Saudi Arabia: 70 Companies Invest $ 6.4 Billion in Military Industries Sector

Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed with the governor of the Saudi General Authority for Military Industries (GAMI) and the Saudi ambassador to the UAE | Asharq Al-Awsat
Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed with the governor of the Saudi General Authority for Military Industries (GAMI) and the Saudi ambassador to the UAE | Asharq Al-Awsat
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Saudi Arabia: 70 Companies Invest $ 6.4 Billion in Military Industries Sector

Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed with the governor of the Saudi General Authority for Military Industries (GAMI) and the Saudi ambassador to the UAE | Asharq Al-Awsat
Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed with the governor of the Saudi General Authority for Military Industries (GAMI) and the Saudi ambassador to the UAE | Asharq Al-Awsat

The number of local and international military industry companies operating in Saudi Arabia reached more than 70 with an estimated investment volume of SR24 billion ($6.4 billion).

The General Authority for Military Industries (GAMI), which is overseeing the Saudi pavilion at IDEX 2021, stated that it has issued licenses for 70 local and international companies until the end of 2020. The total number of these companies' licenses reached 114 licenses that would enable them to engage in several different activities in the military industry sector.

The percentage of manufacturing licenses reached 57% and the military service licenses reached 25%, while the percentage of supply licenses reached 18 percent. The licensed national companies in this sector represent 81%, while the percentage of foreign and mixed companies reached 19% of the total number of companies.

The authority stated that it aims to support investors and facilitate their entry into the Saudi military and security industries market, making them a part of its strategy that contributes to the Saudi Vision 2030 objective of localizing over 50 % of the military equipment spending by 2030.

GAMI’s online licensing portal; licensing.gami.gov.sa allows investors to issue permits and military licenses that include six different activities in the sector including military equipment, military services, military electronics, in addition to military electronic services, ammunition, and manufacturing explosives.

It is worth noting that GAMI is the responsible authority for regulating, enabling, and licensing military industries in Saudi Arabia. It is responsible for developing a sustainable sector for defense and security industries in Saudi Arabia that enhances its strategic independence in this field, strengthens the foundations of its national security, and supports its economic and social growth.

Separately, the third day of the International Defense Exhibition (IDEX) and the Naval Defense Exhibition (NAVDEX) 2021 has seen the UAE Armed Forces sign 12 new deals, worth AED 5.589 billion ($1.4 billion), with local and international companies.

The cumulative value of deals signed at IDEX and NAVDEX 2021 is now AED 17.913 billion ($4.7 billion).

“The total amount of deals signed with international parties amounted to AED 1.164 billion ($310 million), which is 21% of the total deal value for today, and AED 4.425 billion ($1.1 billion) of deals were agreed with UAE companies, which is 79% of today’s total deal value,” said staff Brigadier-General Mohammed Al Hassani.

“Six contracts were awarded to international companies, and six agreements have been implemented with UAE-based companies. 12 deals were signed in total,” added the official spokesperson of the IDEX and NAVDEX exhibitions.



Dollar Hits 2-week Low as Traders Ponder Trump Tariff Plans

A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
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Dollar Hits 2-week Low as Traders Ponder Trump Tariff Plans

A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo

The dollar touched a fresh two-week low on Wednesday, as a lack of clarity on President Donald Trump's plans for tariffs kept financial markets guessing and left the greenback struggling to regain ground against major currencies. Trump said late on Tuesday that his administration was discussing imposing a 10% tariff on goods imported from China on Feb. 1, the same day that he previously said Mexico and Canada could face levies of around 25%.

He also vowed duties on European imports, without providing further details.

Despite those threats, a lack of specific plans from Trump's first day in office saw the dollar start the week with a 1.2% slide against a basket of major peers. It stabilized on Tuesday, ending flat after an attempted rebound fizzled, with US officials saying any new taxes would be imposed in a measured way. The dollar index, which tracks the currency against six top rivals, touched its lowest since Jan. 6 at 107.75 on Wednesday, paring an earlier rise in the index. It was last down 0.15% at 107.97.

"Tariffs have again grabbed the headlines overnight as Trump commented in the evening that his threat of a new 10% tariff on China was still on the table...," said Deutsche Bank's Jim Reid.

"Trump's comments leave plenty of near-term uncertainty even though the trade investigations from his day 1 executive orders will take some time to play out."

Trump on Monday signed a broad trade memorandum, ordering federal agencies to complete comprehensive reviews of a range of trade issues by April 1. The greenback rose 0.3% to 156 yen, edging up from the one-month low it touched the day before.

INFLATION RISKS The euro fell 0.3% in early trading, before it changed course and rose to $1.0457, its highest since Dec. 30. It was last up 0.07% at $1.0434. Sterling hit a two-week high against the greenback, but was last trading down at $1.2351.

Analysts have said that Trump's policies on immigration, tax and tariffs will likely boost growth but also be inflationary, but the more cautious tariff approach has fuelled some hopes that inflation risks could be more limited, Reuters reported.

Traders expect a quarter-point Fed interest rate cut by July, while another reduction by year-end is considered a coin toss. The Canadian dollar was slightly weaker at 1.4346 per US dollar, following a volatile week that saw it tumble as low as 1.4520 overnight for the first time since March 2020, feeling additional pressure from cooling inflation last month. The Mexican peso gained about 0.3% to 20.547 per dollar. China's yuan held steady at 7.272 per dollar in offshore trading, after pushing to the strongest level since Dec. 11 on Tuesday at 7.2530.

"A 10% tariff on China imports would be far below the 60% rate he mentioned in his campaign," said Alvin Tan, head of Asia FX strategy at RBC Capital Markets.

"On top of this is the general sense that Trump is not pursuing maximalist trade protectionism in his early actions, but appears to be positioning for trade negotiations," Tan said.

"Altogether these suggest that the US dollar could drop further."