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Saudi CMA Approves ACWA Power IPO

ACWA Power (Asharq Al-Awsat)
ACWA Power (Asharq Al-Awsat)
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Saudi CMA Approves ACWA Power IPO

ACWA Power (Asharq Al-Awsat)
ACWA Power (Asharq Al-Awsat)

The Saudi Capital Market Authority (CMA) approved the request of the International Company for Water and Power Projects (ACWA POWER) application for public offering of 81.2 million shares, representing 11.1 percent of its share capital.

The Company’s prospectus will be published within sufficient time prior to the start of the subscription period.

The investment value of the company's portfolio exceeds $66.1 billion, producing 42 gigawatts (GW) of electricity and 6.4 million cubic meters of desalinated water per day, provided as a huge production that meets the needs of state utilities, and according to long purchase contracts.

ACWA Power, through its projects, aims to produce reliable electricity and desalinated water at low cost, while contributing effectively to the sustainable social and economic development of societies and countries.

The company successfully raised $746 million, through a senior, unsecured floating Sukuk rate issuance with a seven-year tenor, under the Shariah-compliant Mudaraba-Murabaha structure.

The issuance marked the company’s maiden entry into Saudi debt capital markets and saw significant interest from fund managers, government funds, and insurance companies accounting for approximately 30 percent of the issuance and resulting in an oversubscription of 1.8 times over the issue size.

ACWA Power was established in 2004 in Saudi Arabia and is 50 percent owned by the Public Investment Fund (PIF). PIF increased in November its stake in ACWA Power from 33.6 percent as part of a move to support the renewable energy sector in Saudi Arabia.

It is a developer, investor, and operator of a group of power generation and water desalination plants, and its portfolio currently includes 64 plants that are in operation, construction, or in advanced stages of development.

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Business

IMF Opens Regional Office in Riyadh to Strengthen Partnership with Middle Eastern Countries

The Saudi Minister of Economy and Planning speaks at the conference organized by the IMF, in cooperation with the Ministry of Finance. (Asharq Al-Awsat)
The Saudi Minister of Economy and Planning speaks at the conference organized by the IMF, in cooperation with the Ministry of Finance. (Asharq Al-Awsat)
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IMF Opens Regional Office in Riyadh to Strengthen Partnership with Middle Eastern Countries

The Saudi Minister of Economy and Planning speaks at the conference organized by the IMF, in cooperation with the Ministry of Finance. (Asharq Al-Awsat)
The Saudi Minister of Economy and Planning speaks at the conference organized by the IMF, in cooperation with the Ministry of Finance. (Asharq Al-Awsat)

The International Monetary Fund (IMF) has inaugurated its regional office in Riyadh with the aim to strengthen partnership with countries in the Middle East and beyond, engage with regional institutions, and improve relations with governments in countries of the region.

In October 2022, Saudi Minister of Finance Mohammed Al-Jadaan, signed with the Fund’s Director General, Kristalina Georgieva, a memorandum of understanding to establish a regional IMF office in the Kingdom.

Wednesday’s inauguration came during the launch of a conference organized by the IMF, in cooperation with the Finance Ministry, under the title, “Industrial Policy to Promote Economic Diversification,” in the presence of Minister of Economy and Planning Faisal Al-Ibrahim.

A statement issued by the IMF said that the new office “will scale up capacity building, regional surveillance, and outreach to promote stability, growth, and regional integration. It will strengthen the IMF’s engagement with regional institutions, governments, and other stakeholders.”

“The IMF is grateful for the Kingdom of Saudi Arabia’s financial contribution to boost capacity development to IMF members—including fragile states,” it added.

According to the IMF, the first director of the regional office will be Abdoul Aziz Wane, from Senegal, who is “a seasoned IMF leader with deep knowledge of the institution and a vast network of policymakers and academics across the world.”

Sources told Asharq Al-Awsat that the opening of a regional office for the IMF in Saudi Arabia is evidence of the international institution’s recognition of the strength of the Saudi economy on the one hand, and of the position it enjoys regionally and internationally.

Addressing the conference on Wednesday, Al-Ibrahim said Saudi Arabia will witness a shift in economic diversification, pointing to a need to encourage openness to local and global competition in order to ensure that the country’s industry is able to flourish deservedly and as quickly as possible.

Since the launch of an integrated program within Saudi Vision 2030 to reduce dependence on oil and diversify other sources of income, the Kingdom has witnessed fundamental changes in the legislative and political system that have led to transforming the business environment, creating new sectors, and building huge projects such as NEOM and the Red Sea, the minister underlined.

To promote sustainable development in local industries, Al-Ibrahim stated that the focus remains on stimulating local and international competitiveness. He stressed that this exposure to the international market encourages companies to continuously improve and innovate to maintain their competitive advantage.

The IMF conference is held over two days, and aims to review the basic principles of industrial policy and draw lessons from its successes and failures in other regions.

Business

Saudi Trade Balance Records Monthly Surplus of 13% in February

General view of the Saudi capital Riyadh. Reuters file photo
General view of the Saudi capital Riyadh. Reuters file photo
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Saudi Trade Balance Records Monthly Surplus of 13% in February

General view of the Saudi capital Riyadh. Reuters file photo
General view of the Saudi capital Riyadh. Reuters file photo

Data from the Saudi General Authority for Statistics (GASTAT) showed that the trade balance surplus rose by 13 percent, in February, to SAR32 billion ($8.5 billion), compared to SAR28 billion ($7.4 billion) in January, but registered a decrease of 21.8 percent, on an annual basis.

In its monthly International Trade Bulletin, GASTAT said the Kingdom’s merchandise exports declined by 2 percent on an annual basis to SAR95 billion ($25 billion) in February, affected by a drop in oil exports by 3.8 percent.

According to the data, non-oil exports, which include re-exports, rose by 4.4 percent during February, on an annual basis, to SAR21.8 billion ($5.8 billion). In contrast, Saudi imports increased by 12.3 percent on an annual basis during February to SAR63 billion ($16.7 billion).

China ranked first among Saudi export destinations with a rate of 13.2 percent, followed by Japan and India. China also topped the list of suppliers to the Kingdom with a rate of 19.9 percent, followed by the United States and India with rates of 8 percent and 7 percent, respectively.

Business

Saudi Communications, Tech Market Valued at $44 Billion in 2023

The Saudi Communications, Space and Technology Commission building in Riyadh (the Commission’s website)
The Saudi Communications, Space and Technology Commission building in Riyadh (the Commission’s website)
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Saudi Communications, Tech Market Valued at $44 Billion in 2023

The Saudi Communications, Space and Technology Commission building in Riyadh (the Commission’s website)
The Saudi Communications, Space and Technology Commission building in Riyadh (the Commission’s website)

The size of the communications and technology market in Saudi Arabia reached SAR166 billion ($44.2 billion) during 2023, which is equivalent to a compound annual growth of 8 percent over the past six years.

This was revealed by the Communications, Space and Technology Commission on Wednesday during the 10th edition of the ICT Indicators Forum in Riyadh in the presence of an elite group of experts, specialists and sector leaders.

The event featured four main presentations, and a discussion session on the sector’s future trends. Mufarreh Nahari, the Director General of Studies at the Commission, talked about the performance indicators of the communications and technology sector, noting that the Kingdom ranks second among the G20 countries in the 2023 Communications and Technology Development Index.

Indicators also show that the rate of access to mobile communications service subscriptions has reached 198 percent of the population, while the Internet of Things subscriptions amounted to 12.6 million subscriptions.

Another presentation entitled, “Navigating the Frontiers of Innovation: Information Technology Market Trends in the Kingdom,” featured discussions by Hamza Naqshbandi, Vice President of IDC for Custom Solutions in the Middle East, Türkiye and Africa and Regional Director in Saudi Arabia and Bahrain, and Group Vice President and Director Jyoti Lalchandani, Regional General Manager for the Middle East, Türkiye and Africa at IDC.

The presentation highlighted the Kingdom’s latest innovative technologies, as spending on technology is expected to reach $18.4 billion in 2024.

A session on “The Future of the Technical Scene in the Kingdom,” examined the future horizon through the insights of market experts, with the participation of Salman Faqih, CEO of Cisco in Saudi Arabia, Fahd Al-Turaif, Vice President of the Cloud Computing Sector for the Saudi, Middle East, and North Africa Markets at Oracle and Othman Al-Hokail, partner at Merak Capital.

The forum also reviewed the “Financial Performance of the Sector in Numbers,” presented by Jassim Al-Jubran, Head of Research Department at Aljazira Capital.

Al-Jubran explained that the size of the assets of companies listed in the communications and technology sector amounts to about SAR250 billion ($66.6 billion), noting that the Kingdom’s market constituted about 37 percent of the total assets in the sector in the Gulf region.

Business

UAE, Kenya Sign Investment MoU on Mining, Technology Sectors

The UAE and Kenya signed a memorandum of understanding, setting the stage for investment collaboration in mining and technology sectors. WAM
The UAE and Kenya signed a memorandum of understanding, setting the stage for investment collaboration in mining and technology sectors. WAM
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UAE, Kenya Sign Investment MoU on Mining, Technology Sectors

The UAE and Kenya signed a memorandum of understanding, setting the stage for investment collaboration in mining and technology sectors. WAM
The UAE and Kenya signed a memorandum of understanding, setting the stage for investment collaboration in mining and technology sectors. WAM

UAE’s Ministry of Investment and the Kenyan Ministry of Finance and National Treasury have signed a memorandum of understanding, setting the stage for collaboration in mining and technology sectors, Emirates News Agency (WAM) reported.

The Abu Dhabi-based investment and holding company, ADQ, also announced on Wednesday a finance framework agreement with Kenya’s ministry, facilitating investments in priority sectors of the Kenyan economy, with a potential investment sum of up to $500 million, WAM said.

Kenya’s mining sector boasts significant growth potential owing to its abundant reserves of gold, copper, ilmenite, tantalum, and various non-metallic minerals.

The MoU focuses on mineral exploration, mine development, mineral processing, refining, and mineral marketing in Kenya. One of the key objectives is to explore opportunities for technology transfer in Kenya’s mineral sector, that would support innovation and growth. The two countries will also assess avenues for collaboration in promoting responsible stewardship of the mineral sector, with a strong emphasis on environmental, social, and governance practices, in addition to exploring avenues for collaboration in research and development within the designated sectors.

Minister of Investment of the UAE Mohamed Hassan Alsuwaidi said: “Through this partnership, we are laying down the foundation for a future where sustainable mining practices, innovation, and responsible stewardship form the pillars of our mutual growth.”

“We are committed to leveraging technology to enhance capacities and establish robust governance practices that will not only propel the mineral sector but also ensure overall prosperity of our nations.”

Business

Bahrain's Investcorp Sets Up $1 Bln Fund with China's CIC

Bahrain-based Investcorp said CIC's commitment "comes at a time when the GCC's appeal to institutional investors is gathering pace.” Asharq Al-Awsat
Bahrain-based Investcorp said CIC's commitment "comes at a time when the GCC's appeal to institutional investors is gathering pace.” Asharq Al-Awsat
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Bahrain's Investcorp Sets Up $1 Bln Fund with China's CIC

Bahrain-based Investcorp said CIC's commitment "comes at a time when the GCC's appeal to institutional investors is gathering pace.” Asharq Al-Awsat
Bahrain-based Investcorp said CIC's commitment "comes at a time when the GCC's appeal to institutional investors is gathering pace.” Asharq Al-Awsat

Alternative investment company Investcorp has launched a $1 billion fund backed by China's sovereign wealth fund CIC to invest in companies across Saudi Arabia, the wider Gulf region and China, it said in a statement on Wednesday.

The platform, which will also be anchored by institutional and private investors from the Gulf region, will target "high-growth companies" in sectors such as consumer, healthcare, logistics and business services.

Bahrain-based Investcorp said CIC's commitment "comes at a time when the GCC's appeal to institutional investors is gathering pace.”

Investcorp’s Executive Chairman, Mohammed Alardhi, said: “This commitment by CIC, one of the world’s largest sovereign wealth funds, is a testament to Investcorp’s unparalleled franchise in the GCC and reinforces the trust placed in the firm’s global platform and teams."

"We are looking forward to building on this relationship and growing our partnership in the future,” he added.

"Investcorp is perfectly placed to facilitate cross border cooperation and investments between the GCC and China," the firm's Co-CEO Hazem Ben-Gacem was quoted as saying in the statement.

CIC, which is owned by China's State Council, or cabinet, invests overseas through two subsidiaries, CIC International Co and direct investment vehicle CIC Capital Corp. It also has a domestic investment unit, China Central Huijin.

"During the past couple of years, we have built several bilateral funds with leading financial institutions to facilitate industrial cooperation between China and major economies in the world. Currently we are working closely with Investcorp to build a similar bilateral fund to strengthen financial and industrial ties between China and GCC countries," said Dr. Bin Qi, Executive Vice President and Deputy CIO of CIC.

Business

IMF Launches Regional Office in Saudi Capital Riyadh

A general view of Riyadh, Saudi Arabia on National Day in 2021. (SPA)
A general view of Riyadh, Saudi Arabia on National Day in 2021. (SPA)
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IMF Launches Regional Office in Saudi Capital Riyadh

A general view of Riyadh, Saudi Arabia on National Day in 2021. (SPA)
A general view of Riyadh, Saudi Arabia on National Day in 2021. (SPA)

The International Monetary Fund will open a new regional office in Saudi Arabia's capital Riyadh, it said in a statement on Wednesday, to strengthen partnerships with governments and institutions in the Middle East and further afield.

Abdoul Aziz Wane, a national of Senegal, has been appointed as the first director of the regional office, the statement said.

Saudi Arabia's cabinet approved an agreement to establish an IMF regional office in the country in March.

Business

Saudi Finance Ministry to Ask Government Agencies to Issue Fines through National Platform

An employee of the Ministry of Commerce during a visit to monitor violations (SPA)
An employee of the Ministry of Commerce during a visit to monitor violations (SPA)
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Saudi Finance Ministry to Ask Government Agencies to Issue Fines through National Platform

An employee of the Ministry of Commerce during a visit to monitor violations (SPA)
An employee of the Ministry of Commerce during a visit to monitor violations (SPA)

The Saudi Ministry of Finance will ask all government agencies to use a unified national platform to issue fines and penalties, sources told Asharq Al-Awsat.

The Efaa Services platform enables citizens, residents, visitors and business owners to be informed of and review all their violations with government agencies, and seeks to unify, simplify and improve the relevant procedures.

The step by the Ministry of Finance was based the royal directives to compel government agencies to take fair measures when exercising their jurisdiction in accordance with regulatory texts.

The ministry has informed private sector companies of this new directive, in order to follow up on notifications regarding violations and penalties through the Efaa platform.

The vision of the Saudi government, which the Saudi Data and Artificial Intelligence Authority (SDAIA) is working to implement through the Efaa platform, seeks to enhance services and business continuity at the level of ministries, agencies and various institutions, by raising the efficiency of applications and electronic services, and improving institutional governance and its effectiveness in managing procedures and services related to issuing violations.

The platform was able to connect approximately 36 government agencies, including ministries, agencies, institutions, centers, and other affiliated entities, to unify procedures for violations and improve their process.

Business

Egypt Expects to Achieve Primary Surplus of 5.75% of GDP in Current Fiscal Year

The Egyptian capital, Cairo (Getty)
The Egyptian capital, Cairo (Getty)
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Egypt Expects to Achieve Primary Surplus of 5.75% of GDP in Current Fiscal Year

The Egyptian capital, Cairo (Getty)
The Egyptian capital, Cairo (Getty)

Egypt’s Finance Minister Mohamed Maait said on Tuesday that the state’s general budget was likely to achieve a primary surplus of 5.75 percent of the gross domestic product in the fiscal year 2023-2024, as the treasury has collected $12 billion from the Ras al-Hekma investment partnership deal with the UAE.

Presenting the financial statement for the 2024-2025 general budget before the House of Representatives, Maait noted that the total budget deficit by the end of the current fiscal year was expected to reach EGP555 billion, or 4 percent of the GDP. As for the total deficit expected for the next fiscal year, the minister said that it would reach about EGP1.2 trillion, or 7.3 percent of the GDP.

He added that Egypt aims to achieve a primary surplus of EGP591.4 billion, or 3.5 percent of GDP, in the next fiscal year 2024-2025.

According to data published on the Ministry of Finance website, Egypt aims to achieve a primary surplus of 2.5 percent of GDP in the budget for the current fiscal year.

Business

Saudi Investment Opportunities on US Business Radar

General view in Riyadh, Saudi Arabia, June 21 2020. REUTERS/Ahmed Yosri
General view in Riyadh, Saudi Arabia, June 21 2020. REUTERS/Ahmed Yosri
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Saudi Investment Opportunities on US Business Radar

General view in Riyadh, Saudi Arabia, June 21 2020. REUTERS/Ahmed Yosri
General view in Riyadh, Saudi Arabia, June 21 2020. REUTERS/Ahmed Yosri

Saudi Commerce Minister Dr. Majid Al-Qasabi has discussed Vision 2030 achievements and investment opportunities with US business leaders in Washington. The meeting highlighted the strong trade ties between the Kingdom and the US.

The Saudi-US Business Council recently held a virtual seminar on the future of car manufacturing in Saudi Arabia. Over 100 industry leaders from both countries attended.

During the meeting, Al-Qasabi talked about the progress of Vision 2030 and how it’s opening up new sectors and opportunities for businesses in Saudi Arabia. They also discussed improving the business environment in the Kingdom to attract more American companies.

Princess Reema bint Bandar bin Sultan, the Saudi Ambassador to the US, joined the meeting along with officials from the US Chamber of Commerce.

Additionally, Al-Qasabi and his team visited Georgetown University to discuss collaboration and review the university’s research in areas like entrepreneurship, corporate governance, trade policy, and more.

Al-Qasabi also met with executives from EcoLab, a water and energy solutions provider, and Bechtel Corporation, a major engineering and construction company.

Business

Oil Prices Climb amid US Stocks Decline, Mideast Conflict

FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS
FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS
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Oil Prices Climb amid US Stocks Decline, Mideast Conflict

FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS
FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS

Oil prices extended gains on Wednesday after industry data showed a surprise drop in US crude stocks last week, a positive sign for demand, though markets were also keeping a close eye on hostilities in the Middle East.
Brent crude futures rose 26 cents, or 0.29%, to $88.68 a barrel and US West Texas Intermediate crude futures climbed 26 cents, or 0.31%, to $83.62 a barrel at 0634 GMT, Reuters reported.
US crude inventories fell 3.237 million barrels in the week ended April 19, according to market sources citing American Petroleum Institute figures. In contrast, six analysts polled by Reuters had expected a rise of 800,000 barrels.
Traders will be watching for the official US data on oil and product stockpiles due at 10:30 a.m. EDT (1430 GMT) for confirmation of the big drawdown.
US business activity cooled in April to a four-month low, with S&P Global saying on Tuesday that its flash Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to 50.9 this month from 52.1 in March.
"This could help convince policy makers that rate cuts are required to support the economy," ANZ analysts said in a note.
US interest rate cuts could bolster economic growth and, in turn, demand for oil from the world's top consumer of the fuel.
Analysts were still bullish that any latest developments in conflicts in the Middle East will still support markets, though the impact on oil supplies remains limited for now.
"Overall, crude oil prices are well supported around current levels by on-going Middle East risk premium. On the topside, risk of possible renewed OPEC production increase from Jun will help limit any significant upside," said head of markets strategy for United Overseas Bank (UOB) in Singapore Heng Koon How.
"We maintain our forecast for Brent to consolidate at USD 90/bbl by end of this year," Heng added.
Israeli strikes intensified across Gaza on Tuesday, in some of the heaviest shelling in weeks.
"Recent reports suggest that both Iran and Israel consider the current operations concluded against one another, with no follow-up action required for now," ING analysts said in a note.
"The US and Europe are preparing for new sanctions against Iran – although these may not have a material impact on oil supply in the immediate term," they added.