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Lebanon's Finance Minister: 'Steps Needed After Long-term Investment Rating Downgraded '

FILE PHOTO: Minister Ali Hassan Khalil speaks during a meeting in Beirut.
FILE PHOTO: Minister Ali Hassan Khalil speaks during a meeting in Beirut.
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Lebanon's Finance Minister: 'Steps Needed After Long-term Investment Rating Downgraded '

FILE PHOTO: Minister Ali Hassan Khalil speaks during a meeting in Beirut.
FILE PHOTO: Minister Ali Hassan Khalil speaks during a meeting in Beirut.

Lebanon's Finance Minister Ali Hassan Khalil said a report by Moody's Investors Service that downgraded the country's long-term investment ratings reflects the need for quickly forming a new government and implementing reforms, the Associated Press (AP) reported.

Khalil's statement came in a tweet Tuesday after Moody's downgraded the Lebanon's issuer ratings to Caa1 from B3.

The outlook was changed to stable from negative.

Moody's said its decision reflects the heightened risk that the government's response to increased liquidity and financial stability risks will include "a debt rescheduling or other liability management exercise that may constitute a default under Moody's definition," according to AP.

Lebanon's economy has been under pressure with a debt of $85 billion equal to 150 percent of its GDP and little growth.

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Business

Saudi Arabia Reduces Oil Production to 9 Million bdp to Support Market

Officials, including Saudi Energy Minister Prince Abdulaziz bin Salman (center), at the OPEC+ meeting in Vienna on Sunday. (Twitter)
Officials, including Saudi Energy Minister Prince Abdulaziz bin Salman (center), at the OPEC+ meeting in Vienna on Sunday. (Twitter)
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Saudi Arabia Reduces Oil Production to 9 Million bdp to Support Market

Officials, including Saudi Energy Minister Prince Abdulaziz bin Salman (center), at the OPEC+ meeting in Vienna on Sunday. (Twitter)
Officials, including Saudi Energy Minister Prince Abdulaziz bin Salman (center), at the OPEC+ meeting in Vienna on Sunday. (Twitter)

Saudi Arabia decided to voluntarily reduce its oil production by 1.5 million barrels per day, to the level of 9 million barrels per day, to support oil markets in light of the uncertainty surrounding the global economy.  

An official source in the Saudi Ministry of Energy said on Sunday that the additional voluntary cuts in the Kingdom’s oil production, by one million barrels per day, would take effect as of July and for a month that can be extended.  

During a meeting on Sunday, OPEC+ countries decided to adjust their production level to 40.4 million barrels per day, starting from January 2024 for a period of one year, and agreed to reduce oil production by 3.66 million barrels per day, announced Russian Deputy Prime Minister Alexander Novak.  

The new voluntary cut by Saudi Arabia comes in addition to the OPEC+ agreement. 

The Kingdom described the move as a “precautionary measure”, through which it will extend its voluntary cut of 500,000 barrels per day until the end of December 2024, in coordination with some countries participating in the OPEC+ agreement.  

UAE Minister of Energy Suhail Al Mazrouei immediately announced that his country would extend its voluntary reduction in oil production of 144,000 barrels per day until the end of December 2024.  

“The extension of the voluntary reduction in production comes in coordination with the countries participating in the OPEC+ agreement,” he stated.  

Iraq also announced its commitment to the voluntary cut of its oil production of 211,000 barrels per day. Oman and Algeria also decided to cut their production by 40,000 barrels and 48,000 barrels per day, respectively.  

Following Sunday’s meeting, Novak said his country would extend its voluntary cut in oil production of 500,000 barrels per day until the end of 2024.  

The cuts will be as a precautionary measure, in coordination with the countries participating in the OPEC+ agreement, which had previously announced voluntary cuts in April, he added.  

“This voluntary cut will be from the required production level, as agreed upon at the thirty-fifth ministerial meeting of OPEC+ on June 4, 2023,” Novak stressed.  

He underscored the ability to “adjust our decisions” to stabilize the oil market, referring to economic developments in China.  

“We are closely monitoring China's recovery from the repercussions of the COVID-19 pandemic,” he remarked.  

A press release posted on Sunday on the OPEC website stated that an agreement was reached to hold the OPEC+ ministerial meeting every six months. The next meeting will be held in Vienna on November 26. 

The Joint Ministerial Monitoring Committee was granted the authority to hold additional meetings, or to request a ministerial meeting for the group at any time to meet “market developments whenever necessary.”  

Business

Saudi Arabia, Egypt Sign MoU to Promote Exports, Automobile Industry

Egyptian Prime Minister Mostafa Madbouly chairs talks between the Egyptian side, headed by Minister of Industry Ahmed Samir, and his Saudi counterpart, Bandar al-Khorayef (Asharq Al-Awsat)
Egyptian Prime Minister Mostafa Madbouly chairs talks between the Egyptian side, headed by Minister of Industry Ahmed Samir, and his Saudi counterpart, Bandar al-Khorayef (Asharq Al-Awsat)
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Saudi Arabia, Egypt Sign MoU to Promote Exports, Automobile Industry

Egyptian Prime Minister Mostafa Madbouly chairs talks between the Egyptian side, headed by Minister of Industry Ahmed Samir, and his Saudi counterpart, Bandar al-Khorayef (Asharq Al-Awsat)
Egyptian Prime Minister Mostafa Madbouly chairs talks between the Egyptian side, headed by Minister of Industry Ahmed Samir, and his Saudi counterpart, Bandar al-Khorayef (Asharq Al-Awsat)

Egypt and Saudi Arabia signed on Sunday two memorandums of understanding (MoU) in developing non-oil exports and developing their automobile industries.

The Egyptian Minister of Trade and Industry, Ahmed Samir, and Saudi Minister of Industry and Mineral Resources, Bandar al-Khorayef, witnessed the signing of a memorandum of understanding between the Egyptian Export Development Authority and its Saudi counterpart.

The statement added that the two sides also witnessed the signing of a memorandum of understanding between the Valeo Egypt company and the Saudi National Industrial Development Center in developing the automotive industry.

Khorayef started an official visit to Egypt on Saturday as part of Saudi Arabia's keenness to enhance the role of the mining and industrial sectors.

Later, the Egyptian Prime Minister Mostafa Madbouly received the Saudi Minister of Industry.

They discussed ways to enhance industry cooperation and integration between Egypt and Saudi Arabia.

Madbouly noted the enormous potential and human resources that the two countries possess, adding that Egypt is a huge market and a gateway to the continent of Africa.

He stressed the importance of having an agreement between the two countries that enables the private sector to achieve integration and partnership in the supply and production chains.

During the meeting, Minister Samir noted that Egyptian officials held meetings with their Saudi counterparts. They agreed on a set of joint work issues in industry, namely the industrial integration between the two countries.

The Egyptian minister said that cooperation in specific sectors would improve in the next stage, including the food and drug security industries and promoting exports to African markets.

For his part, the Saudi Minister explained that the national industry strategy aims to create a competitive and sustainable industrial economy.

Saudi Arabia is looking forward to integration with Egypt in the industries identified by the strategy to achieve food and drug security and cooperation for optimal utilization and creation of added value in the petrochemical and mining industries and the automotive industry.

Khorayef said the visit to Egypt would include a tour of several industrial sites and meetings with the private sector.

 

Business

Iraq to Achieve Self-Sufficiency in Gas within 5-7 Years

Technicians working at the Majnoon oil field in Basra, Iraq. (Reuters)
Technicians working at the Majnoon oil field in Basra, Iraq. (Reuters)
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Iraq to Achieve Self-Sufficiency in Gas within 5-7 Years

Technicians working at the Majnoon oil field in Basra, Iraq. (Reuters)
Technicians working at the Majnoon oil field in Basra, Iraq. (Reuters)

Iraq will achieve self-sufficiency in gas within five to seven years, announced Oil Minister Hayyan Abdul-Ghani.

During an interview with Rudaw, Abdul-Ghani said Iraq might have a surplus of gas after it signed the fifth licensing round, which included five contracts and exploration blocks, all gas-producing in the range of 750 to 900 million cubic feet.

"Iraq is compliant with the Paris Agreement and the development of its gas in its entirety to stop the flaring of gas by 2030," he said, adding that the Ministry of Oil is keen to expedite the gas investment process.

"Today, we import large quantities of gas from our neighbor Iran, and we cannot continue to import gas while the gas in our fields is flared. The majority of gas available to us is associated gas, which comes from crude oil production," the Minister said.

"Within five years of activating the Total contract, there will be a stoppage of gas flaring from five oil fields," he said, as well as in other fields, such as Nahr Ibn Omar, which is covered in a contract to invest more than 150 million cubic feet.

Turning to oil, the minister said the objective was to fix and stabilize prices at around $80 per barrel.

Abdul-Ghani noted that Iraq would abide by previous oil production reductions. The first reduction took place at the beginning of the year, and the second in May.

The oil ministry in April announced that it was reducing production by 211,000 barrels per day starting from May and effective until the end of 2023, adding to the two million barrels per day cut already in effect since November of last year.

The minister renewed his country's position in preserving the unity and cohesion of the OPEC organization to maintain oil prices and ensure the availability of oil in global markets to meet energy needs.

Business

Turkish Lira Slips Despite Appointment of Well-Regarded Finance Minister 

People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)
People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)
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Turkish Lira Slips Despite Appointment of Well-Regarded Finance Minister 

People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)
People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)

Türkiye's lira slid almost 1% on Monday in thin trading during the Asian day to weaken past 21 per dollar, in a shaky initial reaction to the appointment of highly-regarded Mehmet Simsek as finance minister.

The lira hit 21.1 to the dollar, not far above a record low of 21.8 made last week.

Simsek, 56, won markets' confidence during terms as finance minister and deputy prime minister between 2009 and 2018. He said on Sunday the country has no choice but to return to "rational ground".

His appointment is seen as a signal that President Recep Tayyip Erdogan's newly-elected government is moving away from unorthodox interest rate cuts in the face of high inflation that sent the lira on a long decline.

"The hope is that he (Simsek) could instigate much-needed economic orthodoxy and engage with the market more effectively," said Mohammed Elmi, senior portfolio manager for emerging markets fixed income at Federated Hermes.

Türkiye's annual consumer price inflation hit a 24-year peak beyond 85% last year, and stood at 44% in April in a sign that further monetary tightening was required, according to Elmi.

"A simple return to credible economic policy could see a marked change in Turkey's investment appeal," he said.

"The long-term outlook for Türkiye is still very much a positive one ... a young population, a burgeoning middle class, and a country that occupies a key strategic location, it has a number of factors in its favor."

Business

Saudi Arabia’s TGA Participates in UITP Global Public Transport Summit

SPA
SPA
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Saudi Arabia’s TGA Participates in UITP Global Public Transport Summit

SPA
SPA

The International Association of Public Transport (UITP) inaugurated on Sunday in Barcelona, Spain, the UITP Global Public Transport Summit, with the participation of the Kingdom of Saudi Arabia’s Transport General Authority (TGA).

The TGA was represented at the Summit by the Authority’s Vice-President for the Regulatory Sector, Eng. Fawaz Al-Sahli; the Authority’s Undersecretary for Land Transport Sector, Abdulmajeed Al-Tasan; and General Director of the Authority’s Studies and Transport Economics, Rayan Alhazmi.

The opening ceremony witnessed the holding of the General Assembly of the UITP, in which a number of issues were discussed, including the adoption of the minutes and results of the 2022 General Assembly as well as the 2023 budget and its work plan.

It also witnessed the election of the President of the UITP for the term 2023-2025, in addition to honoring graduates of the Diploma of Public Transport Managers, which included three officials of the Saudi TGA.

The UITP Global Public Transport Summit’s activities will include the launch of an exhibition, which will last until the 7th of June, with the participation of a number of entities and those interested in the public transport sector, under the theme of ‘Bright Light of the City’.

Business

Saudi Arabia Says Will Implement Additional Voluntary Cut in Oil Production

FILE - The logo of the Organization of the Petroleoum Exporting Countries (OPEC) is seen outside of OPEC's headquarters in Vienna, Austria, on March 3, 2022. (AP Photo/Lisa Leutner, File)
FILE - The logo of the Organization of the Petroleoum Exporting Countries (OPEC) is seen outside of OPEC's headquarters in Vienna, Austria, on March 3, 2022. (AP Photo/Lisa Leutner, File)
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Saudi Arabia Says Will Implement Additional Voluntary Cut in Oil Production

FILE - The logo of the Organization of the Petroleoum Exporting Countries (OPEC) is seen outside of OPEC's headquarters in Vienna, Austria, on March 3, 2022. (AP Photo/Lisa Leutner, File)
FILE - The logo of the Organization of the Petroleoum Exporting Countries (OPEC) is seen outside of OPEC's headquarters in Vienna, Austria, on March 3, 2022. (AP Photo/Lisa Leutner, File)

An official source in the Saudi Energy Ministry announced on Sunday that the Kingdom will implement an additional voluntary cut in its production of crude oil, amounting to one million barrels per day, starting in July for a month, which could be extended further.

The announcement of Saudi cuts of one million barrels per day are in addition to what was agreed upon in the OPEC+ meeting on Sunday for the required production level for each country for 2024, and what the OPEC+ countries had previously announced in April in terms of voluntary cuts until the end of 2023 and extended their voluntary cuts until the end of 2024, the source said.

The Kingdom’s production would become 9 million barrels per day, and its total voluntary cut will be 1.5 million barrels per day, said the source.

The source explained that the Kingdom's additional voluntary cut comes to reinforce the precautionary efforts made by OPEC+ countries with the aim of supporting the stability and balance of oil markets.

Business

Abu Dhabi-listed AD Ports Group Inks 25-Year Deal with Singapore’s Crystal Offshore

Under the agreement’s terms, a 20,000-square-meter plot of land and an associated quay wall in Khalifa Port will be allocated for Crystal Offshore to construct a base. WAM
Under the agreement’s terms, a 20,000-square-meter plot of land and an associated quay wall in Khalifa Port will be allocated for Crystal Offshore to construct a base. WAM
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Abu Dhabi-listed AD Ports Group Inks 25-Year Deal with Singapore’s Crystal Offshore

Under the agreement’s terms, a 20,000-square-meter plot of land and an associated quay wall in Khalifa Port will be allocated for Crystal Offshore to construct a base. WAM
Under the agreement’s terms, a 20,000-square-meter plot of land and an associated quay wall in Khalifa Port will be allocated for Crystal Offshore to construct a base. WAM

AD Ports Group has signed a 25-year agreement with Singapore based Crystal Offshore, a recognized one-stop Logistics Solution provider to the Marine & Offshore Industry.

Under the agreement’s terms, a 20,000-square-meter plot of land and an associated quay wall in Khalifa Port will be allocated for Crystal Offshore to construct a base, featuring office facilities and fabrication workshops to provide advanced repairs and refits to jack-up rigs as well as marine and offshore vessels.

Saif Al Mazrouei, Chief Executive Officer, Ports Cluster – AD Ports Group, said: “Our partnership with one of the world’s leading solution providers in the marine and offshore industry, will add significant value to Khalifa Port’s customers and greatly expand the numerous services it offers to cater to the wide base of the marine industry.”

“As we look towards the future, we will continue our drive to further diversify the service offerings in our ports in the UAE and abroad. We aim to achieve this by forging strong partnerships such as the one we are entering into with Crystal Offshore, ensuring that we remain the global port operator of choice for our customers.”

CEO of Crystal Offshore Sujith Sekharan hailed the partnership with AD Ports Group with a view to deliver services to the oil and gas industry in the Middle East region.

“We have a strong track record with contractors in the region, and with this long-term partnership we anticipate significant and fast growth of our market share, greatly assisted by the geographical proximity and excellent infrastructure that Khalifa Port has to offer. We share the vision of AD Ports Group and look forward to complementing one another through our expertise and capabilities,” he said.

The new shipyard fabrication facility situated within Khalifa Port will cater for drilling rigs and marine assets as well as deep water vessels such as FPSO and semi submersibles.

Business

Saudi Environment Minister Inspects World-Largest Reverse Osmosis Plant

Al-Fadhli inspected the stages of the project that utilizes alternative energy. SPA
Al-Fadhli inspected the stages of the project that utilizes alternative energy. SPA
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Saudi Environment Minister Inspects World-Largest Reverse Osmosis Plant

Al-Fadhli inspected the stages of the project that utilizes alternative energy. SPA
Al-Fadhli inspected the stages of the project that utilizes alternative energy. SPA

Saudi Minister of Environment, Water and Agriculture Eng. Abdulrahman Al-Fadhli visited the Reverse Osmosis Plant in Jubail, the world's largest, and was briefed on the workflow of the production system (1 million m3/day).

This is one of the major projects implemented by the Saline Water Conversion Corporation (SWCC), and the largest of its kind in the world using reverse osmosis technology with the lowest energy consumption, of 2.7 kWh/m3.

Al-Fadhli inspected the stages of the project that utilizes alternative energy to reach a consumption rate of 2.2 kWh/m3, and solar energy to reduce industrial energy consumption by 1.96 kWh/m3.

The tour also included visiting the well water purification units, a project established in the Eastern region by SWCC to improve the quality of well water and thus the quality of life, as part of the most important goals of Vision 2030.

The project aims to increase production rates at 15 different locations, to reach a total capacity of 76,000 m3/day for some 400,000 beneficiaries.

Business

1st Integrated Water Desalination-Solar PV Project in Saudi Arabia is Launched

The inauguration ceremony of the Jubail 3A independent water desalination plant (Jazlah Water Desalination Company). (Asharq Al-Awsat)
The inauguration ceremony of the Jubail 3A independent water desalination plant (Jazlah Water Desalination Company). (Asharq Al-Awsat)
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1st Integrated Water Desalination-Solar PV Project in Saudi Arabia is Launched

The inauguration ceremony of the Jubail 3A independent water desalination plant (Jazlah Water Desalination Company). (Asharq Al-Awsat)
The inauguration ceremony of the Jubail 3A independent water desalination plant (Jazlah Water Desalination Company). (Asharq Al-Awsat)

Eng. Abdul Rahman Al-Fadhli, Minister of Environment, Water and Agriculture, Chairman of the Board of Directors of the Saudi Water Partnerships Company, officially inaugurated the Jubail 3A independent water desalination plant (Jazlah Water Desalination Company).

The move aims to raise spending efficiency and benefit from the expertise of the private sector in construction, operation and management, in addition to reducing carbon emissions by 60,000 tons annually.

ACWA Power, the leading Saudi developer, investor, and operator of power generation, water desalination, and green hydrogen plants worldwide, along with its partners Gulf Investment Corporation (GIC) and AlBawani Water & Power Company (AWP), celebrated on Saturday the official inauguration of the plant, after receiving the commercial operation certificate from Saudi Water Partnership Co. (SWPC), to mark the start of full-time operations.

The Jubail 3A independent water desalination plant is the first of its kind in the Kingdom due to its integration with photovoltaic (PV) solar power.

The $650 million Jazlah company project, located in Jubail, has achieved an exceptional world efficiency record of 2.8 kWh/cubic meter of water using Arabian Gulf Seawater, ACWA Power said in a press release.

It added that the project marked the first Independent Water Project (IWP) in the eastern region with a production capacity of 600,000 cubic meters of desalinated water per day to meet increasing water demands. Jazlah encompasses a 45.5 MW solar PV power generation facility, which will account for 20% of the plant’s energy consumption and will deliver clean water to over three million people at a record-breaking rate of 0.41 USD/m3, using reverse osmosis technology.

In remarks on the occasion, Al-Fadhli stressed that these projects come to achieve the objectives and plans of the National Water Strategy to increase private sector participation in water production projects, supplying drinking water to all regions in the Kingdom.

He added that the project would work directly to meet the demand in the Riyadh and Qassim regions, as well as develop the water sector and improve the quality of its services.

For his part, Eng. Khalid Al-Quraishi, CEO of Saudi Water Partnership Company, said: “Through the utilization of green energy, Jazlah generates 45.5 MW of solar PV power, resulting in reduced carbon emissions and a significant decrease in grid electricity consumption.”

“The plant operates at an impressive energy efficiency rate of 2.8 kWh/cubic meter. The success of this project is a testament to the unwavering commitment of the Ministry of Environment, Water, and Agriculture, along with the cooperation of all public and private stakeholders,” he added.

Mohammad Abunayyan, Chairman of the Board of Directors of ACWA Power, said that the project demonstrated the company’s global leadership in water desalination, and its enduring commitment to cost leadership, social prosperity, and national development.

“A proud addition to our water desalination portfolio, the Jazlah company plant will make invaluable contributions towards the Kingdom’s water security in the years ahead, helping combat climate change while catering to sustainable development goals for a growing population,” he stated.

Business

Saudi Economic Developments Challenge Business Councils’ Capacity to Keep Pace

Saudi flags along a commercial street in the capital Riyadh, Saudi Arabia (Asharq Al-Awsat)
Saudi flags along a commercial street in the capital Riyadh, Saudi Arabia (Asharq Al-Awsat)
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Saudi Economic Developments Challenge Business Councils’ Capacity to Keep Pace

Saudi flags along a commercial street in the capital Riyadh, Saudi Arabia (Asharq Al-Awsat)
Saudi flags along a commercial street in the capital Riyadh, Saudi Arabia (Asharq Al-Awsat)

Amidst Saudi Arabia’s push for economic diversification, the localization of emerging industries, the adoption of green energy technologies like ammonia and hydrogen, climate-conscious initiatives, and the integration of artificial intelligence, experts stress the vital importance of business councils affiliated with the Federation of Saudi Chambers to assume a proactive role.

Their task involves not only keeping pace with the ever-evolving modern economic and industrial landscape but also spearheading the necessary adaptations to effectively respond to transformative developments.

Experts stressed the importance of business councils adopting a strategic plan to attract top investments, form successful partnerships, produce high-quality products that can compete globally, and draw on innovative experiences from various fields, especially in aerospace and technology.

“Business councils play a crucial and primary role in fostering economic and trade relations, facilitating investment flows between Saudi Arabia and other countries,” affirmed Shura Council member Fadl al-Buainain.

“Additionally, they enhance mutual cooperation and contribute to translating commercial and investment opportunities into tangible and high-quality partnerships,” he told Asharq Al-Awsat.

“The more business councils receive the support and guidance of leadership, the more effective their role becomes in overall development,” explained Buainain.

“Saudi Arabia is keen on enhancing the role of the private sector through joint business councils, with increasing support in line with the government’s vision to strengthen strategic partnerships with friendly countries.”

“These councils are envisioned as a bridge for development and investment flows, aligning with a comprehensive vision.”

Buainain further highlighted that within the private sector, there are large companies in which the government holds the majority of ownership. As a result, economic decisions intertwine with sovereign developmental decisions, ultimately serving the public interest.

Regarding the new trends that business councils are expected to focus on, Buainain emphasized the importance of exploring opportunities for green economic development.

He highlighted that this is one of the Kingdom’s main objectives, noting that there is a package of initiatives, including financial investments exceeding SAR 700 billion ($186.6 billion).

According to Buainain, this means expanding investments in two main areas: first, enhancing energy sources to ensure supply sustainability and market stability, and second, promoting green economic development that safeguards the environment and human health.

These efforts are directed towards achieving long-term carbon neutrality.

Buainain also highlighted that the completion of the green hydrogen plant project, which is the world’s largest green hydrogen project with a cost of $5 billion, will enable the Kingdom to export clean fuel in the coming years.

He emphasized that diversifying economic sources is the primary goal of Crown Prince Mohammed bin Salman, stating that hydrogen production is a significant part of his strategy.