Saudi Crown Prince unveils National Red Sea Sustainability Strategy to drive blue economy 

Special Saudi Crown Prince unveils National Red Sea Sustainability Strategy to drive blue economy 
Saudi Crown Prince Mohammed bin Salman has launched the National Red Sea Sustainability Strategy, an initiative aimed at safeguarding the marine environment, supporting local communities, and advancing the Kingdom’s transition to a blue economy.  File
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Updated 08 December 2024
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Saudi Crown Prince unveils National Red Sea Sustainability Strategy to drive blue economy 

Saudi Crown Prince unveils National Red Sea Sustainability Strategy to drive blue economy 
  • Covering 186,000 sq. km and featuring 1,800 km of coastline, the area is home to diverse marine ecosystems, including the world’s fourth-largest barrier reef system and 6.2 percent of global coral reefs
  • The initiative reflects Saudi Arabia’s broader efforts to integrate environmental sustainability into its economic agenda while developing its marine-based industries

RIYADH: Saudi Crown Prince Mohammed bin Salman has launched the National Red Sea Sustainability Strategy, an initiative aimed at safeguarding the marine environment, supporting local communities, and advancing the Kingdom’s transition to a blue economy.  

The strategy is part of Saudi Vision 2030 and ties into national priorities for research, development, and innovation, particularly in environmental sustainability, the Saudi Press Agency reported. 

“The Kingdom of Saudi Arabia continues to unleash its enormous economic, geographical and cultural potential, and its pioneering efforts in sustainability and environmental conservation,” said the Crown Prince, who also serves as prime minister and chairman of the Council of Economic and Development Affairs.  

He added: “Through this strategy, the Kingdom positions the blue economy as a fundamental pillar of its diversified economy and aspires for the Red Sea region to become a global reference for leading blue economy activities, and for the Kingdom to become a global leader in the field of research, development and innovation in blue economy.”  

Covering 186,000 sq. km and featuring 1,800 km of coastline, the area is home to diverse marine ecosystems, including the world’s fourth-largest barrier reef system and 6.2 percent of global coral reefs.  

The strategy outlines measures to protect these resources while developing industries such as ecotourism, fisheries, renewable energy, and water desalination. 

By 2030, the plan seeks to expand marine and coastal protected areas from 3 percent to 30 percent, increase the share of renewable energy in the energy mix to 50 percent, and create new jobs in the blue economy. It also aims to protect investments in coastal tourism, which are expected to contribute to the national economy. 

The strategy focuses on five main objectives: environmental sustainability, economic development, social development, safety and security, and governance. It includes 48 initiatives designed to balance economic activity with environmental preservation and address climate challenges, the SPA added. 

The Crown Prince emphasized the Kingdom’s commitment to a sustainable future for the Red Sea, adding, “We look forward to everyone’s cooperation in protecting our Red Sea coast and the nature and communities that depend on it.” 

The initiative reflects Saudi Arabia’s broader efforts to integrate environmental sustainability into its economic agenda while developing its marine-based industries. 

​​Red Sea Project aligns with Saudi sustainability goals: CEO




John Pagano, CEO of Red Sea Global. AN photo by Huda Bashatah

Speaking in an interview with Arab News, John Pagano, CEO of Red Sea Global, emphasized that this strategy reinforces efforts already underway at the Red Sea Project, marking a significant milestone in cross-sector collaboration along the Saudi Red Sea zone.

“The strategy supports what we’ve been doing now for quite a number of years in terms of habitat, habitat creation, growing mangroves, planting mangroves, growing coral,” Pagano said.

He added: “We’ve already made significant announcements in the years leading up to the NRSSS being announced, by working with the likes of ACWA Power and EDF to produce a 100 percent renewable energy installation for the Red Sea.”

He underscored how the company’s renewable energy initiatives align with minimizing its carbon footprint, one of the key pillars of the NRSSS.

“We’re happy that the NRSSS has been announced because it ultimately brings, you know, cross-sector, cross-stakeholder engagement, where everybody along the Red Sea is going to work together to realize the full potential of the Red Sea, the Saudi Red Sea zone, and really bring a thriving blue economy to Saudi Arabia,” Pagano said.

He also highlighted the global shift in consumer preferences, particularly within the travel and tourism industry.

Pagano emphasized how people are increasingly aware of the environmental impact of their choices and are seeking more sustainable travel options.

“I think it should be no surprise that the world is changing. People and consumer habits are changing. A recent survey by Booking.com showed that something like 86 percent of respondents want to travel more sustainably,” Pagano said.

He added: “Focusing on eco-tourism is really, you know, feeding into a very rich and growing market.”

Pagano added that the project’s vision aligns with Saudi Arabia’s Vision 2030 to create a diversified economy and a thriving tourism industry. He outlined several other initiatives that demonstrate Red Sea Global’s alignment with the NRSSS.

“We align with all five pillars across. Renewable energy is a key pillar. We’re doing that already. Habitat creation. We’re doing that through growing mangroves, through planting mangroves, through growing corals, seagrasses, etc.,” he said.

Pagano highlighted the ecological importance of mangroves and coral reefs, stating, “We’ve committed to plant 50 million mangrove trees. Now, mangroves are an amazing plant for a number of reasons.”

“They protect against sea level rise and erosion. They sequester carbon at three to 10 times more carbon than the equivalent area of trees on land,” according to the CEO.

“We’re building resilience. We’re fragmenting corals to make them grow faster. We created a coral regeneration lab which recreates the spawning events that occur once or twice a year. We can now have that occur multiple times throughout the year,” Pagano said.

He also emphasized the economic impact of the Red Sea Project on Saudi Arabia, stating, “I think there are great economic effects of eco-tourism and what we’re doing on the Red Sea. We’re going to contribute, at full capacity, SR33 billion into the Saudi economy. Each and every year, we’re going to create 120,000 jobs.”

Pagano concluded the interview by extending an invitation to the world: “Come visit the Red Sea. It’s real, it’s happening, and it’s setting a new global standard for regenerative tourism.”


Oil Updates — crude set for 3rd straight weekly gain on winter fuel demand

Oil Updates — crude set for 3rd straight weekly gain on winter fuel demand
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Oil Updates — crude set for 3rd straight weekly gain on winter fuel demand

Oil Updates — crude set for 3rd straight weekly gain on winter fuel demand

LONDON: Oil prices rose in early Asian trade and were on track for a third straight week of gains with icy conditions in parts of the US and Europe driving up fuel demand for heating.

Brent crude futures climbed 40 cents, or 0.5 percent, to $77.32 a barrel at 9:02 a.m. Saudi time. US West Texas Intermediate crude futures gained 38 cents, also 0.5 percent, to $74.30.

Over the three weeks ending Jan. 10, Brent has advanced 6 percent while WTI has jumped 7 percent.

Analysts at JPMorgan attributed the gains to growing concern over supply disruptions due to tightening sanctions, amid low oil stockpiles, freezing temperatures in many parts of the US and Europe and improving sentiment regarding China’s stimulus measures.

The US weather bureau expects central and eastern parts of the country to experience below-average temperatures. Many regions in Europe have also been hit by extreme cold and will likely continue to experience a colder-than-usual start to the year, which JPMorgan analysts expect to boost demand.

“We anticipate a significant year-over-year increase in global oil demand of 1.6 million barrels a day in the first quarter of 2025, primarily boosted by ... demand for heating oil, kerosene, and LPG,” JPMorgan said in a note on Friday.

Meanwhile, the premium of the front-month Brent contract over the six-month contract reached its widest since August this week, potentially indicating supply tightness at a time of rising demand.

Oil prices have rallied despite the US dollar strengthening for six straight weeks. A stronger dollar typically weighs on prices, as it makes purchases of crude expensive outside the US.

Supplies could be further hit as US President Joe Biden is expected to announce new sanctions targeting Russia’s economy this week in a bid to bolster Ukraine’s war effort against Moscow before President-elect Donald Trump takes office on Jan. 20. A key target of sanctions so far has been Russia’s oil industry.

“Uncertainty over how hawkish Trump will be with Iran will be providing some support. Asian buyers have already been looking for alternative grades from the Middle East, with broader sanctions against Russia and Iran making this oil flow more difficult,” ING analysts said in a note on Friday.


SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global

SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global
Updated 09 January 2025
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SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global

SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global

RIYADH: Major Saudi companies, including chemical company SABIC, dairy firm Almarai, and Saudi Electric Co., are well-positioned to handle the impact of higher fuel and feedstock prices introduced on Jan. 1, according to a new report.

Released by capital market economy firm S&P Global, the analysis reveals that those corporates will be able to absorb the marginal increase in production costs by further improving operational efficiencies as well as potentially via pass-through mechanisms.

This came after Saudi Aramco increased diesel prices in the Kingdom to SR1.66 ($0.44) per liter, effective Jan. 1, marking a 44.3 percent rise compared to the start of 2024. The company has kept gasoline prices unchanged, with Gasoline 91 priced at SR2.18 per liter and Gasoline 93 at SR2.33 per liter.

Despite the hike, diesel prices in Saudi Arabia remain lower than those in many neighboring Arab countries. In the UAE and Qatar, a liter of diesel is priced at $0.73 and $0.56, respectively, while in Bahrain and Kuwait, it costs $0.42 and $0.39 per liter.

“For SABIC and Almarai, the increase in feedstock prices will not affect profitability significantly. In the case of utility company, SEC, additional support will likely come from the government if needed,” the report said.

The capital market economy firm projects that SABIC will continue to outperform global peers on profitability.

“We don’t expect the rise in feedstock and fuel prices to materially affect profitability, since the company estimates it will increase its cost of sales by only 0.2 percent,” the report said.

It further highlighted that SABIC is considered a government-related entity with a high possibility of receiving support when needed.

The report also underlines that Almarai anticipates an additional SR200 million in costs for 2025, driven by higher fuel prices and the indirect effects of increased expenses across other areas of its supply chain.

“We believe Almarai will continue focusing on business efficiency, cost optimization, and other initiatives to mitigate these impacts,” the release stressed.

With regards to SEC, S&P said that an unrestricted and uncapped balancing account provides a mechanism for government support, including related to the higher fuel costs.

“We believe any increased fuel cost will be covered by this balancing account,” the report said.

The study further highlights that the marginal increase “could significantly affect wider Saudi corporations’ profit margins and competitiveness.”

The S&P data also suggests that additional costs will be reflected in companies’ financials from the first quarter of 2025.

“Saudi Arabia is continuing its significant and rapid transformation under the country’s Vision 2030 program. We expect an acceleration of investments to diversify the Saudi economy away from its reliance on the upstream hydrocarbon sector,” the report said.

“The sheer scale of projects — estimated at more than $1 trillion in total — suggests large funding requirements. Higher feedstock and fuel prices would help reduce subsidy costs for the government, with those savings potentially redeployed to Vision 2030 projects,” it added.


Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure

Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure
Updated 09 January 2025
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Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure

Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure

RIYADH: Chinese tech giant Lenovo is set to manufacture millions of computer devices in Saudi Arabia by 2026, following the completion of a $2 billion investment deal with Alat, a subsidiary of the Public Investment Fund. 

First announced in May, the partnership has now received shareholder and regulatory approvals, paving the way for Lenovo to establish a regional headquarters and a manufacturing facility in the Kingdom. 

The deal marks a significant step in aligning Lenovo’s growth ambitions with Saudi Arabia’s Vision 2030 goals of economic diversification, innovation, and job creation, the company said in a press release. 

The factory will manufacture millions of PCs and servers every year using local research and development teams for fully end-to-end “Saudi Made” products and is expected to begin production by 2026, it added. 

“Through this powerful strategic collaboration and investment, Lenovo will have significant resources and financial flexibility to further accelerate our transformation and grow our business by capitalizing on the incredible growth momentum in KSA and the wider MEA region,” Yang said. 

He added: “We are excited to have Alat as our long-term strategic partner and are confident that our world-class supply chain, technology, and manufacturing capabilities will benefit KSA as it drives its Vision 2030 goals of economic diversification, industrial development, innovation, and job creation.” 

Amit Midha, CEO of Alat, underscored the significance of the partnership for both Lenovo and the Kingdom. 

“We are incredibly proud to become a strategic investor in Lenovo and partner with them on their continued journey as a leading global technology company,” said Midha. 

“With the establishment of a regional headquarters in Riyadh and a world-class manufacturing hub, powered by clean energy, in the Kingdom of Saudi Arabia, we expect the Lenovo team to further their potential across the MEA region,” he added. 

The partnership is expected to generate thousands of jobs, strengthen the region’s technological infrastructure, and attract further investment into the Middle East and Africa, according to the press release. 

In May, Lenovo raised $1.15 billion through the issuance of warrants to support its future growth plans. The initiative, which was fully subscribed by investors, signals confidence in Lenovo’s strategic approach and its plans for global expansion. 

The investment deal was advised by Citi and Cleary Gottlieb Steen & Hamilton for Lenovo, while Morgan Stanley and Latham & Watkins represented Alat. 


Lebanon’s bonds climb as parliament elects first president since 2022

Lebanon’s bonds climb as parliament elects first president since 2022
Updated 09 January 2025
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Lebanon’s bonds climb as parliament elects first president since 2022

Lebanon’s bonds climb as parliament elects first president since 2022

LONDON: Lebanon’s government bonds extended a three-month long rally on Thursday as its parliament voted in a new head of state for the crisis-ravaged country for the first time since 2022.

Lebanese lawmakers elected army chief Joseph Aoun as president. It came after the failure of 12 previous attempts to pick a president and the move boosts hopes that Lebanon might finally be able to start addressing its dire economic woes.

Lebanon’s battered bonds have almost trebled in value since September when the regional conflict with Israel weakened Lebanese armed group Hezbollah, long viewed as an obstacle to overcoming the country’s political paralysis.

Most of Lebanon’s international bonds, which have been in default since 2020, rallied after Aoun’s victory was announced to stand between 0.8 and 0.9 cents higher on the day and at nearly 16 cents on the dollar.

They have also risen almost every day since late December, although they remain some of the lowest priced government bonds in the world, reflecting the scale of Lebanon’s difficulties.

With its economy still reeling from a devastating financial collapse in 2019, Lebanon is in dire need of international support to rebuild from the war, which the World Bank estimates to have cost the country $8.5 billion.

 


Closing Bell: Saudi main index closes in green at 12,097

Closing Bell: Saudi main index closes in green at 12,097
Updated 09 January 2025
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Closing Bell: Saudi main index closes in green at 12,097

Closing Bell: Saudi main index closes in green at 12,097

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Thursday, gaining 9.01 points, or 0.07 percent, to close at 12,097.75. 

The total trading turnover of the benchmark index was SR7.48 billion ($1.99 billion), as 96 stocks advanced, while 133 retreated.    

The MSCI Tadawul Index decreased by 3.28 points, or 0.22 percent, to close at 1,510.14. 

The Kingdom’s parallel market, Nomu, surged, gaining 251.24 points, or 0.82 percent, to close at 31,027.39. This comes as 56 of the listed stocks advanced, while 32 declined. 

The best-performing stock was Nice One Beauty Digital Marketing Co. for the second day in a row, with its share price increasing by 7.69 percent to SR49. 

Other top performers included Fawaz Abdulaziz Alhokair Co., which saw its share price rise by 6.5 percent to SR14.74, and Abdullah Saad Mohammed Abo Moati for Bookstores Co., which saw a 4.42 percent increase to SR35.45. 

Arabian Pipes Co. and Dr. Sulaiman Al Habib Medical Services Group also saw positive change with their share prices moving up by 4.10 percent and 3.89 percent to SR12.70 and SR298.80, respectively. 

The worst performer of the day was Salama Cooperative Insurance Co., whose share price fell by 5.88 percent to SR19.52. 

Almoosa Health Co. and Al Hassan Ghazi Ibrahim Shaker Co. also saw declines, with their shares dropping by 5.13 percent and 3.91 percent to SR133.20 and SR28.25, respectively.   

On the announcements front, Riyad Bank declared its intention to fully redeem its $1.5 billion fixed-rate reset tier 2 sukuk, issued in February 2020, on Feb. 25, 2025.  

According to a Tadawul statement, the sukuk originally maturing in 2030, will be redeemed at face value in accordance with the terms and conditions. The redemption, approved by the regulators, will include any accrued but unpaid periodic distributions.  

On the redemption date, Riyad Sukuk Limited will deposit the full amount into the accounts of sukuk holders, marking the completion of the issuance. This redemption will conclude the sukuk’s life, with no remaining value post-redemption. 

Riyad Bank ended today’s trading session edging up by 0.91 percent to SR27.85.