Pakistan central bank cuts key rate by 200 bps to 17.5%

Pakistan central bank cuts key rate by 200 bps to 17.5%
People walk past a sidewalk money exchange showcase, which is decorated with pictures of currency notes, in Karachi, Pakistan on September 12, 2023. (REUTERS/File)
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Updated 12 September 2024
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Pakistan central bank cuts key rate by 200 bps to 17.5%

Pakistan central bank cuts key rate by 200 bps to 17.5%
  • Thursday’s move follows cuts of 150 bps in June, 100 bps in July that brought down the rate from an all-time high of 22% to 17.5%
  • Pakistan’s annual consumer price inflation rate slowed to 9.6% in August from a high of nearly 40% in May last year

ISLAMABAD: Pakistan’s central bank cut its key policy rate by 200 basis points to 17.5% on Thursday, it said in a statement, making it the third straight reduction since June as the country looks to spur growth as inflation eases.

Most respondents in a Reuters poll this week expected a cut of 150 basis points after inflation fell to single digits in August for the first time in nearly three years.

Thursday’s move follows cuts of 150 bps in June and 100 bps in July that have taken the rate from an all-time high of 22% — set in June 2023 and left unchanged for a year — to the current 17.5 percent.
Pakistan’s annual consumer price inflation rate slowed to 9.6 percent in August from a high of nearly 40 percent in May 2023.
Economic indicators have stabilized in the South Asian nation since last summer when the country came close to a default before a last-gasp bailout from the International Monetary Fund.
But concerns have risen once again with the global lender’s board yet to approve a staff level agreement struck in June for a new, $7 billion, three-year program.
The government initially said it expected the board approval in August, and later said it was likely in September. The issue is yet to be placed on the IMF board’s agenda.


Saudi Arabia offers October ‘Sah’ sukuk savings products with over 4.9% return 

Saudi Arabia offers October ‘Sah’ sukuk savings products with over 4.9% return 
Updated 26 sec ago
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Saudi Arabia offers October ‘Sah’ sukuk savings products with over 4.9% return 

Saudi Arabia offers October ‘Sah’ sukuk savings products with over 4.9% return 
  • Investors will receive bond allocations on Oct. 15, with the redemption period spanning four days starting Oct. 20
  • Subscriptions start at a minimum of SR1,000 per bond, with a maximum limit of SR200,000

JEDDAH: Saudi Arabia has launched its October subscription for the subscription-based savings product, Sah, offering a 4.92 percent return to promote financial stability and growth among citizens. 

The Shariah-compliant, government-backed sukuk issuance began at 10:00 a.m. Saudi time on Oct. 6 and will close at 3:00 p.m. on Oct. 8, as announced by the National Debt Management Center. 

Investors will receive bond allocations on Oct. 15, with the redemption period spanning four days starting Oct. 20. Redemption amounts will be disbursed seven days later. 

Subscriptions start at a minimum of SR1,000 ($266.66) per bond, with a maximum limit of SR200,000, allowing for the purchase of up to 200 bonds. 

Issued by the Ministry of Finance and organized by the NDMC, the fee-free savings products offer low-risk returns and are distributed through the digital channels of approved financial institutions. 

Sah is Saudi Arabia’s first government sukuk designed to foster saving habits by encouraging citizens to set aside a portion of their income regularly. The initiative supports the Financial Sector Development Program, part of Vision 2030, which aims to raise the national savings rate from 6 percent to 10 percent by 2030. 

Saudi nationals aged 18 and above can invest in Sah through SNB Capital, Aljazira Capital, and Alinma Investment, as well as SAB Invest, or Al Rajhi Bank. The bonds are issued monthly, with a one-year savings period and fixed returns, paid out upon maturity. 

In September, the NDMC successfully allocated SR2.603 billion in sukuk. In a detailed statement, the authority outlined the distribution of the sukuk into six tranches. 

The first tranche comprised SR255 million, set to mature in 2027, while the second tranche secured SR375 million for bonds maturing in 2029. 

The third tranche reached SR638 million for Islamic bonds maturing in 2031, followed by the fourth tranche totaling SR1.021 billion, with maturity set for 2034. 

Moreover, the fifth tranche encompassed SR202 million for sukuk maturing in 2036, and the final tranche accounted for SR112 million, set to mature in 2039. 

As demand for such low-risk investment options continues to rise, it demonstrates the evolving preferences of individuals seeking stable, Shariah-compliant savings opportunities, further enhancing financial inclusion in the Kingdom.


Qatar’s non-energy sector growth stable despite PMI dip

Qatar’s non-energy sector growth stable despite PMI dip
Updated 24 min 6 sec ago
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Qatar’s non-energy sector growth stable despite PMI dip

Qatar’s non-energy sector growth stable despite PMI dip
  • The 12-month outlook for activity strengthened in September to the highest since March 2023
  • Non-energy private sector workforce expanded at the fastest rate on record

RIYADH: Non-oil business activities in Qatar were steady in September, even as the country’s Purchasing Managers’ Index dropped to 51.7 from 53.1 in August, an economy tracker showed. 

The latest report released by Qatar Financial Center compiled by S&P Global said that the PMI readings for September indicate the country’s sustained growth in the non-energy private sector. 

According to the credit rating agency, any PMI readings above the 50 mark indicate expansion of business activities, while below signifies contraction. 

Strengthening the non-hydrocarbon sector is crucial for Qatar, as the country is on a path of economic diversification by reducing its reliance on oil. 

Under the National Vision 2030, Qatar aims to gradually lessen its dependence on hydrocarbon industries and enhance the role of the private sector to drive the country’s growth further. 

“Although the headline PMI eased in September, on the whole, the latest survey results show a number of positive developments for the Qatari non-energy economy,” said Yousuf Mohamed Al-Jaida, CEO of QFC Authority. 

“The pause in overall growth of output wholly reflected the construction sector, with growth sustained in manufacturing, services, finance, wholesale, and retail,” he added. 

“There was a series-record increase in employment during the month as firms sought to expand capacity to address rising backlogs,” Al-Jaida also said. 

According to the S&P Global analysis, the 12-month outlook for activity strengthened in September to the highest since March 2023 as demand for goods and services continued to increase, leading to a build-up in outstanding business. 

The rating agency attributed this positive outlook among Qatari firms to economic development, a rising population, and investment in key sectors, including construction, real estate, and tourism. 

“The 12-month outlook continued to brighten, as firms mentioned investment in key sectors such as construction, real estate and tourism. September data also showed a record increase in wages, which should boost consumer demand,” said Al-Jaida. 

The survey revealed that the non-energy private sector workforce expanded at the fastest rate on record, surpassing the previous peak set in January 2019. 

Although new business rose and the outlook improved, purchasing activity softened slightly as firms reported broadly stable inventory holdings. 

The report added that September witnessed a further acceleration in demand growth for Qatari financial services. 

“The seasonally adjusted Financial Services New Business Index rose to 64.1, from 62.8 in August, signaling a rapid improvement in demand conditions with the fastest growth since August 2022,” said S&P Global. 


Saudi Arabia’s e-commerce sector sees 9.4% growth in Q3

Saudi Arabia’s e-commerce sector sees 9.4% growth in Q3
Updated 54 min 14 sec ago
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Saudi Arabia’s e-commerce sector sees 9.4% growth in Q3

Saudi Arabia’s e-commerce sector sees 9.4% growth in Q3

RIYADH: Saudi Arabia’s e-commerce sector continues its upward momentum, with 39,769 businesses registered in the third quarter, a 9.4 percent increase year on year. 

The latest data from the Ministry of Commerce revealed that Riyadh led with 16,274 registrations, followed by Makkah with 10,023, and the Eastern Province with 6,328. 

In the Madinah and Qasim regions, e-commerce registrations reached 1,897 and 1,302, respectively. 

This growth highlights the Kingdom’s ongoing transition toward a diversified, digitally-driven economy, with e-commerce playing a crucial role. Saudi Arabia now ranks among the top 10 countries globally in e-commerce expansion. 


Aramco hikes Arab Light crude November prices for Asian buyers

Aramco hikes Arab Light crude November prices for Asian buyers
Updated 06 October 2024
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Aramco hikes Arab Light crude November prices for Asian buyers

Aramco hikes Arab Light crude November prices for Asian buyers

RIYADH: Saudi Aramco has raised its November pricing for Arab Light crude oil for Asian buyers, according to a recent price list.

The state-owned oil giant increased the official selling price of its Arab Light crude by 90 cents, bringing it to $2.20 per barrel above the regional benchmark.

Global oil prices are on the rise amid the growing tensions in the Middle East. Crude prices rocketed around 5 percent on Thursday. Analysts warned that slowing demand in many countries and plentiful supply within and outside OPEC is likely to eventually cap prices.

The oil giant slashed the prices of all grades to Europe and the US .

The Arab Light price differential for buyers in West Europe has been set at $0.45 above the ICE Brent, according to an emailed statement from Aramco.

The price hike aligns with market forecasts of around 45 cents and has driven the medium sour crude price to its highest point this year. On Wednesday, Saudi Arabia confirmed it would maintain its voluntary output reduction of 1 million barrels per day through November and until the end of December 2023.

Saudi Aramco also increased the price of Extra Light crude for Asia by 50 cents in November, bringing it to $3.35 a barrel above Oman/Dubai quotes. This adjustment reflects the rising prices for light sour grades in the spot market, while the OSPs for Arab Medium and Arab Heavy remain unchanged.


Saudi Arabia’s hosting Olympic Esports Games 2025 underlines the Kingdom’s economic and social transformation

Saudi Arabia’s hosting Olympic Esports Games 2025 underlines the Kingdom’s economic and social transformation
Updated 06 October 2024
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Saudi Arabia’s hosting Olympic Esports Games 2025 underlines the Kingdom’s economic and social transformation

Saudi Arabia’s hosting Olympic Esports Games 2025 underlines the Kingdom’s economic and social transformation
  • Kingdom hosting the Olympic Esports Games will position the Middle East as a major player in digital entertainment, say experts

RIYADH: History was made in July when the International Olympic Committee decided to create Olympic Esports Games, with the first edition being set to be held in 2025 in Saudi Arabia.

The event is set to be a game-changer for competitive gaming globally, with the industry’s value expected to reach over $1 trillion by 2032, growing at a compound annual growth rate of 11.60 percent during the forecast period 2023-2032, according to market research firm Inkwood Research.

With this event expected to be held at the same level as the Winter and Summer Olympics, it will position the Middle East as a major player in digital entertainment, leveraging the country’s young, tech-savvy population and strong government support.

The Esports Olympics is also set to attract international talent and showcase advanced gaming technology, highlighting the region’s potential as a global esports hub.

Impact and opportunities on global esports industry

According to Shahid Khan, partner and global head of Media, Entertainment, Sports, and Culture at international management consulting firm Arthur D. Little, the hosting of the Esports Olympics in the Kingdom legitimizes the pastime on an international stage and aligns it more closely with traditional sports.

“This event will likely accelerate investment in esports infrastructure, not just in Saudi Arabia but across the Middle East and beyond. It presents opportunities for game developers, tournament organizers, and esports teams to expand their presence in the region. Additionally, it could spark increased interest in esports careers among young people in the Middle East,” Khan said.

The substantial prize pool of $62.5 million, will undoubtedly elevate the profile of esports in the Middle East and globally, he added.

“This event could reshape perceptions of esports, particularly in regions where it’s still gaining mainstream acceptance. It positions Saudi Arabia as a serious player in the global esports landscape and could inspire other countries in the region to invest more heavily in their esports ecosystems,” the Arthur D. Little partner said.

Firms contributing to the growth of the gaming and esports industry in the region

Numerous companies in Saudi Arabia and the Middle East are actively participating in advancing and prospering the gaming and esports sector across the Kingdom and the wider region.

One such firm is Dubai-headquartered Shaffra.

The technology, information and Internet company is looking to redefine productivity and innovation, crafting a future where work is not just a place you go, but a space you shape and share, according to the company’s co-founder and Chief Technology Officer Marc Wehbi.

He told Arab News: “Our AI-driven Workforce solutions are tailored to handle complex tasks such as managing in-game analytics, optimizing player performance, and generating engaging content.”

Wehbi went on to say that through the integration of advanced technologies, Shaffra’s objective is to strengthen the region’s esports infrastructure and position it as a global leader in technological innovation and competitive gaming.

Another illustration of this is MENATech Entertainment, a technology company with projects related to the video games and education sector.

The firm’s CEO Mario Perez told Arab News that his firm recognizes the government’s significant push to cultivate a strong gaming and esports environment, complemented by private initiatives that open a wide range of opportunities for consumers.

“By leveraging our global experience and success, particularly through initiatives like Amazon UNIVERSITY Esports, which has seen a 57 percent growth in student participation in Saudi Arabia, we aim to foster talent and enhance the esports ecosystem in the region,” he said.

Perez explained that his firm has expanded its reach to over 220 universities across the region, which contributes to the region’s economic and cultural upliftment and helps position Saudi Arabia and the broader Middle East as leading players in the global esports arena.

Similarly, the Sports Lead Partner at PwC Middle East Nick Oakley shed light on how the firm has been extensively involved in the esports sector for the past five years and have delivered several strategic projects which have had a real impact in growing the industry.

“We are continuing to collaborate with key partners in the industry, including the Saudi Esports Federation, on various joint initiatives,” Oakley said.

Managing consulting company Kearney is also seen to be contributing to the rise of the gaming and esports industry, as is global law firm Reed Smith.

According to Jamie Ryder, partner at Entertainment and Media Industry Group at Reed Smith, the company has team members throughout the US, Europe, the Middle East and Asia with gaming and esports expertise which allows it to provide advice and guidance in line with international best practice and learnings from different territories.

“Our footprint allows us to combine international best practice with our local experience which is always crucial in understanding how and why things may need to be done differently in different territories,” Ryder told Arab News.

Arthur D. Little’s Khan said the benefits of hosting major events, such as the Esports Olympics, help Saudi Arabia in a financial regard – with an increase in tourism – but also enhance the Kingdom’s image as a modern, tech-savvy nation.

“The gaming and esports industry can play a crucial role in realizing Vision 2030 goals by fostering innovation, attracting foreign investment, and creating high-skilled jobs for young Saudis. Moreover, as a digital-first industry, it supports the Kingdom’s ambitions to become a leading digital economy,” Khan said.

From MENATech Entertainment’s perspective, Saudi Arabia hosting the Esports World Cup, Esports Olympics and the construction of Qiddiya City Esports Arena are “monumental steps toward” realizing the Kingdom’s digital economy goals.

Pérez said: “KSA’s esports market is projected to soar to $6.8 billion by 2030, with the rollout of the National Gaming and Esports Strategy expected to contribute SR50 billion to the nation’s GDP, create 39,000 new jobs, generate over 30 competitive games within local studios and make KSA one of the top three nations in professional esports.”

The CEO went on to say how these initiatives are not just milestones in realizing Vision 2030 but also elevate Saudi Arabia’s global status, embedding esports into the cultural and economic fabric of the region, driving tourism, infrastructure development, and international investment.

From Kearney’s side, Hammoud argued that as Vision 2030 focuses on both economic and social transformation, the gaming and esports industry can play a crucial role in both.

“Socially, it enhances the Quality-of-Life Program by fostering a dynamic, youth-driven culture and promoting digital literacy. By aligning with Vision 2030, the industry supports economic diversification, creates new opportunities for young Saudis, and positions Saudi Arabia as a leader in the global digital economy,” he said.