Turkiye’s lira bonds set to yield promising returns, central bank governor says

Turkiye’s lira bonds set to yield promising returns, central bank governor says
Turkish Central Bank Gov. Hafize Gaye Erkan indicated that while the stringent monetary policies have started to influence consumer prices, she does not anticipate inflation dropping to single digits until at least 2026. AFP
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Updated 17 December 2023
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Turkiye’s lira bonds set to yield promising returns, central bank governor says

Turkiye’s lira bonds set to yield promising returns, central bank governor says

RIYADH: Turkiye is urging foreign investors to consider government bonds that offer yields in Turkish lira as the country approaches the end of its tightening monetary cycle, according to the central bank’s chief. 

Turkish Central Bank Gov. Hafize Gaye Erkan stated that the country is currently approaching economic stability and Turkish lira bonds will yield significant returns, Bloomberg reported, citing Erkan’s interview with Turkish daily newspaper Hurriyet. 

“At this time next year, we will be in a more moderate environment in terms of inflation and monetary tightening. I advise foreign investors to seize the opportunity now, as the yields will be lower after this time,” she said. 

She indicated that while the stringent monetary policies have started to influence consumer prices, she does not anticipate inflation dropping to single digits until at least 2026. 

Following Erkan’s appointment in June, the central bank has implemented a substantial interest rate hike, raising rates by over 30 percentage points to 40 percent. 

This announcement comes after a decade where foreign investors largely sidestepped lira-denominated bonds in response to a series of unconventional economic strategies deployed by Ankara aimed at curbing the short selling of the lira. 

Highlighting a positive development, the governor pointed out the recent uptick in interest from foreign investors, especially from the US, in Turkish government bonds over the last month. 

However, Erkan expressed a preference for direct investments over swap contracts, noting their limited impact on the country’s reserves. 

Erkan’s comments come in the backdrop of the Monetary Policy Committee’s announcement last month, suggesting a slowdown and imminent end to the ongoing monetary tightening cycle. 

She noted a decrease in the price hikes across various sectors, including automotive, electronics, and furniture. However, she acknowledged that more time is needed to see similar trends in transportation and food. 

Erkan also touched upon the persistently high inflation in sectors like education and housing. She highlighted the supply shortages impacting the housing market’s pricing dynamics and shared her personal experience with Istanbul’s increased rental costs. 

As of the end of November, Turkiye’s annual inflation rate stood at 62 percent, with the apex bank projecting it to climb to 65 percent by the year’s end and then fall to 36 percent by the end of the following year. 


Saudis spent more money on electronic devices during the 4th week of May: SAMA data

Saudis spent more money on electronic devices during the 4th week of May: SAMA data
Updated 28 May 2024
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Saudis spent more money on electronic devices during the 4th week of May: SAMA data

Saudis spent more money on electronic devices during the 4th week of May: SAMA data

RIYADH: Saudi Arabia’s point-of-sale spending reached SR11.2 billion ($2.98 billion) in the fourth week of May, official figures showed.

The latest data from the Saudi Central Bank, also known as SAMA, revealed that spending on electronic and electric devices surged by 9.5 percent to reach SR240.4 million.

Beverages and food, which accounts for the largest share at 14.9 percent, saw a 5.9 percent decline, reaching SR1.66 billion, during the week from May 19 to 25.

Meanwhile, transactions at restaurants and cafes, holding a 14.6 percent share, recorded a slower decline of 4.8 percent, amounting to SR1.64 billion. 

Saudi spending on miscellaneous goods and services, including personal care items, supplies, maintenance, and cleaning, constituted the third-highest share and witnessed a 5.1 percent decline that week, reaching SR1.36 billion. 

Despite composing only 1 percent of the week’s overall POS value, spending on education recorded a minimal increase of 0.1 percent to SR152.48 million.

In the past few years, this sector has been allocated the largest share of government expenditure in comparison to other divisions of the economy. 

Efforts are underway to revamp the education system, aiming to equip the national workforce with the necessary skills to thrive in a technological and information-centric global economy.

The hotel sector experienced the largest decline in POS transaction value, dropping 10.9 percent to SR227.13 million.

According to data from SAMA, 35.44 percent of POS spending occurred in Riyadh, with the total transaction value reaching SR3.97 billion. However, this represents a 1.6 percent decrease from the previous week.  

Riyadh has undergone considerable expansion, evolving into a pivotal center for growth and progress. The city is witnessing a surge in new businesses setting up operations, drawn by its vibrant economic landscape and strategic prospects for investment and innovation.

Spending in Jeddah followed closely, accounting for 14.3 percent of the total and reaching SR1.60 billion; however, it marked a 3.1 percent weekly drop. 

The two cities that registered the highest declines in POS spending were Makkah and Madinah, with decreases of 11 percent and 6.8 percent, respectively. The value of transactions in Makkah reached SR380.98 million, while in Madinah, it was SR393.26 million.


Saudi healthcare to advance with major digital tech partnership

Saudi healthcare to advance with major digital tech partnership
Updated 28 May 2024
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Saudi healthcare to advance with major digital tech partnership

Saudi healthcare to advance with major digital tech partnership

RIYADH: The Saudi healthcare system is set to advance as two of the country’s major companies partner to leverage digital technologies to enhance the Kingdom’s capabilities.

SAMI Advanced Electronics Co., a wholly owned subsidiary of SAMI, the nation’s defense and digital solutions provider, has signed a cooperation agreement with the National Unified Procurement Co., a Public Investment Fund company.

The agreement, signed on May 27, will provide solutions for medication tracking and IT infrastructure and increase local content through medical devices manufacturing and maintenance.

This partnership demonstrates SAMI-AEC’s unremitting efforts to build a harmonious and applicable healthcare system in Saudi Arabia based on digital technologies.

Ziad Al-Musallam, CEO of SAMI-AEC, commented on the agreement, saying that they are honored to collaborate with NUPCO, as this deal underscores the unwavering commitment of both entities to bolstering efforts aimed at enhancing the healthcare ecosystem in Saudi Arabia.

“At SAMI-AEC, we firmly believe in the significance of augmenting public health services through digital solutions and delivering e-health services. This involves integrating effective, fast technologies to empower the healthcare sector, aligning with the objectives of Saudi Vision 2030,” he said.

Fahad Al-Shebel, CEO of NUPCO, highlighted the agreement’s importance and its role in fortifying the healthcare infrastructure and facilitating access to the integrated technology offered by SAMI-Advanced Electronics Co.

Aiming to upgrade the healthcare sector by improving its facilities in all public hospitals and medical centers in the Kingdom, NUPCO is the country’s largest central company providing medical purchasing, storage, and distribution services for medicines, devices, and supplies.

With a workforce of over 3,320 individuals, 85 percent of whom are Saudi nationals, SAMI-AEC has positioned itself as a leader in electronics, technology, engineering, and manufacturing. Its services span sectors such as defense and aerospace, digital, energy, and security.

Over 800 of the company’s employees are engineers and certified experts, reaffirming the dedication of SAMI-AEC, which was established in 1988, to excellence and innovation.

On the other hand, NUPCO was established in 2009 with SR1.5 billion in capital. It is the leading company in Saudi Arabia in procurement, logistics, and supply chain management for pharmaceuticals, medical devices, and supplies for governmental hospitals.


Closing Bell: Saudi main index continues downward trend to close at 11,660

Closing Bell: Saudi main index continues downward trend to close at 11,660
Updated 28 May 2024
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Closing Bell: Saudi main index continues downward trend to close at 11,660

Closing Bell: Saudi main index continues downward trend to close at 11,660

RIYADH: Saudi Arabia’s Tadawul All Share Index continued its downward movement for the third consecutive session this week, as it shed 171.28 points to close at 11,659.94 on Tuesday. 

The total trading turnover of the benchmark index was SR5.34 billion ($1.42 billion), with 23 stocks advancing and 202 declining. 

The Kingdom’s parallel market, Nomu, also slipped by 0.81 percent to 26,234.79, while the MSCI Tadawul Index shed 20.97 points to close at 1,449.44.

The best-performing stock on the main index was Sustained Infrastructure Holding Co. The firm’s share price soared by 6.2 percent to SR34.25.

Other top performers were the Mediterranean and Gulf Insurance and Reinsurance Co. and AYYAN Investment Co., whose share prices edged up by 3.98 percent and 3.63 percent respectively. 

The worst-performing stock on the benchmark index was Saudi utility giant ACWA Power, as its share price slid by 4.68 percent to SR456.60. 

On the announcements front, Etihad Atheeb Telecommunication Co. said that it was awarded two projects worth SR45.51 million by Technical and Vocational Training Corp. to provide dedicated Internet services in 77 locations. 

In a Tadawul statement, the telecommunication provider said that the first project has a value of SR23.64 million, while the second one amounts to SR21.87 million. 

Meanwhile, Mouwasat Medical Services Co. announced that its shareholders have approved the board’s recommendation to distribute a 17.5 percent cash dividend, or SR 1.75 per share for 2023. 

In March, Mouwasat Medical Services Co. had revealed that its net profit witnessed a growth of 10 percent in 2023 to SR657.7 million, compared to the previous year. 

Al Moammar Information Systems Co., on Tuesday, revealed that it received new orders to increase the capacity of data centers at a total value of SR 75.2 million. 

In a statement to Tadawul, the company added that further developments of the order will be unveiled in due course. 


PIF’s Halal Products Development Co. invests in Singapore-based cosmetics firm

PIF’s Halal Products Development Co. invests in Singapore-based cosmetics firm
Updated 28 May 2024
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PIF’s Halal Products Development Co. invests in Singapore-based cosmetics firm

PIF’s Halal Products Development Co. invests in Singapore-based cosmetics firm

RIYADH: In a bid to localize the Kingdom’s cosmetics and personal care industry, the Halal Products Development Co. announced an investment in a Singapore-based fast-moving consumer goods conglomerate.

The Public Investment Fund-owned company signed a binding agreement with Believe — a company specializing in the halal cosmetics and personal care field.

As per the agreement, the company will relocate its headquarters from Singapore to Saudi Arabia and establish a factory to manufacture its products, the Saudi Press Agency reported.

The new headquarters will also serve as a major center for exporting the company’s products to various countries of the world.

This move is in line with the PIF-owned firm’s goal to strengthen the halal industries in Saudi Arabia and provide high-quality products compatible with Islamic standards.

Halal Products Development Co. CEO Fahad Al-Nuhait said that investing in this sector is a very important first step that serves as a major catalyst for developing and localizing the manufacturing of halal cosmetics and personal care.

In return, this is expected to raise the efficiency of the sector and support research as well as development efforts to improve the services provided locally and globally, Al-Nuhait added.

The CEO said it will also facilitate the transfer of the expertise and resources to the Kingdom.

Moreover, it will also contribute to achieving the goals of the Kingdom’s Vision 2030 by creating direct and indirect job opportunities.

Believe CEO Ankit Mahajan said this partnership represents a strategic opportunity to expand the scope of investment and boost manufacturing capabilities.  

The agreement will also provide contract manufacturing services for local brands in the initial stage and will expand to international brands in the future.

In August, Halal Products Development Co. signed a strategic cooperation agreement with the Saudi Exports Development Authority to launch the Halal Products Manufacturing Accelerator Program.

According to a statement, the new program came amid the Kingdom’s efforts to become a global hub for halal food products and accelerate the growth of the sector.


TVM Capital Healthcare launches $250m fund for Saudi medical firms

TVM Capital Healthcare launches $250m fund for Saudi medical firms
Updated 28 May 2024
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TVM Capital Healthcare launches $250m fund for Saudi medical firms

TVM Capital Healthcare launches $250m fund for Saudi medical firms

RIYADH: Saudi medical companies stand to benefit as private equity firm TVM Capital Healthcare unveils its second pool of funding valued at $250 million for the Middle East. 

Since 2009, the international growth capital investment fund has operated in the Middle East, expanding to Southeast Asia in 2021. 

The launch of the new fund builds on the firm’s past successes in the region, delivering compelling returns and showcasing its expertise in sourcing deals and nurturing the growth of sustainable enterprises, according to a press release. 

Bandr Al-Homaly, managing director and CEO of Jada Fund of Funds, said that the closing of the deal marks an important milestone in mobilizing private capital into Saudi Arabia’s healthcare sector. 

“We are pleased to lead the investment, providing capital to support the development of the sector in line with Vision 2030,” he said. 

TVM Capital focuses on addressing medical needs through strategic investments in entrepreneurial ventures. 

These efforts bring about lasting positive impacts in local communities and offer significant returns for investors, it said. 

The firm said it has built a reputation as an international fund manager involved in financing and overseeing major medical companies within the Kingdom. 

The company also invests in healthcare growth deals in Europe and the US to support these firms’ expansion plans for Saudi Arabia and the wider Gulf Cooperation Council. 

With this two-pronged strategy, TVM Capital aims to bolster the Saudi economy and enhance the region’s access to cutting-edge products, technologies, and services.

Chairman and CEO Helmut M. Schuehsler expressed pride in attracting a notable consortium of institutional and family investment groups from Saudi Arabia, other GCC countries, and Europe. They are investing in a specialized capital pool dedicated to domestic companies in the Kingdom and international firms entering the market.

 “We are uniquely positioned for success because our leadership team comprises executives with long-standing expertise in Europe and the US, who have built excellent international networks throughout their careers, alongside local Saudi healthcare experts,” he said. 

The chairman noted that their investment journey in the GCC and Egypt spans over 13 years, with a specific focus on Saudi Arabia since 2015 through their previous portfolio companies, ProVita International Medical Center and Cambridge International Medical Center. 

“Today, we are truly excited about our ability to enhance the local and regional healthcare ecosystem at a much larger scale, helping to improve access to high-quality patient care, medical products, and treatment regimens across the Kingdom,” Schuehsler said. 

Among the initial investments of the fund are Baraya Extended Care, a chain of long-term, post-acute care and rehabilitation clinics based in Riyadh; and DEBx Medical, a developer and manufacturer of innovative products for chronic wound treatment based in Amsterdam, which is set to enter the Saudi market. Additionally, neurocare group, a provider of personalized mental health services and products headquartered in Munich, with clinics in the US, the Netherlands, and Australia, is gearing up to enter Saudi Arabia and the GCC. 

According to the statement, additional deals encompass longevity and genomics, oncology and pharmaceuticals, as well as manufacturing and diagnostics. 

TVM Capital operates offices in Riyadh, Dubai, Singapore, and Ho Chi Minh City, with supporting offices in Munich and Boston. 

The multinational law firm Morgan Lewis represented the firm in the fundraiser.