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Encouraging Private Sector to Issue Sukuk Increases Savings Rate in Saudi Arabia

Saudi Arabia is working to reach its goal of increasing savings rates from 6% to the global average of 10%. (Reuters)
Saudi Arabia is working to reach its goal of increasing savings rates from 6% to the global average of 10%. (Reuters)
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Encouraging Private Sector to Issue Sukuk Increases Savings Rate in Saudi Arabia

Saudi Arabia is working to reach its goal of increasing savings rates from 6% to the global average of 10%. (Reuters)
Saudi Arabia is working to reach its goal of increasing savings rates from 6% to the global average of 10%. (Reuters)

The Saudi government is intensifying its efforts to help individuals raise the savings rate in the country, by encouraging the private sector to issue new sukuks.
The Financial Sector Development Program, within Vision 2030, aims to raise savings rates among individuals, increase the availability of savings products, enrich financial culture and spread awareness of the importance of saving and its benefits to plan future goals.
According to earlier statements by Minister of Finance Mohammed Al-Jadaan, the government sukuk program comes as part of several initiatives that aim to increase the savings rate, which is one of the pillars of the financial sector development program affiliated with Vision 2030.
The Saudi government is seeking to increase savings rates from 6 percent to the global average of 10 percent.
In this context, new financial technology companies are competing to offer more innovative and less complex savings products, including enabling an individual to open a savings wallet with an amount starting from one thousand riyals ($266), with a return of up to 5 percent annually.
The CEO of a savings platform, Adel Al-Ateeq, told Asharq Al-Awsat that financial technology companies are currently seeking to offer new savings products with guaranteed returns, adding that saving has become necessary to preserve capital and protect it from the impact of inflation and the rise in prices.
Economist Ahmed Al-Shehri highlighted the importance of saving for the individual and the family as a whole, such as securing the financial future and retirement, providing better education opportunities for children, buying a house, in addition to dealing with financial emergencies, and striving for financial independence.
He said that Saudi Arabia was witnessing a major shift in the savings culture in recent years, noting that the government has begun to launch awareness campaigns and educational programs, and to offer new savings programs for individuals.
Al-Shehri recommended setting a budget in which income and various expenses are determined, including necessary expenses, investment, and entertainment, giving the highest priority to basic necessities and needs, in addition to specifying a certain percentage of income for saving. He also stressed the importance of avoiding debts and excessive reliance on credit cards.
The Ministry of Finance and the National Debt Management Center launched the savings product intended for individuals and supported by the government, under the name “Sah”, with a value of one thousand riyals per instrument and a return rate exceeding 5 percent.
The second savings round closed on March 5, having attracted over SAR 959 million in total cumulative savings commitments from 37,000 participants.

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Business

Riyadh Air Launches First Domestic Service to Jeddah

The launch marks a key step in the carrier's strategy to expand its destination network from the Saudi capital. SPA
The launch marks a key step in the carrier's strategy to expand its destination network from the Saudi capital. SPA
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Riyadh Air Launches First Domestic Service to Jeddah

The launch marks a key step in the carrier's strategy to expand its destination network from the Saudi capital. SPA
The launch marks a key step in the carrier's strategy to expand its destination network from the Saudi capital. SPA

Riyadh Air, Saudi Arabia's new national carrier, launched on Sunday its first domestic flight from Riyadh to King Abdulaziz International Airport in Jeddah.

The move is part of Riyadh Air's plans to expand its domestic network through daily flights between Riyadh and Jeddah and strengthen connectivity between major destinations across the Kingdom.

The inaugural flight arrived from King Khalid International Airport in Riyadh with Minister of Hajj and Umrah Tawfig Al-Rabiah, President of the General Authority of Civil Aviation Abdulaziz Al-Duailej, Riyadh Air board member Raid Ismail, and several aviation-sector leaders on board.

They were received by Chairman of the Board of Directors of Jeddah Airports Company (JEDCO) Raed Al-Mudaiheem, JEDCO CEO Mazen Johar, and representatives of government and security agencies operating at the airport.

The launch marks a key step in the carrier's strategy to expand its destination network from the Saudi capital. The inaugural flight departed King Khalid International Airport (RUH) at 9:00 a.m. and landed at King Abdulaziz International Airport (JED) at 10:50 a.m.

Riyadh Air launched the route with two daily flights. Frequencies will increase to three daily flights from June 18 and four daily flights from July 2.

The route is being launched amid strong demand growth. According to aviation analytics firm OAG, the Riyadh-Jeddah route ranked as the world's fifth-busiest domestic air route in 2025, with 9.8 million seats.

By operating the service, Riyadh Air supports national strategies by providing additional seat capacity that contributes to the growth of the Kingdom's tourism, business, and economic sectors.

Riyadh Air CEO Tony Douglas said the launch of flights to Jeddah marks an important milestone in the airline's journey toward building a broad network connecting Saudi Arabia with the world. He noted that the route serves a large segment of business and leisure travelers and supports the goals of Saudi Vision 2030 to develop the aviation sector and strengthen air connectivity.

JEDCO CEO Mazen Johar said the new service reflects integration among the components of the Kingdom's aviation ecosystem and contributes to expanding travel options and enhancing passenger services. He added that King Abdulaziz International Airport served more than 14.8 million passengers through nearly 84,000 flights during the first quarter of 2026, reflecting continued growth in operational activity.

The new flights support Riyadh Air's goal of reaching more than 100 destinations worldwide. The route also facilitates business travel, tourism, and Hajj and Umrah traffic while reinforcing Riyadh's position as a major international air-connectivity hub.

Business

Saudi Housing Surpasses One Million Contracts as 70% Homeownership Target Nears

Construction work in the 'Shams Al-Diyar' project, part of the housing program in Riyadh (SPA)
Construction work in the 'Shams Al-Diyar' project, part of the housing program in Riyadh (SPA)
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Saudi Housing Surpasses One Million Contracts as 70% Homeownership Target Nears

Construction work in the 'Shams Al-Diyar' project, part of the housing program in Riyadh (SPA)
Construction work in the 'Shams Al-Diyar' project, part of the housing program in Riyadh (SPA)

Saudi Arabia continues to reshape its real estate sector at a rapid pace, achieving structural advances that have placed quality of life at the heart of urban development. The enabling of nearly 33,000 Saudi families to obtain their first home during the first quarter of 2026 underscores the efficiency of the regulatory framework in advancing the goals of Vision 2030 and moving toward its target of raising homeownership to 70 percent.

This momentum, which lifted the homeownership rate to 66.24 percent by the end of 2025, coincides with the Real Estate Development Fund and the Sakani program surpassing the milestone of one million subsidized contracts, reflecting a profound transformation in the structure of the market and greater integration across its financing and regulatory components.

Integrated Regulatory Environment

In an analysis of first-quarter 2026 figures, Mohammed Al-Rassasmah, spokesperson for the Ministry of Municipalities and Housing, told Asharq Al-Awsat that enabling 32,983 Saudi families to own their first home in just three months reflects the integration of the housing ecosystem across its various components, from developing the regulatory and legislative environment to expanding housing options and providing financing solutions and partnerships with the private sector.

Al-Rassasmah explained that the carefully planned expansion of housing projects and the diversification of real estate products have helped meet the needs of different segments of Saudi families. He pointed to the decisive role played by digital transformation in improving procedural efficiency and accelerating access to suitable housing solutions for beneficiaries.

He noted that this achievement builds on what Minister of Municipalities and Housing Majed Al-Hogail announced at the beginning of this year regarding the homeownership rate among Saudi families exceeding 66.24 percent by the end of 2025, demonstrating the success of the housing system in expanding ownership opportunities across the Kingdom.

Partnership With the Private Sector

Within this development path, Al-Rassasmah said partnerships with the private sector represent one of the key enablers of growth in the housing sector, contributing directly to increased real estate supply and faster development.

He added that real estate developers now offer a diverse range of housing products that meet families' aspirations, while the ministry continues to improve the investment environment and promote competitiveness.

He noted that the sector's transformation is no longer limited to developing individual housing units but now extends to creating integrated urban communities that provide services, facilities, infrastructure, and quality-of-life opportunities. This, he said, enhances the attractiveness of cities and improves the efficiency of long-term economic development.

Headquarters of the Real Estate Development Fund in Riyadh (Fund's website)

Off-Plan Sales Projects

Regarding off-plan sales projects, Al-Rassasmah said they have become one of the most important tools supporting increased housing supply and accelerating real estate development in recent years.

He explained that these projects have enabled the implementation of larger and more diverse developments, providing broader opportunities for ownership.

He stressed that the strict regulatory and oversight framework imposed by the ministry has enhanced the credibility of such projects and protected buyers' rights, increasing confidence in the market and significantly boosting demand. As a result, they have become one of the most reliable pathways supporting first-home ownership.

Long-Term Strategic Vision

The ministry's spokesperson also stressed that the ministry approaches housing demand from a long-term strategic perspective focused on increasing supply and improving the efficiency of the real estate market through empowering developers, developing land and master plans, stimulating investment flows, and expanding housing projects in areas experiencing high demand.

He explained that increasing supply and diversifying housing options contribute positively to market balance and help provide more suitable solutions for beneficiaries, alongside the ministry's ongoing efforts to enhance transparency, develop real estate indicators, and improve market efficiency to ensure it remains attractive and stable.

Al-Rassasmah concluded by describing mortgage finance as one of the key pillars behind the rise in homeownership rates in recent years through the provision of diverse and accessible financing solutions that have strengthened the purchasing power of Saudi families.

He noted that 23,222 families benefited from housing support services during the first quarter of this year alone, and added that cooperation among the housing ecosystem, financing institutions, and the Real Estate Development Fund helped push the number of subsidized contracts beyond 1.02 million by the end of last March.

According to Al-Rassasmah, the transformation currently taking place in the sector reflects a comprehensive structural shift that supports the sustainability of the real estate market and enhances citizens' quality of life in line with national ambitions.

Business

Iraq Cancels $764 million Baghdad Airport Project over Corruption Concerns

Ali al-Zaidi has decided to cancel the Baghdad International Airport development project - File photo/Reuters
Ali al-Zaidi has decided to cancel the Baghdad International Airport development project - File photo/Reuters
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Iraq Cancels $764 million Baghdad Airport Project over Corruption Concerns

Ali al-Zaidi has decided to cancel the Baghdad International Airport development project - File photo/Reuters
Ali al-Zaidi has decided to cancel the Baghdad International Airport development project - File photo/Reuters

Iraqi Prime Minister Ali al-Zaidi has decided to cancel the Baghdad International Airport development project after corruption suspicions were raised, Iraqi state media reported on Sunday, citing a government source.

The project involves a $764 million contract awarded last year to a consortium of Luxembourg-based Corporacion America Airports (CAAP) and Iraqi real estate firm Amwaj International, aimed at upgrading and expanding the capital’s main airport, Reuters reported.

Two government sources speaking on condition of anonymity due to the sensitivity of the matter told Reuters that officials raised concerns about potential irregularities over the tendering process and contract terms.

The move follows a drive against corruption which has meant growing scrutiny within government institutions.

The airport upgrade had been presented as a key infrastructure project to modernize Iraq’s aviation sector and increase capacity at Baghdad International Airport, which has suffered from years of underinvestment.