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UAE, Malaysia Launch Negotiations to Establish a CEPA

UAE Minister of State for Foreign Trade Thani al-Zeyoudi and Malaysian Minister of Investment, Trade, and Industry Tengku Zafrul Aziz during the signing ceremony (WAM)
UAE Minister of State for Foreign Trade Thani al-Zeyoudi and Malaysian Minister of Investment, Trade, and Industry Tengku Zafrul Aziz during the signing ceremony (WAM)
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UAE, Malaysia Launch Negotiations to Establish a CEPA

UAE Minister of State for Foreign Trade Thani al-Zeyoudi and Malaysian Minister of Investment, Trade, and Industry Tengku Zafrul Aziz during the signing ceremony (WAM)
UAE Minister of State for Foreign Trade Thani al-Zeyoudi and Malaysian Minister of Investment, Trade, and Industry Tengku Zafrul Aziz during the signing ceremony (WAM)

UAE Minister of State for Foreign Trade Thani al-Zeyoudi and Malaysian Minister of Investment, Trade, and Industry Tengku Zafrul Aziz have signed a joint statement agreeing to launch negotiations to establish a Comprehensive Economic Partnership Agreement (CEPA).

Zeyoudi underlined on Tuesday the developing relations between the UAE and Malaysia, stating that the negotiations have built upon solid growth in bilateral trade and investment over recent years, which witnessed a positive development in various areas of cooperation.

Non-oil trade between the UAE and Malaysia continued its upward trajectory over the past five years, reaching $4.6 billion in 2022, a growth of five percent compared to 2021 and up 31 percent and 18 percent compared to 2020 and 2019, respectively.

The UAE is Malaysia's 17th trade partner globally and the second in the Middle East, accounting for 32 percent of Malaysia's trade with Arab countries.

"The UAE is also the first destination for Malaysian merchandise exports to Arab countries, accounting for 40 percent of its exports to the region. The other way, Malaysia ranks eighth globally for UAE exports and 19th in re-exports," said the Minister.

Zeyoudi highlighted that the value of Malaysian investments in the UAE amount to $150 million across sectors of industry, building and construction, real estate, trade, transport, storage, financial activities, insurance, and professional and technical activities.

UAE investments in Malaysia amount to more than $220 million, including more than $51 million in the industrial sector.

He stressed that the CEPA with Malaysia comes as part of the UAE's plans to expand its network of trade partners with strategically essential markets, noting that Malaysia is the fourth largest economy in the Southeast Asian region.

The CEPA agreement will contribute to the consolidation of trade and investment relations between the two countries, launching a new era of partnership that will accelerate opportunities for the business communities in the two countries, especially in priority sectors, said the Emirati Minister.

The Malaysian Minister indicated that with the start of negotiations for the Malaysia-UAE CEPA, Kuala Lumpur is committed to enhancing the longstanding economic partnership with the UAE.

He explained that the agreement would set the stage for a comprehensive and mutually beneficial economic framework to forge stronger strategic collaborations, foster innovation, spur economic growth, and create job opportunities for both nations.

The negotiations with Malaysia are the latest under the UAE's ambitious foreign trade agenda, which has seen the conclusion of four CEPAs with India, Israel, Indonesia, and Turkey.

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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)

Telecommunications companies listed on the Saudi Stock Exchange (Tadawul) achieved a 12.46 percent growth in their net profits, which reached SAR 4.07 billion ($1.09 billion) during the second quarter of 2024, compared to SAR 3.62 billion ($965 million) during the same period last year.

They also recorded a 4.76 percent growth in revenues during the same quarter, after achieving sales worth more than SAR 26.18 billion ($7 billion), compared to SAR 24.99 billion ($6.66 billion) in the same quarter of 2023.

The growth in the revenues and net profitability is the result of several factors, including the increase in sales volume and revenues, especially in the business sector and fifth generation services, as well as the decrease in operating expenses and the focus on improving operational efficiency, controlling costs, and moving towards investment in infrastructure.

The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia. The fiscal year of Etihad Atheeb Telecommunications Company (GO) ends on March 31.

According to its financial results announced on Tadawul, Etihad Etisalat Company (Mobily) achieved a 33 percent growth rate of profits, bringing its profits to SAR 661 million by the end of the second quarter of 2024, compared to SAR 497 million during the same period in 2023. The company also achieved a 4.59 percent growth in revenues to reach SAR 4.47 billion, compared to SAR 4.27 billion in the same quarter of last year.

The Saudi Telecom Company achieved the highest net profits among the sector’s companies, at about SAR 3.304 billion in the second quarter of 2024, compared to SAR 3.008 billion in the same quarter of 2023. The company registered a growth of 4.52 percent in revenues.

On the other hand, the revenues of the Saudi Mobile Telecommunications Company (Zain Saudi Arabia) increased by about 6.69 percent, as it recorded SAR 2.55 billion during the second quarter of 2024, compared to SAR 2.39 billion in the same period last year.

Commenting on the quarterly results of the sector’s companies, and the varying net profits, the head of asset management at Rassanah Capital, Thamer Al-Saeed, told Asharq Al-Awsat that the Saudi Telecom Company remains the sector leader in terms of customer base expansion.

He also noted the continued efforts of Mobily and Zain to offer many diverse products and other services.

Financial advisor at the Arab Trader Mohammed Al-Maymouni said the financial results of telecom sector companies have maintained a steady growth, up to 12 percent, adding that Mobily witnessed strong progress compared to the rest of the companies, despite the great competition which affected its revenues.

He added that Zain was moving at a good pace and its revenues have improved during the second quarter of 2024. However, its profits were affected by an increase in the financing cost by SAR 26.5 million riyals and a rise in interest, while net income declined significantly compared to the previous year, during which the company made exceptional returns.