Saudi inflation rate rises to 1.5% in July on higher housing costs

Saudi inflation rate rises to 1.5% in July on higher housing costs
According to data from the General Authority for Statistics, the 9.3 percent increase in the prices of housing, water, electricity, gas, and other fuels was the primary contributor to the inflation rate. Shutterstock
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Updated 18 August 2024
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Saudi inflation rate rises to 1.5% in July on higher housing costs

Saudi inflation rate rises to 1.5% in July on higher housing costs
  • The 9.3% increase in the prices of housing, water, electricity, gas and other fuels was the primary contributor to the inflation rate
  • Food and beverage prices saw a rise of 0.4% year on year in July

RIYADH: Saudi Arabia’s annual inflation rate climbed to 1.5 percent in July compared to the same period last year, driven largely by a surge in housing costs, official data showed. 

According to data from the General Authority for Statistics, the 9.3 percent increase in the prices of housing, water, electricity, gas, and other fuels was the primary contributor to the inflation rate.  

This category, which represents a significant portion of the consumer price index, played a crucial role in maintaining the overall inflation level. 

The authority further noted that food and beverage prices also saw a modest rise of 0.4 percent year on year in July, while transportation costs declined by 3.5 percent during the same period. 

This comes against the backdrop of Saudi Arabia’s resilient economy, which maintained an average annual inflation rate of 1.6 percent despite global economic challenges, as noted during a May meeting of the Council of Economic and Development Affairs. 

The Kingdom’s inflation rate continues to be one of the lowest in the region, reflecting the government’s proactive efforts to stabilize the economy and mitigate the impact of global price fluctuations. 

The GASTAT report further noted that housing costs, particularly actual rents, surged by 11.1 percent year on year in July, driven by a 12 percent increase in apartment rental prices. 

“The increase in this (housing) category had a significant impact on maintaining the annual inflation rate for July 2024, given the weight this group represents at 21 percent,” said GASTAT in the report.  

Additionally, the cost of dining out and hotel stays rose by 2.3 percent year on year, fueled by a 7 percent increase in accommodation service prices, the authority said.

According to the authority, prices for furnishings and home equipment fell by 3.4 percent in July, with furniture, carpets, and flooring costs decreasing by 5.6 percent. 

Clothing and footwear expenses dropped by 3 percent, with ready-made clothing prices declining by 5.5 percent. 

Monthly inflation 

GASTAT noted a 0.1 percent increase in inflation from June to July. This monthly rise was driven by a 0.1 percent increase in housing, water, electricity, gas, and other fuels, with a 1.2 percent rise in actual housing rents. 

Compared to June, prices for restaurants and hotels rose by 0.2 percent, and costs for furnishings, household equipment, and maintenance increased by 0.1 percent in July. Expenses for education and tobacco also went up by 0.2 percent and 0.1 percent, respectively. 

Conversely, prices for food and beverages declined by 0.3 percent, and transportation costs fell by 0.4 percent in July. 

Recreation and culture prices declined by 0.5 percent, and personal goods and services dropped by 0.3 percent. Clothing and footwear, along with health care products, saw a 0.1 percent month-on-month decrease. 

Wholesale Price Index 

The Kingdom’s Wholesale Price Index rose to 3.1 percent in July compared to the previous year. This increase was driven by a 15.7 percent rise in basic chemical prices and a 12 percent increase in refined petroleum products. Expenses for other transportable goods edged up by 8.3 percent. 

Food products, beverages, tobacco, and textiles saw a 0.9 percent increase, fueled by a 5.0 percent rise in leather, leather products, and footwear prices, and a 4.4 percent increase in grain mills, starch, and other food items. 

Conversely, ores and mineral prices decreased by 4.3 percent, while expenses for metal products, machinery, and equipment fell by 0.8 percent. 

“Agricultural and fishery products prices experienced a 0.2 percent year-on-year decrease in July, driven by a 0.4 percent decrease in live animals and animal products prices and a 0.1 percent slip in agricultural products prices,” said GASTAT in the report.  

On a monthly basis, Saudi Arabia’s WPI decreased by 0.1 percent in July compared to June, largely due to a 0.3 percent drop in prices for agricultural and fishing products.  

Metal products, machinery, and equipment saw a 0.3 percent decline, while ores and minerals prices fell by 0.2 percent. 

Expenses for other transportable goods remained stable with no significant changes. The WPI tracks the pre-retail prices of 343 items collected monthly from Riyadh, Jeddah, and Dammam. 

Average prices  

Meanwhile, GASTAT’s latest report revealed notable shifts in the average prices of goods and services in Saudi Arabia for July. 

Local melon prices surged by 12.56 percent month on month, while green beans rose by 12.22 percent. Indian pomegranates increased by 7.14 percent, and prices for dates and American cardamom edged up by 5.56 percent and 5.24 percent, respectively.  

Local tomatoes and Indian cardamom saw rises of 4.65 percent and 4.47 percent, while imported tomatoes increased by 4.16 percent. 

Conversely, prices for local grapes fell by 16.96 percent, with hotel accommodations and furnished apartments dropping by 11.64 percent and 11.34 percent.  

Abu Sorra Egyptian oranges declined by 10.75 percent, followed by Pakistani mangoes, Harri sheep, and Lebanese grapes, which fell by 10.27 percent, 9.57 percent, and 8.20 percent, respectively. 

These reports highlight the diverse factors affecting inflation and cost of living in the Kingdom. 


How AI is transforming the banking industry and leading the fight against fraud

How AI is transforming the banking industry and leading the fight against fraud
Updated 03 October 2024
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How AI is transforming the banking industry and leading the fight against fraud

How AI is transforming the banking industry and leading the fight against fraud
  • Banks in Saudi Arabia and the UAE are adopting AI-driven programs to help improve accuracy, efficiency, and security
  • AI is already facilitating faster decision-making and personalized services, boosting customer satisfaction and driving innovation

RIYADH: Artificial intelligence is transforming the banking industry by creating seamless customer experiences, automatically detecting fraudulent activity, and completing time-consuming tasks normally performed by humans.

According to a report published this year by McKinsey, generative AI could add between $200 billion and $340 billion a year in value across the global banking sector, largely through increased productivity.

Earlier this year, Riyad Bank announced the launch of its new “Center of Intelligence,” which will introduce AI technologies and services to the Saudi banking sector.

Using machine learning and modeling, the center will offer a cutting-edge environment for AI-driven research, innovation and analysis. It will also use machine-learning techniques and solutions to improve the efficiency and effectiveness of the bank’s investments and operations.

Mazen Pharaon, chief digital officer at Riyad Bank, called AI “a strategic asset and game changer” for the industry.

“It’s also instrumental in helping us offer exceptional financial services to our customers and financial performance to our shareholders,” he told Arab News.

AI offers significant advantages over traditional, human-led methods, including enhanced efficiency, accuracy and scalability, Pharaon said.

“It enables us to process large volumes of data rapidly, delivering insights that would be challenging to obtain through conventional techniques.

“AI also facilitates accelerated decision-making and personalized services, boosting customer satisfaction and driving innovation.

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“Additionally, AI helps us identify new business opportunities, reducing costs and improving risk management by identifying potential issues before they escalate.”

Money management has not been entirely handed over to the machines, however. AI-driven automated decisions at Riyad Bank are complemented by human oversight to guarantee accountability and ethical compliance.

“While AI excels at processing vast amounts of data and identifying patterns at scale, our experts are involved in reviewing and validating key decisions and their expected impact,” Pharaon said.

“This hybrid approach allows us to leverage AI’s power while preserving the essential human supervision and oversight in banking.”

Riyad Bank’s long-term vision is to extend AI across all business areas.

“Our aspiration at Riyad is to embed the use of AI, data science and advanced analytics in the bank’s DNA and overall processes,” Pharaon said.

Mashreq Bank, a privately owned bank based in the UAE, also uses AI-backed digital solutions, which analyze customer data to provide personalized financial recommendations and insights across various platforms.

Fernando Morillo, the group head of retail banking at Mashreq, believes AI will be integral to the future of banking services.

“We utilize AI in various ways to enhance customer experience and streamline operations,” Morillo told Arab News.

DID YOU KNOW?

• AI could add up to $340 billion annually to the global banking sector through increased productivity.

• Riyad Bank’s ‘Center of Intelligence’ will introduce AI technologies to enhance research, investments and operational efficiency.

•AI-backed digital solutions at Mashreq Bank improve customer experience, offer personalized financial advice and detect fraudulent activity.

“We have launched a chatbot in the UAE, which is also being rolled out to other markets. This AI-powered chatbot can understand customer intent, translate it into actions, and provide 24/7 support.

“Our AI-backed chatbot has the ability to handle more than 80 different scenarios, anticipating customer needs and proactively offering solutions.”

Because data protection is a growing concern for every business, Mashreq offers advanced encryption techniques to ensure secure data-sharing protocols, and conducts regular security audits to safeguard customers’ information.

“Additionally, we implement rigorous testing and validation of our algorithms to ensure they meet ethical standards and regulatory requirements.”

Mashreq Bank uses AI-backed digital solutions. (Supplied)

Morillo said the ability of machine-learning models to continuously adapt to recognize new fraud tactics significantly reduces the risk of fraudulent activities and enhances overall security for customers.

“AI algorithms help us in analyzing vast amounts of data in real-time to identify patterns and anomalies that may indicate fraudulent activity,” he said. “This allows us to detect suspicious transactions, prevent fraudulent account openings, and reduce false positives.”

But Morillo does not believe that AI will replace humans entirely. Indeed, employees will still be needed to review AI activities and make adjustments as needed.

“While AI can provide insights, recommendations, and even decisions, ultimately humans supervise these systems to ensure decisions are fair, accurate, and compliant,” he said.

“This oversight is essential for maintaining accountability and addressing any ethical concerns that may arise.”

 


ACWA Power joins COP29 as energy and water partner

ACWA Power joins COP29 as energy and water partner
Updated 03 October 2024
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ACWA Power joins COP29 as energy and water partner

ACWA Power joins COP29 as energy and water partner

RIYADH: ACWA Power, a developer, investor, and operator of power generation and desalinated water plants, joined COP29 as an energy and water partner, highlighting the company’s commitment to sustainable practices in the renewable energy landscape.
Along with ACWA Power’s role as a partner at the summit in Azerbaijan, the company will participate in the event’s Green Zone as an innovative leader in the energy sector.
The zone will host a variety of global businesses presenting climate-friendly solutions, serving as a dedicated space for private sectors.
The objective for ACWA Power at the global conference is utilizing the opportunity to create a platform for collaborations with other global industries, potential partners, and climate advocates, thereby fostering progress in the energy transition initiatives.
As the largest private water desalination provider in the world, ACWA Power is at the head of green hydrogen development. It also plays a critical role in the global energy transition.
“We believe that tackling this global challenge demands a paradigm shift in how we provide water and energy to our world. We must act fast to continue the transition away from fossil fuels, while providing reliable, competitive and sustainable supplies,” said Marco Arcelli, CEO of ACWA Power.
“It is with this focus that we deliver solutions that contribute to Net Zero goals and long-term climate ambitions, in a just and inclusive manner. Celebrating COP29 in Azerbaijan is of particular significance.”

He concluded: “Today, the country has the potential to turn into a bridge between Central Asia and Europe for new green sources of power and green molecules, technologies where ACWA Power has reached the most competitive costs and highest reliability in the world.”
ACWA Power, established in 2004, expanded its operations to various countries in the region including in Africa, Central Asia, and Southeast Asia. The Saudi company aligns its strategies with the UN climate change objectives.

Partners at COP 29 will have opportunities to participate in global climate policies, showcase sustainability efforts, and support climate action in their key business areas.


Global cybersecurity workforce faces 2.8m shortfall, says BCG official

Global cybersecurity workforce faces 2.8m shortfall, says BCG official
Updated 03 October 2024
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Global cybersecurity workforce faces 2.8m shortfall, says BCG official

Global cybersecurity workforce faces 2.8m shortfall, says BCG official

RIYADH: The global cybersecurity workforce is grappling with a substantial shortfall, with an estimated 2.8 million professionals required to meet demand, according to Shoaib Yousuf, managing director of the Boston Consulting Group.

In an interview with Arab News during the Global Cybersecurity Forum in Riyadh, Yousuf stated that the current workforce stands at 7.1 million.

Yousuf delved into the reasons behind this gap, pinpointing a fundamental deficiency in “skilled” workers.

He emphasized: “This gives us a clear direction that a lot of work needs to be done to take the young cybersecurity professionals or young graduates and train them and provide them the right set of skills, training, certifications, mentorship, and internship to convert them and provide the career opportunities for them.”

During the forum, BCG, in collaboration with the Global Cybersecurity Forum, released the 2024 Global Cybersecurity Workforce Report, which paints a troubling picture of the industry. The report indicates that only 72 percent of digital defense roles are filled, leaving organizations increasingly vulnerable to rising threats.

To tackle these workforce challenges, Yousuf stressed the need for a comprehensive approach. “Building a sustainable cybersecurity talent pipeline requires a multi-faceted strategy,” he said. He advocated for an integrated system that includes awareness campaigns, educational programs, and initiatives that lay a strong foundation for those interested in cybersecurity careers.

A robust talent pipeline is essential, Yousuf noted, to create awareness, improve educational frameworks, and adequately prepare young professionals for success in the field. He mentioned that establishing strong strategies to attract students to cybersecurity, along with the private sector’s appealing mentorship and internship opportunities, could significantly enhance the workforce’s quality.

“One of the challenges we found is that everyone wants a skilled workforce. Everyone wants somebody with five to eight years of experience,” Yousuf pointed out, highlighting the gap faced by newcomers entering the cybersecurity arena.

He elaborated, “The third step is the career advancement and retention of the professionals. How we can do that is by providing a thriving career. Making sure we invest in the upskilling, we invest in the right set of cybersecurity certifications, and also look into the diversification. Today, we found that women participation in cybersecurity is 24 percent, whereas the average in ICT (information and communications technology) is 36 percent.”

Yousuf also noted a high demand for specific skill sets, stating, “Based on a survey, we identified that there are four skills that are highly in demand. One of them is definitely the cybersecurity leaders. There is a strong shortage of that. Cloud security, as you can see, there is a strong push for many organizations to shift to the cloud. Cloud security is one of the roles which was highlighted as one of the critical shortages.”

Additionally, he mentioned the growing need for security architects and experts in emerging technologies, particularly those specializing in artificial intelligence.

He emphasized the urgency of addressing cybersecurity threats, labeling it as one of the most significant global risks, second only to climate change. “Cybersecurity is one of the top risks, and multiple reports have highlighted that cybersecurity is a second top threat and risk after climate change,” Yousuf asserted.

Yousuf underscored that cybersecurity has remained “on the top agenda for many nations, for many decision-makers, many CXOs,” and has become a central topic of discussion at the board level, necessitating improvements in defenses.

Despite considerable investments in cybersecurity, he remarked, “We have always been catching up.” Yousuf highlighted the financial implications of cybercrime, noting that the cost of such offenses exceeded $2 trillion last year and is projected to surpass $6 trillion in the next five years. “If you look at the impact of cybercrime, it is moving so fast. But when you look at the cybersecurity investment, it’s not keeping up at the right pace,” he explained.

He reiterated the importance of creating a level playing field, suggesting that “AI provides a fantastic opportunity to understand the threat landscape better, and we can play a much better role, to be a little bit more proactive.”

Yousuf also pointed out that cybersecurity is a top priority for Gulf Cooperation Council countries, which have made significant advancements in recent years. “One of the things which we have observed is that cybersecurity is the top priority for the GCC countries, and over the last five to eight years, we have seen a leapfrog effort, not only incremental effort, leapfrog efforts,” he stated.

He highlighted Saudi Arabia’s swift progress, noting its rise from a ranking in the late 40s on the ITU Global Cybersecurity Index in 2019 to the second position within three years.

Yousuf concluded by stressing that GCC nations recognize the importance of fostering a secure cyberspace to build trust, particularly as digital adoption is pivotal to their economic growth. He underscored that investing in digital infrastructure and robust cybersecurity is critical to supporting their ongoing digital transformation efforts.


New Child Protection in Cyberspace Index aims to improve online safety for kids

New Child Protection in Cyberspace Index aims to improve online safety for kids
Updated 03 October 2024
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New Child Protection in Cyberspace Index aims to improve online safety for kids

New Child Protection in Cyberspace Index aims to improve online safety for kids

RIYADH: The launch of the Child Protection in Cyberspace Index at the Global Cybersecurity Forum signifies a historic advancement in safeguarding children online, according to an international think tank.  

Yuhyun Park, founder and CEO of the DQ Institute, highlighted that the CPC Index reflects tangible change following last week’s UN General Assembly agreement on a global digital compact, which included child protection in cyberspace as a central focus.  

“The CPC Index is the first concrete action since that agreement, and what we are seeing is a very high level of commitment to move forward,” she told Arab News during an interview on the sidelines of the forum in Riyadh. 

The index, developed in collaboration with key partners including the International Telecommunication Union, UNICEF, and WeProtect and the GCF institute offers a comprehensive framework for understanding child safety online at the national level.  

It builds on the DQ Institute’s seven years of research into child online safety but expands to include the roles of parents, schools, technology companies, and governments.  

“The beauty of the CPC Index is that it looks at the entire ecosystem surrounding children online, from families and schools to ICT companies and government regulations,” Park said, adding that this 360-degree approach provides countries with valuable insights into how they can best utilize their resources to improve child safety online. 

The CEO emphasized that the initiative is not just driven by one organization or nation but is the result of global collaboration across public and private sectors.  

The index aggregates standards and measures from around the world, helping nations track their progress in reducing cyber risks for children. “We are connecting the dots globally, so nations can see how they can move from today’s reality to a safer digital future,” she said. 

Park highlighted that over 70 percent of children globally have experienced at least one cyber risk, according to the latest Child Online Safety Index from the DQ Institute. With the rise of artificial intelligence, or AI, this number could shift dramatically as new risks emerge.  

“AI is going to change the landscape of online risks for children, and we expect new forms of dangers to become normalized, like AI-generated deepfakes and increased exposure to fake news,” the executive said.  

She warned that while AI can be used to mitigate some risks, it also has the potential to exacerbate existing challenges at an exponential rate. “We are entering a phase where bad actors have access to even better tools, and the dynamic could change quickly.” 

In this context, the CPC Index serves as a critical tool for countries to understand their vulnerabilities and implement necessary measures to protect children from these evolving threats. “The goal is to reduce that 70 percent number to zero,” Park said, underscoring the urgency of global cooperation in tackling these risks. 

Park praised Saudi Arabia’s leadership in advancing child protection in cyberspace, describing the Kingdom’s efforts as “remarkable” and fast-moving. “Saudi Arabia has shown a humongous advancement since 2020 in digital citizenship, digital well-being, and child online safety,” she said, crediting the Kingdom’s leadership under Crown Prince Mohammed bin Salman and Vision 2030.  

The Kingdom’s proactive stance on child protection is paving the way for other nations, Park observed, as it moves quickly from dialogue to action. 

One of the Saudi Arabia’s achievements is the development of national frameworks for child online safety, including plans to integrate digital citizenship education into the national curriculum.  

“If digital citizenship is implemented from primary school, it will be a tipping point for ensuring long-term online safety for children,” Park said. She encouraged the Ministry of Education to make digital literacy a core part of early childhood education, noting that such measures could set a global standard. 

Park also called for greater involvement from the private sector in ensuring a safer digital environment for children. “Private sector companies that have created the digital environment need to take leadership on this topic,” she said, adding that Saudi Arabia is well-positioned to drive collaboration between public and private sectors at both national and global levels. 

She also stressed that big tech companies like Google, Meta, Amazon, TikTok, and Snapchat must work together to create consistent measures and reporting systems to track and reduce cyber risks for children.  

“This isn’t about competition — it’s about collaboration,” she said, urging tech companies to partner with the CPC initiative to ensure transparency and accountability in online safety. 

The CPC Index and the broader child protection initiative, she concluded, represent a critical step in ensuring that children are protected in an increasingly AI-powered world. “This is why the CPC commitment is historically important — we need to act together to put the right boundaries around children in the digital space,” she said. 

As Saudi Arabia and the global community work together on this initiative, the CPC Index will provide valuable data and insights to help nations create safer digital environments for children, according to the executive.  

“The pact for the future is a starting point, but real change happens with implementation, and that’s where the CPC Index will make a difference,” Park said. 


Collaboration key to strengthening global cyber resilience, says ITU official

 Collaboration key to strengthening global cyber resilience, says ITU official
Updated 03 October 2024
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Collaboration key to strengthening global cyber resilience, says ITU official

 Collaboration key to strengthening global cyber resilience, says ITU official

RIYADH: Domestic and international cooperation are crucial components of the global cybersecurity agenda, according to Doreen Bogdan-Martin, secretary-general of the International Telecommunication Union.

Speaking at the panel discussion titled “Navigating the future: Advancing international cooperation to build confidence in cyberspace” during the Global Cybersecurity Forum in Riyadh, she emphasized the urgent need for enhanced global efforts to combat cyber threats.

Bogdan-Martin noted that international collaboration is vital for addressing the transnational nature of these threats. Such cooperation allows for the sharing of best practices, intelligence, and resources, which strengthens collective cyber resilience.

In 2023, cyberattacks impacted over 343 million victims, and data breaches rose by 72 percent between 2021 and 2023, breaking previous records, according to Forbes Advisor.

“There’s still some gap that’s remaining. I think we are progressing on the right track, but we need to do more; we need to go faster; we need to go deeper,” she said.  

“We have a global cybersecurity agenda that we laid out back in 2007, and I actually think it’s still very relevant today,” Bogdan-Martin. 

She highlighted the importance of establishing a robust legal and regulatory framework, operational preparedness, and capacity building as critical components in addressing cyber challenges, adding that “cooperation, both domestically and internationally,” is vital. 

Bogdan-Martin noted that the landscape has become increasingly complex, particularly with the emergence of artificial intelligence. “Look at just the past year and a half and how generative AI has sort of swept the planet. I don’t think we understood how quickly the technology would evolve, but we knew that we had to be building safety by design back in the day,” she said. 

In a separate panel, titled “Crime Inc: The institutionalization of organized cybercrime,” Deputy Assistant Attorney General Josh Goldfoot from the US Department of Justice shed light on the structured nature of cybercrime. 

“The message I wanted to convey about how cybercrime is organized is that it is dispersed and centered around specialization,” Goldfoot explained. “One attack on a company requires several different components: malware, reconnaissance, penetration, and, finally, economic exploitation.” 

Goldfoot elaborated that cybercriminals often specialize in specific aspects of an attack and advertise their services to others in online forums. 

Experts from technology, public policy, defense, and other sectors gathered in Riyadh for the two-day Global Cybersecurity Forum, focusing on the theme “Advancing Collective Action in Cyberspace.” 

The event was aimed at enhancing multi-stakeholder engagement and driving joint initiatives on key strategic priorities, featuring five core sub-themes that address critical aspects of cybersecurity.