Saudi Arabia issues 124 licenses to industrial units in different sectors in January

The total investment value of these units is estimated at SR2.4 billion ($639 million). Shutterstock
The total investment value of these units is estimated at SR2.4 billion ($639 million). Shutterstock
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Updated 19 March 2023

Saudi Arabia issues 124 licenses to industrial units in different sectors in January

Saudi Arabia issues 124 licenses to industrial units in different sectors in January

RIYADH: Saudi Arabia’s Ministry of Industry and Mineral Resources issued licenses to 124 industrial units in January, according to an official statement.

The total investment value of these units is estimated at SR2.4 billion ($639 million). The factories will be established in five economic sectors. According to the official data, 29 licenses were issued in the food sector, 18 permits were given for work in non-metallic minerals, 12 in the chemicals industry, 11 for the manufacture of formed metals excluding machinery and equipment, and eight licenses were issued for the manufacture of rubber products.

The new industrial units are dispersed across 12 regions in the Kingdom. Forty-four factories were licensed in Riyadh, 24 in Makkah, 24 in the Eastern Province, 10 in the Qassim region, eight in Madinah, five in Jazan, three in Asir, two in Hail, one in Northern Borders province, one in Tabuk, one in Al-Jouf province, and one in Najran.

Official data indicated that small-sized enterprises accounted for 86.29 percent of the newly issued licenses in January, followed by medium-sized enterprises with 11.29 percent, and micro-enterprises with 2.42 percent.

According to the type of investment, national plants topped the new licenses with 79.84 percent, followed by foreign establishments (10.48 percent), and joint investments comprised 9.68 percent of the total number.

The number of factories that commenced production in January reached 164 with total investments amounting to SR2.7 billion.


China emerges as Saudi Arabia's top export destination in January

China emerges as Saudi Arabia's top export destination in January
Updated 13 sec ago

China emerges as Saudi Arabia's top export destination in January

China emerges as Saudi Arabia's top export destination in January

RIYADH: China emerged as the top global export destination for Saudi Arabia in January 2023 accounting for 14.8 percent of total Saudi exports valued at SR15.6 billion. It was followed by Japan and India with exports valued at SR11.7 billion (11.2 percent of total exports) and SR10.8 billion (10.2 percent) respectively, data released by the General Authority for Statistics showed on Monday.


PIF’s SEVEN appoints Egis to manage entertainment destinations  

PIF’s SEVEN appoints Egis to manage entertainment destinations  
Updated 58 min 47 sec ago

PIF’s SEVEN appoints Egis to manage entertainment destinations  

PIF’s SEVEN appoints Egis to manage entertainment destinations  

RIYADH: SEVEN, the investment and entertainment execution arm of the Public Investment Fund, has appointed global consulting firm Egis as the project management company for destinations in Northwestern and Southern Provinces, including a recently announced development in Tabuk.  

Egis will oversee the design of these destinations and overlook all development stages, including the identification of potential specialist partnerships required as well as the construction and project management services needed.  

“Our commitment to Saudi Vision 2030 is ongoing with our projects, presence and people in the Kingdom. We are excited to further emphasize this with our involvement on the project with SEVEN, which is set to change the entertainment industry across the country,” Alaa AbuSiam, CEO of Egis in the Middle East and South Asia, said.  

Egis has been operating in Saudi Arabia for almost 30 years and is currently working on more than 25 projects spread across the Kingdom including Riyadh Metro, Green Riyadh, AlUla development, Riyadh Airport and NEOM.  

“We are delighted to be working with Egis, who are leaders in their field with a strong track record of delivering projects to the highest of standards. We will work together to achieve our shared vision of elevating the quality of life for the people of Saudi Arabia by providing unrivaled experiences at our world-class entertainment destinations across the Kingdom,” Abdullah AlDawood, chairman of SEVEN, said.  

SEVEN is one of the main players in Saudi Arabia’s entertainment industry having made significant efforts directed at developing the ecosystem in line with Vision 2030.  

“SEVEN will bring world-class entertainment which will contribute to the improvement of the sector and the quality of life of the Kingdom’s population; an objective both Egis and SEVEN have in common,” AbuSiam added.  

Founded in 2017, SEVEN is planning to invest more than $13.3 billion to build 21 entertainment destinations across the Kingdom. Its most recent project is a $266 million attraction in Tabuk that was announced in January. 


stc expands 5G network by 130% in the Grand Holy Mosque in preparation of Umrah season 

stc expands 5G network by 130% in the Grand Holy Mosque in preparation of Umrah season 
Updated 27 March 2023

stc expands 5G network by 130% in the Grand Holy Mosque in preparation of Umrah season 

stc expands 5G network by 130% in the Grand Holy Mosque in preparation of Umrah season 

RIYADH: Saudi Arabia’s leading telecom provider stc Group is boosting its 5G network scope in the Grand Holy Mosque by 130 percent compared to last year to ensure better performance during the Umrah season. 

The company also increased its network capabilities by 13 percent in Makkah and 18 percent in Madinah compared to last year, while expanding 5G coverage by 25 percent and 13 percent in the respective locations. 

The group has prepared an emergency plan with authorities to achieve a rapid response to any crisis in addition to deploying network stability, technical support, and maintenance teams ready around the clock. 

The digital infrastructure of the Grand Holy Mosque and the Prophet's Mosque was established to receive millions during the holy month of Ramadan. 

The Group aims to prepare all sites for Umrah performers, worshipers, and visitors to the Grand Holy Mosque and the Prophet's Mosque in a way that guarantees a distinguished digital experience and raises the level of quality of services provided to them. 

These early preparations aim to ensure the readiness of the Group's services and digital solutions to provide a unique experience for visitors. 

Saudi Arabia receives millions of visitors during its Hajj and Ramadan seasons with Umrah visitors reaching seven million in 2022, according to the Ministry of Hajj. 

In 2022, the ministry, for the first time, allowed people who had a tourist visa to the Kingdom to perform Umrah during their stay. 

Last year’s Umrah performers increased by half a million compared to the year before. The Kingdom also expects to reach nine million Umrah visitors this year. 

At the beginning of March, stc signed an agreement with Ericsson to explore deployment options and future network architectures for delivering 5G services. 

The agreement aims to support stc’s goal to evolve towards cloud-native technologies and open network designs as well as increase the company’s flexibility in its 5G infrastructure.  


Aramco expands its presence in China with 10% stake in Rongsheng Petrochemical Co.

Aramco expands its presence in China with 10% stake in Rongsheng Petrochemical Co.
Updated 27 March 2023

Aramco expands its presence in China with 10% stake in Rongsheng Petrochemical Co.

Aramco expands its presence in China with 10% stake in Rongsheng Petrochemical Co.

RIYADH: Global energy giant Saudi Arabian Oil Co. has further expanded its presence in China by acquiring a 10 percent stake in Shenzhen-listed Rongsheng Petrochemical Co. for $3.6 billion.

According to a press release, Aramco will supply 480,000 barrels per day of Arabian crude oil to Rongsheng affiliate Zhejiang Petroleum and Chemical Co. under a long-term sales agreement.

It further noted that Aramco Overseas Co., a wholly owned subsidiary of Aramco, will acquire the interest in Rongsheng.

“This announcement demonstrates Aramco’s long-term commitment to China and belief in the fundamentals of the Chinese petrochemicals sector,” said Aramco Executive Vice President of Downstream Mohammed Y. Al-Qahtani.

He added: “It is an important acquisition for Aramco in a key market, supporting our growth ambitions and advancing our liquids to chemicals strategy. It also promises to secure a reliable supply of essential crude to one of China’s most important refiners.”

Rongsheng owns a 51 percent equity interest in ZPC, which in turn owns and operates the largest integrated refining and chemicals complex in China with a capacity to process 800,000 bpd of crude oil and produce 4.2 million metric tons of ethylene per year.

“This strategic cooperation will take our long-term friendship and mutual trust to a new level and paves the way for a bright future for the high-quality development of the world’s petrochemicals industry,” said Rongsheng Chairman Li Shuirong.

Shuirong added that Aramco’s involvement will help Rongsheng implement its petrochemical growth strategy.

On March 26, Aramco inked a deal with China’s Norinco Group and Panjin Xincheng Industrial Group to form a joint venture named Huajin Aramco Petrochemical Company, aimed at constructing a refinery and petrochemical complex in the Asian giant’s Liaoning province.

Aramco holds a 30 percent stake in HAPCO, and the Saudi firm will supply up to 210,000 bpd of crude oil feedstock to the complex.

Combined, the partnership with Rongsheng and the HAPCO joint venture would see Aramco supply a total of 690,000 bpd of crude to high chemical conversion assets, the press release added.

During the China Development Forum in Beijing on Sunday, Aramco CEO Amin Nasser affirmed its support for China’s long-term energy security and development.

“We want to be an all-inclusive source of energy and chemicals for China’s long-term energy security and China’s high-quality development — to the horizon, and even beyond,” said Nasser.

He added: “That’s why we are doubling down on China’s energy supply, including new lower carbon products, chemicals, and advanced materials, all supported by emissions reduction technologies.”


Saudi banks’ income surges 28% to $17bn in 2022: Alvarez & Marsal analysis  

Saudi banks’ income surges 28% to $17bn in 2022: Alvarez & Marsal analysis  
Updated 27 March 2023

Saudi banks’ income surges 28% to $17bn in 2022: Alvarez & Marsal analysis  

Saudi banks’ income surges 28% to $17bn in 2022: Alvarez & Marsal analysis  

RIYADH: Amid fears of a global banking crisis, Saudi lenders are expected to maintain profitability in 2023 with continued credit growth as the Kingdom’s top banks reported an aggregate net profit of 28.4 percent in 2022, revealed an analysis done by the global professional services firm Alvarez & Marsal. 

The report shows that the aggregate net income of the 10 biggest listed banks increased to SR62.7 billion ($16.72 billion) in 2022 compared to SR48.83 billion in 2021 on the back of higher credit demand, better asset yield, and operating efficiencies amidst rising benchmark interest rates. 

The report’s outcome is based on the comparative analysis of the financial results of 10 banks in 2022 against 2021, involving Saudi National Bank, Al Rajhi Bank, Riyad Bank, Saudi British Bank, Banque Saudi Fransi, Arab National Bank, Alinma Bank, Bank Albilad, Saudi Investment Bank and Bank Aljazira. 

“We consider the Saudi banks’ capital position to be strong. Profitability improved due to an increase in operating income which was further supported by lower impairments,” stated Asad Ahmed, managing director of Middle East financial services at A&M.   

In its report Saudi Arabia Banking Pulse for the fiscal year 2022, the firm showed that the credit growth of Saudi banks reached 14.4 percent year-on-year in 2022, whereas deposits only witnessed an 8.3 percent growth during the same period. 

Its analysis showed that the banks’ loan growth outpacing deposits came from the rising demand in personal loans and real estate activities, and is expected to edge up further in 2023.   

The report further noted that the Saudi Central Bank, known as SAMA, will continue to extend tenors for its support packages in 2023 in an effort to prevent a credit crunch.   

As interest rates continue to mount, A&M expects current and savings accounts will migrate toward term deposits.   

“Net interest income expanded as asset yield improvement surpassed changes in the funding cost,” stated the report.   

Saudi banks’ net interest income received from lending activities, rose by 15 basis points in 2022, yet remained below pre-COVID levels.   

“SAMA has increased its interest rates along with the US Federal Reserve (+425 basis points) in the financial year 2022 and we expect SAMA to continue matching monetary tightening by the Reserve, which will help boost the overall banking sector’s NIMs and in turn its profitability,” said Ahmed.   

He added, “Corporate lending is likely to increasingly drive credit growth in the near term as Saudi Vision 2030 projects are implemented.”  

The A&M report used independently sourced published market data and 16 different metrics to assess the banks’ key performance areas, including size, liquidity, income, operating efficiency, risk, profitability, and capital.