HR development, technology are pillars of success: Aramco official 

 Saleh M. Saleh, Aramco’s vice president of the characterization and field development geosciences, speaks at a panel on Thursday.
Saleh Saleh, Aramco’s vice president of the characterization and field development geosciences, speaks at a panel on Thursday.
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Updated 11 January 2024

HR development, technology are pillars of success: Aramco official 

HR development, technology are pillars of success: Aramco official 

RIYADH: People’s development and leading in technology serve as pillars of success for a center of excellence, according to a Saudi Aramco official. 

Speaking in a panel discussion titled “Regional centers of excellence: investing in capacity building. Key focus areas” on the second day of the Future Minerals Forum taking place in Riyadh, the oil giant’s vice president of the characterization and field development geosciences, Saleh M. Saleh, explained how the two factors contributed to Saudi Aramco’s success. 

This falls in line with the company’s vision of maximizing income, facilitating the sustainable and diversified expansion of the Kingdom’s economy, and enabling a globally competitive and vibrant energy sector. 

“These are two capabilities that were very successful for us and we think they will be, of course, certainly adding value to build on,” Saleh said. 

With regard to people’s development, the official said: “Saudi Aramco has invested a lot in ensuring that we have a skillful (and) competent workforce and one of the most rewarding programs in the company’s history was really the ‘Hire to Retire.’” 

He went on to explain that the program takes the best students in high school and sponsors them through local and global universities and then continues once they are back to receiving focused training to accelerate their development. 

With regard to technology, Saleh disclosed: “Last year, we celebrated the granting of more than 1,000 patents, as the largest number in our company history but also for any energy company.” 

Also speaking during the same panel discussion, the director general at the Geological Survey of Finland, Kimmo Tiilikainen, shed light on what needs to be done to expand the mineral sector and exploration. 

“If we need to expand the mineral sector and exploration, it means that we need more professionals; so, we need to increase the education of geosciences around the region,” he stressed. 

Tiilikainen added: “It’s not only the number of professionals, we also need to raise the skill level to use modern technologies and the methods that data science offers today so that we can deliver more information and more data useful for the investors.”  

Moreover, during the same discussion, Juan Carlos Jobet, visiting fellow of the Center on Global Energy Policy at the Columbia University School of International and Public Affairs, also clarified why mining firms should not operate in isolation.  

“Mining companies tend to operate in isolation, not coordinating their efforts very much and I think when we talk about innovation and technology development, operating in isolation is not very efficient,” he underlined. 

The Future Minerals Forum is not just a platform for discussion but a beacon for global cooperation in the production of critical minerals essential for transforming the energy sector.  

Key discussions during the two-day event are expected to revolve around the potential of the major mineral-rich super region, with government representatives and officials from multilateral organizations like the UN and the World Bank, alongside trade and business associations, exchanging ideas and experiences.  

IoT revolutionizes Saudi agriculture toward sustainability and prosperity

IoT revolutionizes Saudi agriculture toward sustainability and prosperity
Updated 4 sec ago

IoT revolutionizes Saudi agriculture toward sustainability and prosperity

IoT revolutionizes Saudi agriculture toward sustainability and prosperity
  • Transformative approach promises to revolutionize traditional agricultural practices

RIYADH: In Saudi Arabia’s vast agricultural terrain, a transformative shift is occurring, driven by the adoption of advanced technologies.

Despite challenges such as water scarcity, inefficient practices, and climatic hardships, integrating Internet of Things technologies in farming is bringing a sense of optimism.

This transformative approach promises to revolutionize traditional agricultural practices and offer a path toward a more resilient and prosperous future for Saudi farmers. 

In an interview with Arab News, economist and policy adviser Mahmoud Khairy said that improving productivity, resource efficiency, and sustainability in the farming sector are key factors driving the adoption of IoT applications in the Kingdom.

“These technologies enable farmers to monitor and manage their crops and livestock more effectively, leading to better yields and reduced costs,” he said.

Phil Webster, partner at the management consulting firm Arthur D. Little, told Arab News: “There has been significant uptake of these relatively nascent technologies compared to, say, five years ago.”

As the nation embraces IoT solutions, it embarks on a journey toward sustainable agriculture, where productivity, efficiency, and environmental stewardship converge to create a brighter future.

Transforming agricultural practices

The application of IoT in smart farming is revolutionizing traditional agricultural practices. Farmers can gather real-time data on various parameters crucial for crop growth by utilizing sensors, actuators, and connected devices. 

Soil moisture, temperature, humidity, livestock health, and crop growth data are collected and analyzed to make informed decisions. This data-driven approach enables farmers to optimize resource usage, improve crop yields, and minimize environmental impact.

Mishkat, a company specializing in sustainable and high-production farming, has highlighted its initiatives, such as vertical farming and impressive greenhouse facilities, which showcase the immense potential of IoT technologies in overcoming challenges.

The company aims to produce nutritious, authentic, and trusted food with minimal environmental impact, prioritizing sustainability, safety, and health.

“We want to be the leading experts in KSA on sustainable and high production farming techniques, delivering high- quality produce with maximum resource efficiency,” Mishkat says.

The firm’s unique fusion of vertical farming with greenhouse cultivation offers a sustainable solution to local pesticide-free and water-efficient production.

Nestled on the outskirts of Jeddah, Mishkat’s agricultural facility combines vertical farming with advanced greenhouse technology to offer a sustainable solution to local pesticide-free and water-efficient production.

This unique fusion of techniques presents a compelling vision for the future of agriculture in arid regions. Their facility includes a vertical farm where crops are grown in stacked layers.

This design, reminiscent of a multi-tiered tower, is more than just visually striking – it’s a smart solution to land scarcity. 

These technologies enable farmers to monitor and manage their crops and livestock more effectively, leading to better yields and reduced costs.

Mahmoud Khairy, economist and policy adviser

Complementing the vertical farm, Mishkat boasts two state-of-the-art greenhouses. These structures, armed with advanced climate control systems, provide an optimal environment for plant growth.

By modulating factors like temperature, humidity, and light, greenhouses ensure that the crops inside are shielded from the harsh climatic conditions typical of the Jeddah outskirts.

Mishkat’s headquarters is unique for several reasons: it is among the first commercial vertical farms in the Kingdom, offers rare greenhouse and vertical hybrid agricultural facilities, and is one of the few certified organically controlled environment farms globally.

In Riyadh, Bather Farm is also redefining urban farming with its cutting-edge vertical farming system.

By leveraging Agritecture Designer farm planning software and iFarm technology, Bather Farm optimizes crop production in an otherwise arid environment.

“At Bather Farm, we envision a greener and healthier Saudi Arabia, where agriculture gives to the people and planet more than it takes,” the firm says on its website.

This project underlines CEA’s potential to reinvent regional agriculture, paving the way toward food security and sustainability.

This melding of technology and agriculture underscores the potential for harmonizing urban living with sustainable farming practices.

E-farming boosting the economy

Economist and policy adviser Mahmoud Khairy emphasized the significance of adopting advanced agricultural solutions in Saudi Arabia.

Khairy highlighted that embracing IoT-enabled farming technologies and precision agriculture practices aligns with the nation’s broader economic and agricultural development objectives.

He added: “By embracing these technologies, the country aims to modernize its agricultural sector, create job opportunities, and reduce its dependency on food imports,” stressing that such advancements would bolster food security, diversify the economy, and minimize water usage in agriculture.

Moreover, Khairy pointed out that implementing data-driven approaches to optimize crop yields and resource efficiency could lead to several economic benefits.

By leveraging data analytics, farmers can make more informed decisions, resulting in increased productivity, higher revenues, and improved profitability. 

Partnerships and collaborations play a critical role in promoting the adoption and maintenance of digital technologies in agriculture.

Phil Webster, partner at Arthur D. Little

Khairy emphasized that compared to traditional methods, data-driven approaches offer a more precise and scientific way of managing agricultural operations. Therefore, they enhance productivity and resource efficiency while ensuring long-term economic viability and sustainability.

IoT-enabled farming technologies in Saudi Arabia’s agricultural sector play a crucial role in improving productivity and sustainability through precision monitoring and management, resource efficiency, and remote management, according to Khairy.

“These technologies, such as sensors and drones, provide real-time data on soil quality, crop health, and pest infestations, allowing farmers to make informed decisions on irrigation, fertilization, and pest control,” he explained.

Government support and collaboration

For IoT technologies to reach their full potential in Saudi agriculture, government support and collaboration are paramount.

Initiatives like the National Agricultural Development Co.’s AI solutions demonstrate the importance of leveraging technology for agricultural advancement.

By fostering collaboration among stakeholders and providing financial support, policymakers can facilitate the widespread adoption of IoT technologies.

Additionally, investment in research and development, infrastructure, and training programs is essential to equip farmers with the necessary skills and knowledge to embrace IoT solutions effectively.

Moreover, partnerships between government agencies, agricultural extension services, technology providers, and academic institutions can promote knowledge-sharing and innovation in the agricultural sector.

“Partnerships and collaborations play a critical role in promoting the adoption and maintenance of digital technologies in agriculture,” Arthur D. Little’s Webster emphasized.

He added: “The most important role of such collaborations is to ensure that there is good governance over the data that is collected at all parts of the food chain from farm to fork.” 

Webster explained that data governance is “clarity over how data – and any associated meta-data – is collected, in what form, and for use by whom (e.g., different parts of the agri-food supply chain, regulators, Government) and under what circumstances.”

He stressed the cruciality of such aspects in ensuring that business models involving the use and monetization of data work effectively.

Webster also called on farmers to take advantage of the Saudi government’s wide range of initiatives and programs to integrate digital technologies.

The General Authority for Statistics has recently launched the inventory survey of agricultural holdings in the Kingdom in order to provide essential data on plant and animal production, including cultivated areas and production quantities, as well as sales volumes, crop values, and livestock numbers at the regional level.

Commenting on the survey, Khairy said: “With this data, policymakers, researchers, and agricultural stakeholders can identify areas for improvement, pinpoint specific challenges faced by farmers, and tailor agriculture solutions to address the unique needs of different regions.”

As Saudi Arabia faces the challenges of water scarcity, climate change, and food security, embracing IoT technologies becomes imperative.

The integration of IoT in agriculture offers a pathway to overcome these challenges, enhance productivity, and promote sustainable farming practices.

Through collaboration, innovation, and government support, Saudi farmers can embark on a journey toward a more resilient and prosperous agricultural future.

“Owing to both demand and investment – as well as the increasing availability of IoT-enabled farming technologies – this future trajectory will no doubt continue,” Webster said.

He suggested that the nation could soon achieve self-sufficiency or become a net exporter, particularly in products like eggs.

Webster envisioned a revolution in agricultural supply chains, emphasizing a transition to alternative proteins with great potential in semi or fully-automated indoor farming, which promises heightened productivity and reduced production costs.

Khairy said that Saudi Arabia’s adoption of advanced farming technologies is “poised to make significant contributions to global food security and environmental conservation efforts.”

He added that through the incorporation of sustainable agricultural practices, farmers in the Kingdom can increase productivity while minimizing environmental impact.

“This not only ensures food security domestically but also allows Saudi Arabia to potentially become a key player in international food supply chains,” Khairy explained.

UAE’s Epik Foods nears its Saudi growth phase

UAE’s Epik Foods nears its Saudi growth phase
Updated 6 min 6 sec ago

UAE’s Epik Foods nears its Saudi growth phase

UAE’s Epik Foods nears its Saudi growth phase
  • UAE firm has an ambitious vision for its influence in the Saudi market

CAIRO: Saudi Arabia’s food and beverage sector is attracting interest from new businesses at home and abroad, and startup Epik Foods is one of those eying significant expansion in the burgeoning market.

Founded in 2017, the company now operates over 100 brands and 50 locations across the UAE, Saudi Arabia, and Oman. 

The UAE-based firm has emerged as a dynamic and multifaceted F&B group, operating virtual brands, dine-in restaurant concepts, meal plan services, and catering services. 

In an interview with Arab News, Epik Foods CEO and co-founder Khaled Fadly shared the company’s strategy for acquiring a 20 percent share of the Kingdom’s market.

A strategic Kingdom 

Epik Foods has outlined clear objectives for its operations in Saudi Arabia, with Fadly saying the company’s immediate goal is to lay the groundwork for sustained growth and success in the Kingdom.

“Through strategic initiatives, strong partnerships, and a relentless focus on quality and innovation, we aim to carve out a significant presence and become a household name synonymous with exceptional dining experiences,” he said. 

“We are committed to establishing a solid foundation that will support our long-term objectives and ensure our continued success in the region,” he added. 

Looking ahead, Epik Foods has an ambitious vision for its influence in the Saudi market.   

“We aspire to influence the sector by continually innovating, adapting, and setting industry standards,” Fadly said. 

The company’s goal is to exceed its customer expectations through culinary experiences, sustainable practices, and community engagement initiatives.  

“Over the next five years, we aim to capture at least 20 percent of the healthy fast-casual dining market share in major cities like Riyadh, Jeddah, and Dammam, while also expanding our virtual brand presence to cater to the growing online delivery segment. Through these efforts, we envision reshaping the landscape of the Saudi F&B market,” he said. 

Fadly elaborated on the company’s expansion strategy, stating that the expansion strategy in Saudi Arabia is multifaceted, focusing on establishing a strong presence, both physical and virtual.  

“Over the next two years, we plan to open 20 dine-in restaurants in key locations such as Riyadh, Jeddah, and Dhahran for our flagship brands,” he stated.  

“Additionally, we’re launching multiple virtual brands covering diverse cuisines, including Arabic, Indian, Asian, burgers, fried chicken, and desserts which will be available exclusively for delivery through platforms like Jayez and HungerStation,” he added. 

Furthermore, Epik Foods is establishing partnerships with prominent gym institutions to operate Healthy & Co. kiosks within their facilities.  

These kiosks will provide convenient and nutritious post-workout meals, catering to health-conscious individuals and expanding the company’s reach into new customer segments, Fadly explained. 

Fadly confirmed that his company is “actively seeking opportunities” to collaborate with Saudi governmental bodies, adding: “We aim to work closely with the Saudi Food and Drug Authority to ensure compliance with local regulations and standards. Additionally, we are eager to participate in initiatives like the Saudi Vision 2030’s Quality of Life Program, which aims to promote healthier lifestyles and dining options.” 

Through strategic initiatives, strong partnerships, and a relentless focus on quality and innovation, we aim to carve out a significant presence and become a household name synonymous with exceptional dining experiences.

Khaled Fadly, Epik Foods CEO and co-founder

Epik Foods has set ambitious growth objectives for the next year, aiming to open five new dine-in restaurants, achieve a 30 percent increase in online delivery sales, and secure partnerships with at least three major gym chains for its Healthy & Co. and Prep & Co. brands.  

“In the Saudi market, we aim to achieve significant milestones including a projected 60 percent increase in revenue, doubling our dine-in restaurant footprint, and establishing ourselves as a recognized leader in healthy dining options,” stated Fadly. 

Fadly also shared news about new products tailored for the Saudi market. “We’re excited to launch our Daily Meal Kits featuring pre-packaged meals inspired by both traditional Saudi cuisine and international favorites,” he said.  

“The Saudi market plays a pivotal role in Epik Foods’ expansion strategy for several reasons. With its large and growing population, strong economy, and increasing demand for diverse culinary experiences, Saudi Arabia presents a significant opportunity for growth,” Fadly stated. 

“By establishing a strong foothold in Saudi Arabia, we can leverage our success to further penetrate neighboring markets and enhance our international brand recognition and reputation. Thus, the Saudi market serves as a cornerstone in our strategic roadmap for sustainable expansion and long-term success,” he added.

“We prioritize maintaining open communication channels with relevant authorities, regularly updating our policies and procedures to align with new regulations, and investing in employee training and development to ensure awareness and compliance at all levels of our organization,” Fadly explained.  

Additionally, the company leverages technology to streamline regulatory processes and minimize compliance risks.  

“We actively participate in industry associations and forums to stay informed and contribute to shaping future regulations, demonstrating our commitment to responsible business practices and regulatory compliance in Saudi Arabia,” he added.

Business fundamentals  

“Throughout our journey within the Saudi Arabian market so far, we’ve encountered various challenges that demanded our attention and strategic maneuvering,” stated Fadly.  

These challenges include navigating the intricate regulatory framework, tailoring offerings to resonate with the distinct Saudi culinary palate, efficiently tackling logistical complexities in supply chain and workforce management, and carving a distinctive identity amidst a bustling landscape of local and global competitors.  

“To tackle these obstacles, we’ve embraced a holistic approach rooted in cultural insights, agile adaptability, and a commitment to delivering quality and innovation,” he added. 

“At Epik Foods, our business model is a fusion of various services tailored to meet the evolving needs of today’s consumers,” Fadly explained.  

The company operates a diverse portfolio comprising dine-in restaurants, innovative virtual brands, corporate catering services, personalized meal plans, and convenient meal kits.  

“While each avenue contributes to our revenue, the primary sources stem from our dynamic virtual brands and bustling dine-in restaurants,” he added. 

“We are proud to share that our company has achieved profitability at the country level,” Fadly revealed.  

“We are excited about this achievement and remain focused on further growth and success in the future,” he added. 

An Epik inception 

“The motivation behind founding our company stemmed from a desire to bring something new and innovative to the F&B market in Dubai,” Fadly recalled.  

In 2017, Fadly and his current co-founder Ranya Basyuni, both transitioning from corporate roles, identified a significant gap in the market, the absence of poke restaurants.  

This realization led to the opening of their first poke restaurant, marking the beginning of their journey in the F&B sector. 

The COVID-19 pandemic in 2020 presented unprecedented challenges, compelling Epik Foods to adapt its business model.  

“This period of adversity prompted us to pivot towards virtual brands, a strategy that not only allowed us to sustain our operations but also to explore new culinary avenues,” Fadly explained. 

The formation of Epik Foods was a strategic move to consolidate their ventures, merging the operations of Happy Platters Kitchen and Sweetheart Kitchen with KR&CO.  

“As we continue to evolve, we are looking forward to announcing the launch of Epik Catering, our catering service, to further expand our culinary footprint and cater to the diverse needs of our clientele,” he added. 

“At Epik Foods, we measure success through a multifaceted approach, relying on key performance indicators such as customer satisfaction scores, revenue growth, and the expansion of market share,” Fadly noted.  

The company is also committed to customer retention and operational excellence, which relies on prioritizing adaptability to local nuances and swiftly responding to evolving consumer preferences.  

“Our top metrics include an analysis of customer feedback and local market penetration,” he added. 

“We have raised a significant amount of funding, which we are strategically utilizing to expand our presence in Saudi Arabia,” Fadly shared.  

Specifically, these resources are being channeled towards opening more than 20 physical dine-in restaurants within the next two years.  

“This investment underscores our commitment to growth and delivering exceptional dining experiences to our valued customers,” he added. 

“Yes, we are actively exploring opportunities to secure additional funding to support our expansion plans,” Fadly confirmed.  

The focus is on enhancing infrastructure, scaling up operations, and entering new markets within Saudi Arabia.  

“Securing additional funds will enable us to accelerate our growth trajectory and better serve our customers in the region,” he said.  

He further shared the company’s current objectives that extend beyond financial metrics. 

“With Saudi Arabia’s vast population and diverse culture, we anticipate becoming integral to their lives and attracting even more customers,” he said. 

“The expansion potential in Saudi Arabia is immense, surpassing that of the UAE, and our success will serve as a regional springboard, enabling us to leverage synergies across neighboring countries,” Fadly elaborated.

Saudi PIF, French private equity group to acquire 38 percent of Heathrow airport

Saudi PIF, French private equity group to acquire 38 percent of Heathrow airport
Updated 15 June 2024

Saudi PIF, French private equity group to acquire 38 percent of Heathrow airport

Saudi PIF, French private equity group to acquire 38 percent of Heathrow airport
  • Ferrovial to remain as shareholder under revised deal for UK’s busiest hub

LONDON: Saudi Arabia’s sovereign wealth fund and a French private equity group will acquire a 38 percent stake in Britain’s busiest airport, Heathrow, officials announced on Friday.

Dutch-based transport company Ferrovial SE said the Public Investment Fund and Ardian had made a revised offer to acquire shares representing 37.62 percent of the share capital of FGP Topco, the parent company of Heathrow Airport Holdings Ltd, for more than £3.2 million ($4.1 million).

Under the new agreement, Ferrovial, which operates in more than 15 countries, will remain as a shareholder with shares representing 5.25 percent of the issued share capital of FGP Topco.

Following the sale, the Topco shareholders and Ferrovial will together hold shares “representing 10 percent of the issued share capital,” while PIF and Ardian will buy 22.6 percent and 15 percent respectively of FGP Topco through separate vehicles, Ferrovial said.

“The parties have been working toward satisfaction of the condition for the sale of the Tagged Shares to be sold alongside Ferrovial’s shares by exploring different options to satisfy the same,” the statement added.

The deal remains subject to regulators’ approval, Ferrovial said.

In November, Ferrovial had said it was planning to offload its stake, with PIF taking 10 percent and Ardian taking 15 percent, but the deal has been amended to allow FGP Topco shareholders to sell their shares on the same terms under so-called “tag-along rights.”

“Ardian is pleased to have worked closely with the parties to find this revised agreement and reiterates its strong commitment to investing in the UK,” the French company said in a separate statement.

The private investment house, which manages or advises $166 billion of assets on behalf of more than 1,600 clients globally, added that it “actively supports its assets to accelerate their transformation by leveraging data and new technologies to reduce emissions, creating new, more sustainable revenue sources, becoming more independent and resilient to external shocks, and improving their impact on both local and global environments.”

IMF heralds Saudi Arabia’s ‘unprecedented economic transformation’ in glowing report

IMF heralds Saudi Arabia’s ‘unprecedented economic transformation’ in glowing report
Updated 14 June 2024

IMF heralds Saudi Arabia’s ‘unprecedented economic transformation’ in glowing report

IMF heralds Saudi Arabia’s ‘unprecedented economic transformation’ in glowing report

RIYADH: Saudi Arabia’s “unprecedented economic transformation” is progressing well thanks to prudent government policies and successful diversification efforts, according to the International Monetary Fund.

In a report focusing on the changing economic landscape of the Kingdom, the organization highlighted growing domestic demand, ongoing financial reforms, and environmental policies as areas of strength.

The findings comes just days after the Organisation for Economic Co-operation and Development released figures showing that Saudi Arabia’s economy witnessed growth above the G20 average in the first three months of the year.

In a release to mark the the end of an official visit to the Kingdom by the IMF, the organization projected Saudi Arabia’s overall GDP growth will accelerate to around 4.5 percent in 2025 before stabilizing at 3.5 percent per year over the medium term.

It forecast non-oil growth to reach 3.5 percent in 2024 “before picking up in 2025 onwards.”

It added: “Oil output is projected to contract by 4.6 percent in 2024 but increase by 5.1 percent in 2025, reflecting an extension of oil production cuts in 2024 and a gradual recovery to 10 mbpd in 2025.”

Reflecting on the transformation policies undertaken by the Saudi government, the IMF noted that “Efforts to diversify the economy have started to bear fruit.”

The report added: “Building on these successes, it will be important to sustain the non-oil growth momentum, maintain financial sector stability, continue mitigating risks of overheating, reverse declining total factor productivity and ensure inter-generational equity.”

The IMF welcomed the “recent recalibration” of funding requirements associated with the Vision 2030 objectives, and also praised the Kingdom’s drive to become a haven for private sector development.

“Reforms to enhance Saudi Arabia’s business environment and attractiveness for foreign investment are progressing well,” said the IMF, noting that Saudi Arabia climbed 15 notches in the IMD’s World Competitiveness ranking in two years, obtaining the 17th position globally in 2023. 

“Ongoing work to boost human capital through the Human Capability Development program, further increases in female labor force participation, significant strides in digital transformation and AI preparedness, streamlining of fees and levies, promotion of access to land and finance, and stronger governance would further enhance private sector growth, help attract more FDI, and contribute to total factor productivity growth,” the report added.

The IMF described Saudi Arabia’s financial sector as being on a “strong footing,” noting that bank credit growth – mainly to the corporate sector – continues to surpass deposit growth and is expected to remain at around 10 percent in 2024. 

“The continued efforts by SAMA to modernize the regulatory and supervisory frameworks are key to safeguarding financial stability,” said the report, adding: “SAMA should continue using macroprudential tools to forestall possible risks stemming from a lending boom.”

The report also noted Saudi Arabia’s environmental initiatives, saying that the Kingdom “remains committed” to achieving net zero emissions by 2060. 

“The authorities continue to invest in renewable energy, energy efficiency, clean hydrogen, and carbon capture technologies,” said the IMF, adding: “Eliminating energy subsidies would incentivize energy conservation and improve returns on investment in renewable energies. Augmenting the active green finance portfolio—including through the implementation of the Green Finance framework announced in March 2024 and by an inaugural sovereign green bond issuance planned for this year—would be critical for mobilizing private capital.”

China approves first ETFs tracking Saudi equities, fund managers tell Reuters

China approves first ETFs tracking Saudi equities, fund managers tell Reuters
Updated 14 June 2024

China approves first ETFs tracking Saudi equities, fund managers tell Reuters

China approves first ETFs tracking Saudi equities, fund managers tell Reuters

SHANGHAI: China approved its first exchange-traded funds investing in Saudi Arabia equities on Friday, fund managers told Reuters, as Beijing expands ties with the Middle East amid rising tensions with the West.

The products, managed by China’s Huatai-Pinebridge Investments and Southern Asset Management separately, will track Hong Kong-listed CSOP Saudi Arabia ETF, which debuted in November by Hong Kong-based CSOP Asset Management, according to the two fund managers.

“The approval will further deepen the cooperation between Saudi and China in capital markets,” said Ding Chen, chief executive officer at CSOP.

The CSOP Saudi Arabia ETF, which tracks the performance of the FTSE Saudi Arabia Index, is down roughly 5 percent so far this year, compared with a 3 percent gain in China’s stock benchmark CSI 300 .

Reuters reported in August that China and Saudi Arabia’s stock exchanges were talking about allowing exchange-traded funds (ETFs) to list on each other’s bourses, as the countries look to deepen financial ties amid warming diplomatic relations.

Through the ETF, investors in China will be able to trade Saudi stocks including the oil giant Saudi Aramco and Saudi National Bank.

Beijing, frustrated by what it sees as Washington’s weaponization of economic policies, has sought to expand ties with countries in Europe, the Middle East and Africa. Its diplomatic push to court others include US ally Saudi Arabia.

Earlier this week, China’s securities regulator told Reuters that it welcomes foreign financial institutions and investors, including those from the Middle East, to expand investment in China.

The statement was made in response to a Reuters request seeking comment on news that Qatar’s sovereign wealth fund had agreed to buy a 10 percent stake in China Asset Management Co., the country’s second biggest mutual fund company.