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Foreign Capital Represents 39% of Saudi Industrial Sector Investments

The National Industrial Development and Logistics Program aims to achieve integration between the targeted sectors, namely industry, mining, energy and logistics. (Asharq Al-Awsat)
The National Industrial Development and Logistics Program aims to achieve integration between the targeted sectors, namely industry, mining, energy and logistics. (Asharq Al-Awsat)
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Foreign Capital Represents 39% of Saudi Industrial Sector Investments

The National Industrial Development and Logistics Program aims to achieve integration between the targeted sectors, namely industry, mining, energy and logistics. (Asharq Al-Awsat)
The National Industrial Development and Logistics Program aims to achieve integration between the targeted sectors, namely industry, mining, energy and logistics. (Asharq Al-Awsat)

The Ministry of Industry and Mineral Resources said on Sunday that foreign or joint capital investments represent about 39 percent of the total investments in the industrial sector in the Kingdom.

The ministry also revealed that the total number of existing and under construction factories until the end of last May reached 15 percent.

The number of factories with foreign investment in Saudi Arabia reached 839 by the end of May 2022, the ministry said, representing approximately 8 percent of the total number of factories, with investments estimated at more than SR65 billion (USD 17.3 Billion).

The number of joint venture factories in Saudi Arabia reached about 787, constituting 7 percent of the total factories, with investments estimated at more than SR464 billion.

Meanwhile, the National Industrial Development and Logistics Program (NDLP) has managed to contribute 690.7 billion riyals (USD184 billion) to the Saudi economy during the past year.

The program’s economic activities contributed about SR413.5 billion (USD110 billion) to the real GDP, with a growth rate of 9 percent compared to 2020, in addition to SR231 billion (USD61 billion) for non-oil commodity exports, with a growth of 37 percent.

Saudi Arabia launched the National Industrial Development and Logistics Program in 2019 with the aim of transforming the Kingdom into a leading industrial power and a global platform for logistics services, and achieve integration between the targeted sectors, namely industry, mining, energy and logistics.

According to a recent report by NDLP, the value of re-export operations improved by the end of 2021 to reach SR43.5 billion (USD11.6 billion), compared to SR35.3 billion (USD9.4 billion) in the previous year.

The National Industrial Development and Logistics Program is one of the most important and largest of the thirteen programs in the Kingdom’s Vision 2030, in terms of its expected positive impact on the Saudi economy.

By 2030, the program aims to increase the contribution of its four sectors - industry, mining, logistics and energy - to the GDP to SR1.2 trillion (USD320 billion), stimulate investments worth more than SR1.7 trillion (USD453.3 billion), and raise the volume of non-oil exports to more than one trillion riyals (USD266 billion), as well as developing the labor market by creating 1.6 million new jobs.

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Oil Prices Steady as Markets Weigh Demand against US Inventories

FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)
FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)
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Oil Prices Steady as Markets Weigh Demand against US Inventories

FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)
FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)

Oil prices were little changed on Thursday as investors weighed firm winter fuel demand expectations against large US fuel inventories and macroeconomic concerns.

Brent crude futures were down 3 cents at $76.13 a barrel by 1003 GMT. US West Texas Intermediate crude futures dipped 10 cents to $73.22.

Both benchmarks fell more than 1% on Wednesday as a stronger dollar and a bigger than expected rise in US fuel stockpiles pressured prices.

"The oil market is still grappling with opposite forces - seasonal demand to support the bulls and macro data that supports a stronger US dollar in the medium term ... that can put a ceiling to prevent the bulls from advancing further," said OANDA senior market analyst Kelvin Wong.

JPMorgan analysts expect oil demand for January to expand by 1.4 million barrels per day (bpd) year on year to 101.4 million bpd, primarily driven by increased use of heating fuels in the Northern Hemisphere.

"Global oil demand is expected to remain strong throughout January, fuelled by colder than normal winter conditions that are boosting heating fuel consumption, as well as an earlier onset of travel activities in China for the Lunar New Year holidays," the analysts said.

The market structure in Brent futures is also indicating that traders are becoming more concerned about supply tightening at the same time demand is increasing.

The premium of the front-month Brent contract over the six-month contract reached its widest since August on Wednesday. A widening of this backwardation, when futures for prompt delivery are higher than for later delivery, typically indicates that supply is declining or demand is increasing.

Nevertheless, official Energy Information Administration (EIA) data showed rising gasoline and distillates stockpiles in the United States last week.

The dollar strengthened further on Thursday, underpinned by rising Treasury yields ahead of US President-elect Donald Trump's entrance into the White House on Jan. 20.

Looking ahead, WTI crude oil is expected to oscillate within a range of $67.55 to $77.95 into February as the market awaits more clarity on Trump's administration policies and fresh fiscal stimulus measures out of China, OANDA's Wong said.