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Saudi Arabia Launches $266 Mln Investment Fund for Semiconductor Development

CEO of Rapid Silicon Naveed Sherwani (Asharq Al-Awsat)
CEO of Rapid Silicon Naveed Sherwani (Asharq Al-Awsat)
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Saudi Arabia Launches $266 Mln Investment Fund for Semiconductor Development

CEO of Rapid Silicon Naveed Sherwani (Asharq Al-Awsat)
CEO of Rapid Silicon Naveed Sherwani (Asharq Al-Awsat)

Saudi Arabia has launched a billion-riyal ($266.6 million) investment fund for the semiconductor industry, alongside a national center. This initiative aims to support the establishment of 50 design companies and train 5,000 engineers by 2030.
Announced during the “Semiconductor Forum 2024,” which was held on June 5-6, the National Semiconductor Hub aims to secure over 150 million riyals ($40 million) from the National Information Technology Development Program and attract 25 global experts through a special residency program.
With this initiative, Saudi Arabia aims to become a global center for semiconductor markets, leveraging its strategic location.
Naveed Sherwani, CEO of Rapid Silicon, highlighted to Asharq Al-Awsat the kingdom’s advantage in accessibility, allowing businesses to connect with countries like Taiwan and Korea, accessing diverse markets.
Sherwani stressed the importance of semiconductor design firms, essential for various sectors like smartphones, tablets, automobiles, healthcare, and education.
He emphasized semiconductors’ role in enhancing national sovereignty, stating that the hub’s launch aims to meet Saudi Arabia’s sovereignty needs, showcasing the Kingdom’s high competitiveness in this field.
As for the Semiconductor Forum 2024, officials stressed its importance in gathering decision-makers, industry leaders, experts, and researchers in semiconductor technologies.
It aligns with the Kingdom’s goals in digital economy, artificial intelligence, and technology localization.
Saeed Al-Shahri, Deputy President of King Abdulaziz City for Science and Technology (KACST) for the Energy and Industry sector, told Asharq Al-Awsat that the forum aims to bring together experts, scientists, and decision-makers to discuss and localize these technologies in the Kingdom.
Saudi Arabia aims to have 500,000 electric cars by 2030, with about 40% relying on electronic chips or semiconductors.
Al-Shahri mentioned that the Kingdom has targets in the realms of digital economy, artificial intelligence, Internet of Things, and smart cities, all requiring an electronic chip industry.

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China Flags More Fiscal Stimulus for Economy

FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo
FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo
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China Flags More Fiscal Stimulus for Economy

FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo
FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo

China pledged on Saturday to "significantly increase" debt to revive its sputtering economy, but left investors guessing on the overall size of the stimulus package, a vital detail to gauge the longevity of its recent stock market rally.
Finance Minister Lan Foan told a press conference Beijing will help local governments tackle their debt problems, offer subsidies to people with low incomes, support the property market and replenish state banks' capital, among other measures.
These are all steps investors have been urging China to take as the world's second-largest economy loses momentum and struggles to overcome deflationary pressures and lift
consumer confidence amid a sharp property market downturn, Reuters reported.
But Lan's omission of a dollar figure for the package is likely to prolong investors' nervous wait for a clearer policy roadmap until the next meeting of China's rubber-stamp legislature, which approves extra debt issuance. A date for the meeting has yet to be announced but it is expected in coming weeks.
The press conference "was strong on determination but lacking in numerical details," said Vasu Menon, managing director for investment strategy at OCBC in Singapore.
"The big bang fiscal stimulus that investors were hoping for to keep the stock market rally going did not come through," said Menon, adding this may "disappoint some" in the market.
A wide range of economic data in recent months has missed forecasts, raising concerns among economists and investors that the government's roughly 5% growth target this year was at risk and that a longer-term structural slowdown could be in play.
Data for September, which will be released over the coming week, is expected to show further weakness, but officials have expressed "full confidence" that the 2024 target will be met.
New fiscal stimulus has been the subject of intense speculation in global financial markets after a September meeting of the Communist Party's top leaders, the Politburo, signaled an increased sense of urgency about the economy.
Chinese stocks reached two-year highs, spiking 25% within days since that meeting, before retreating as nerves set in given the absence of further policy details from officials. Global commodity markets from iron ore to industrial metals and oil have also been volatile on hopes stimulus will stoke sluggish Chinese demand.
Reuters reported last month that China plans to issue special sovereign bonds worth about 2 trillion yuan ($284.43 billion) this year as part of fresh fiscal stimulus.
Half of that would be used to help local governments tackle their debt problems, while the other half will subsidize purchases of home appliances and other goods as well as finance a monthly allowance of about 800 yuan, or $114, per child to all households with two or more children.
Separately, Bloomberg News reported that China is also considering injecting up to 1 trillion yuan of capital into its biggest state banks, though analysts say more lending firepower will come up against stubbornly weak credit demand.