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Bahrain’s GFH Spins Out Infrastructure Investments into Newly Established 'Infracorp'

General view of Bahrain World Trade Center in Manama, Bahrain (File photo: Reuters)
General view of Bahrain World Trade Center in Manama, Bahrain (File photo: Reuters)
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Bahrain’s GFH Spins Out Infrastructure Investments into Newly Established 'Infracorp'

General view of Bahrain World Trade Center in Manama, Bahrain (File photo: Reuters)
General view of Bahrain World Trade Center in Manama, Bahrain (File photo: Reuters)

Bahrain-based GFH Financial Group announced the spinning out of its infrastructure and real estate assets under the newly established “Infracorp” with a capital of $1 billion.

Infracorp will specialize in investments focusing on accelerating growth and development of sustainable infrastructure assets and environments across the Gulf and global markets.

A statement by the group, which Asharq Al-Awsat received a copy of, said the company will be managing a portfolio of near $3 billion of infrastructure assets including the land bank in the Gulf, North Africa, and South Asia of approximately 250 million square feet earmarked for sustainable economic and social infrastructure.

It focuses on investments in developing communities and investing in logistics and technologies that support sustainability and renewables as well as social infrastructure assets across the education and healthcare sectors.

CEO of GFH Hisham al-Rayes explained that the launch of Infracorp has been in response to the significant need and opportunity for private sector investment in the development of sustainable infrastructure as global economies transition to becoming more equitable and socially and environmentally conscious.

Rayes explained that unprecedented levels of capital are needed to both upgrade and develop sustainable foundations.

"Infracorp is well placed to put its capital, insight, and ethos into investments that support sustainable growth."

Launching the company also comes in response to the demand of regional and global investors for opportunities that deliver solid returns and provide for significant and measurable ESG impact.

Investment in sustainable infrastructure is inextricably linked with social and economic progress and Infracorp is focused on raising and deploying capital to help meet strategic development needs while enhancing economic wellbeing and returns for all stakeholders, according to Rayes.

"Furthermore, spinning out infrastructure assets from GFH will allow the Group to focus more on financial assets, while allowing Infracorp to manage and deliver returns from infrastructure and real estate assets which have a longer investment cycle than banking activities."

GFH believes the move will reflect positively on its results and the quality of its balance sheet.

"We will also look to list Infracorp on GCC exchange over the next 24 months and issue Green Sukuk, creating even greater value and providing a unique opportunity for investors.”

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Saudi Non-Oil Exports Reach Highest Levels Since 2022

A view of the Jeddah Islamic Port. (Asharq Al-Awsat)
A view of the Jeddah Islamic Port. (Asharq Al-Awsat)
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Saudi Non-Oil Exports Reach Highest Levels Since 2022

A view of the Jeddah Islamic Port. (Asharq Al-Awsat)
A view of the Jeddah Islamic Port. (Asharq Al-Awsat)

Saudi Arabia’s non-oil exports have reached their highest levels since the second quarter of 2022, continuing to grow at a steady pace. By the end of the third quarter of this year, non-oil exports, including re-exports, totaled SAR 80 billion (USD 21 billion), reflecting a 16.8% increase compared to the same period in 2023.

This growth aligns with the goals of Vision 2030, which aims to diversify Saudi Arabia’s economy and reduce reliance on oil revenues. Credit rating agency Moody’s recently upgraded Saudi Arabia’s credit rating to AA3 from A1 with a stable outlook, citing the Kingdom’s ongoing economic diversification and the strength of its non-oil private sector. Moody’s projects the non-oil private sector’s GDP to grow by 4–5% annually in the coming years.

According to data from Saudi Arabia’s General Authority for Statistics, non-oil national exports (excluding re-exports) grew by 7.6% in the third quarter of 2024, reaching SAR 57 billion (USD 15.1 billion). Re-exports saw a remarkable surge of 48.4%, amounting to SAR 23 billion (USD 6.1 billion).

In contrast, total merchandise exports dropped by 7.7% to SAR 276 billion (USD 73.5 billion) due to a 14.9% decline in oil exports. As a result, the share of oil exports in total exports decreased from 77.3% in the third quarter of 2023 to 71.3% this year.

Chemical industry products accounted for 25.5% of non-oil exports, growing by 5.3% compared to the same period last year. Plastics, rubber, and their derivatives followed closely, representing 24.9% of non-oil exports, with an 8.9% increase from the third quarter of 2023.

China remained Saudi Arabia’s top export destination, accounting for 15.2% of total exports in the third quarter of 2024. Japan and South Korea followed, at 9.3% and 9.2%, respectively. Other major destinations included India, the UAE, the US, Poland, Egypt, Bahrain, and Taiwan. Together, these ten countries accounted for 66.4% of Saudi exports.

Experts emphasize that the growth in non-oil exports strengthens Saudi Arabia’s economy and reflects the success of its diversification strategy under Vision 2030.

Shura Council member Fadhel Al-Buainain highlighted the importance of considering the scale of Saudi non-oil exports during the third quarter of 2024. He emphasized two key aspects of Saudi non-oil exports.

First, the 16.8% growth achieved is a significant leap that boosts the Saudi economy’s ability to continue strengthening non-oil exports, which are a focal point of Vision 2030 and its economic diversification goals.

Second, he said the 48.4% increase in the value of re-exported goods represents substantial growth, reflecting the Kingdom’s potential to play a pivotal role in regional re-export activities. This, in turn, can stimulate exports and position Saudi Arabia as a global logistics hub.

He further noted that the increase in export value compared to the second quarter of this year, amounting to SAR 37.2 billion (USD 9.92 billion) or 15.6%, indicates sustained and accelerating export growth.

Al-Buainain believes that Saudi Arabia’s ports on the Red Sea and the Arabian Gulf are well-equipped to play a central role in re-exporting, supported by free economic zones, robust infrastructure, and a well-established transportation and logistics network.

He also stated that the improvement in global demand, particularly in the petrochemical sector, which accounted for the largest share of exports, contributed to this growth.

However, the global economic conditions may face certain challenges that will reflect negatively on global demand, he remarked, stressing the importance of diversifying exports.

Dr. Osama Al-Obaidi, an international commercial law consultant and professor, told Asharq Al-Awsat that the significant increase in non-oil exports in the third quarter of this year compared to the same period in 2023 is linked to the growth in petrochemical exports, particularly plastics, rubber, and their derivatives.

He explained that this rise reflects the effectiveness of Saudi Arabia’s economic diversification efforts and its reduced reliance on oil as a sole income source, in line with Vision 2030.

It also highlights the success of the substantial investments made by the government to develop ports and logistics services, such as King Abdulaziz Port in Dammam and Jeddah Islamic Port.

Moreover, improvements in domestic, regional, and international airports, along with initiatives to promote local industries—particularly chemicals, food products, pharmaceuticals, and other high-demand goods in foreign markets—have also played a pivotal role.