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IMF Says Preparing for 1st Review of Egypt Program

A general view of banks, hotels, office and residential buildings in the center of Cairo, Egypt, September 13, 2018. REUTERS/Amr Abdallah Dalsh
A general view of banks, hotels, office and residential buildings in the center of Cairo, Egypt, September 13, 2018. REUTERS/Amr Abdallah Dalsh
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IMF Says Preparing for 1st Review of Egypt Program

A general view of banks, hotels, office and residential buildings in the center of Cairo, Egypt, September 13, 2018. REUTERS/Amr Abdallah Dalsh
A general view of banks, hotels, office and residential buildings in the center of Cairo, Egypt, September 13, 2018. REUTERS/Amr Abdallah Dalsh

Preparations for the first review of Egypt's economic reform program with the International Monetary Fund have begun and dates for the review mission will be announced when agreed with the authorities, an IMF spokesperson said on Thursday.

The IMF approved in December a $3 billion Extended Fund Facility loan for Egypt.

Disbursements under the 46-month program are subject to eight reviews, the first of which was dated March 15, 2023 in an IMF staff report published in December.

Among the key commitments that Egypt made to secure the loan were a permanent shift to a flexible exchange rate regime and wide-ranging structural reforms to reduce the state's footprint in the economy.

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Saudi Energy Minister Warnings to Speculators Highlighted Ahead of OPEC+ Meeting

Saudi Energy Minister Prince Abdulaziz bin Salman upon his arrival at the OPEC headquarters in Vienna (AFP)
Saudi Energy Minister Prince Abdulaziz bin Salman upon his arrival at the OPEC headquarters in Vienna (AFP)
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Saudi Energy Minister Warnings to Speculators Highlighted Ahead of OPEC+ Meeting

Saudi Energy Minister Prince Abdulaziz bin Salman upon his arrival at the OPEC headquarters in Vienna (AFP)
Saudi Energy Minister Prince Abdulaziz bin Salman upon his arrival at the OPEC headquarters in Vienna (AFP)

The OPEC+ countries seek to maintain the stability of oil markets at their meeting on Sunday amid global economic turmoil and uncertainty surrounding global economic and political prospects.

Last week, Saudi Energy Minister Prince Abdulaziz bin Salman warned "short sellers" against betting on oil prices falling, saying they should watch out.

Ministers of OPEC and its allies began their two-day meetings on Saturday at the organization's headquarters in Vienna.

Reuters quoted unnamed sources saying that the OPEC+ alliance will discuss possible options, including additional oil cuts.

OPEC+ pumps around 40 percent of the world's crude, meaning its policy decisions can significantly impact oil prices.

Several countries in the coalition had announced voluntary cuts of 1.6 million barrels per day last April, in addition to the two million barrels per day that had been previously reduced. The decision took effect in May.

The surprise output announcement in April helped to drive oil prices about $9 per barrel higher to above $87, but they swiftly retreated, under pressure from concerns about global economic growth and demand. On Friday, the international benchmark Brent settled at $76.

However, Russian Deputy Prime Minister Alexander Novak said he did not expect any new steps from the OPEC+ group at its meeting in Vienna on June 4, according to Russian media.

"This figure is premature, and these matters have not yet been addressed."

Western countries have accused OPEC of manipulating oil prices and undermining the global economy by raising energy costs.

The West also accused OPEC of being too biased toward Russia, despite sanctions over Moscow's invasion of Ukraine.

Reuters indicated that OPEC officials said the West's money-printing over the last decade exacerbated inflation and forced oil-producing nations to take measures to preserve the value of the leading commodity among their exports.

Asian countries like China and India bought the lion's share of Russia's oil exports and refused to join Western sanctions against Russia.

UAE Energy Minister Suhail al-Mazrouei said that there is an aspiration for a resolution that guarantees a sustainable balance of supply and demand.

The International Energy Agency (IEA) expects global oil demand to rise further in the second half of 2023, potentially boosting oil prices.

Analysts at JPMorgan, however, said OPEC needed to act more quickly to adjust supply to record high levels of US output and higher-than-expected Russian exports.

"There is simply too much supply," the JPMorgan analysts said in a note, adding that extra cuts could amount to around one million bpd.

Business

King Abdullah Economic City Gets a Special Economic Zone License

Situated at the crossroads of global trade routes, the city enjoys direct access to all markets in the Middle East and North Africa region
Situated at the crossroads of global trade routes, the city enjoys direct access to all markets in the Middle East and North Africa region
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King Abdullah Economic City Gets a Special Economic Zone License

Situated at the crossroads of global trade routes, the city enjoys direct access to all markets in the Middle East and North Africa region
Situated at the crossroads of global trade routes, the city enjoys direct access to all markets in the Middle East and North Africa region

King Abdullah Economic City has been granted a license for the Special Economic Zone, the Saudi Press Agency reported.

Situated at the crossroads of global trade routes, the city enjoys direct access to all markets in the Middle East and North Africa region. Spanning a total area of 60 km², the zone will be under the direct supervision of the Special Economic Cities and Zones Authority (ECZA), SPA said Saturday.

The Special Economic Zone's strategic location facilitates the operations of various logistics services and light industries. It is a promising investment environment, offering economic incentives with globally competitive advantages, SPA said.

The zone benefits from cutting-edge infrastructure, including the King Abdullah Port, the Industrial Valley, and a modern and vibrant community. This community encompasses diverse commercial and social facilities, catering to the needs and aspirations of residents, visitors, and workers in the city.

Moreover, the Special Economic Zone focuses on economic sectors such as car manufacturing, consumables, food, medicine, logistics, and associated industries. It aims to boost domestic output, attract foreign direct investment, generate new employment opportunities, and maximize the Kingdom's exports by hosting a diverse and extensive range of industries.

Business

Tunisian President Suggests Taxing Rich as Solution to Fiscal Problem

Tunisia's President Kais Saied gives a statement on the coronavirus disease (COVID-19) vaccination, during a European Union - African Union summit, in Brussels, Belgium February 18, 2022. (Reuters)
Tunisia's President Kais Saied gives a statement on the coronavirus disease (COVID-19) vaccination, during a European Union - African Union summit, in Brussels, Belgium February 18, 2022. (Reuters)
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Tunisian President Suggests Taxing Rich as Solution to Fiscal Problem

Tunisia's President Kais Saied gives a statement on the coronavirus disease (COVID-19) vaccination, during a European Union - African Union summit, in Brussels, Belgium February 18, 2022. (Reuters)
Tunisia's President Kais Saied gives a statement on the coronavirus disease (COVID-19) vaccination, during a European Union - African Union summit, in Brussels, Belgium February 18, 2022. (Reuters)

Tunisian President Kais Saied on Saturday suggested raising taxes on richer people could be an alternative to socially painful reforms as a means to secure an international financial rescue package.

Tunisia's government negotiated a preliminary agreement in October with the International Monetary Fund (IMF) for a $1.9 billion loan in return for cuts to subsidies and the public sector wage bill and reform of state-owned companies.

Credit ratings agencies have warned that Tunisia faces a possible default on sovereign debt without the loan, which is also expected to unlock more bilateral financing.

The IMF has said Tunisia needs to put its finances on a more sustainable trajectory and has previously voiced concern at the level of its public wage bill, subsidies, low tax base and support for unprofitable state-owned companies.

Although the IMF deal reached in October was based on proposals made by Tunisia's government, Saied has described the fiscal reforms it contained as "diktats". Without his approval, the agreement - and loan - cannot be finalized.

Speaking to French President Emmanuel Macron in a remarks published by Saied's office, he described the IMF deal conditions as "tantamount to lighting a match next to a high explosive".

"Another scenario could be based on putting taxes on those who do not need support", in order to maintain social justice, his office quoted him as saying.

Saied also proposed a summit meeting on the issue of illegal migration across the Mediterranean. Italian Prime Minister Giorgia Meloni will visit Tunisia next week, Tunisian state media reported on Friday.

Business

Arab Economies Expected to Grow by 3.4% in 2023

The Arab Monetary Fund (AMF) projected a 3.4 percent growth for Arab economies. (WAM)
The Arab Monetary Fund (AMF) projected a 3.4 percent growth for Arab economies. (WAM)
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Arab Economies Expected to Grow by 3.4% in 2023

The Arab Monetary Fund (AMF) projected a 3.4 percent growth for Arab economies. (WAM)
The Arab Monetary Fund (AMF) projected a 3.4 percent growth for Arab economies. (WAM)

The Arab Monetary Fund (AMF) projected a 3.4 percent growth for Arab economies, accompanied by tighter monetary policies to curb inflation.

The report showed that Arab countries with economic reform programs and strategies to diversify their economies, improve their resilience, enhance their business environments, empower the private sector, and invest in human capital are more able to cope with economic shocks.

The economic growth rate of Arab countries will rise to 4 percent in 2024, mainly due to the expected stability of oil and gas prices, basic goods prices, and controlled inflation.

Higher energy prices will boost the economic growth of major Arab oil exporters in 2023 and 2024, with their economies expected to grow by 3.4 percent in 2023 and by 4.2 percent in 2024, the report stated.

Gulf Cooperation Council (GCC) countries have a positive outlook for 2023, with an expected GDP growth of 3.4 percent, mainly due to their efforts to diversify their sources of income, the report added, noting that oil prices are likely to remain stable and high, resulting in higher oil revenues and improved financial outcomes, foreign exchange reserves and fiscal positions.

The report stressed that promoting workforce localization and increasing the participation of citizens in the private sector is another key approach to achieving growth in GCC countries, most notably in the UAE, Saudi Arabia, and Bahrain.

According to the AMF report, Arab countries that import oil will see their growth rate increase from 3.1 percent in 2023 to 4 percent in 2024, after inflation is controlled by the end of this year and monetary policies are eased.

Various international organizations had different estimates for global economic growth in 2023 and 2024, ranging from 1.7 percent to 2.9 percent for 2023 and from 2.7 percent to 3.1 percent for 2024, the report stated.

Director General and Chairman of the Board of the Arab Monetary Fund. Dr. Abdulrahman Al Hamidy said the region has been witnessing a remarkable transition in the past years.

Saudi Arabia

The AMF expected Saudi Arabia's economic growth to remain robust in 2023-2024, reaching 3.1 percent and 5.7 percent respectively.

The non-oil sector in the Kingdom is forecast to achieve strong growth averages.

Even as the Kingdom aims to reduce its reliance on energy to develop the economy, its pioneering role in the global oil markets can’t be disregarded, the report added.

Saudi Arabia achieved an 8.7 percent GDP growth rate in 2022 and broke its total amount record of more than $1 trillion.

A considerable part of this growth is attributed to the massive reforms carried out by the Kingdom and structural improvements that contributed to supporting the economy’s diversity, sustainable development in the non-oil sector, and maintaining a balanced public debt, in addition to reinforcing the financial and tourism sectors’ role within the Saudi Vision 2030.

UAE

The UAE's economic growth is expected to remain robust, averaging 4.6 percent from 2022 to 2024, driven by higher oil prices and improved business confidence, according to the AMF.

It forecasts a 4.2 percent growth rate for the UAE in 2023, accompanied by a decline in the consumer price index to 2.9 percent in 2023 and 2.57 percent in 2024.

Egypt

The Egyptian economy is expected to achieve a 3.7 percent growth in 2023 down from 6.6 percent in 2022.

This drop is attributed to the global economic condition and the uncertainty resulting from the global geopolitical and economic changes, in addition to increased inflation that impacts business and individuals’ purchasing power.

Business

Saudi Arabia Committed to Supporting Development, Food Security

Saudi Minister of Foreign Affairs Prince Faisal bin Farhan. (File photo: Reuters)
Saudi Minister of Foreign Affairs Prince Faisal bin Farhan. (File photo: Reuters)
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Saudi Arabia Committed to Supporting Development, Food Security

Saudi Minister of Foreign Affairs Prince Faisal bin Farhan. (File photo: Reuters)
Saudi Minister of Foreign Affairs Prince Faisal bin Farhan. (File photo: Reuters)

Saudi Arabia stressed on Friday the significance of advancing future cooperation to achieve collective prosperity.

The Kingdom affirmed its commitment to cooperating with international partners to achieve the UN Sustainable Development Goals (SDGs) by 2030 and intensify global efforts to enhance food and energy security amid recurring crises and supply-chain issues.

Saudi Arabia is keen to develop future cooperation with the BRICS group to achieve collective prosperity, said Saudi Minister of Foreign Affairs Prince Faisal bin Farhan at the ministerial meeting of Friends of BRICS in South Africa’s Cape Town

He added that the Kingdom aims to advance cooperation with BRICS by benefiting from the capabilities that the Kingdom and BRICS countries possess.

“The Kingdom remains the BRICS group’s largest commercial partner in the Middle East. The total value of bilateral trade with the countries of the BRICS group increased from $81 billion in 2017 to $128 billion in 2021 and exceeded $160 billion in 2022,” he revealed.

Saudi Arabia shares basic values with the BRICS countries such as that relations between countries are based on the principles of respect for sovereignty, non-interference, and adherence to international law, the existence of multilateral frameworks, and collective action as reference points to face common challenges, he went on to say.

Prince Faisal reiterated the Kingdom’s commitment to work with international partners to achieve the UN SDGs by 2030.

The Kingdom is also committed to intensifying global efforts to enhance food and energy security amid recurring crises and supply-chain issues, the FM said, noting that Saudi Arabia plays a significant role in the field of humanitarian and development aid and is among the top ten donors to low- and middle-income countries.

The Saudi delegation in Cape Town included the Undersecretary of the Saudi Ministry of Foreign Affairs for Multilateral Affairs Dr. Abdulrahman Al-Rassi and the Ambassador of the Custodian of the Two Holy Mosques to the Republic of South Africa, Sultan al-Anqari.

Business

Sheikh Abdullah bin Zayed: UAE Committed to Deepening Cooperation with BRICS Group

Officials at the BRICS meeting in Cape Town on Friday. (WAM)
Officials at the BRICS meeting in Cape Town on Friday. (WAM)
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Sheikh Abdullah bin Zayed: UAE Committed to Deepening Cooperation with BRICS Group

Officials at the BRICS meeting in Cape Town on Friday. (WAM)
Officials at the BRICS meeting in Cape Town on Friday. (WAM)

United Arab Emirates Foreign Minister Sheikh Abdullah bin Zayed Al Nahyan attended a “Friends of BRICS” meeting held in Cape Town, South Africa, on Friday.

Sheikh Abdullah expressed his happiness at attending the meeting, which underscored the partnership and strong friendship within the BRICS group, reported the UAE’s state news agency (WAM).

He stressed that the UAE values and backs the BRICS group, especially given its world-scale significance in supporting peace, security and prosperity globally.

“The UAE is pleased to be a friend to the BRICS group and is committed to expanding and deepening its cooperation with the group, its member states and its partners in driving development and prosperity,” Sheikh Abdullah said.

He highlighted the rising influence of the BRICS group in recent years, noting that it accounts for 30 percent of the world’s overall economic growth since 2001, and the group’s economies currently account for 25 percent of the global GDP.

The BRICS group’s inclusive approach is among its distinguishing characteristics, as enables it to widen its cooperation with international economic institutions and create a broader platform for representing developing and emerging economies at a global level, he added.

The BRICS group, as part of the changing world that seeks multilateral action, should continue advancing its institutional system and broaden its international presence by supporting emerging economies, Sheikh Abdullah stressed, underlining the UAE’s support for the group and its keenness to become an active and contributing BRICS member.

He also explained the UAE’s contributions and role as a partner of the BRICS group and its member countries, as well as a reliable source of energy and a strong advocate for issues facing developing countries. He pointed out the UAE’s active participation in multipartite initiatives, such as joining the New Development Bank and investing heavily in infrastructure, food security, clean energy, transportation and industry.

“The UAE will continue to work with you to address global challenges and foster a balanced and sustainable approach to driving climate action and achieving the energy transition,” Sheikh Abdullah said.

He underscored the UAE’s vision of a future based on constructive cooperation and common goals. He also stressed the country’s backing of BRICS and highlighted its focus on three key pillars, which are promoting financial and economic development through cooperation and openness, respecting the sovereignty of other countries and pursuing peaceful resolutions to conflicts; and working to ensure justice and representation in the global governance system.

Business

Saudi Arabia Launches Platform to Enable Contractors to Implement PIF Projects

Works on the Amaala project on the Red Sea coast, northwest of Saudi Arabia (Photo: Asharq Al-Awsat)
Works on the Amaala project on the Red Sea coast, northwest of Saudi Arabia (Photo: Asharq Al-Awsat)
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Saudi Arabia Launches Platform to Enable Contractors to Implement PIF Projects

Works on the Amaala project on the Red Sea coast, northwest of Saudi Arabia (Photo: Asharq Al-Awsat)
Works on the Amaala project on the Red Sea coast, northwest of Saudi Arabia (Photo: Asharq Al-Awsat)

Saudi Arabia has launched a platform that qualifies contractors and provides services and facilities to enable them to obtain pre-qualification according to technical evaluation criteria.

 

The new platform will contribute to providing a highly reliable indicator for companies affiliated with the Public Investment Fund to implement construction projects in cooperation with the private sector.

 

The Saudi Sovereign Fund has been able to establish 77 local companies so far, as part of its endeavor to advance economic transformation, create job opportunities and diversify investments at the local and international levels.

 

On Thursday, the Saudi Contractors Authority (SCA), in cooperation with the PIF, announced the launch of the “re-qualification of contractors” program, in a step to enhance competitiveness and transparency in the sector, and to enable the implementation of current and future projects for companies affiliated with the Sovereign Fund in accordance with the highest quality standards.

 

The service provides a platform that brings together a number of establishments affiliated to the PIF in a unified pre-qualification program, and enables them to participate in the projects through several criteria, including: activities and experience, quality management, and health and safety.

 

The Saudi Contractors Authority has recently concluded the fifth edition of the Future Projects Forum, in Riyadh.

 

More than 3,000 contractors and interested parties from 16 countries around the world participated in the event, along with 43 government and private agencies.

 

The forum reviewed the details and developments of more than 3,000 future projects, the value of which was estimated at SAR 1 trillion ($266 billion).

 

It also saw the launching of a platform that helps contractors and interested parties to track and search for contracting projects in Saudi Arabia and the Middle East.

 

Meanwhile, iot squared, a leading company in the Internet of Things (IoT) technologies and a subsidiary of the STC group, has signed a cooperation agreement with “AHOY” Technology, specializing in smart mobility infrastructure and logistics services.

 

This collaboration supports the complete transformation towards IoT, contributing to an advanced technological revolution that aims to achieve the targets of Saudi Vision 2030.

 

Under this agreement, iot squared, in partnership with “AHOY”, will provide the latest smart logistics solutions, including advanced technology infrastructure and various programs that contribute to developing application interfaces and software platforms. The collaboration also involves identifying the target audience and providing technical support.

 

Othman Aldahsh, CEO of "iot squared", emphasized that global alliances were a key priority to benefit from potentials and create new opportunities through dedicated investments, acquisitions and partnerships.

 

Business

UAE to Attract $160 Bln in New Economy Investments over Next Three Decades

Two employees in Strata Manufacturing check up a locally manufactured component of satellites. (WAM)
Two employees in Strata Manufacturing check up a locally manufactured component of satellites. (WAM)
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UAE to Attract $160 Bln in New Economy Investments over Next Three Decades

Two employees in Strata Manufacturing check up a locally manufactured component of satellites. (WAM)
Two employees in Strata Manufacturing check up a locally manufactured component of satellites. (WAM)

UAE Minister of Economy Abdullah bin Touq Al Marri said that the UAE aims to attract $160 billion worth of investments in new economic sectors over the next three decades.

 

The minister affirmed that the growth potential of the global economy is linked to creating more investment opportunities in new economic sectors, including the space industry, food, agriculture, healthcare, transportation, renewable energy, circular economy models, and advanced technology, as well as investing in digital infrastructure development and employing artificial intelligence and virtual reality technologies, to enhance their contribution to economic growth.

 

The minister added that the UAE aims to become a global model of green growth and circular economy, contributing to sustainable economic growth through cooperation with partners, to open new markets for national exports, enhance the competitiveness of the national economy, and improve the business environment.

 

During the “Make it in the Emirates Forum,” Al Marri stressed that the industrial and manufacturing sector is a priority and a key pillar for strengthening the soft power of the national economy and enhancing its competitiveness in international markets, WAM reported.

 

He also noted that the national industry is capable of competing in regional and global markets in various sectors, such as aviation, transportation, logistical services, renewable energy, mining, food, petrochemicals, pharmaceuticals, and others.

 

Al Marri stated that the ministry is working in collaboration with its strategic partners on several initiatives and policies to create investment opportunities in new economies while continuing efforts to create an appropriate environment for start-ups and family businesses.

 

He also explained that the UAE achieved record growth in 2022, with a GDP growth rate of 7.6 percent, one of the highest economic growth rates in the world.

 

Projections for 2023 indicate that the national economy will continue to grow at 3.9 percent, with non-oil output growth at 4.2 percent, according to estimates by the Central Bank of the UAE.

 

The percentages are expected to increase in 2024, reaching 4.3 percent for GDP and 4.6 percent for non-oil output.

 

Business

Report: Saudi Arabia’s Exports to Hit $418 Bn by 2030

The Standard Chartered bank logo is seen at their headquarters in London, Britain, July 26, 2022. REUTERS/Peter Nicholls
The Standard Chartered bank logo is seen at their headquarters in London, Britain, July 26, 2022. REUTERS/Peter Nicholls
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Report: Saudi Arabia’s Exports to Hit $418 Bn by 2030

The Standard Chartered bank logo is seen at their headquarters in London, Britain, July 26, 2022. REUTERS/Peter Nicholls
The Standard Chartered bank logo is seen at their headquarters in London, Britain, July 26, 2022. REUTERS/Peter Nicholls

A research report by Standard Chartered projects that Saudi Arabia will be a key driver of a global trade growth, with its exports projected to reach $418 billion by 2030 and an annual growth rate of 4.8% percent.

The report - Future of Trade: New opportunities in high-growth corridors – said Thursday that global trade is set to reach $32.6 trillion with a growth rate of five percent by 2030.

Trade corridors anchored in Asia, Africa and the Middle East will outpace global trade growth rate by up to four percentage points, driving combined trade volume in these regions to $14.4 trillion to account for 44 percent of global trade by 2030.

India, Singapore, and the UAE are among the fastest-growing export corridors, while Mainland China will remain the largest export destination for Saudi Arabia, said the report.

Saudi Arabia is boosting trade through increasing industrial production. The Saudi Vision 2030 provides a roadmap for the development of new economic sectors, in order to diversify its economy away from oil, and transition to one that is digital and knowledge-based.

The report also said that Saudi Arabia envisions itself to become the next global logistics hub. In October 2022, the Kingdom announced plans to build 59 new logistic zones across the nation and is also aiming to improve its liner shipping connectivity by introducing new routes between Asia and Europe.

CEO of Standard Chartered, Saudi Arabia, Mazen Bunyan, said the Kingdom “aspires to become the next global logistics hub, and has pledged to make its economy more sustainable and innovative.”

“Leveraging its strategic location at the center of Asia, Africa and Europe, its enhancing its shipping networks to connect these regions and is continuously liberalizing international trade of goods and services.”

“With various initiatives across the logistics, sustainability and innovation fronts, Saudi Arabia is poised to lead the Gulf and wider Middle East into a new era of trade and economic prosperity," he added.

Business

Saudi Arabia's PIF to Acquire 30% of Tamimi Markets

PIF said it signed a share subscription agreement to invest in Tamimi Markets.
PIF said it signed a share subscription agreement to invest in Tamimi Markets.
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Saudi Arabia's PIF to Acquire 30% of Tamimi Markets

PIF said it signed a share subscription agreement to invest in Tamimi Markets.
PIF said it signed a share subscription agreement to invest in Tamimi Markets.

Saudi Arabia's Public Investment Fund (PIF) plans to acquire a 30% stake in local supermarket chain Tamimi Markets Company, the kingdom's sovereign wealth fund said on Thursday.

PIF said it signed a share subscription agreement to invest in Tamimi Markets.

It said the transaction, which will involve a capital increase and subscription for new shares, aligns with the fund's strategy to enable the private sector and create Saudi national champions.

"This investment aims to enable Tamimi Markets to realize its full potential, transforming it from one of the leading national grocery chains to a major regional chain," PIF said in a statement.

"It aims to support the company’s ambitious plans through expansion of its operations and commercial opportunities, including acceleration of regional growth and a potential initial public offering," it added.