Kingdom approves formation of new joint Saudi-foreign business councils

Kingdom approves formation of new joint Saudi-foreign business councils
Saudi Arabia is boosting its foreign trade in line with Vision 2030. Shutterstock
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Updated 11 July 2024
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Kingdom approves formation of new joint Saudi-foreign business councils

Kingdom approves formation of new joint Saudi-foreign business councils

RIYADH: Saudi Arabia’s foreign trade with countries such as Canada, Nigeria, and Indonesia is set to improve following the approval of the formation of several joint business councils.  

Mohammed bin Nasser Al-Duleim has been approved as chairman of the Saudi-Canadian Business Council and chairman of the executive committee by the General Authority for Foreign Trade, with Abdullah bin Salem Al-Mukhles and Abdullah bin Ahmed Al-Ahmad as vice-presidents, according to a statement.    

This falls in line with the recent development of relations between the two countries and their eagerness to explore ways to enhance developments in various fields.   

In 2022, Saudi Arabia was Canada’s most important two-way trading partner in the Middle East and North Africa region and 23rd globally.  

Merchandise trade between the two countries in 2022 was approximately $5.1 billion, with $1.3 billion in exports from Canada and $3.8 billion in imports to the country.  

The statement further disclosed that the council also approved the nomination of Sultan bin Mahdi Al-Qahtani as chairman of the Saudi-Nigerian Business Council and chairman of the executive committee with Nasser bin Abdulaziz Al-Sudaisand Sultan bin Khalid Al-Turki as vice-chairmen.  

This aligns well with the business and diplomacy initiatives created between the two sides to help trade between them blossom.   

This comes as relations between the two countries are already strong, with Nigeria being one of the first countries to extend its support in the Kingdom’s bid to host the 2030 World Expo.  

According to the online data visualization and distribution platform Observatory of Economic Complexity, in 2022, Nigeria exported $5.94 million to Saudi Arabia, while the Kingdom exported $293 million to the African country.

Additionally, the nomination of Ayman bin Amin Sajini was approved as chairman of the Saudi-Indonesian Business Council and chairman of the executive committee, with Osama bin Abdullah Qoqandi and Saleh bin Abdullah Al-Qabaa appointed as vice-chairmen.

This comes as Saudi-Indonesian ties span centuries but have gained momentum in recent years following King Salman’s visit to Indonesia in 2017, which has since sparked more bilateral exchanges at the political and business levels.    

Riyadh and Jakarta established the Saudi-Indonesia Supreme Coordinating Council headed by Crown Prince Mohammed bin Salman and President Joko Widodo during the latter’s visit to the Saudi capital in 2023. 

The OEC also revealed that in 2022, Indonesia exported $1.97 billion to Saudi Arabia, while the Kingdom exported $2.77 billion to Indonesia.


Oil Updates – crude regains ground on political uncertainty in US, Mideast

Oil Updates – crude regains ground on political uncertainty in US, Mideast
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Oil Updates – crude regains ground on political uncertainty in US, Mideast

Oil Updates – crude regains ground on political uncertainty in US, Mideast

SINGAPORE: Oil regained ground on Monday, with political uncertainty in the US and the Middle East supporting prices, offsetting downward pressure from a stronger dollar and weak demand in top importer China, according to Reuters.

Brent crude futures rose 15 cents, or 0.2 percent, to $85.18 a barrel by 7:25 a.m. Saudi time after settling down 37 cents on Friday. US West Texas Intermediate crude stood at $82.41 a barrel, up 20 cents, or 0.2 percent.

Oil prices shrugged off the impact from the dollar, which firmed after a failed assassination bid on US presidential candidate Donald Trump.

“I don’t think you can ignore the uncertainty that the weekend’s assassination attempt will cast across a deeply divided country in the lead-up to the election,” said IG market analyst Tony Sycamore.

In the Middle East, talks on ending the Gaza conflict between Israel and Hamas halted on Saturday after three days, though a Hamas official said the following day it had not withdrawn from discussions.

However, an Israeli attack targeting the group’s military leader killed 90 people on Saturday.

The uncertainty around the volatile situation has kept the geopolitical premium in oil elevated.

Oil markets are also broadly underpinned by supply cuts from OPEC+ with Iraq’s oil ministry saying it will compensate for any overproduction since the beginning of 2024.

Last week, Brent fell more than 1.7 percent after four weeks of gains while WTI futures slid 1.1 percent as a fall in China’s crude imports, the world’s top importer, countered robust summer consumption in the US.

“While fundamentals are still supportive, there are growing demand concerns, largely emanating from China,” ING analysts led by Warren Patterson said in a note.

China’s crude oil imports fell 2.3 percent in the first half of this year to 11.05 million barrels a day, amid disappointing fuel demand and as independent refiners cut output due to weak profit margins.

Crude throughput at Chinese refineries fell 3.7 percent in June from a year earlier to 14.19 million bpd, the year’s lowest so far, customs data showed on Monday.

China’s economy slowed in the second quarter as a protracted property downturn and job insecurity weighed on domestic demand, keeping alive expectations Beijing will need to unleash more stimulus.

In the US, active oil rig count, an early indicator of future output, fell by one to 478 last week, the lowest since December 2021, energy services firm Baker Hughes said on Friday.


New SAMA platform Naqd to facilitate easier account access for agencies 

New SAMA platform Naqd to facilitate easier account access for agencies 
Updated 14 July 2024
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New SAMA platform Naqd to facilitate easier account access for agencies 

New SAMA platform Naqd to facilitate easier account access for agencies 

RIYADH: A new digital platform will allow government agencies to access their accounts in the Saudi Central Bank easily and conveniently. 

The central bank, also known as SAMA, has announced the launch of Naqd, a platform for government banking services. The service is designed to provide government entities with easy and secure access to their accounts at the central bank and to conduct financial transactions through a trusted digital platform. 

The initiative is part of SAMA’s strategy to offer banking outlets to government entities and support digital transformation. 

The central bank is fostering digitalization across the spectrum with the launch of several initiatives. 

In May, SAMA announced the launch of a new undertaking — “View My Bank Accounts” — for individual bank account holders. The service enhances reliability and reduces the risk of suspicious transactions, unauthorized account use, and impersonation.  

The Naqd platform aims to digitize financial transaction services for government entities, providing a unified and secure platform. 

It facilitates round-the-clock access to account information, account management and real-time monitoring of transactions conducted from and to government accounts. 

The platform is intended to deliver electronic banking services that support government financial transactions, enhance user experience, and increase efficiency and productivity in financial dealings using the latest technologies.

Additionally, it aims to reduce the time required to execute government banking procedures. 


Saudi environment minister launches financial support program to propel fisheries sector

Saudi environment minister launches financial support program to propel fisheries sector
Updated 14 July 2024
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Saudi environment minister launches financial support program to propel fisheries sector

Saudi environment minister launches financial support program to propel fisheries sector

RIYADH: Saudi Arabia’s fisheries sector is set to receive a boost thanks to a new direct financial support program launched by the Kingdom’s minister of environment, water and agriculture.

Abdulrahman Al-Fadhli will oversee the financial support for the Reef Saudi program, which aims to open new horizons for the development of the fisheries sector and stimulate the industry, according to a statement. 

The Sustainable Agricultural Rural Development Program, or Reef Saudi, seeks to improve the rural agricultural sector to raise the standard of living of small farmers and rural families, increase efficiency and productivity, and improve lifestyle and food security.

This move falls in line with the objectives of the Kingdom’s Vision 2030, as the program is an important step toward achieving several strategic goals, including strengthening the nation’s local economy.  

It also aligns well with Saudi Arabia’s Ministry of Environment, Water, and Agriculture’s continuous efforts over the past years to boost the fisheries sector, including establishing a national program to protect fish stocks and the industry as a whole, the provision of concessional loans to assist small-scale fishermen with the purchase of boats, and initiatives to modernize ports in the Red Sea and Arabian Gulf.

Moreover, the program requires that fisherman wishing to obtain support must have a fishing license, in either the Saudi artisan category or Saudi sailor category. 

The fisherman should also not be an employee in the public or private sector, be no younger than 18 years old, and be based within the Kingdom during the period, in addition to the duration of each fishing trip being no less than six hours.

Earlier this month, Saudi Arabia highlighted its role in leading and unifying international efforts to develop the fisheries sector during its presidency of a special UN committee dedicated to the industry. 

This came during the conclusion of the 36th session of the body, which was held at the headquarters of the Food and Agriculture Organization in Rome and was chaired by the Kingdom’s permanent representative to the FAO, Mohammed Al-Ghamdi.

During the meeting, Saudi Arabia reviewed its most prominent efforts to promote and develop the fisheries sector and achieve its sustainability during its two-year presidency, the Saudi Press Agency reported at the time.


Closing Bell: Saudi main index rose to close at 11,881

Closing Bell: Saudi main index rose to close at 11,881
Updated 14 July 2024
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Closing Bell: Saudi main index rose to close at 11,881

Closing Bell: Saudi main index rose to close at 11,881

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Sunday, gaining 89.14 points, or 0.76 percent, to close at 11,881.55.

The total trading turnover of the benchmark index was SR6.36 billion ($1.69 billion) as 154 of the stocks advanced, while 68 retreated.  

On the other hand, the Kingdom’s parallel market Nomu slipped 79.18 points, or 0.31 percent, to close at 25,696.86. This comes as 34 of the listed stocks advanced while 36 retreated. 

Meanwhile, the MSCI Tadawul Index gained 15.65 points, or 1.06 percent, to close at 1 1,488.02.

The best-performing stock of the day was Miahona Co. The company’s share price surged 9.96 percent to SR37.00.

Other top performers include MBC Group Co. as well as Al Taiseer Group Talco Industrial Co.

The worst performer was Al-Rajhi Co. for Cooperative Insurance, whose share price dropped by 7.27 percent to SR209.20. 

Other worst performers were Saudi Advanced Industries Co. as well as Arabian Pipes Co.

On the announcements front, ADES Holding Co. has announced that it has amended its existing syndicated facility, securing an additional equivalent to $3 billion, with the majority of existing lenders participating along with new, leading local and regional financial institutions.

According to a Tadawul statement, the new upsized financing is divided into the equivalent of a $2.7 billion standby term tranche to finance the group’s expansion plans and an additional $300 million revolving credit facility tranche to be applied toward the general corporate purposes of the company.

While the financing duration of the standby term tranche is eight and a half years, with a final maturity in December 2032, that of the RCF tranche is eight years, with a final maturity in June 2032. 

The financing entities include Saudi Awwal Bank, Riyadh Bank, Al Rajhi Banking and Investment Corp., and Arab National Bank, as well as the Saudi National Bank, Alinma Bank, Banque Saudi Fransi, and Aljazira Bank. Arab Petroleum Investments Corp. and Commercial Bank of Dubai PSC are also included.

The bourse filing also revealed that the guarantees offered for the financing entail mortgages over offshore rigs, share mortgages or pledges over entities that hold onshore or offshore rigs as applicable, and security over the collection accounts and debt service accrual account. 

They also include assignment of receivables under client contracts, assignment of receivables under insurance contracts in respect of financed rigs as well as promissory notes.


Saudi Arabia and Thailand strengthen economic ties with new investment office in Riyadh

Saudi Arabia and Thailand strengthen economic ties with new investment office in Riyadh
Updated 14 July 2024
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Saudi Arabia and Thailand strengthen economic ties with new investment office in Riyadh

Saudi Arabia and Thailand strengthen economic ties with new investment office in Riyadh

RIYADH: Saudi Arabia is set to enhance private sector cooperation with Thailand as the Southeast Asian nation opens its first Board of Investment office in Riyadh, a top official announced. 

On the sidelines of a business forum in the Saudi capital, Minister of Investment Khalid Al-Falih highlighted that this marks Thailand’s inaugural office in the Middle East, encouraging stronger bonds and new investment opportunities in both countries. 

This came as the minister lauded the steady trade relations, that saw business soar to $8.8 billion in 2023, up from $7.5 billion following the nations’ restored ties in 2022. This represents nearly 22 percent of Thailand’s total trade with the Middle East, underscoring a flourishing economic partnership. 

 

 

Addressing the business delegation at the Saudi-Thailand Investment Forum, Al-Falih said: “Representative offices from the Kingdom of Saudi Arabia and your country will do a great deal of facilitating private sector to private sector cooperation and allowing us to reach the potential that I mentioned.”  

He added: “I believe it will continue to grow at double digits as it has been the last couple of years. In investment, we’ve also seen growth, although from very small numbers, with FDI (foreign direct investment) stock doubling since 2019 in the Kingdom of Saudi Arabia.”  

The minister added that travel and tourism are returning to previous levels, with close to 200,000 tourists and visitors traveling from Saudi Arabia to Thailand. He also noted that over 30,000 Thai visitors had come to the Kingdom the previous year to experience Saudi Arabia. 

The Thailand BOI office will cover a total of 13 countries in the Middle East, including Bahrain, Qatar, Kuwait, Turkiye, and the UAE. 

The Riyadh headquarters is Thailand BOI’s 17th overseas office, with two additional locations in China and Singapore set to be added soon.  

“We hope investors from Saudi Arabia and the Middle East will consider making Thailand an investment base to expand business in ASEAN (Association of Southeast Asian Nations) and take advantage of Thailand’s membership in the RCEP (Regional Comprehensive Economic Partnership) agreement, the world’s largest free trade area,” said Narit Therdsteerasukdi, secretary-general of the Thailand BOI. 

He added: “We believe there is a strong potential for investment and cooperation in several key sectors, including agriculture, processed food, renewable energy, healthcare and medical services, as well as automotive, especially electric vehicles.” 

Additionally, Al-Falih explained that the Thailand BOI office will boost areas of cooperation between both countries in several areas. 

“Before I do that, let me assure you — and this is not just me, not our Ministry of Investment, not the government, but the entire Saudi Arabia — we are very bullish on Thailand and indeed very impressed with your achievements,” the minister said.  

He continued: “Your GDP (gross domestic product) per capita has tripled in 20 years, while your export structure has evolved significantly into increasingly sophisticated products in the same time frame.” 

Furthermore, the minister recognized Thailand as one of the founding members of ASEAN, a significant economic alliance that holds importance not only in Asia but globally. 

Due to Thailand’s strategic location and economic strength — the second-largest economy in ASEAN with a GDP exceeding half a trillion dollars — it is a crucial partner for Saudi Arabia.  

“Especially as you are bolstered by ASEAN free trade agreements with most major economies, as you outlined to me this morning. These agreements include big economies in East Asia, as well as South Asian economies. Of course, anchored by India,” Al-Faih said. 

The minister stressed common parallels between the two countries, noting they share a “great deal of complementarity.” Thailand has its National Strategy 2037, whereas Saudi Arabia has its Vision 2030. 

“Which naturally leads me to emphasize the energy sector, including its multifaceted branches downstream: biofuels, biochemicals and CCUS (carbon capture utilization and storage), hydrogen, and renewables,” he said. 

Al-Falih added: “This is obviously an area where we share common ambitions, and the Kingdom has unique capability, creating numerous investment opportunities for both countries in terms of supply chain products as well as project development.” 

Saudi Arabia’s demand for agricultural and food processing products is expected to reach over $130 billion by 2030, with a compound annual growth rate of 7.5 percent.  

Meanwhile, Thailand’s agricultural and food processing sectors were robust in 2022, with exports totaling $45 billion. 

“This presents a huge area of complementary that would boost trade and investment as well as enhance food security in both nations,” Al-Falih underscored. 

Moreover, during the event’s opening speech, Thailand’s Minister of Foreign Affairs, Maris Sangiampongsa, underscored the robust private sector collaboration between both countries, noting the success of the International Mega Fair organized by the Thai Chamber of Commerce in Saudi Arabia. 

This event featured over 30 Thai businesses showcasing 1,000 products from 200 brands, significantly boosting Thailand’s presence in Saudi Arabia. 

Looking ahead, Sangiampongsa announced the upcoming International Mega Fair 2024 in Riyadh, scheduled for November. This event aims to promote trade across diverse sectors, such as construction materials, hospitality, and defense technology. 

The minister expressed confidence in Thai investment representatives’ readiness to strengthen cooperation with their Saudi counterparts, building on the momentum of past successes.  

“As both our nations are located strategically at the crossroads of continents, we recognize that connectivity and efficiency are part and parcel of any feasible development strategy,” Sangiampongsa stated. 

He continued: “That is why, as part of our plan, Thailand launched our flagship Landbridge Project, which will connect the Gulf of Thailand with the Andaman Sea and the Indian Ocean. This bold initiative will reduce commuting time and costs by 15 percent.” 

The forum saw the signing of 11 memoranda of understanding between Thai and Saudi companies, covering cooperation in areas including energy, infrastructure, engineering, agriculture, and forestation. 

The event also featured bilateral meetings and discussions between private sector representatives, which reviewed developments in the investment environment in Saudi Arabia and Thailand. 

Additionally, Saudi Assistant Minister of Investment Ibrahim Al-Mubarak met with Therdsteerasukdi to discuss ways of cooperation and developments in the work of the Saudi-Thai Coordination Council. 

Further, a meeting was held between Saad Al-Khalb, CEO of Saudi EXIM, and Senior Executive Vice President of Export-Import Bank of Thailand Benjarong Suwankiri, discussing areas of cooperation aimed at enabling promising investment opportunities. 

In 2023, Thailand’s applications for investment promotion surged to a nine-year peak of 848.3 billion baht (approximately $24 billion), marking a 43 percent increase from the previous year. 

This growth was driven by significant foreign direct investments primarily in five key sectors outlined in the BOI’s new Investment Promotion Strategy: green industries, automotive (including electric vehicles), and semiconductors. Additionally, investments in advanced electronics, digital and creative industries, and international business centers contributed significantly.  

These sectors accounted for more than half of the total investment pledges. Leading sources of investment included China, Japan, Singapore, and the US.