Over 200 Chinese firms to attend business event in Saudi Arabia amid growing trade ties

The total volume of trade between Saudi Arabia and China hit $120 billion in 2022, registering a 30 percent increase over 2021. SPA/File
The total volume of trade between Saudi Arabia and China hit $120 billion in 2022, registering a 30 percent increase over 2021. SPA/File
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Updated 26 November 2023
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Over 200 Chinese firms to attend business event in Saudi Arabia amid growing trade ties

Over 200 Chinese firms to attend business event in Saudi Arabia amid growing trade ties
  • China Trade Week in Dammam to showcase over 4,000 innovative Chinese products

RIYADH: Chinese companies are set to expand their presence in Saudi Arabia and the broader Middle East and North Africa region as the Kingdom launched its inaugural China Trade Week in Dammam on Sunday.

More than 200 companies from the Asian country are taking part in the event to explore investment opportunities in the Kingdom amid the growing Saudi-Sino ties.

The inaugural CTW is considered very crucial, as it will help Chinese firms to expand their footprint in the Kingdom, along with seeking further collaborations with entities in the wider MENA region.  

Opportunities  

Hosted by MIE Events, in collaboration with Dhahran Expo, CTW Saudi Arabia 2023 is expected to be a platform where Chinese manufacturers will showcase various innovative products in key sectors including construction and building materials, interior design, machinery and hard tools, and heating, ventilation, and air conditioning.  

“CTW Saudi Arabia 2023 emerges as the ideal platform for local businesses to connect with esteemed high-profile Chinese manufacturers, opening doors to unique opportunities for Saudi companies to form partnerships and distribution channels with 200-plus Chinese enterprises,” a CTW statement.  

FASTFACTS

  • More than 300 exhibitors will participate in the event, where over 4,000 Chinese products will be exhibited. The event which is expected to attract 2,000 visitors will also feature 12 seminars.  
  • During the event, China will exhibit various growing trends in the construction sector which include the usage of sustainable building materials to the adoption of advanced construction techniques.  
  • The event will also exhibit machinery and hard tools that can be used in the construction sector to increase the efficiency of operations.  
  • The Kingdom exported goods worth SR19 billion ($5.07 billion) in September. On the other hand, Saudi Arabia imported goods worth SR12.3 billion from China in September.  
  • In November, the Saudi Central Bank, also known as SAMA, and the People’s Bank of China signed a local currency swap agreement worth SR26 billion.  

It added: “This event stands out as a premier B2B (business to business) trading platform for professionals seeking to engage with distinguished Chinese manufacturers and suppliers.”  

According to the CTW website, more than 300 exhibitors will participate in the event, where over 4,000 Chinese products will be exhibited. The event which is expected to attract 2,000 visitors will also feature 12 seminars.  

During the event, China will exhibit various growing trends in the construction sector which include the usage of sustainable building materials to the adoption of advanced construction techniques.  

The event will also exhibit machinery and hard tools that can be used in the construction sector to increase the efficiency of operations.  

In the interior design sector, the exhibition will showcase the latest trends in furniture, lighting and decor. 

During the exhibition, Chinese companies will also show emerging trends in the HVAC sector, as the world sails toward a sustainable future.  

“As climate control becomes increasingly important in modern buildings, the HVAC sector will offer a glimpse into the future of heating, ventilation, and air conditioning solutions,” the statement added.  

It said: “This event provides an exclusive opportunity for 200 Chinese construction and building companies looking to expand their footprint in Saudi Arabia. By participating in CTW Saudi Arabia 2023, they can establish connections with a wide network of local businesses, fostering valuable partnerships to penetrate the Saudi market.” 


Growing ties
Trade and economic relationship between Saudi Arabia and China has always been strong, as the Kingdom exported goods worth SR19 billion ($5.07 billion) in September. On the other hand, Saudi Arabia imported goods worth SR12.3 billion from China in September.  

The total volume of trade between Saudi Arabia and China hit $120 billion in 2022, registering a 30 percent increase over 2021. 

Speaking at an event on Saturday, vice chairman of the Saudi-Chinese Business Council, Anas Al-Fadda said: “China represents 21 percent of the Kingdom’s trade, focusing primarily on sectors like infrastructure, petrochemicals and manufacturing.”

In November, the Saudi Central Bank, also known as SAMA, and the People’s Bank of China signed a local currency swap agreement worth SR26 billion.  

In a press statement, SAMA said that the three-year agreement “has been established in the context of financial cooperation between the Saudi Central Bank and the People’s Bank of China.” 

On the other hand, the People’s Bank of China said that the agreement will help strengthen financial cooperation between Saudi Arabia and China, promote the use of local currencies, and strengthen trade and investments between the countries.
Currency swap agreements are financial contracts between two nations to exchange a predetermined amount of one currency for an equivalent value in another currency. 

In December 2022, Chinese President Xi Jinping visited Saudi Arabia, during which both countries signed a Comprehensive Strategic Partnership Agreement, committing to support each other’s core interests, sovereignty and territorial integrity, and to defend the principle of non-interference in the internal affairs of states. 

Xi’s meeting with Saudi Arabia’s King Salman, Crown Prince Mohammed bin Salman, and top Saudi ministers, resulted in the signing of 35 memorandums of understanding and deals worth $30 billion. 

Building a shared future

In June, Saudi Arabia also hosted the Arab-China Business Conference under the theme “Collaborating for prosperity.”  

During the conference, Saudi Foreign Minister Prince Faisal bin Farhan said that such events provide an opportunity to consolidate the historical Arab-China friendship, build a shared future that will benefit both sides and promote peace and development in the world. 

Saudi Energy Minister Prince Abdulaziz bin Salman said that the Kingdom seeks collaboration with the world’s second-largest economy instead of competition. 

Prince Abdulaziz emphasized there are synergies between the two countries, as the Kingdom is progressing steadily with its Vision 2030 plan, while China is pursuing its Belt and Road Initiative. 

In September this year, Saudi Arabia and China signed a memorandum of understanding to exchange expertise in modern transport systems, including high-tech methods to enhance roads, build autonomous vehicles, and improve shipping and the running of ports. 

In the same month, Saudi Arabia was officially granted Approved Destination Status by China, allowing Chinese citizens to travel to the Kingdom on group tours, a pivotal step in boosting tourism in the Kingdom.  

The agreement is expected to boost connectivity between countries and open opportunities across the tourism sector. 

In October 2023, Saudi Arabia’s Literature, Publishing, and Translation Commission also partnered with China’s National Press and Publishing Administration to promote literary translation. 

Under this deal, both nations will work together to strengthen cultural ties, enhance content exchange and reinforce literary cooperation. 


Saudi Arabia accelerates automotive sector localization: NCID official  

Saudi Arabia accelerates automotive sector localization: NCID official  
Updated 21 April 2024
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Saudi Arabia accelerates automotive sector localization: NCID official  

Saudi Arabia accelerates automotive sector localization: NCID official  

RIYADH: Saudi Arabia’s automotive sector localization is poised to receive a boost as the government aims to achieve its Vision 2030 targets, according to a senior official. 

At the Saudi-American Business Council seminar, Aftab Ahmed, senior advisor to the Kingdom’s National Center for Industrial Development in the automotive sector, underscored the rapid transition toward domestic production of passenger vehicles and parts. 

He stated that this effort aligns with the ambitious objectives outlined in the National Industrial Strategy under Saudi Vision 2030, the Saudi Press Agency reported.  

The council, in collaboration with the NCID, recently hosted a virtual seminar on the future of the Kingdom’s automotive sector.  

Over 100 industry leaders from Saudi Arabia and the US convened to discuss various aspects of the sector, including government initiatives, investment standards, and operational experiences within the Kingdom. 

The event facilitated the exchange of insights and opportunities in this rapidly evolving field. 


Saudi Arabia offers 3rd round of ‘Sah’ savings products with 5.59% return 

Saudi Arabia offers 3rd round of ‘Sah’ savings products with 5.59% return 
Updated 21 April 2024
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Saudi Arabia offers 3rd round of ‘Sah’ savings products with 5.59% return 

Saudi Arabia offers 3rd round of ‘Sah’ savings products with 5.59% return 

RIYADH: Saudi Arabia has opened its third round of the subscription-based savings product, Sah, for April, offering a 5.59 percent return, encouraging financial stability and growth among citizens. 

The Shariah-compliant, government-backed sukuk commenced on April 21 and is scheduled to continue until April 23, with redemption amounts set to be paid within a year, as disclosed by the National Debt Management Center in a release on X. 

Organized by the NDMC and issued by the Ministry of Finance, these fee-free saving products offer low-risk returns and are distributed through digital channels of various approved financial institutions. 


Global growth rate slows to 2.6% in 2024 amid uneven recovery: UNCTAD

Global growth rate slows to 2.6% in 2024 amid uneven recovery: UNCTAD
Updated 21 April 2024
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Global growth rate slows to 2.6% in 2024 amid uneven recovery: UNCTAD

Global growth rate slows to 2.6% in 2024 amid uneven recovery: UNCTAD

RIYADH: Global economic growth is anticipated to slow to 2.6 percent in 2024, with the UN Trade and Development agency highlighting an uneven post-pandemic financial recovery among countries. 

In its latest report, UNCTAD revealed that the prevailing focus on inflation, which is overshadowing other critical issues like trade disruptions, climate change, and rising inequalities, is driving the economic slowdown in various countries. 

The study also noted that Saudi Arabia’s economy is expected to increase by 2.7 percent in 2024, down 0.2 percent compared to its previous projection.  

In Asia, China’s economy is projected to grow 5 percent in 2024, while India’s output will expand by 6 percent, driven by substantial public investment and service sector growth. 

On the other hand, several European countries are expected to face an economic slowdown in 2024, with France, Germany, and Italy expected to grow at a moderate rate of 1.3 percent, 0.9 percent, and 0.8 percent, respectively. 

In North America, development remains relatively resilient, even though challenges continue. The US economy is projected to grow at 2 percent in 2024, reflecting concerns over high household debt levels, UNCTAD added. 

In South America, the economic growth is slowing, with Brazil expected to develop at 2.1 percent, hampered by external pressures and commodity dependence, while Argentina faces a 3.7 percent contraction due to inflation and complex debt negotiations. 

Additionally, the African economy will grow by 3 percent this year, with armed conflicts and climate impacts posing significant risks to several continental nations.  

The report also added that inequality in the labor market continues to rise post-pandemic, with workers in both developed and developing countries earning a reduced share of income. 

“This indicates that the benefits of economic growth are increasingly reaped by capital owners rather than by workers, widening wage and wealth gaps,” UNCTAD said.  

Earlier this month, the International Monetary Fund revealed that global economic growth, estimated at 3.2 percent in 2023, is projected to continue at the same pace in 2024 and 2025.  

IMF added that global headline inflation is forecasted to slip to 5.9 percent this year after 2023’s 6.8 percent average.  

However, the IMF warned that it is still too early to declare victory in the fight against inflation.


IMF concerned about debt, fiscal challenges facing low-income countries 

IMF concerned about debt, fiscal challenges facing low-income countries 
Updated 21 April 2024
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IMF concerned about debt, fiscal challenges facing low-income countries 

IMF concerned about debt, fiscal challenges facing low-income countries 

WASHINGTON: Shareholders of the International Monetary Fund agreed this week on the importance of addressing challenges faced by low-income countries, many of which are facing unsustainable debt burdens, IMF Managing Director Kristalina Georgieva said on Friday. 

Multiple reports from the IMF and the World Bank this week sounded the alarm about economic developments and prospects in low-income developing countries, which are still grappling with the aftermath of the COVID-19 pandemic and other shocks. 

The IMF lowered its 2024 growth forecast for low-income countries as a group to 4.7 percent from an estimate of 4.9 percent in January. In a separate report, the World Bank said half of the world’s 75 poorest countries were experiencing a widening income gap with the wealthiest economies for the first time this century in a historical reversal of development. 

Georgieva said the IMF was working to reinforce its ability to support low-income countries hit hardest by recent shocks, including through a 50 percent quota share increase and by adding resources to its Poverty Reduction and Growth Trust. 

Georgieva and Saudi Arabia’s Finance Minister Mohammed Al-Jadaan, who chairs the IMF’s steering committee, both said internal reforms adopted by the IMF this week should help make the debt restructuring process speedier and smoother. 

Georgieva said a meeting of the Global Sovereign Debt Roundtable hosted by the IMF and the World Bank this week had made progress on setting timelines for debt restructurings and ensuring comparability of treatment for various creditors. 

She said high debt levels posed a huge burden for low-income countries, including many in Sub-Saharan Africa, where countries are now facing debt service payments of 12 percent on average, compared to 5 percent a decade ago. High interest rates in advanced economies have lured away investments, and raised the cost of borrowing. 

“What is heartbreaking is that in some countries debt payments are up to 20 percent of revenues,” Georgieva said, adding that this meant those countries had far fewer resources to invest in education, health, infrastructure and jobs. 

Affected countries needed to increase their domestic revenues by raising taxes, continuing to fight inflation, paring back spending and developing local capital markets, she said. 

The Bulgarian economist said it was vital for these countries to make themselves more attractive to investors, and said the IMF was engaging with countries to help them do that. 

Iolanda Fresnillo, with the non-profit European Network on Debt and Development, said the UN should implement a new multilateral legal framework to deal with sovereign debt, in a similar way that is currently being done for a new framework to govern tax cooperation. 

The current approach is too piecemeal and a broader framework should take into account climate change, environmental degradation and human rights, she said. 

US Treasury Undersecretary Jay Shambaugh raised concerns about the situation facing low-income countries last week, warning China and other emerging official creditors against free-riding by curtailing loans to low-income countries just as the IMF or multilateral development banks were pouring funds in. 

Almost 40 countries saw external public debt outflows in 2022, and the flows likely worsened in 2023, he said.


Saudi Arabia leading region’s transformative journey 

Saudi Arabia leading region’s transformative journey 
Updated 20 April 2024
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Saudi Arabia leading region’s transformative journey 

Saudi Arabia leading region’s transformative journey 
  • SVC makes significant strides in shaping private investment landscape

CAIRO: A wave of venture capital funding has washed over the Middle East and North Africa region, prompting transformative change in the entrepreneurial landscape.

Saudi Arabia’s government is leading the shift through a subsidiary of the SME Bank, part of the National Development Fund.  

The Kingdom’s Saudi Venture Capital has made significant strides in shaping the private investment landscape, deploying finance across 40 investment funds and over 700 startups and small and medium-sized enterprises.  

This was highlighted in the latest Impact Report issued by SVC, which detailed its contributions since its inception in 2018. 

The document revealed that SVC’s total investments have reached SR2.6 billion ($693.1 million), with the overall impact of these, including partner commitments, estimated at around SR13.6 billion.  

These investments span various sectors critical to economic diversification, such as e-commerce, fintech, healthcare, educational technologies, transportation, and logistics. 

“SVC plays a crucial part in stimulating the private VC investment to sustain and foster the steady growth of the VC ecosystem in the Kingdom,” Nabeel Koshak, CEO of SVC, said.  

“SVC’s strategy, since its inception in 2018, contributed to increasing the number of investors in Saudi startups, encouraging existing and new financial companies to establish VC funds, and motivating regional and global funds to invest in Saudi startups,” Koshak stated. 

“Accordingly, the funding deployed into Saudi Arabian startups grew 21 times to a record-high of $1.4 billion in 2023 versus $65 million in 2018, the year SVC was launched,” he added. 

Significantly, SVC’s strategic initiatives have positioned Saudi Arabia as a leader in venture investments within the MENA for the first time in 2023.  

This milestone reflects the broader economic and financial sector evolution under Saudi Vision 2030, aimed at enhancing the national economy. 

Saudi Arabia’s Penny Software closes undisclosed pre-series A round 

Closing its pre-series A funding round, Saudi Arabia’s Penny Software raised an undisclosed sum from Iliad Partners, joined by GSI and US-based Knollwood Investments, alongside existing investors such as Dallah Investment, Hambro Perks Oryx Fund, Class 5 Global, Altuwajiri family fund, and strategic angel investors.  

Founded in 2020 by Iyad Al-Dalooj, Majid Al-Dalooj, and Mohamad Ibrahim, Penny Software is a business to business Software-as-a-Service procurement startup that digitizes the entire source-to-pay process, thereby enhancing spend efficiency, governance, and compliance. 

“This investment from Iliad Partners, alongside the continued support from our existing and new investors, represents a significant vote of confidence in Penny Software’s vision and our team’s ability to execute,” Iyad Al-Dalooj, the CEO, said. 

“We are excited to leverage this partnership to scale our operations, enhance our product offering, and solidify our position as a leader in the procurement software industry. The future of procurement is here, and Penny Software is at the forefront of this transformation,” he added. 

This new capital infusion is poised to fuel Penny’s ambitions for regional and global expansion.  

This follows a successful $5 million seed funding round in 2021, led by Outliers Venture Capital with participation from Wamda, Shorooq Partners, Hambro Perks ORYX Fund, Class 5 Global, and strategic angel investors.  

Penny Software aims to leverage this investment to further enhance its platform capabilities and broaden its market reach, reinforcing its position in the competitive SaaS industry. 

The company claims that it is set to manage a gross transaction value of over $1 billion this year, and ease procurement for thousands of companies globally. 

“Saudi Arabia is an economy that is undergoing a major transformation in which technology is playing a key role. This is our first investment in the Kingdom, and we plan to invest a significant portion of our fund in this market, supporting strong founders on their journey from the pre-series A stage and onwards,” Christos Mastoras, founder and managing partner of Iliad Partners, stated   

UAE’s DocsInBox closes $500k in a funding round 

UAE’s e-invoicing and procurement startup DocsInBox closed a $500,000 funding round from angel investors to boost its presence. 

Founded by serial entrepreneurs Leonid Dovbenko and Stanislav Seleznev,  DocsInBox significantly streamlines invoicing and procurement processes, saving up to 1 million hours each month, the company claimed.  

The platform enables purchasing agents to place orders in just three clicks, while accountants can complete tasks in 13 seconds that previously took 300 seconds.  

By automating procurement, DocsInBox reduces manual labor by 15 percent, operational costs by 5 percent, and food costs by 8 percent.  

UAE’s U-topia secures $850k in funding round 

UAE-based Web3 services provider U-topia has secured $850,000 in funding from GDA Capital. 

Established in 2021 by Jérémy Mahieu and Nicolas Prévost, U-topia operates as a Web3 entertainment company that merges global intellectual property licensing in GameFi, artificial intelligence music, and video entertainment supported by non-fungible token provenance.  

The newly acquired investment is earmarked for the development of advanced features and technologies on the U-topia platform, aiming to enhance its offerings in the dynamic Web3 landscape. 

Nigeria’s VC firm Verod-Kepple Africa Ventures closes $60m fund 

Nigeria-based VC firm Verod-Kepple Africa Ventures has concluded a final close of $60 million for its pan-African VC fund, led by existing investors and new investors, including SCM Capital from Nigeria and institutional investors from Japan, including Taiyo Holdings and C2C Global Education Japan. 

Formed in 2021 as a joint venture between Kepple Africa Ventures and Verod Holdings, VKAV is led by partners Satoshi Shinada, Ryosuke Yamawaki, and Ory Okolloh. 

The fund aims to bridge the funding gap for African startups, especially for companies moving to series A and B stages. 

Egypt’s VC firm Beltone teams up with UAE’s CI Venture to manage a $30m fund 

Egypt’s Beltone Venture Capital, under Beltone Holding, has teamed up with CI Venture Capital from UAE’s Citadel International Holdings to manage a $30 million fund aimed at nurturing fast-growing startups.  

This collaborative fund is set to invest in pre-seed and seed funding rounds of innovative tech startups across the MENA region while also continuing to support standout performers within its existing portfolio. 

In recent months, the fund has actively begun deploying capital, finalizing investments in several startups, including Bosta, Trella, Qlub, and ariika.