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Saudi Arabia's ACWA Power Signs $4.85 Bln Deal for Central Asia's Largest Wind Farm

Officials are seen at the signing ceremony in Tashkent. (Asharq Al-Awsat)
Officials are seen at the signing ceremony in Tashkent. (Asharq Al-Awsat)
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Saudi Arabia's ACWA Power Signs $4.85 Bln Deal for Central Asia's Largest Wind Farm

Officials are seen at the signing ceremony in Tashkent. (Asharq Al-Awsat)
Officials are seen at the signing ceremony in Tashkent. (Asharq Al-Awsat)

Saudi Arabia’s ACWA Power signed a Power Purchase Agreement (PPA) with the National Electric Grid of Uzbekistan for Central Asia’s largest wind farm -- the Aral 5GW Wind Independent Power Producer (IPP) project in the Karakalpakstan region.

The agreement was signed on the sidelines of the Tashkent International Investment Forum held under the patronage of Uzbek President Shavkat Mirziyoyev.

It was signed in the presence of Uzbek Prime Minister Abdulla Aripov and Saudi Energy Minister Prince Abdulaziz bin Salman Al Saud during a ceremony inaugurating two of ACWA Power’s ongoing projects in the country: the 1.5GW Sirdarya CCGT plant and the first 100MW phase of the Riverside solar plant in the Tashkent region.

Mirziyoyev also attended the ceremony.

As ACWA Power’s 15th project in Uzbekistan, Aral Wind IPP solidifies the company’s strong commitment to providing the renewable energy needed to meet the Central Asian country’s ambitious aims to have 40% of its energy mix provided by renewables by 2030.

Uzbekistan is ACWA Power’s largest market after its home country of Saudi Arabia, and this latest project brings its total investment in the country to $13.9 billion.

Founder and Chairman of the Board of ACWA Power Mohammad Abunayyan said: “This historic project will provide clean power to approximately 4.5 million houses in Uzbekistan, a country which is propelling its energy transition thanks to its ambitious and decisive leadership.”

“We are proud to collaborate with Uzbekistan’s government to export our low-carbon expertise beyond the borders of Saudi Arabia, improving the lives of millions in a country with whom we are honored to share close ties,” he added.

The Aral Wind IPP will be deployed in five phases. This flagship initiative will generate approximately 18,500 GWh of clean electricity annually, displacing 247 billion tons of CO2 over its lifetime and providing power to around four million homes, thus marking a pivotal step in Uzbekistan's green energy transition.

It is projected to create hundreds of direct and indirect jobs and stimulate local industry by localizing services and supplies.

ACWA Power is the world’s largest private water desalination company and a leader in energy transition and first mover into green hydrogen.

Its total portfolio in Uzbekistan now comprises 11.6GW of power, of which 10.1GW is renewable, as well as the country’s first green hydrogen project with a capacity of 3,000 tons per year, the first phase of which was inaugurated in November 2023.

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Saudi GDP Grows 2.8% in First Quarter

The Saudi capital, Riyadh (SPA)
The Saudi capital, Riyadh (SPA)
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Saudi GDP Grows 2.8% in First Quarter

The Saudi capital, Riyadh (SPA)
The Saudi capital, Riyadh (SPA)

Saudi Arabia's real gross domestic product grew 2.8% in the first quarter, year-on-year, preliminary government estimates showed on Thursday.

Non-oil activities grew 2.8% in the quarter, and oil activities increased 2.3% from the prior-year period, the General Authority of Statistics data ⁠showed.

On a quarterly basis, growth shrank 1.5% in the three months to March 31 compared to the fourth quarter, driven by a decline in oil activities.

Oil activity decreased 7.2% from the fourth quarter, while non-oil activity was almost flat.

Business

IMF Warns Asia to Keep Policy in Balance Amid Energy Disruptions

FILE PHOTO: A view of the International Monetary Fund (IMF) logo at its headquarters in Washington, D.C., US, November 24, 2024. REUTERS/Benoit Tessier/File Photo
FILE PHOTO: A view of the International Monetary Fund (IMF) logo at its headquarters in Washington, D.C., US, November 24, 2024. REUTERS/Benoit Tessier/File Photo
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IMF Warns Asia to Keep Policy in Balance Amid Energy Disruptions

FILE PHOTO: A view of the International Monetary Fund (IMF) logo at its headquarters in Washington, D.C., US, November 24, 2024. REUTERS/Benoit Tessier/File Photo
FILE PHOTO: A view of the International Monetary Fund (IMF) logo at its headquarters in Washington, D.C., US, November 24, 2024. REUTERS/Benoit Tessier/File Photo

Asian countries will need to keep their powder dry in preparation for future shocks even as they tackle an energy crisis caused by the Iran War, IMF Director for Asia Pacific Krishna Srinivasan said on Thursday.

With energy supplies running short due to the logjam in the Strait of Hormuz, southeast Asian economies have budgeted significant sums to cushion the impact of surging prices, and have also introduced measures to conserve energy, including work from home plans.

But Srinivasan, speaking at a media roundtable, warned countries against ramping up energy subsidies.

"If you give generalised subsidies, it's very hard to pull it back," he said, adding that countries should instead provide budget neutral ⁠and targeted fiscal ⁠support, and maintain fiscal discipline.

"In other words, cut elsewhere to support people who are being hit by the energy shock," Reuters quoted him as saying.

Srinivasan said that while some markets, such as Thailand and China, can hold off on tightening monetary policy because they are in deflationary territory, markets already above their inflation targets, including Australia, need to start now.

He also ⁠noted that some markets, such as the Philippines, have decided to tighten preemptively to anchor inflation expectations, but he added that the IMF's advice would have been to see through the shock and wait to see if inflation really picks up in a meaningful way.

"You may want to take insurance upfront or you may want to wait and see so that you don't hurt growth ... it's a very difficult balance to strike as a central bank governor," he said.

The IMF cut its global GDP outlook for 2026 to 3.1% on April 14, assuming ⁠a short-lived Middle ⁠East conflict and oil prices normalising in the second half of the year.

However, IMF chief economist Pierre-Olivier Gourinchas warned that the fund's "adverse scenario" of 2.5% growth looked increasingly likely, with continued energy disruptions and no clear path to end the conflict.

Srinivasan said that if the Strait of Hormuz remains closed beyond the next three months and oil prices stay elevated for the rest of the year, the IMF's more severe growth scenarios will become more likely.

There are still downside risks to growth, with a number of uncertainties facing the world economy, including the duration of the energy crisis and the severity of fertiliser shortages, which could create a food supply shock, he said.

Business

Euro Zone Inflation Soars Further Above ECB Target

FILE -Clouds cover the sky over the headquarters of the European Central Bank in Frankfurt, Germany, Sept. 11, 2025. (AP Photo/Michael Probst, File)
FILE -Clouds cover the sky over the headquarters of the European Central Bank in Frankfurt, Germany, Sept. 11, 2025. (AP Photo/Michael Probst, File)
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Euro Zone Inflation Soars Further Above ECB Target

FILE -Clouds cover the sky over the headquarters of the European Central Bank in Frankfurt, Germany, Sept. 11, 2025. (AP Photo/Michael Probst, File)
FILE -Clouds cover the sky over the headquarters of the European Central Bank in Frankfurt, Germany, Sept. 11, 2025. (AP Photo/Michael Probst, File)

Euro zone inflation surged further in April on soaring energy costs, Eurostat data showed on Thursday, adding to the case for interest rate hikes, even if benign underlying price growth figures ease the urgency of any move.

Inflation in the 21 countries sharing the euro currency jumped to 3.0% this month from 2.6% in March, moving further above the European Central Bank's 2% target, with energy costs accounting for the vast majority of the increase.

A closely watched figure ⁠on underlying or 'core' ⁠inflation, which excludes volatile food and energy prices, meanwhile slowed to 2.2% from 2.3% a month earlier.

Services inflation, a stubbornly high component of the price basket over the past several years, slowed to 3.0% from 3.2% while inflation for non-energy industrial ⁠goods, a key drag on prices picked up to 0.8%.

The figures are a mixed bag for the ECB, which is meeting on Thursday and will likely keep interest rates unchanged, even if it signals that policy tightening is increasingly likely, Reuters reported.

The high headline inflation print strengthens the argument for interest rate hikes but the underlying figures suggest that the initial energy shock is not yet creating major ⁠second round effects.

The ⁠ECB is largely powerless against an energy shock but must step in if these second round effects become visible as they risk creating a hard-to-break self-sustaining inflation spiral.

This is why investors expect the ECB to hike its 2% deposit rate already in June and see at least two more moves before the end of the year.

This outlook is volatile, however, and largely depends on developments in the Iran war and oil prices, which hit a four-year-high of $124 on Thursday.