudi Arabia’s PIF committed $300 million to Rakiza. The Asia Infrastructure Investment Bank has also invested $50 million in the infrastructure fund. 

“Driven by Rakiza’s local investment teams in our Riyadh and Muscat offices, we aim to deliver on the fund’s return objectives by investing in and developing compelling essential infrastructure projects in Oman and Saudi Arabia,” Crossley added. 

Saudi-Oman bilateral relations have been positively impacted in recent times with agreements being reached by both countries. 

Last month, Saudi Arabia and Oman signed 13 investment memoranda of understanding between the public and private sectors covering various industries.

Dubai inflation rises close to 5% in February on higher F&B prices 

Dubai inflation rises close to 5% in February on higher F&B prices 
Updated 21 March 2023

Dubai inflation rises close to 5% in February on higher F&B prices 

Dubai inflation rises close to 5% in February on higher F&B prices 

RIYADH: In line with the global trend, Dubai saw its annual inflation rate rising to 4.9 percent in February driven by an increase in food and beverages costs, the latest data from the emirate's Statistics Center showed.   

This comes as Dubai’s Consumer Price Index rallied by 0.32 percent in February from 4.58 in January.  

According to the report, food and beverage prices increased by 6.29 percent in February, while the prices of housing, water, electricity, gas and other fuels surged by 4.87 percent.  

The rise in inflation for the month of February was also driven by an increase in prices of restaurants and accommodation services and insurance and financial services which went up by 4.47 percent and 5.41 percent respectively.  

The report, however, added that the prices of furnishings, household equipment and routine household maintenance marginally went down to 9.42 percent in February, from 9.50 percent in January.  

Inflation in the UAE has stayed relatively low when compared to other parts of the world, as the emirate showed signs of recovering from the pandemic, amid global economic headwinds.  

According to the UAE Central Bank, the country’s economy had grown 7.6 percent in 2022, the highest in 11 years, after expanding by 3.9 percent in 2021.  

Earlier in March, data analytics firm Kantar said that inflation and the resulting price rises are putting pressure on consumers in the UAE.  

“Spending has remained high since 2019 and this ongoing financial strain is leading consumers to change the way they shop,” said Imtiaz Hashem, consumer insights director at Kantar Worldpanel, UAE. 

But despite this, he added the UAE economy ended 2022 solidly and signs suggest this growth will continue but might slow in the first half of 2023.  

In February, a report released by Kuwait-based investment strategy and research firm Kamco Invest said that the inflation rate in the Gulf Cooperation Council countries is showing a downward trend in 2023 compared to 2022.  

The International Monetary Fund, in its World Economic Report, also noted that nearly 84 percent of the countries in the world are forecasted to have lower consumer price index inflation growth in 2023 than in 2022.  

IMF added that global headline inflation would fall from an annual average of 8.8 percent in 2022 to 6.6 percent in 2023 and further to 4.3 percent in 2024.  

Amid economic uncertainties, Saudi Arabia also showed strong signs of combating inflation effectively in February.  

In March, a report released by Saudi Arabia’s General Authority for Statistics showed the Kingdom’s inflation rate has softened to 3 percent in February 2023, against 3.4 percent recorded in January, driven by a slight decrease in food and beverage prices.  

The monthly consumer price index was affected by a 0.6 percent fall in food and beverages prices, as a result of the decrease in food by 0.7 percent.  

The GASTAT data revealed that transport prices also fell by 0.5 percent in February against the previous month, mainly due to the decrease in motor car prices by 0.9 percent.    

Saudi Venture Capital launches $80m Saudi fintech fund 

Saudi Venture Capital launches $80m Saudi fintech fund 
Updated 21 March 2023

Saudi Venture Capital launches $80m Saudi fintech fund 

Saudi Venture Capital launches $80m Saudi fintech fund 

CAIRO: Saudi Arabia’s booming fintech sector is set to be boosted by an $80 million investment fund launched by Saudi Venture Capital Co..

The ‘Investment in Fintech VC Fund’ was launched in partnership with Saudi Arabia’s Capital Market Authority and the Financial Sector Development Program to preserve the Kingdom’s fintech industry growth that attracted almost 25 percent of all Saudi venture capital funding last year. 

SVC aims to stimulate and sustain financing for startups and small and medium enterprises from early stage to initial public offering by backing venture capital and private equity firms all around the region. 

The firm has been keen to empower the startup landscape in the Kingdom, and also signed a memorandum of understanding last month with the Saudi stock market Tadawul to support SMEs going public. 

The company will strategically place the new fund to support Saudi Arabia’s fintech ecosystem which raised $239 million in funding in 2022, according to venture data firm MAGNiTT. 

Saudi Arabia’s venture capital market has been one of the most attractive markets globally, capturing $987 million in funding last year, a 72 percent increase from the year before. 

The Kingdom’s 2022 funding boom came as investment across the world decreased by 35 percent year-on-year, while the US venture market experienced a 37 percent drop, according to Crunchbase. 

The UAE and Egypt, which are the region’s leading venture markets, also witnessed a decline in funding activity last year. 

Founded in 2018, SVC is a government investment company under the SME Bank and has invested in 35 funds which financed 525 companies through 904 deals. 

Oil Updates — Crude down; Venezuela president accepts resignation of oil minister  

Oil Updates — Crude down; Venezuela president accepts resignation of oil minister  
Updated 21 March 2023

Oil Updates — Crude down; Venezuela president accepts resignation of oil minister  

Oil Updates — Crude down; Venezuela president accepts resignation of oil minister  

RIYADH: Oil drifted lower on Tuesday as more than a week of banking turmoil kept weighing on market confidence. 

Brent crude futures for May settlement dropped 84 cents, or 1.14 percent, trading at $72.95 per barrel at 11.00 a.m. Saudi time.  

US West Texas Intermediate crude futures were down 56 cents, or 0.83 percent, to $67.08 a barrel. 

In the previous session, both Brent and WTI fell about $3 a barrel before settling higher. That followed Swiss bank UBS throwing a lifeline to Credit Suisse and major central banks saying they would enhance market liquidity and support the banking system. 

Venezuela’s Maduro accepts resignation of oil minister El Aissami 

Venezuela’s President Nicolas Maduro on Monday accepted the resignation of the country’s oil minister Tareck El Aissami, following the detention of at least six high-level officials amid a corruption probe focused on state-run company PDVSA and the judiciary. 

El Aissami had said earlier on Monday on Twitter he would resign to fully support the investigations. The probe especially touches PDVSA, which is supervised by the oil ministry. 

Maduro did not immediately name a replacement for El Aissami, who has served as vice president, and as a minister and mayor over the past two decades. 

Brazil environment agency asks for more info from Petrobras  

Brazil’s environmental regulator Ibama has asked Petrobras for additional information on its plan to drill at the mouth of the Amazon river before authorizing the company to test its emergency oil spill response, the agency’s president told Reuters. 

Ibama has not defined a test date because Petrobras did not deliver all of the documents required, but it will be scheduled as soon as the company provides the information, the agency’s president Rodrigo Agostinho said. 

Petrobas views the mouth of the Amazon as the newest and most important frontier for oil exploration in Brazil and the company planned the test to assess its response in the event of a major spill. 

The company has been working for years to open up a new exploration frontier in a region close to Guyana, where Exxon Mobil has made important discoveries and many wells were drilled. 

Later on Monday, Petrobras said it had just filed details and responses to Ibama’s demands. 

“After analysis and agreement by the environmental agency, the date for carrying out the pre-operational assessment may be defined together with Ibama,” the company said in a statement. 

The area was auctioned in 2013 and Petrobras has planned to explore there for years after BP and TotalEnergies gave up on their assets, even after investing in studies, because of difficulties in obtaining drilling licenses. 

Iran counts on ‘huge volumes’ of oil and gas swaps from Russia 

Iran counts on “huge volumes” of oil and gas swaps from Russia this year, Iranian Economy Minister Ehsan Khandouzi said in an interview with Russia’s RIA state news agency.  

“This year will witness huge volumes of swap supplies. We are very pleased that Tehran and Moscow have started cooperation on the issue of swap supplies of oil and gas,” Khandouzi was cited as saying. 

There were no details on what volumes of oil and gas Iran is expecting. 

(With input from Reuters)