“As a group, sovereign funds have doubled their participation in local economies since 2015, according to The International Forum of Sovereign Wealth Funds. The pandemic will accelerate this trend, especially as funds have more cash on hand: 31% revealed plans for an overweight cash position in the next 12 months, the SWFI’s March 2020 survey shows.”
-Una Galani writing for Reuters examines sovereign wealth funds globally and how many of them are bolstering local economies during the fallout from the Covid-19 pandemic. [Reuters]
“Real estate financing is expected to grow by 2.3 times over the next decade to become around 10 percent of the gross domestic product, worth some $270 billion, by 2029. Saudi Arabia is expected to build around 200,000 houses and apartments per year in that period.”
-Frank Kane in Arab News discusses real estate finance group Amlak International and it’s plans to list 30% of it’s equity. With retail group Bin Dawood also planning an IPO, he concludes the Amlak IPO is an important test of investor sentiment following Saudi Arabia’s economic lockdown. [Arab News]
“With the myriad challenges facing the Saudi economy, a successful recovery and evolution will require several key outcomes. The government will need to be disciplined, willing to deviate from long-established norms, and able to make decisions that will be painful in the short-term….A reform-driven period also provides the opportunity for the Saudis to be decisive and reset elements of the economy that have lagged. The economy can re-emerge with a renewed dedication to the private sector’s potential and new opportunities for youth employment. During the pandemic, the kingdom can capitalize on recent progress in the digital space, through mobile apps, government service portals, and e-commerce.”
-Bayly Winder, writing for the Carnegie Endowment for International Peace, discusses how the Saudi economy can embrace challenges brought on by a global recession and pandemic and emerge stronger in years to come. [carnegieendowment.org]
“Corruption costs developing countries US$1.26 trillion every year and represents a major obstacle to investment, negatively impacting economic growth and job prospects for these markets in the long term.”
-Frank Orlowski for Global Trade Magazine interviews Mathad Al-Ajmi, Vice President and General Counsel at Saudi Telecom Company and Chair of the B20 Saudi Arabia Integrity & Compliance Taskforce. Mr. Al-Ajmi is also involved with the Pearl Initiative, a global coalition of business leaders from the Gulf Region aimed at fostering a corporate culture of accountability and transparency [Global Trade Magazine]
“Amazon is building a local logistics and operations network spanning across the kingdom. Currently, it operates three fulfillment centers and 11 delivery stations across the nation, with a workforce of more than 1,400… women will make up approximately 40 per cent of the workforce at its newest 226,000 square-foot Jeddah facility.”
-The National reports on the official launch of Amazon.sa which replaces Souq.com in Saudi Arabia nearly three years after Amazon acquired Souq for $580m. [The National]
“We learned about retailing while other families went on holiday. We started as bag packers, then cashiers. Aged 11, I remember figuring out that I needed to ask the right questions to make a sale. I celebrated selling my first toy on the ninth day.”
-Ahmad BinDawood, 34-year-old “down to earth” supermarket boss who started off working as a child in his family’s store, on his first sale. He is now CEO of one of Saudi Arabia’s largest retailers. [ft.com]
“After climbing for six straight years between 2010-2015 ($26.3 billion to $41.8 billion) foreign remittances from Saudi Arabia have declined annually over the 2016-2019 period with $33.4 billion remitted in 2019.”
-Reporting based on research conducted by Saudi Arabia’s Okaz newspaper tracks the trajectory of foreign remittances over the last decade. They are expected to decline even further in 2020. [Middle East Monitor]
“The Secretariat assesses that the cruise missiles and/or parts thereof used in the four attacks [on Saudi Aramco facilities and a Saudi airport] are of Iranian origin.”
-U.N. Secretary-General Antonio Guterres, in a report to the U.N. Security Council in a report seen by Reuters on Thursday. Guterres also said several items in U.S. seizures of weapons and related materiel in November 2019 and February 2020 were “of Iranian origin.” [reuters.com]
“The collaboration goes beyond merely conducting business – it is a reflection of the robust Saudi-Chinese ties that … will open new doors of collaboration on future and grander projects across the world.”
-Paddy Padmanathan, ACWA Power’s president and chief executive officer, describes the company’s perspective on China’s state-owned Silk Road Fund which completed a 49% acquisition of ACWA in May 2020. Writing for AGSIW, Robert Mogilenicki explores China’s expanding position in the Gulf’s renewable energy market. [Arab Gulf States Institute in Washington]
“More work is needed to make carbon capture technology commercially viable for the private sector. This is especially important because CCUS offers much more than capturing emissions alone. Aramco has invested in a conversion technology that uses captured CO2 to create useful polymers, such as plastics, with just one-third the carbon footprint of conventional polymers. We have also developed a technology that uses CO2 instead of air to cure concrete — storing up to 20% carbon dioxide within the most ubiquitous construction material.”
-Ahmad O. Al-Khowaiter, chief technology officer of Saudi Aramco, discussing how capturing carbon emissions can help combat climate change. [cnn.com]
