Rising appetite for Saudi capital market reflects robust G20 economies

Rising appetite for Saudi capital market reflects robust G20 economies
Lazard’s investment banking CEO for the Middle East and North Africa Wassim Alkhatib. (Supplied)
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Updated 12 February 2023
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Rising appetite for Saudi capital market reflects robust G20 economies

Rising appetite for Saudi capital market reflects robust G20 economies

RIYADH: Increasing appetite to list on Saudi bourses displays the robust market performance of the G20 economies, noted top executive of a financial advisory and asset management firm. 

Speaking at the second edition of the Saudi Capital Forum in Riyadh on Sunday, Lazard’s investment banking CEO for the Middle East and North Africa Wassim Alkhatib said that the Saudi capital market is a reflection of a very strong G20 economy and has over 200-250 listed companies.  

This comes as the Kingdom witnessed a migration of around SR43 billion ($11.5 billion) from foreign investors in 2022.  

“In 2022, what we saw is continued migration of capital from the international investment community into the region, and specifically on the Tadawul stock exchange,” said Alkhatib.  

Despite the unprecedented global challenges being faced by nations over the past year, he said the Saudi capital market has proven to be resilient.  

“In addition to the global inflationary environment, the cascading effects of Ukraine and the invasion of Ukraine, and the recycling of capital and rotation out of certain sectors and into several regions, Tadawul was ultimately a very big winner,” the Lazard chief noted.   

Alkhatib pointed out that there are robust and appealing opportunities for both local and international investors across the 20 sectors of the Saudi stock exchange, also known as Tadawul.  

He said such investors would be able to take advantage of the deep liquidity and the sturdy fundamentals of the Tadawul sectors.   

“That becomes a very easy conversation to explain to investors that it’s not just about them parking their capital in a safe region, but there are also very attractive commercial opportunities,” noted Alkhatib.   

As for the Saudi initial public offerings pipeline, it experienced one its most remarkable years in 2022 transforming Saudi Arabia into a leading listings market worldwide.   

“And if you look at the sectors of those companies, they are actually quite diverse. They cater to all asset managers, different fund managers covering emerging markets or technology or retail or oil and gas and petrochemicals,” added Alkhatib.   

Moreover, Lazard’s CEO believes that  “the market is very likely to continue to be a very prominent recipient hub of international flows.”  

This year’s SCM Forum brings together issuers, investors and capital market institutions to discuss key structural changes happening across one of the fastest-growing capital markets internationally.   

The event opens the floor for central opinion leaders, investors, issuers, and governmental institutions, and ends with the presentation of the SCM Awards.  

Taking place in Riyadh from Feb. 12 to 13, the forum is held under the patronage of the Chairman of the Board of the CMA, Mohammed A El-Kuwaiz.   


UAE economy set for 3% growth in 2023, driven by non-oil sectors: S&P 

UAE economy set for 3% growth in 2023, driven by non-oil sectors: S&P 
Updated 13 sec ago
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UAE economy set for 3% growth in 2023, driven by non-oil sectors: S&P 

UAE economy set for 3% growth in 2023, driven by non-oil sectors: S&P 

RIYADH: The UAE is expected to achieve 3 percent economic growth in 2023 driven primarily by the non-oil sector, as outlined in a report by Standard and Poor’s.

The analysis from the ratings agency forecasts a further expansion rate of 4 percent next year.

S&P is bullish regarding the prospects of the UAE’s tourism industry, attributing its growth to the successful hosting of major events and activities. 

Trevor Cullinan, a sovereign ratings analyst at the agency, pointed to the impressive expansion of the UAE’s non-oil sector, citing significant strides in services and industrial domains, reported the Emirates News Agency, also known as WAM. 

Identifying key sectors that are steering the UAE’s economic growth, Cullinan mentioned oil and gas, wholesale trade, and industry, as well as real estate, construction, and financial services. 

He expects the non-oil sector to sustain its momentum, with factors like an influx of expatriates and tourists, positive sentiments among investors and consumers, and private sector development playing pivotal roles.   

These projections align with the “We Are the UAE 2031” vision, a national strategy aimed at boosting trade and increasing the tourism sector’s contribution to the gross domestic product through collaborative efforts between government entities and the private sector, the WAM report stated.  

Tatiana Liskova, a corporate ratings analyst at S&P, sees the UAE’s travel and hospitality industries as a key driver of economic growth, citing Dubai’s achievement in attracting 14.7 million international visitors in 2022, double that of the previous year. 

She expects the sector’s growth to continue, bolstered by high-profile events like the UN Framework Convention on Climate Change, or COP28, a major step toward the UAE’s ambitious goal of welcoming 40 million visitors by 2030 and expanding its hotel room capacity to 250,000.  

Liskova pointed out that both Abu Dhabi and Dubai will maintain their positions as leaders in attracting business and tourists to the country. 

Meanwhile, other emirates such as Ras Al Khaimah and Sharjah are making significant progress in diversifying their tourism offerings, enhancing their overall appeal. 

Mohamed Damak, a financial institution ratings analyst and global head of Islamic Finance at S&P, predicts continued strength in the UAE’s banking sector.  

Improved profitability, surpassing pre-COVID-19 levels, and benefiting from rising interest rates are on the horizon, with UAE banks also set to capitalize on technological advancements.  


Abu Dhabi National Hotels CEO reveals expansion plans at Future Hospitality Summit

Abu Dhabi National Hotels CEO reveals expansion plans at Future Hospitality Summit
Updated 26 September 2023
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Abu Dhabi National Hotels CEO reveals expansion plans at Future Hospitality Summit

Abu Dhabi National Hotels CEO reveals expansion plans at Future Hospitality Summit

RIYADH: Abu Dhabi National Hotels is exploring expansion opportunities in North Africa and Europe, the company’s CEO revealed during the Future Hospitality Summit on Tuesday.

This development strategy points to the company’s growth ambitions, giving access to new customer segments and markets, Khalid Anib indicated.

The executive also emphasized ADNH’s commitment to environmental responsibility, stating: “As owners, we are embracing sustainability and are ready to enhance our buildings to be more sustainable.”

The Future Hospitality Summit, a gathering of industry figureheads and key stakeholders, witnessed prominent business leaders sharing their insights on expansion and ambitions for growth within the market. 

Adeeb Ahamed, the managing director of Lulu Financial Holdings & Twenty14 Holdings, addressed the hospitality industry’s pivotal role in job creation.

Ahamed stated: “One in 11 jobs are generated by the hospitality sector, making it a priority in every market.”

He stressed that despite technological advancements, the hospitality sector remains unique, with limited job displacement, as the human touch remains integral.

Ahamed also highlighted the growing appeal of the region as a tourist hot spot, drawing parallels with popular European destinations.

He noted: “The countries in the GCC (Gulf Cooperation Council) are becoming very attractive in terms of tourism, and this is very good news for the entire economy. Like in Europe where people visit multiple countries in one holiday, the GCC is creating something of that sort and this is where we like to capitalize, we like to see how we can do it in Oman, in Saudi Arabia, in Qatar. And this would give more reasons to travel here.”

In response to the rapid growth of the hospitality sector in neighboring Saudi Arabia, Ahamed commented: “I think Saudi Arabia is not a competition. It’s a combined effort that’s going to bring more confidence to investors to invest in the region, so more awakening done by neighboring countries is definitely going to boost the ecosystem.”


Saudi Arabia’s transport plans play crucial role in global carbon emissions battle 

Saudi Arabia’s transport plans play crucial role in global carbon emissions battle 
Updated 58 min 48 sec ago
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Saudi Arabia’s transport plans play crucial role in global carbon emissions battle 

Saudi Arabia’s transport plans play crucial role in global carbon emissions battle 

RIYADH: Saudi Arabia’s sustainable transport plans are a vital part of the Kingdom’s drive to reduce global carbon emissions by 4 percent, said a government official on Tuesday.   

Speaking at the Global Sustainable Transport Forum held in Beijing from Sept. 25-26, the Saudi Transport and Logistics Services Minister, Saleh bin Nasser Al-Jasser, stressed that sustainability is a fundamental element of the Kingdom’s Vision 2030. 

Al-Jasser underscored that the Kingdom’s strong commitment to sustainability has been smoothly incorporated into the transport and logistics sector through the National Strategy for Transport and Logistics.    

The strategy includes reducing carbon emissions per person by 2 percent in a year, increasing sustainable mobility, electrifying transport and implementing them across the logistics value chain.   

It also includes developing the necessary infrastructure to meet future demand, with the primary goal of minimizing traffic fatalities. 

According to Al-Ekhbariya, the minister also pointed out that cooperation, innovation and the exchange of best practices create the foundation for achieving common goals. 

He also revealed that there has been significant progress over the years, with the number of fatalities falling from 28 per 100,000 people in 2016 to 13.5 in 2020. 

Through the implementation of a national safety program that emphasizes infrastructure development, road safety awareness and governance improvements, the goal is to lower the fatalities to less than five by 2030. 

Al-Jasser also emphasized how the COVID-19 pandemic hugely affected the global logistics and transportation industry, causing supply chains to break down and some transport sectors to collapse. 

This fact underlines how crucial it is to balance the social, economic, and environmental pillars of sustainable development to create green transportation networks. 

Furthermore, the minister said in August that Saudi Arabia’s master plan to develop logistics centers in the Kingdom will help improve transport services and contribute to infrastructure development. 

He noted that the new master plan will also strengthen Saudi Arabia’s connection with global markets, as the Kingdom is strategically placed in the middle of three continents.   

Saudi Arabia’s NSTL aims to position the Kingdom as one of the top 10 countries globally in the logistics performance index by the end of this decade, aligned with the goals outlined in Vision 2030. 


Egypt awards oil and gas exploration blocks to Eni, BP, QatarEnergy, Zarubezhneft 

Egypt awards oil and gas exploration blocks to Eni, BP, QatarEnergy, Zarubezhneft 
Updated 26 September 2023
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Egypt awards oil and gas exploration blocks to Eni, BP, QatarEnergy, Zarubezhneft 

Egypt awards oil and gas exploration blocks to Eni, BP, QatarEnergy, Zarubezhneft 

CAIRO: Egypt awarded on Tuesday four blocks in an oil and gas exploration bid round for concessions in the Mediterranean and Nile Delta to Italy’s Eni, BP, QatarEnergy, and Russia's Zarubezhneft, the petroleum ministry said. 

Eni would take two blocks by itself and a third in a coalition with BP and QatarEnergy, while Zarubezhneft was also awarded a block. 

This comes after Egypt’s petroleum ministry launched an international bidding round on Monday for exploration in 23 open blocks, with the offer deadline set for Feb. 25, according to Reuters. 

The round includes 10 areas in Egypt’s Western Desert, two in the Eastern Desert, seven in the Gulf of Suez and four in the Red Sea, the ministry said. 

Egypt, the most populous Arab country, has sought to position itself as a regional energy hub. 


Fitch upgrades Oman’s credit rating to BB+

Fitch upgrades Oman’s credit rating to BB+
Updated 26 September 2023
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Fitch upgrades Oman’s credit rating to BB+

Fitch upgrades Oman’s credit rating to BB+

RIYADH: Reflecting Oman’s commitment to fiscal stability, US-based Fitch Ratings upgraded the Gulf nation’s long-term foreign currency issuer default rating to “BB+” from “BB.”  

According to the agency, the Omani government’s dedication to implementing measures to maintain financial security was a key factor contributing to the advancement. 

This promise comes in response to the challenging scenario of the oil price’s breakeven point, which has declined from $80-90 per barrel between 2017 and 2019 to less than $70 per barrel in 2023. 

The agency also noted that the upgrade implied that the government would not backtrack on recent fiscal consolidation measures. 

“The reduction of Oman’s fiscal breakeven price to below $70 per barrel over our forecast horizon from $80-$90 over 2017-19 significantly reduces vulnerability to oil price swings, although risks remain,” said Fitch Ratings in its report.