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World Bank raises Saudi Arabia’s 2025 GDP growth forecast to 5.9%

Overall, the MENA region is expected to achieve a growth rate of 2.7 percent in 2024, which aligns with pre-COVID levels but still trails the global average.  
Overall, the MENA region is expected to achieve a growth rate of 2.7 percent in 2024, which aligns with pre-COVID levels but still trails the global average.  
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Updated 15 April 2024
Arab News
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World Bank raises Saudi Arabia’s 2025 GDP growth forecast to 5.9%

World Bank raises Saudi Arabia’s 2025 GDP growth forecast to 5.9%
Updated 15 April 2024
Arab News
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RIYADH: The World Bank has raised its expectations for Saudi Arabia’s economic growth to 5.9 percent in 2025 from 4.2 percent predicted earlier in January.

In its latest report the bank, however, revised its 2024 forecast for the Kingdom’s gross domestic product growth downward to 2.5 percent from an earlier forecast of 4.1 percent.

Concurrently, the overall GDP growth forecast for Gulf Cooperation Council countries in 2024 has been reduced to 2.8 percent, down from 3.6 percent, while the 2025 forecast has been revised to 4.7 percent from 3.8 percent.  

The report also adjusted the UAE’s GDP growth forecast to 3.9 percent for 2024, up from the previously projected 3.7 percent, with a further rise to 4.1 percent in 2025, from 3.8 percent. 

Kuwait’s economy is expected to expand by 2.8 percent in 2024 and increase further to 3.1 percent in 2025.  

Similarly, Bahrain’s economy is likely to grow by 3.5 percent in 2024 and 3.3 percent in 2025, marking an increase from January’s projections. 

Meanwhile, Qatar’s economy saw a downward revision for its 2024 forecast from 2.5 percent to 2.1 percent but an upward revision for 2025 from 3.1 percent to 3.2 percent. 

Oman’s economy projections for 2024 and 2025 saw a marginal increase of 0.1 percent since the January forecast. 

This adjustment reflects the broader economic trends where the surge in oil prices following Russia’s invasion of Ukraine in 2022 bolstered oil-exporting economies in the Middle East and North Africa.  

In contrast, economic growth in non-oil-exporting nations — including MENA oil importers like Djibouti, Jordan, Morocco, Tunisia, and the West Bank and Gaza — has slowed. 

By 2024, the growth disparity between GCC oil exporters and developing oil importers is expected to narrow to just 0.9 percentage points, marking a significant shift from 2022 when GCC countries grew 5.6 percentage points faster, the report stated.  

“Developing oil exporters will grow 2.8 percent in 2024, down from 3.1 percent in 2023 while growth in developing oil importers is forecasted to decrease to 2.5 percent in 2024, down from 3.1 percent in 2023,” the report stated. 

Overall, the MENA region is expected to achieve a growth rate of 2.7 percent in 2024, which aligns with pre-COVID levels but still trails the global average.  

While other emerging markets and developing economies are also projected to remain below pre-pandemic growth rates, they are expected to surpass the MENA region by 1.2 percentage points in 2024.  

Topics: Saudi Arabia GCC World Bank Forecast GDP

Oil Updates — prices pause gains after surging on Libyan outages, Middle East tension

Oil Updates — prices pause gains after surging on Libyan outages, Middle East tension
Updated 6 sec ago
Reuters
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Oil Updates — prices pause gains after surging on Libyan outages, Middle East tension

Oil Updates — prices pause gains after surging on Libyan outages, Middle East tension
  • Brent crude futures was up 3 cents at $81.46 a barrel
  • US West Texas Intermediate crude futures dropped 6 cents to $77.36 a barrel
Updated 6 sec ago
Reuters

BEIJING: Oil prices paused recent advances to trade in a range on Tuesday, after a surge of more than 7 percent in the previous three sessions, on supply concerns prompted by fears of a wider Middle East conflict and the potential shutdown of Libyan oil fields, according to Reuters.
Brent crude futures was up 3 cents at $81.46 a barrel by 09:30 a.m. Saudi time, while US West Texas Intermediate crude futures dropped 6 cents to $77.36 a barrel.
“Losses in oil prices may seem contained in today’s session, which suggests prices taking a breather following a sharp rally over the past few days,” said Yeap Jun Rong, market strategist at IG.
“With the jump in oil prices pricing for geopolitical risks in the Middle East and a production halt in Libya, market participants are now in some wait-and-see to assess further developments.”
The rise of the previous three sessions was driven by expectations of US interest rate cuts that could boost fuel demand, military assaults between Israel and Hezbollah in Lebanon over the weekend that threaten a wider Middle East conflict, disrupting supply from the key producing region and the risk of Libyan closures.
Over that period, WTI gained 7.6 percent and Brent gained 7 percent.
Oilfields in eastern Libya responsible for almost all its production will be closed and production and exports halted, the eastern-based administration said on Monday, after a flare-up in tension over the leadership of the central bank.
There was no confirmation from the internationally recognized government in Tripoli or from the National Oil Corp, which controls the country’s oil resources.
The political dispute could affect almost all of the 1.17 million barrels per day of output from the North African country, based on data from the latest Reuters survey of production by the Organization of Petroleum Exporting Countries in July.
While bearish demand sentiment could weigh on oil prices, with Chinese demand having an outsized impact, the potential closure of Libya’s oil fields would tighten supply and brake declining oil prices, said Vortexa analyst Serena Huang.
“Other oil producers would be rejoicing at the higher oil prices, and may not necessarily bring in additional supply immediately.”
Oil has also been supported by the escalation of the conflict between Israel and Hezbollah, with a major exchange of missiles between them as Hezbollah attempts to retaliate for the killing of a senior commander last month.
“Markets remain on edge as skirmishes between Israel and Hezbollah intensify,” ANZ analysts said in a note.
A top US general said on Monday the danger of a broader war had eased somewhat but that an Iran strike on Israel remained a risk.

Topics: Oil energy Oil Updates  Oil market oil prices Brent crude

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Saudi Arabia’s pharma, medical device factories surge to 206 with $2.6bn investments

Saudi Arabia’s pharma, medical device factories surge to 206 with $2.6bn investments
Updated 26 August 2024
Nour El-Shaeri
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Saudi Arabia’s pharma, medical device factories surge to 206 with $2.6bn investments

Saudi Arabia’s pharma, medical device factories surge to 206 with $2.6bn investments
Updated 26 August 2024
Nour El-Shaeri

RIYADH: The number of pharmaceutical and medical device factories in Saudi Arabia has reached 206, with investments totaling SR10 billion ($2.6 billion), according to official data.

The Ministry of Industry and Mineral Resources reported that this growth includes 56 pharmaceutical factories licensed by the Saudi Food and Drug Authority, with investments in the pharmaceutical sector alone exceeding SR7 billion.

The medical device sector in Saudi Arabia has seen notable advancements. Globally, this market is valued at $500 billion, with Saudi Arabia's share estimated at $6.6 billion.

The Kingdom now boasts 150 licensed medical device factories, representing a 200 percent increase since 2018. Investments in this sector have reached SR3.1 billion, with notable achievements including the production of advanced respiratory devices, insulin syringes, and specialized surgical instruments.

This expansion aligns with the ministry’s broader efforts to localize the pharmaceutical industry and reduce reliance on imports.

Globally, the pharmaceutical market is valued at approximately $1.1 trillion, with the Middle East and Africa accounting for $31 billion of this total.

Saudi Arabia, the largest pharmaceutical market in the region, holds a $10 billion share, representing 32 percent of the market.

Between 2019 and 2023, the Saudi pharmaceutical market grew by 25 percent, rising from $8 billion to $10 billion annually.

This growth highlights a successful push toward localization, with the Kingdom reducing its dependence on pharmaceutical imports from 80 percent in 2019 to 70 percent by 2023.

In June 2022, the ministry announced over SR11 billion in new investment opportunities in the vaccine and biopharmaceutical sectors, aligning with the Kingdom’s strategic goals of enhancing health security and establishing Saudi Arabia as a hub for pharmaceutical and biopharmaceutical production.

Government initiatives, such as the “Made in Saudi” program, have also been instrumental in this expansion by promoting local products on international platforms.

The ministry has focused on enhancing value chains by fostering collaborations in research and development and securing essential raw materials locally.

The Kingdom aims to localize 80-90 percent of its government procurement needs for insulin and vaccines while also attracting foreign investments in the pharmaceutical and healthcare sectors.

Saudi Arabia’s industrial sector demonstrated notable resilience during the COVID-19 pandemic. The ministry quickly ramped up domestic production capacity for essential medical supplies, increasing the daily output of medical masks from 450,000 to 3 million.

In just three months, the number of hand sanitizer factories grew from 12 to 70. These efforts highlight the Kingdom's ability to respond effectively to global supply chain disruptions and further solidify its growing prominence in the pharmaceutical and medical device industries.

Topics: main

Closing Bell: TASI edges down to close at 12,261 

Closing Bell: TASI edges down to close at 12,261 
Updated 26 August 2024
Nour El Shaeri
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Closing Bell: TASI edges down to close at 12,261 

Closing Bell: TASI edges down to close at 12,261 
Updated 26 August 2024
Nour El Shaeri

RIYADH: Saudi Arabia’s Tadawul All Share Index closed at 12,261.18 points on Monday, losing 1.46 points, or 0.01 percent.     

MSCI Tadawul 30 Index lost 0.40 points or 0.03 percent to finish at 1,536.44.     

The parallel market, Nomu, also fell 256.47 points, or 0.96 percent, to conclude the day at 26,433.91.     

The main index posted a trading value of SR9 billion ($2.4 billion), with 85 stocks advancing and 137 declining. On the other hand, Nomu has 26 gainers and 40 losers, reporting a trade volume of SR35.9 million.      

Al-Baha Investment and Development Co. was the top performer on TASI as its share price surged 8.33 percent to SR0.13. Saudi Real Estate Co. also jumped 6.33 percent to SR22.86.     

Saudi Pharmaceutical Industries and Medical Appliances Corp. was also among the top gainers, climbing 4.99 percent to SR33.65. Al-Omran Industrial Trading Co. and Saudi Research and Media Group rose 4.49 percent and 3.48 percent to SR40.75 and SR261.40, respectively.    

Savola Group was the day’s worst performer, with its share price dipping 5.01 percent to SR25.60.   

Wafrah for Industry and Development Co. and Herfy Food Services Co. also performed poorly with their stocks dropping by 3.62 percent and 2.90 percent, to close at SR41.25 and SR26.80, respectively.   

Saudi Automotive Services Co. and Kingdom Holding Co. were also among the worst performers.   

Savola Group’s share price drop followed shareholder approval of a board recommendation to increase the company’s capital through a rights issue aimed at strengthening its financial position and supporting future investments.   

The capital increase will involve offering 600 million ordinary shares at SR10 per share, raising a total of SR6 billion. This move will more than double Savola’s capital from SR5.34 billion to SR11.34 billion, enabling the company to pay off debts and distribute shares in Almarai Co. to eligible shareholders.  

The rights issue will be available to shareholders registered at the close of trading on the day of the extraordinary general assembly meeting, with eligibility being finalized two days later.

This capital increase will result in a 112.36 percent rise in the company’s share count, expanding from 533.98 million shares to 1.13 billion shares. 

In a separate bourse filing, Rawasi Albina Investment Co. reported a SR9.4 million loss for the first half of the year. The company’s net profit saw a significant drop from SR15.1 million in the same period last year, primarily due to increased spending on project implementation and operational capacity. Revenue also decreased by 59.5 percent year on year to SR38 million, down from SR94.2 million. 

Mohammed Hasan AlNaqool Sons Co. also announced its financial results for the same period, witnessing a 55.7 percent growth in revenue.   

The company’s sales reached SR29,233 in the first half of the year, up from SR18,770 in the same period last year. This was mainly attributed to an increase in revenue from subsidiaries.   

Net profit also increased to SR1,201, up from a loss of SR652 last year. 

Topics: Finance

Qatar strikes another 15-year LNG supply deal with Kuwait 

Qatar strikes another 15-year LNG supply deal with Kuwait 
Updated 26 August 2024
Reuters
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Qatar strikes another 15-year LNG supply deal with Kuwait 

Qatar strikes another 15-year LNG supply deal with Kuwait 
  • Deliveries will start in January 2025
  • Kuwait imports the fuel to help meet rising demand for power generation
Updated 26 August 2024
Reuters

KUWAIT: Qatar agreed on Monday to supply Kuwait with 3 million tonnes per annum of liquefied natural gas for 15 years, the second such deal since 2020 as Kuwait imports the fuel to help meet rising demand for power generation. 

The chief executives of state-owned QatarEnergy and Kuwait Petroleum Corp. signed the long-term sales and purchase agreement for LNG in Kuwait. Deliveries will start in January 2025, KPC CEO Sheikh Nawaf Al-Sabah said. 

Reuters reported last week that QatarEnergy and KPC were in talks for the deal. 

Kuwait, an OPEC member and a major oil producer, has been boosting its reliance on imported gas to meet power demand, especially in the summer when consumption by air conditioning systems rises sharply. KPC also aims to ramp up its own gas output as part of a strategy that targets higher oil production capacity too. 

Last week, Kuwait faced a second round of scheduled power outages this summer due to a lapse in local gas supply, despite officials indicating there would be no more cuts after the first round in June. Summer temperatures regularly soar above 50 degrees Celsius or 122 degrees Fahrenheit. 

The deal will play “a pivotal role in electricity generation in Kuwait,” Sheikh Nawaf said. 

He declined to disclose the deal’s value, saying it was confidential. 

Qatar this year announced a further expansion of its North Field project that will cement it as one of the world’s top LNG exporters. The project will boost the North Field’s LNG output to 142 mtpa from 77 mtpa by 2030. 

The LNG from the new supply deal for Kuwait could be partly from the North Field expansion project and partly from Qatar’s existing output, said QatarEnergy CEO Saad Al-Kaabi, who is also Qatar’s state minister for energy. It will be delivered to Kuwait’s Al Zour port. 

Kuwait and Qatar agreed in 2020 a 15-year deal for the supply of 3 mtpa of LNG from 2022, which will overlap with the new deal. 

Topics: energy qatarenergy Kuwait LNG Qatar

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Saudi Arabia, Ethiopia form business council to boost economic ties

Saudi Arabia, Ethiopia form business council to boost economic ties
Updated 26 August 2024
MOHAMMED AL-KINANI
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Saudi Arabia, Ethiopia form business council to boost economic ties

Saudi Arabia, Ethiopia form business council to boost economic ties
  • Saudi-Ethiopian Business Council aims to enhance bilateral trade and investment opportunities
  • Council is expected to serve as a pivotal platform for supporting Saudi exports and targeting key sectors in Ethiopia
Updated 26 August 2024
MOHAMMED AL-KINANI

JEDDAH: Saudi Arabia and Ethiopia are set to strengthen their economic ties with the establishment of a new business council for the 2024-2028 term, the Federation of Saudi Chambers announced. 

The Saudi-Ethiopian Business Council, recently approved by the General Authority for Foreign Trade, aims to enhance trade and investment opportunities between the two nations.

Abdullah bin Mohammed Al-Ajmi will lead the council as president, with Omar bin Abdullah Al-Kharashi and Misfer bin Musaad Al-Shahrani serving as vice presidents, according to the Saudi Press Agency. 

The formation of the council aligns with Saudi Arabia’s strategy to deepen economic relations with Africa, particularly with Ethiopia, which is one of the continent’s largest economies with a gross domestic product of approximately $205 billion in 2022.

Despite the substantial economic potential, trade between Saudi Arabia and Ethiopia remains below SR1.3 billion ($346 million). Al-Ajmi emphasized that the council is poised to capitalize on this untapped potential by fostering stronger business partnerships between the two countries.

The council is expected to serve as a pivotal platform for supporting Saudi exports and targeting key sectors in Ethiopia. Al-Ajmi highlighted Ethiopia’s attractive investment environment and its strategic role as a trade hub for Central Africa. 

He noted that the council will focus on promising sectors such as agriculture, mining, petrochemicals, food industries, tourism, real estate, and construction.

The creation of the council follows an agreement announced nearly three months ago during the Saudi-Ethiopian Business Forum, held on June 5 in Addis Ababa. 

The ceremony was attended by Hassan bin Moejeb Al-Huwaizy, chairman of the Federation of Saudi Chambers, along with over 250 investors and several Ethiopian ministers, officials, and representatives from both the public and private sectors.

Al-Huwaizy described the establishment of the council as the result of ongoing efforts and a shared commitment to enhancing economic cooperation. 

He underscored that the council will provide a vital platform for Saudi and Ethiopian businesspeople to expand their activities and forge new partnerships, driving mutual growth and investment.

As both countries look to the future, the new business council is set to play a crucial role in unlocking significant economic opportunities, fostering bilateral trade, and creating a more integrated economic landscape between Saudi Arabia and Ethiopia.

Topics: main Saudi Arabia Ethiopia

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