Riyadh Explores Agricultural Investment Opportunities in Africa

The Saudi Minister of Environment, Water and Agriculture during his visit to Nigeria. (Asharq Al-Awsat)
The Saudi Minister of Environment, Water and Agriculture during his visit to Nigeria. (Asharq Al-Awsat)
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Riyadh Explores Agricultural Investment Opportunities in Africa

The Saudi Minister of Environment, Water and Agriculture during his visit to Nigeria. (Asharq Al-Awsat)
The Saudi Minister of Environment, Water and Agriculture during his visit to Nigeria. (Asharq Al-Awsat)

Saudi Arabia recently concluded agreements with a number of African countries with the aim to achieve sustainable agricultural development and promote food security.

The moves come at a time when global grain supplies are expected to be lower next season, paving the way for higher agricultural commodity prices, while economies are still suffering from deep-rooted inflation, according to US outlooks.

Saudi-African relations have witnessed remarkable development during the recent period. The Kingdom and several African countries have agreed to support and develop joint bilateral relations in all fields, especially the agricultural sector.

At the end of 2023, the Kingdom hosted the Saudi-African Summit to boost joint cooperation and mutual strategic partnership.

Saudi Minister of Environment, Water and Agriculture, Eng. Abdul Rahman Al-Fadhli carried out last week a visit to Senegal, the Ivory Coast, Nigeria and Ghana where he explored future investment opportunities and prospects for cooperation.

Al-Fadhli agreed with Senegalese Prime Minister Ousman Sonko to strengthen and develop bilateral relations in the fields of agriculture, food security, fisheries and livestock.

He also discussed with Ivorian Minister of State for Agriculture and Rural Development Kobenan Kouassi Adjoumani aspects of joint cooperation in the fields of agricultural investment, livestock and food security to bolster future investment opportunities.

The Saudi minister held an extensive meeting with representatives of the Ivorian private sector to learn about the most prominent companies and their products, in addition to identifying agricultural investment opportunities that benefit both countries.

In addition, Al-Fadhli reviewed with Nigerian Minister of Agriculture and Food Security Abubakar Kyari investment opportunities in the sector, and means to increase the prospects for joint trade and economic cooperation.

The meeting discussed aspects of joint cooperation between the two countries in all fields, with a focus on enhancing mutual work in agriculture and food security, and reviewing the available investment opportunities, taking advantage of their natural wealth, including the vast area and rich natural diversity, in addition to agricultural resources and food products.

Ghana was the last leg in the African tour, where Al-Fadhli discussed aspects of joint cooperation with Minister of Food and Agriculture Bryan Acheampong and reviewed investment opportunities in the field of agriculture, livestock, and food manufacturing.

The officials agreed to facilitate the work of investors to achieve common interests and increase the volume of economic partnerships.

In remarks to Asharq Al-Awsat, Economic and Academic Analyst at King Faisal University, Dr. Mohammad Al-Qahtani said a number of African states, including, Senegal, Nigeria, Ghana, and the Ivory Coast, are witnessing remarkable economic growth.

This has encouraged Saudi authorities to strengthen bilateral cooperation with them and to benefit from the Kingdom’s strategic location that forms a bridge between three continents and plays a major role in the global logistics process, he underlined.

Al-Qahtani added that Saudi Arabia will act as a logistical gateway to the most important African countries, stressing the importance of increasing investments in agriculture, especially strategic commodities, such as cocoa and coffee, which will boost exports and the global trade movement.

He stated that the Kingdom has great research expertise in the field of agriculture and food, expecting that it will harness agricultural research centers to explore new crops that will help African countries and the region achieve food security.

Saudi Arabia is taking advantage of its strategic location through its many ports by investing in the process of digitization and logistical intelligence, which makes it at the top of the global competition to connect the East and the West, the analyst remarked.

Business development advisor and academic Dr. Saleh Al-Turki explained that the recent tour conducted by Minister Al-Fadhli is an important step to benefit from the agreements concluded by Saudi Arabia with some African states that participated in the African Summit at the end of 2023.

He added that the agreements concluded during the visit will help in achieving sustainable agricultural development in Saudi Arabia.

Many Saudi companies and institutions specialized in the field of food security will benefit from these partnerships, Al-Turki stressed, pointing to the important role of scientific research and training in national universities, such as King Faisal University, in supervising food security programs.



Economists Push Back on Harris Price Gouging Plan

 US Vice President and 2024 Democratic presidential candidate Kamala Harris as she steps off Air Force Two upon arrival at Joint Base Andrews, Maryland, on August 23, 2024. (AFP)
US Vice President and 2024 Democratic presidential candidate Kamala Harris as she steps off Air Force Two upon arrival at Joint Base Andrews, Maryland, on August 23, 2024. (AFP)
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Economists Push Back on Harris Price Gouging Plan

 US Vice President and 2024 Democratic presidential candidate Kamala Harris as she steps off Air Force Two upon arrival at Joint Base Andrews, Maryland, on August 23, 2024. (AFP)
US Vice President and 2024 Democratic presidential candidate Kamala Harris as she steps off Air Force Two upon arrival at Joint Base Andrews, Maryland, on August 23, 2024. (AFP)

Kamala Harris's price gouging policy has been criticized by economists and analysts, who say it is an uncompetitive proposal that could end up hurting, and not helping, US consumers.

Harris, the Democratic nominee for president, announced the policy last week as part of a raft of populist proposals which included a $6,000-a-year tax credit for families with newborn children and a $10,000 tax credit for first-time home buyers.

If elected President, Harris would work with Congress to advance "the first-ever federal ban on price gouging on food and groceries," her campaign said in a statement.

The proposals would look to set "clear rules of the road" to stop big corporations from running up "excessive" profits on food and groceries, and beef up state and federal regulatory powers to penalize rule-breakers.

While popular with the Democratic base, the price gouging plans elicited a fierce reaction from Republican presidential candidate Donald Trump, who is running against Harris in November's elections.

"Kamala will implement SOVIET Style Price Controls," he wrote in a social media post a day after the proposals were published.

Supporters of the policy say it has been mischaracterized and misunderstood.

"When there is more concentration in an industry, we have seen much greater increases in the profit margins," US Senator Elizabeth Warren said in an interview with CNBC on Friday.

The Harris campaign did not respond to a request for comment. But several US media organizations, including the Washington Post, reported that the Harris campaign sees the policy as an attempt to elevate existing state-level rules on price gouging to the federal level.

- What price gouging? -

A global inflationary surge at the tail-end of the Covid-19 pandemic contributed to a sharp rise in the cost of everyday items across the United States.

Consumer inflation has eased dramatically since peaking at more than nine percent in 2022. But Americans are still contending with an overall price increase of just over 20 percent since Joe Biden took office, according to data from the US Labor Department.

However, "very little" of that increase is down to price gouging, Oxford Economics chief US economist Ryan Sweet told AFP.

Instead, Sweet points to a pandemic-fueled supply shock, and an increase in demand for goods and services spurred -- in part -- by generous federal support for households during the pandemic.

"What this gouging does is pivot the blame from the Biden administration, which Harris was part of, to corporations," said Gary Hufbauer, a nonresident senior fellow at the Peterson Institute for International Economics.

"It's a pretty successful political argument," he told AFP. "It has no economic basis."

- 'Penny business' -

The retail business is notoriously tough, with profit margins often in the low single digits -- in stark contrast to higher-margin sectors like tech.

"Is there a more competitive space than retail?" Target chief executive Brian Cornell said in an interview with CNBC on Wednesday that touched on Harris's price gouging plans.

"It is a penny business, and it's a very competitive space, and we provide the value consumers are looking for," he added.

But for people struggling with the cost of living, it's a difficult argument to make.

"People see that gasoline prices are higher than they were a few years ago, food prices are going to be higher than they were a few years ago," said Sweet, from Oxford Economics.

"But we're not going back down to the prices that we saw pre-pandemic," he added.

That's because easing inflation does not translate into lower sticker prices at the grocery store.

Instead, when wages increase faster than inflation -- as they have been for well over a year now -- the cost of those items relative to wages declines over time.

But it's a slow process.

The Federal Reserve appears increasingly confident that it is winning its battle to bring inflation back down to its long-term target of two percent.

On Friday, Fed chair Jerome Powell said "the time has come" to start lowering interest rates, lifting expectations of a rate cut next month.

"There's clear evidence that businesses' pricing power has started to diminish," said Sweet.

"I think over time, as inflation gets back down to the Fed's target, this discussion of price gouging is going to start to fade to the background," he added.