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Saudi Arabia Launches New Industrial Projects in Eastern Province

Eastern Province Governor, Industry Minister review model of new projects – SPA
Eastern Province Governor, Industry Minister review model of new projects – SPA
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Saudi Arabia Launches New Industrial Projects in Eastern Province

Eastern Province Governor, Industry Minister review model of new projects – SPA
Eastern Province Governor, Industry Minister review model of new projects – SPA

Saudi Arabia inaugurated new industrial projects in Dammam on Thursday, as Eastern Province Governor Prince Saud bin Naif opened two major facilities in the city’s First and Second Industrial Zones.

The launch was attended by Industry and Mineral Resources Minister Bandar Alkhorayef, who also chairs the Saudi Authority for Industrial Cities and Technology Zones (MODON), and MODON CEO Majed Al-Argoubi.

Prince Saud highlighted the rapid growth in the Kingdom’s industrial sector, attributing it to strong government backing aligned with Vision 2030 objectives to enhance local content, boost competitiveness, and solidify the Eastern Province’s status as a key industrial hub.

Multi-Storey and Ready-Built Factories

The projects include an eight-storey multi-purpose factory complex in Dammam’s First Industrial City, housing 78 industrial units ranging between 156 and 251 square meters. The facility aims to support small and medium enterprises (SMEs) and entrepreneurs with modern infrastructure, consultancy, and training services in a flexible environment designed to foster expansion and innovation.

In the Second Industrial City, Prince Saud also inaugurated a ready-built factory project comprising 84 units with floor spaces of 700 and 1,500 square meters, spanning more than 92,000 square meters in total.

This development targets light industries, offering opportunities for investors in sectors such as food processing, pharmaceuticals, medical equipment, electrical goods, electronics, and 3D printing.

Among the newly opened projects was a production plant for food and beverage giant PepsiCo. Speaking to Asharq Al-Awsat, Ahmed El-Sheikh, PepsiCo’s President for the Middle East, North Africa, and Pakistan, said the company’s latest investment reflected growing confidence in the Saudi market, fueled by Vision 2030 reforms.

“Saudi Arabia has undergone a remarkable transformation in recent years, making it a highly competitive and attractive investment destination,” he said. “Modernized regulations, streamlined procedures, and robust incentives have opened the door to greater growth and innovation.”

El-Sheikh noted that PepsiCo’s recent expansions—including its Dammam plant and the launch of a regional headquarters in Riyadh—underscore the Kingdom’s strategic role in the company’s regional operations.

The Dammam factory is now one of PepsiCo’s most advanced production sites in the region, with plans to export more than 8,600 tons of products across the Middle East this year.

Boost from Logistics and Tech Infrastructure

“Logistical and infrastructure upgrades under Vision 2030 and the National Industrial Development and Logistics Program (NIDLP) have significantly improved our operational efficiency,” El-Sheikh said.

He cited the implementation of technologies such as a Warehouse Management System (WMS) and a Transport Control Tower (TCT), enabling real-time tracking, better inventory control, and lower operating costs. These advances have enhanced PepsiCo’s delivery speed to regional markets and improved customer experience.

Saudi Arabia’s geographic location also plays a pivotal role, enabling efficient distribution via well-developed land, sea, and air networks.

The Dammam facility has achieved a 84.3% Saudization rate, with women making up more than 21% of the workforce. The expansion has created 30 new jobs in the supply chain, offering fresh opportunities for Saudi youth.

PepsiCo sources 100% of the potatoes used in its snack products from Saudi farms, reinforcing local food security and encouraging sustainable agricultural practices, such as drip irrigation, which has reduced water consumption by 30% compared to 2015 levels.

The company also procures most of its packaging materials domestically, supporting local manufacturers and bolstering the SME ecosystem.

Focus on Innovation and Industry 4.0

“The Saudi snack food market is highly competitive and constantly growing, which pushes us to keep innovating and meeting evolving consumer demands,” El-Sheikh added.

PepsiCo is also integrating Industry 4.0 technologies—including advanced digital systems, solar panels, and water recycling solutions—to enhance operational efficiency and minimize environmental impact.

The latest expansion, valued at SAR 300 million ($80 million), has increased the plant’s production capacity by 19,000 metric tons. The company plans to build on this momentum by boosting local sourcing, improving operational performance, and expanding its use of smart manufacturing technologies.

 

 

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Business

Focus Turns to Building Stronger Institutions in Africa to Speed Shift to Renewable Energy

A solar power plant in Burkina Faso (Reuters)
A solar power plant in Burkina Faso (Reuters)
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Focus Turns to Building Stronger Institutions in Africa to Speed Shift to Renewable Energy

A solar power plant in Burkina Faso (Reuters)
A solar power plant in Burkina Faso (Reuters)

Africa’s biggest clean energy challenge is shifting from building projects to building the institutions, markets and regulatory systems needed to deliver them at scale, experts say.

That challenge is emerging even as clean energy reaches a historic milestone globally.

Renewables generated 34% of the world’s electricity in 2025, overtaking coal’s 33% share. Together with nuclear power, renewables are expected to provide half of global electricity by 2030.

As industrialization, artificial intelligence and electrification push demand higher, experts say the bottleneck in transitioning to cleaner energy has shifted from technology to the systems supporting it, including funding.

Overcoming such obstacles is vital for securing access to power for the 600 million people in Africa who are yet to be connected.

“Clean energy is now cheaper than fossil fuels in virtually every part of the world,” former New York City Mayor Michael R. Bloomberg, the UN Secretary-General’s Special Envoy on Climate Ambition and Solutions, said in late June while announcing a new $285 million Bloomberg Philanthropies initiative to strengthen clean energy industries in emerging and developing economies.

“But fixable obstacles are still slowing down deployment, and with energy demand rising at an unprecedented speed, we can’t allow those obstacles to continue standing in the way,” The Associated Press quoted him as saying.

Rather than financing solar farms or wind projects directly, the initiative will invest in strengthening market design, regulatory capacity, technical expertise and industry institutions, areas increasingly viewed as essential for attracting private investment and accelerating use of renewable energy.

It reflects a growing consensus that Africa’s energy transition is constrained less by a lack of renewable resources or viable technologies than by the institutional capacity needed to turn those advantages into financially viable projects and electricity on the grid.

Many projects remain delayed by weak market design, limited grid planning, slow permitting processes and fragmented regulatory systems.

“What has been missing is not the potential, but the institutional infrastructure and capabilities to unlock it,” said Saliem Fakir, executive director of the African Climate Foundation.

“Philanthropy that targets those gaps directly is the kind of intervention that can shift the trajectory of a continent’s energy system.”

Across Africa, renewable energy costs have fallen sharply while investment appetite continues to grow. However, investors say policy uncertainty, slow permitting processes and limited regulatory capacity are hindering projects.

Wangari Muchiri, founder and chief executive of RE.Think Energy, said the commitment signals that “the next phase of the energy transition is not about proving clean energy works, it’s about removing the barriers preventing it from scaling fast enough.”

The Bloomberg initiative is looking beyond ambitious renewable energy targets to focus on helping projects attract long-term investments and connect to national grids.

“The next chapter of Africa's renewable energy story will not be only by the projects it builds, but the institutions that make these projects possible,” Muchiri said.

Business

Volkswagen CEO Looks to Avoid Plant Closures as Automaker Moves to Cut Costs

FILE PHOTO: Oliver Blume, CEO of Volkswagen AG and Porsche AG, speaks during the annual Volkswagen Group press conference in Wolfsburg, Germany March 11, 2025. REUTERS/Liesa Johannssen/File Photo
FILE PHOTO: Oliver Blume, CEO of Volkswagen AG and Porsche AG, speaks during the annual Volkswagen Group press conference in Wolfsburg, Germany March 11, 2025. REUTERS/Liesa Johannssen/File Photo
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Volkswagen CEO Looks to Avoid Plant Closures as Automaker Moves to Cut Costs

FILE PHOTO: Oliver Blume, CEO of Volkswagen AG and Porsche AG, speaks during the annual Volkswagen Group press conference in Wolfsburg, Germany March 11, 2025. REUTERS/Liesa Johannssen/File Photo
FILE PHOTO: Oliver Blume, CEO of Volkswagen AG and Porsche AG, speaks during the annual Volkswagen Group press conference in Wolfsburg, Germany March 11, 2025. REUTERS/Liesa Johannssen/File Photo

Volkswagen's CEO indicated in comments published Sunday that he's trying to avoid closing plants as he seeks to turn around the automaker's performance.

The Wolfsburg, Germany-based company faces pressure to cut costs at home and increasingly intense competition in the lucrative Chinese market, in particular.

Last week, Volkswagen said its “fundamental realignment” over the past three years had reached its next phase, announcing plans to streamline the model lineup by up to half.

It didn't provide specifics, and questions remain over how else it will cut costs. There has been renewed speculation about the future of several plants in Germany.

“There are more intelligent solutions than closing plants,” CEO Oliver Blume told the Bild am Sonntag newspaper, according to The Associated Press.

He added that a cost-cutting program in Germany already is producing effects. “We were able to improve our factory costs in Germany by an average 20% last year alone,” he said, describing that as “strong progress.”

Blume argued that Volkswagen's products are very popular, but “we just earn too little money with them. So we must continue to reduce our costs. In all kinds of costs.”

Business

While Global Oil Demand Drops, US Drivers Keep Buying More Gas

A man stands near his car at a gas station in Austin, Texas - July 10, 2026 (AFP)
A man stands near his car at a gas station in Austin, Texas - July 10, 2026 (AFP)
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While Global Oil Demand Drops, US Drivers Keep Buying More Gas

A man stands near his car at a gas station in Austin, Texas - July 10, 2026 (AFP)
A man stands near his car at a gas station in Austin, Texas - July 10, 2026 (AFP)

While global oil demand is set to decline this year due to the US-Iran conflict, gasoline consumption in the United States increased in the second quarter of 2026.

Gasoline prices surpassed $4.50 on average for a gallon of regular in the US in May, rising more than 50% since the start of the war, according to AAA data.

But that didn’t stop drivers from hitting the road; in fact, gasoline consumption rose in the US during the second quarter of the year, according to AP.

One reason may be because the percentage of household income spent on gasoline in the US has been declining for years, said Daniel Sternoff, senior fellow at the Center on Global Energy Policy at Columbia University. Plus, many people have been transitioning from remote work to in-office jobs, he added.

“Even though it’s a really political price that people pay a lot of attention to, if you are in the higher quintiles of income in the US, you might grumble about it, but you’re not really driving less just because of that increase in prices,” Sternoff said.

Jim Burkhard, vice president and head of crude oil research at S&P Global Energy, said, “The future of Hormuz is probably more uncertain today than it was at the beginning of the war.”

Burkhard said Iran is still trying to control the strait, while the US has not been able to fully restore normal operations, making a return to prewar conditions unlikely.

Global oil demand averaged just 97.9 million barrels per day in May, down 5.3 million barrels per day from a year earlier. Much of the decline was in Asia, which relies heavily on oil from the Middle East.

According to a report from the International Energy Agency Global, oil demand is set to decline this year for the first time since the height of the COVID-19 pandemic in 2020.

The drop, which the agency expects to amount to about 1 million barrels per day in 2026, is due to higher oil prices and disruptions to physical supply that weighed heavily, but unevenly, on various parts of the world, the report said.

The supply disruptions were caused by the war between the US and Iran, which left ships loaded with crude oil stranded in the Arabian Gulf for more than three months, unable to safely travel through the Strait of Hormuz, a major route for oil and gas shipments.

But the main exception to the global slump in oil usage was in the US, where gasoline use increased in the second quarter of 2026, despite the fact that pump prices were about 50% above their prewar levels in May, the report said.