Sun. Jun 4th, 2023

https://arab.news/46vep
Riyadh: King Abdulaziz Port in Dammam is now part of container carrier giant Maersk’s express shipping service in a move that will boost trade between the Arabian Gulf and the Indian Subcontinent. 
The weekly service — known as Shaheen Express — links the port to major regional hubs such as Dubai’s Jebel Ali, India’s Mundra and Pipavav aboard container ship BIG DOG, which has a carrying capacity of 1,740 twenty-foot equivalent units. 
The announcement by the Saudi Ports Authority, also called Mawani, comes after several other shipping lanes chose Dammam as a port of call in 2022.  
These included SeaLead Shipping’s Far East to Middle East service, Emirates Shipping Line’s Jebel Ali Bahrain Shuwaikh (JBS), and Gulf-India Express 2 by Aladin Express. 
This is alongside the recent connection to Singapore and Shanghai ports on the Gulf China Service by Pacific International Lines. 
King Abdulaziz Port was declared the fourteenth most efficient port in the World Bank’s Container Port Performance Index for 2021, a historical achievement that stems from its state-of-the-art infrastructure, world-class operations, and record-breaking performance, according to the Saudi Press Agency.
In a sign of the growth of the facility, King Abdulaziz Port set a new container throughput record in June 2022, by handling 188,578 TEUs, surpassing the previous record of set in 2015. 
The record-breaking performance of the port was attributed to the rise in export and import volumes, as the Kingdom moves in line with the National Transport and Logistics Strategy aimed at turning Saudi Arabia into a global logistics hub.
 “The port’s strategic location on the Arabian Gulf lends it a distinct status as a trade gateway to the Kingdom’s eastern and central regions, which provides investors interested in setting up integrated logistics facilities that offer value-added services a competitive edge like no other,” said Mawani in the statement when the figures were released in September. 
Mawani is currently working on upgrading the 19 sq. km. port to make it capable of receiving giant vessels and handling up to 105 million tons annually. 
RIYADH: Small and medium-sized enterprises are a force to reckon with in Saudi Arabia as the Kingdom, in line with the goals outlined in Vision 2030, continues to diversify its economy which has been dependent on oil for several decades.
Even when COVID-19 disrupted global economies, SMEs in Saudi Arabia remained steadfast in their growth under the visionary leadership of King Salman and Crown Prince Mohammed bin Salman.
In 2022, when the world started rebounding from the fallout of the pandemic, the support offered by the government to SMEs in Saudi Arabia was instrumental in helping them get back on their feet.
With new regulations, reforms and financial support aimed to create an accommodative environment, the government is transforming the SME sector into an engine for economic growth in the Kingdom.
The role of Monsha’at
Saudi Arabia’s Small and Medium Enterprises General Authority, also known as Monsha’at, is fueling the growth of the SME sector in the Kingdom.
The state-run authority offers entrepreneurial platforms such as business incubators, business accelerators, and co-working spaces for SMEs to evolve and thrive in the market. The authority also facilitates government-fee refund, direct and indirect lending programs for SMEs and fast-growing unicorns.
Through these initiatives, Monsha’at aims to successfully achieve the targets outlined in Vision 2030 which include lowering the unemployment rate from 11.6 percent to 7 percent, increasing women’s participation in the workforce from 22 percent to 30 percent, and expanding SME contribution to 35 percent of gross domestic product by the end of this decade.
Monumental growth of SMEs
The growth of SMEs in 2022 was monumental, as the number of registered SMEs in Saudi Arabia hit 892,063 at the end of June, registering a 25.6 percent increase from the fourth quarter of 2021.
In its report titled SME Monitor, Monsha’at said that Riyadh and Makkah were the most attractive regions for startups, accounting for 35.4 percent and 21 percent of the Kingdom’s SMEs respectively in the first half of 2022.
The report also revealed that Saudi Arabia has successfully narrowed the gender gap in the Kingdom, as 45 percent of SMEs are now headed by women.
According to the report, regulatory reforms over the first half of 2022 have played a crucial role in increasing the number of female entrepreneurs in the country, with most of them leading firms in the food, wholesale and retail, health and professional sectors and supporting service industries.

Regulatory changes
It was on June 28 that the Saudi Cabinet approved the new company law in the Kingdom aimed at boosting entrepreneurship.
Ghassan Al-Sulaiman, chairman of the National Center for Family Enterprises, said that the new company law in the Kingdom will play a pivotal role in providing an incubating and stimulating environment for investment, especially in family businesses and small and medium enterprises.
Under the new law, many restrictions in the incorporation, practice and exit phases and restrictions on company names have been removed.
In November, Saudi Arabia’s Cabinet approved the Small and Medium Enterprises Bank System, aimed at providing all its products and services in digital form without the need to establish branches.
After the approval, ministers also signed off the transfer of the Kafalah SME Loan Guarantee Program from Monsha’at to SME Bank.
• Saudi Arabia’s Small and Medium Enterprises General Authority offers entrepreneurial platforms such as business incubators, business accelerators, and co-working spaces for SMEs to evolve and thrive in the market.
• The authority also facilitates government-fee refund, direct and indirect lending programs for SMEs and fast-growing unicorns.
• The growth of SMEs in 2022 was monumental, as the number of registered SMEs in Saudi Arabia hit 892,063 at the end of June, registering a 25.6 percent increase from the fourth quarter of 2021.
Earlier in October, oil giant Saudi Aramco launched the Taleed program to support the Kingdom’s small and medium enterprises sector with funding of over SR3 billion ($798 million).
According to a statement from Aramco, Taleed will feature 20 initiatives which are categorized into three diverse groups: job-matching upskilled local talent, creating business opportunities for SMEs, and supporting SMEs and enabling the ecosystem.
In April, the Saudi Export-Import Bank signed a tripartite memorandum of understanding with Monsha’at and the International Islamic Trade Finance Corp. to launch a program to support SME exports.
The agreement aims to accelerate digital transformation among SMEs to boost their export capabilities and provide indirect funding by offering insurance, products and financial guarantees.
“The MoU will also encourage Shariah-compliant SMEs in Saudi Arabia to access new markets,” Hani Sonbol, CEO of the International Islamic Trade Finance Corp., told Arab News.
As Saudi Arabia leapfrogs in the travel and tourism sector, the Tourism Development Fund launched a $133 million fund to support and develop small businesses in the Kingdom in August.
Aligned with the country’s National Tourism Strategy, the “Aoun Tourism” program is expected to fund over 2,000 enterprises in the Kingdom.
The three-year program will ensure funding, education and training for tour guides, operators, facilities, travel agents and event organizers who work within the Kingdom. In an exclusive interview with Arab News, Wahdan Al-Kadi, the chief business officer at TDF, said that it is providing both financial and non-financial support to SMEs in the Kingdom. “We have financial support and non-financial support. We have a business app that offers to coach SMEs to run their businesses. We have 10 different products for SMEs that offer startup loans, working capital, asset financing, and many other products to support them,” said Al-Kadi.
Technological revolution
Despite growing at a massive pace, SMEs in Saudi Arabia will have to transform and become more technologically savvy in their operations to go global and compete internationally, multinational professional services network KPMG said in a report.
The KMPG report outlined that SMEs in the Kingdom should make use of third parties to accelerate digitization, enabling them access to the technical skills and experience required to build new digital solutions.
Sulaiman Al-Mazroua, CEO of the National Industrial Development and Logistics Program, had said that SMEs in the Kingdom should develop innovative technological ideas to fill gaps in logistics.
“This area (technology) in logistics, specifically, is very attractive to small and medium businesses, and innovation in that area is extremely open. So with more SMEs coming in to fill gaps in logistics, you will need less time and cost to produce. And whenever there’s competition, innovation comes to play,” Al-Mazroua told Arab News.
As Saudi Arabia continues its journey to achieve the goals outlined in Vision 2030, SMEs in the nation are expected to emerge as the driving factor which will change the face of the Kingdom in the coming years.
RIYADH: With the highest growth rate among the G20 countries, continuous efforts to diversify the economy and a healthy inflow of foreign direct investment, Saudi Arabia’s market performance has been resilient.
“Tadawul is by far the largest stock exchange in the Middle East, and it is seeking to become a regional center with cross-listings of companies from other countries in the Gulf,” said Waleed Rasromani, corporate mergers and acquisitions partner of Dubai and Riyadh at Linklaters, a UK-based multinational law firm.
Intense merger and acquisition activity combined with significant growth in initial public offerings have led the Kingdom’s market to evolve and is expected to carry that momentum into 2023.
Geared for market growth
The Kingdom’s oil-led growth, non-oil diversification strategy and governmental frameworks created a strong foundation for its impressive market performance.
Strong liquidity, local investor appetite for Saudi stocks and the pursuit of goals outlined in Vision 2030 have also facilitated the market’s development.
A report released by the World Bank in November suggested that growth in the oil sector is driving the Kingdom’s economy forward. As a result, the economy is expected to grow by 8.3 percent in 2022.
The International Monetary Fund also noted that Saudi Arabia would maintain its position as the fastest-growing economy among the G20 countries despite economic headwinds.
As for legislative efforts, the Capital Market Authority is working toward making the financial market more attractive and transparent and raising investors’ awareness.
CMA is focused on raising institutional investor turnover to 41 percent of the total market turnover by the financial year of 2023.
The Kingdom’s Financial Sector Development Program is another factor that enables and supports Saudi market growth.
Excluding the Saudi Arabian Oil Co. IPO, it aimed to increase the value of the stock market as a percentage of the gross domestic product to 88 percent by 2030 from 66.5 percent in 2019. Saudi Aramco closing share price on Dec. 29 at SR32.10.
Saudi governmental authorities are also stimulating the planned privatization of state-owned institutions through IPOs on the Saudi stock exchange.
In addition, Saudi firms prefer to list IPOs locally rather than on more developed stock exchanges, probably due to disclosure and corporate governance requirements.
“The Saudi government’s push for privatization has prompted more IPOs, and the involvement of key sovereign funds and stakeholders in the capital markets is helping the Kingdom monetize its investments,” said Ibrahim Soumrany, a partner at US-based global law firm White & Case in Dubai.
Soumrany added that more foreign companies are considering listing in the Kingdom. As a result, there is increasing support to permit dual listings in the coming years as more companies seek to list both in their local markets and Saudi Arabia.
Robust performance
The Kingdom was the best performing of all the emerging markets since COVID-19, with the market capitalization of Tadawul up 24 percent year on year to reach $3.19 trillion in the first quarter of 2022.  The market capitalization on Dec.29 was nearly $2.63 trillion.

As of December, the earnings for Saudi-listed companies have grown 22 percent per year over the last three years. In addition, their revenues increased by 19 percent per year, indicating that these firms are generating more sales and their profits are on the rise.
Nevertheless, the owner of the Kingdom’s bourse recently recorded a 23 percent decrease in profit to SR367 million ($98 million) in the first nine months of 2022.
This dip was coupled with a 7 percent decline in revenue to SR849 million, mainly due to the decrease in trading and post-trade services.
Higher salaries and employee-related benefits further weighed on profit between January and September, leading to a 14.7 percent year-on-year increase in operating expenses to SR465 million.
At the start of December, the Kingdom’s stock market benchmark index fell 2.5 percent to hit its lowest since April last, pulled down by a 4.9 percent and 4.7 percent dip in Al-Rajhi Bank and Riyadh Bank, respectively.
Why? Since the Saudi riyal is pegged to the US dollar and the Saudi Central Bank follows the US Federal Reserve’s open market operations, the Kingdom takes a hit when the Fed pursues quantitative tightening to reign over inflation.
“However, the market could find some support in solid local fundamentals,” Daniel Takieddine, CEO of the Middle East and North Africa region of Seychelles-based financial institution BDSwiss.
Al-Rajhi Bank and Riyadh Bank share prices closed on Dec.29 at SR75.20 and SR31.80, respectively.
Gulf markets have witnessed a banner year with regard to IPOs, benefiting from a war-driven surge in oil prices, with Saudi Arabia at the forefront.
The Kingdom is also leading the way in regional listing activity despite the fall in IPOs in developed markets due to global uncertainties and stock market volatility.
“The IPO market in the Kingdom is expected to remain resilient, and we anticipate increased IPO traction. It doesn’t seem like there would be a slowdown there,” noted Ali Anwar, managing director and the Middle East practice leader with Alvarez & Marsal Global Transaction Advisory Group in Dubai.
Saudi Arabia had two IPOs on Tadawul and three on its parallel market Nomu during the third quarter of this year, making $490 million in total proceeds, according to leading professional services firm Ernst & Young.
As for early next year, the Saudi market is expected to see growth in M&A activity propped up by rising corporate enthusiasm to maximize shareholder wealth through strategic partnerships and business alliances, according to a press release by Riyadh-based GIB Capital.
“We are seeing a fundamental maturity in the attitude of the Saudi corporate community toward business combinations and partnerships, which is very promising for our market,” said Khalid AlGhamdi, the acting CEO of GIB Capital.
Anwar further highlighted that despite the possibility of a dip in 2023 compared to the previous year, Saudi Arabia will retain large financial buffers and push ahead with ambitious investment programs in line with Vision 2030.
Future outlook
When asked about the outlook for 2023, Anwar told Arab News: “The Kingdom of Saudi Arabia is brimming with confidence.” On the other hand, Rasromani of Linklaters said, “I am optimistic for the coming year.”
This sentiment is evident in the Riyadh-based brokerage Al Rajhi Capital’s 2023 outlook report.
A survey from the report showed that approximately 60 percent of participants expect the markets to be in the positive range, 23 percent of which expect gains to surpass 5 percent, despite the economic uncertainty and fears of recession.
The report identified the banking sector as the most preferred, where participants anticipate net interest margin expansion and growth in corporate loans to drive the profitability of banks during the fourth quarter of 2022 and the following one.
The petrochemicals sector unexpectedly topped the list of the most appealing industries as the prices weakened in the past on demand concerns due to global instability.
“I expect that the industrial sector will be active in the Kingdom as the drive to localize supply chains continues, and renewable energy will also likely be of key interest as numerous projects are launched,” noted Rasromani.
He added, “I am most excited about venture capital because this form of investing has become increasingly sophisticated in the Kingdom, and it has the potential to transform society and business for the better fundamentally.”
CAIRO: Startups in the Middle East have accomplished their 2022 resolutions with funding, expansion and technological achievements.
The region witnessed startups making headlines like never before with a rise in investment, partnerships, and product development in the ecosystem.
Saudi Arabia’s food technology company Foodics topped the list of the region’s most active startups exceeding all expectations and experiencing rapid growth.
Founded in 2014, Foodics is a Saudi-based food and fintech company that offers point-of-sale solutions with hardware and software to boost the food and beverage sector.
Ahmad Al-Zaini, CEO and co-founder of Foodics, told Arab News that the company’s first acquisition and series C funding round were the most notable achievements in 2022.
“This year has been crucial for Foodics,” said Al-Zaini, “In January, we acquired POSRocket and became the dominant restaurant-tech provider in the Middle East and North Africa region.”
“This landmark acquisition was a strategic move and one that enabled Foodics to consolidate the market, as well as take market leadership positions in Egypt, Kuwait, Oman and Jordan on top of the dominant position it already has in the rest of GCC,” he added.
Established in 2016, POSRocket is a Jordan-based point-of-sale software provider for restaurants that was dubbed the second largest cloud technology provider in the MENA region.
The second most notable achievement for Foodics this year was its mega-funding round which positioned the company on a growth trajectory and made it one of the most funded startups in the region.
“Foodics raised $170 million in the largest software as a service Series C round in the MENA. We have come a long way since our early days, and we were proud to have been able to secure capital from premium international tech investors to further power our journey to better support the F&B entrepreneurs and owners who make up the majority of our client community,” Al-Zaini said.
Raising a total of $198 million since its inception, the company managed to onboard top-notch investment firms like Sanabil Investments, STV, Endeavor Catalyst, Vision Ventures, Prosus and Sequoia Capital India.
This year was full of excitement for Foodics as it announced the launch of its micro-lending products that will greatly support its client base. Moreover, the company doubled down on its fintech side by rolling out new financial products and partnering with one of the largest fintech companies in the region, Paymob.
Paymob’s partnership is just the beginning; Al-Zaini explained that the company managed to seal 15 new strategic agreements with companies across the Middle East and Egypt.
Some of Foodics’s partnerships include Qoot, Sabbar, Alinma Bank, King Abdullah Financial District and Classera, which target Saudi Arabia’s F&B sector.
Foodics has also secured a partnership with the UAE’s Ministry of Economy that aims to promote the growth of small and medium enterprises in the F&B sector.
The two entities aim to collaborate on initiatives that include workshops to optimize strategies and business operations, improve supply chain management, boost sales and marketing and adopt technologies.
“Fostering the growth of the wider entrepreneurial ecosystem has always been part of our company’s DNA,” Al-Zaini stated.
“In 2022, we processed over 6 billion transactions on our platforms, launched a new tech stack, grew our marketplace ecosystem to more than 70 companies and launched Foodics Academy,” he added.
Al-Zaini stated that the company currently serves more than 22,000 F&B outlets across 35 countries, helping around 40 percent of the Saudi market adopt the technology by making it 85 percent more affordable.
He added that 2022 had been a year of change for Saudi Arabia, with entrepreneurial talent and startup companies increasing to address consumer needs through innovation.
“The Kingdom’s Vision 2030 aims to drive the digital transformation of numerous sectors and inspire new collaborations between the public and private to create a greater impact. The country is building a great foundation of success for the future, during which unprecedented reforms were made in the public sector’s operating model, the economy and society as a whole,” Al-Zaini said.
“One crucial strand of this drive is the championing of startups across the Kingdom. Significant efforts have been put into cultivating the successful incubation of startups,” Al-Zaini added.
The Kingdom’s combination of government facilities and the drive for entrepreneurship have disrupted day-to-day experiences by bringing more ease and convenience to growth in all sectors.
“At Foodics, we are proud to help support this vision. We have brought affordable omnichannel tech and fintech solutions to the F&B industry to help them start and grow their business through innovative tech solutions,” Al-Zaini added.
The company is not stopping here; Al-Zaini shared that Foodics is still ambitious to fulfill much more goals in 2023.
“Our future ambition is to continue to shape the restaurant business, to give restaurant owners the freedom to focus on growing their business while we take care of the rest,” he added.
Al-Zaini explained that the company’s tech stack would empower automation in the F&B sector through self-ordering and payment solutions to create a seamless and efficient industry.
“We constantly listen closely to our customer and ecosystem partners and strive for new ideas to test and implement into new product rollouts. We will also continue to be the government’s partner in accelerating digital transformation in the F&B sector’s micro and small and midsize business segments and help accelerate their growth,” he explained.
TOKYO: More than three quarters of Japan’s oil imports in November (76.4 percent) came from the UAE and Saudi Arabia, with rates of 41.5 percent (32.1 million barrels) and 36.3 percent (28.16 million barrels), respectively, according to data from the Japanese Energy Agency on Friday.
Japan’s crude oil imports from Saudi Arabia were down from 31.60 million barrels, while imports of UAE crude were down from 33.93 million barrels in the previous month.
Total imports in November amounted to 77.53 million barrels – down from 84.58 million the previous month – at a rate of 2.58 million barrels per day.
From Kuwait, Qatar, Bahrain, Oman and the neutral zone (between Saudi Arabia and Kuwait), imports amounted to 9.4percent, 5 percent, 1.3 percent, 1.3 percent and 0.6 percent, respectively, which means that Arab oil provided Japan with 95.4 percent of its oil needs in November, according to the agency, which is part of the Ministry of Economy, Trade and Industry.
Japan’s exports from Ecuador, Australia, Vietnam, Malaysia and Indonesia came to less than 5 percent of its consumption in November.
The ban on buying Russian and Iranian oil imposed by Japanese companies in compliance with US sanctions continued in November, but Japan still imports Russian natural gas from the Russian Sakhalin region for about 8 percent of its LNG needs under bilateral investment and development treaties that are exempt from Japanese sanctions against Russia.
• This article originally appeared on Arab News Japan
RIYADH: Saudi Arabia is set to become a “global leader” in the mining sector thanks to the Kingdom’s investment incentives, according to a new report issued on the eve of a major industry conference.
The analysis, by The Payne Institute for Public Policy at the Colorado School for Mines in the US, states that the Kingdom is on track to play a central role in the supply of precious minerals needed to power the transition to green energy in order to reach the goal of net zero carbon emissions.
The report notes that investments are projected to create roughly 14,000 new jobs in clean energy within the region, and the Kingdom plans to attract $32 billion of investment.
The findings come as Saudi Arabia gears up to host the second edition of the Future Minerals Forum in Riyadh from Jan. 10 to Jan. 12, with an estimated 200 speakers from around the world expected to attend the event. 
The summit is set to tackle several topics, including sustainability, the future of mining, energy transition, the contribution of minerals to the development of societies, digital transformation, and integrated value chains.
Reflecting on Saudi Arabia’s role in the sector, the report states: “The outlook for Saudi Arabia’s role as a global leader in building out efficient critical mineral supply chains is promising, in part, due to a welcoming investment climate. 
“By providing incentives for investment and being transparent/open to investors, the Kingdom has started to attract a lot of interest in investment partnerships, with the CEO of Eurasian Resources Group, recently stating that Saudi Arabia has all the ‘ingredients to be successful.’”
Currently, the Kingdom is processing 145 exploration license applications sent in by foreign companies, according to the analysis.
According to geological surveys dating back 80 years, the Kingdom is thought to have an estimated reserve of untapped mining potential valued at $1.3 trillion.
However, with the prices of valuable minerals, especially gold, copper and zinc rising, the true value of the Kingdom’s current mineral wealth could be double that figure, CEO of the Saudi Geological Survey Abdullah Al-Shamrani said in September 2022.
Earlier this week it was revealed that Saudi Arabia issued 38 new mining licenses in November, up from the 21 it awarded the previous month as the sector continues to grow in line with the Vision 2030 economic diversification plan, according to official data.
The total mining exploration licenses in the Kingdom now stand at 2,201, up from 2,164 in October.
Of those handed out in November, 24 were for mineral exploration, 13 for the building materials industry and one for raw material production, Saudi Press Agency reported, citing data from the Ministry of Industry and Mineral Resources.

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