Saudi Arabia Seeks to Open New Markets to Confront Global Supply Chain Crisis

Saudi Arabia is seeking to diversify the resources of significant commodities to avoid the risks of the global supply chains crisis. (Asharq Al-Awsat)
Saudi Arabia is seeking to diversify the resources of significant commodities to avoid the risks of the global supply chains crisis. (Asharq Al-Awsat)
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Saudi Arabia Seeks to Open New Markets to Confront Global Supply Chain Crisis

Saudi Arabia is seeking to diversify the resources of significant commodities to avoid the risks of the global supply chains crisis. (Asharq Al-Awsat)
Saudi Arabia is seeking to diversify the resources of significant commodities to avoid the risks of the global supply chains crisis. (Asharq Al-Awsat)

The Council of Saudi Chambers (CSC) is seeking to open new markets to achieve food security for essential commodities amid the global supply chain crisis.

The food supply chain crisis led to an increase in the prices of many food commodities and raw materials, and its impact included the oil markets and logistics services.

A recent study prepared by the Assistant General Secretariat for Economic Affairs of the Council revealed the repercussions of the crisis on the local and global economy, indicating that the Kingdom is a pivotal country with an effective influence on the stability of global economic markets.

The study said the global crisis affected many food, energy, and industrial chains, stressing the need for efforts to achieve food security for basic and other commodities.

It has supported and enabled importers and producers in the private sector to maintain price levels of a strategic stock of commodities with high food risks and other items necessary for achieving food security and comprehensive development in the Kingdom.

The study stated that the Council worked through the private sector to open new markets to import alternative goods in the short- and medium-term and maintain price levels at the purchasing power of citizens for most food and other products.

The Council identified the challenges and risks arising from the crisis in the local market and discussed it with the concerned authorities and business owners.

The CSC prepared several supportive initiatives to avoid the food supply chain crisis.

The Council studied various aspects of the crisis to determine possible advantages of the global situation in attracting international companies to the local Saudi market in partnership with Saudi investors.

Under its plan to serve the private sector and the national economy to avoid the crisis of food supply chains and other commodities, the Council took several essential steps to achieve the national economy's general interest.

It formed specialized teams for essential food commodities to speed up taking urgent decisions and join the crisis management committee of the Saudi Grains Organization (SAGO).

The challenges of food supply chains and other commodities include the high costs of raw materials and shipping, the lack of shipping companies working in the maritime field with the Kingdom, the delay of shipments to the local market due to global restrictions and high port, and customs fees.

The Council stressed that the government agencies are exerting efforts to identify the risks and challenges of the crisis and work to resolve the issues facing the private sector.

It also devised support programs for the public sector and established a direct line of communication with the concerned authorities to support the industry in providing food commodities.



Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)

Telecommunications companies listed on the Saudi Stock Exchange (Tadawul) achieved a 12.46 percent growth in their net profits, which reached SAR 4.07 billion ($1.09 billion) during the second quarter of 2024, compared to SAR 3.62 billion ($965 million) during the same period last year.

They also recorded a 4.76 percent growth in revenues during the same quarter, after achieving sales worth more than SAR 26.18 billion ($7 billion), compared to SAR 24.99 billion ($6.66 billion) in the same quarter of 2023.

The growth in the revenues and net profitability is the result of several factors, including the increase in sales volume and revenues, especially in the business sector and fifth generation services, as well as the decrease in operating expenses and the focus on improving operational efficiency, controlling costs, and moving towards investment in infrastructure.

The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia. The fiscal year of Etihad Atheeb Telecommunications Company (GO) ends on March 31.

According to its financial results announced on Tadawul, Etihad Etisalat Company (Mobily) achieved a 33 percent growth rate of profits, bringing its profits to SAR 661 million by the end of the second quarter of 2024, compared to SAR 497 million during the same period in 2023. The company also achieved a 4.59 percent growth in revenues to reach SAR 4.47 billion, compared to SAR 4.27 billion in the same quarter of last year.

The Saudi Telecom Company achieved the highest net profits among the sector’s companies, at about SAR 3.304 billion in the second quarter of 2024, compared to SAR 3.008 billion in the same quarter of 2023. The company registered a growth of 4.52 percent in revenues.

On the other hand, the revenues of the Saudi Mobile Telecommunications Company (Zain Saudi Arabia) increased by about 6.69 percent, as it recorded SAR 2.55 billion during the second quarter of 2024, compared to SAR 2.39 billion in the same period last year.

Commenting on the quarterly results of the sector’s companies, and the varying net profits, the head of asset management at Rassanah Capital, Thamer Al-Saeed, told Asharq Al-Awsat that the Saudi Telecom Company remains the sector leader in terms of customer base expansion.

He also noted the continued efforts of Mobily and Zain to offer many diverse products and other services.

Financial advisor at the Arab Trader Mohammed Al-Maymouni said the financial results of telecom sector companies have maintained a steady growth, up to 12 percent, adding that Mobily witnessed strong progress compared to the rest of the companies, despite the great competition which affected its revenues.

He added that Zain was moving at a good pace and its revenues have improved during the second quarter of 2024. However, its profits were affected by an increase in the financing cost by SAR 26.5 million riyals and a rise in interest, while net income declined significantly compared to the previous year, during which the company made exceptional returns.