Capital adequacy of applicants to be assessed on a case-by-case basis
Saudi Arabia's central bank is reviewing licence requests for two digital banks to operate in the kingdom, the Saudi Arabian Monetary Authority (SAMA) confirmed to Zawya on the phone.
“Work is underway to evaluate these two licence requests,” Yazeed Alsheikh, director for general of banking control at SAMA, was earlier quoted as saying in local daily Aleqtisadiyah.
He added that the policy for granting licenses for digital banks is done through a comprehensive evaluation process that takes into account what added value a provider can bring to the Saudi banking sector.
Earlier this week, SAMA issued licensing guidelines for digital-only banks in Saudi Arabia.
It stipulated that online banks must set up as a locally incorporated joint-stock company and maintain a physical presence in the kingdom.
The Saudi regulator will assess the adequacy of capital of applicants “on a case-by-case basis considering the scale, nature and complexity of the operations,” SAMA said.
source: zawya
Badir-incubated technology startups raise SR508 million in 10 years
30 Jan 2020 Written by Admin AdminTechnology startups incubated by the Badir Program for Technology Incubators and Accelerators, one of the leading initiatives of King Abdulaziz City for Science and Technology (KACST), closed 2019 on a high note, raising a record SR236 million ($62.93 million) led by venture capital firms, individual investors, private companies, and governmental institutions.
The total funding for startups increased to SR508 million ($135.47 million) from 2010 until the end of December 2019 across 184 deals, according to a statistical report compiled by the Business Incubators and Accelerators Company (BIAC), which manages and operates the Badir Program.
The report revealed that venture capital firms were the most active in terms of funding size, investing SR 203 million into startups, equivalent to 40% of the total amount of funding and investment, while private sector companies provided SR 168 million, 33% of the total funding.
BIAC report further disclosed that the total financing by individual investors amounted to SR 104 million, 20% of the total amount of funding, followed by government institutions who invested SR 35 million, 7% of the total investment volume.
The increase in investments reflects the maturing startup environment in the Kingdom of Saudi Arabia and the continued and growing interest of local and international investors.
Furthermore, the number of startups incubated in the Badir Program rose to 655 companies since inception until the end of the third quarter of 2019.
The Badir Program offers one of the most important national and innovative environments in the field of entrepreneurship.
The Program was established in 2007 by the King Abdulaziz City for Science and Technology, to support and provide opportunities for technology- and innovation-based business enterprises.
Nawaf Al Sahhaf, the Chief Executive Officer of BIAC, said: “As the startup environment is thriving in Saudi Arabia, we have seen more of the startups succeed in receiving significant investments from several investors.
The success of startups provides an incentive for encouraging and enhancing the entrepreneurship environment in the market."
When the Badir Program incubates a technological startup company, it facilitates funding by providing a platform by connecting investors and entrepreneurs through its annually-held "Projects Presentation Day" program.
A state-owned subsidiary of the Saudi Technology Development and Investment Company (TAQNIA) – owned by the Public Investment Fund (PIF) – BIAC operates and manages entrepreneurship support platforms, innovation and technology transfer programs.
It also offers project management and business support with specialized consultancy and training services.
Offering an array of services in over nine different cities in the Kingdom, BIAC operates and manages 10 incubators and 8 accelerators in various fields, most notably the Badir Program's 8 incubators in 7 regions.
In addition, BIAC manages and operates the Saudi Innovation Center for Water Technology Program; the Fast Track to Innovation Program; the Innovation Center for Industry 4.0; the KAMIN Program for raising industrial capabilities and enhancing the capabilities of small- and medium-sized industrial enterprises; the Industrial Establishments Accelerator; Haramein Technology Accelerator; Badir Accelerator, and the Inventions Transfer Accelerator.
source: saudigazette
The name "Neom" was constructed from two words. The first three letters form the Ancient Greek prefix neo- meaning “new”. The fourth letter is from the abbreviation of Mostaqbal, an Arabic word meaning “future.”
Where will be "Neom" build?
The Neom project is located in Tabuk, Saudi Arabia in the northwest of the Kingdom, extended along with Aqaba Gulf and 468 km of coastline with beaches and coral reefs, as well as mountains up to 2,500 m high, with a total area of around 26,500 sq. km.
What is it's Goal?
Neom (styled NEOM; Arabic: نيوم Niyūm) is a Saudi project for a smart and tourist cross-border city planned for construction, The project is located in the far north-west of Saudi Arabia it will be constructed in Tabuk. It includes marine land located within the Egyptian and Jordanian borders. It will provide many investment opportunities with a total area of 26,500 km2 (10,200 sq mi) and will extend 460 km on the coast of the Red Sea.
What are the purposes of its Goal?
The project aims to transform Saudi Arabia into a leading global model in various aspects, one of the main objectives of the project is to seek ways of cooperation and investment with a wide network of international investors and innovators, and aims to focus on advanced industries and advanced technology. The first phase will be completed by 2025. The project was supported and funded by the Saudi Public Investment Fund of $ 500 billion.
Vision:
The city was announced by Saudi Crown Prince Mohammad bin Salman at the Future Investment Initiative conference in Riyadh, Saudi Arabia on October 24, 2017. He said it will operate independently from the “existing governmental framework” with its own tax and labor laws and an "autonomous judicial system."
The initiative emerged from Saudi Vision 2030, a plan that seeks to reduce Saudi Arabia's dependence on oil, diversify its economy, and develop public service sectors. Ghanem Nuseibeh told Inverse that the Saudi intention was "..to shift from oil to high tech and put Saudi kingdom at the forefront of technological advances. This is the post-oil era. These countries are trying to flourish beyond oil exporting and the ones who don’t will be left behind." The German Klaus Kleinfeld, former chairman and CEO of Alcoa Inc., and former president and CEO of Siemens AG, will direct the development of the city. Plans call for robots to perform functions such as security, logistics, home delivery, and caregiving and for the city to be powered solely with wind and solar power. Because the city will be designed and constructed from scratch, other innovations in infrastructure and mobility have been suggested. Planning and construction will be initiated with $500 billion from the Public Investment Fund of Saudi Arabia and international investors. The first phase of the project is scheduled for completion by 2025.
For High Technologies > Losing List:
Oil Based Fuel Vehicles will be gone
Paper Printed Money will be gone
Taxi with Driver and Delivery Man will be fired
All the Personal Assistants will be fired
Computer of today will be lost from market
High Technologies > Gaining List:
Electric Rechargable Vehicles will Come
Digital Transit will take place of Money
Driverless less vehicle and Drone delivery
Robot will be replaced with Personal Assistant
Regenerative Medicine
Quantum Computing
CRISPR Cas-9 (Clustered Regularly Interspaced Short Palindromic Repeats)
Elimination of > Huntington, Parkinson etc.
source: dev.to
Total Saudi non-oil exports to GCC reached $1.01bln in October
Non-oil exports from Saudi Arabia to member countries of the Arabian Gulf Cooperation Council (GCC) increased by SAR 133 million ($35.5 million) or 5.2% year-on-year (YoY) during October 2019.
Saudi exports of national origin to GCC countries recorded SAR 2.7 billion ($721 million) last October, compared with SAR 2.57 billion ($686 million) in October 2018, according to a Mubasher survey, based on the data of the Saudi General Authority for Statistics (GaStat).
Saudi non-oil re-exported goods to GCC member countries decreased by 18.2% to SAR 1.12 billion ($298 million). Accordingly, total non-oil exports reached SAR 3.82 billion in October.
Meanwhile, Saudi imports from GCC countries decreased to SAR 3.9 billion ($1.04 billion), with a trade balance deficit of SAR 83 million ($22.13 million).
source: zawya
The banking sector’s exposure to real estate has been contained at 17% of total credit to the private sector as of mid-year 2019
Like other real estate markets in the Gulf Cooperation Council (GCC), Saudi Arabia’s property sector has been under a fair amount of pressure with falling property prices and rents in recent years.
Hydrocarbon production quotas, subdued global oil and gas prices and geopolitical tensions have all hindered the country’s economic growth. A series of social and economic reforms has been adopted by the Kingdom to attract foreign investment under a diversification drive. Alongside these measures, we expect a rebound in economic growth to 2.3 percent on average over 2020-2022 to support the real estate market.
The banking sector’s exposure to real estate has been contained at 17 percent of total credit to the private sector as of mid-year 2019. Although Saudi banks seems to have written off a significant portion of their problematic contractor exposures, we do not rule out some volatility in the asset-quality metrics.
Mortgage portfolios have been expanding rapidly over the past two years, fueled by government-subsidized programs and regulatory incentives introduced by Saudi Arabian Monetary Authority (SAMA). They remain mostly salary assigned, so banks are exposed to unemployment risk, rather than asset-pricing risk. Yet, the cost of risk on mortgages has been negligible so far.
Nevertheless, government efforts to promote housing affordability, including lower regulatory requirements for mortgage exposures through loans could mean a build-up of risks in the long term.
Currently, the risks are still well-reflected in their ratings.
The general market trend is of weakening prices and rents across various segments, making the sector sensitive to unexpected changes in economic growth. The residential performance has been soft in Riyadh and Jeddah as residential sale prices and rents have declined. While supply is slated to increase slowly, we believe the segment is expected to remain under pressure mainly due to the exit of foreign workers, which has followed new and increasing taxes applying to expats.
We expect government initiatives, such as those incentivizing developers to build affordable homes, or encouraging banks to introduce more home financing options, to increase home ownership rates among Saudi citizens. Saudi Arabia has recently approved a program that offers permanent residency to some foreigners to attract investments, which could also boost prices. In addition, we forecast improving regulation to promote transparency and investment in the sector.
The commercial market is quite fragmented, with limited new supply in the pipeline. There is good demand for Grade A office space in part due to demand from newly created government companies under Vision 2030. The rest of the market however continues to experience rental decline. In Jeddah, the trend is negative too, with vacancy rates as high as 21 percent.
The retail market is competitive and unorganized, especially outside of the cities. Lacklustre economic growth means a soft retail environment, one that has negatively affected retail rents. Rents in Riyadh and Jeddah, especially for regional and
community malls, have declined by 5 percent year on year and are trending downward as more supply is expected over next 2 years.
A key difference between Saudi Arabia and neighboring countries is the size of the local population and demographics. Compared to the UAE population of approximately 9.5 million with 10-15 percent citizens, Saudi Arabia’s population is over 33 million of which 60-65 percent are citizens.
Due to the current over supply in residential sector we believe the Dubai market will remain under pressure in 2019-2020, with no meaningful recovery in the near term. Dubai Expo 2020, which is expected to attract millions of visitors to the emirate, may have a positive effect on market sentiment. Since the decline in prices has been gradual, relative to the previous cycle, we believe any meaningful recovery will take longer.
In contrast, Saudi Arabia has the opportunity to better manage property supply than its neighbors, with a key strength being its growing population and rapidly changing demographics.
Its youthful population has increasing disposable income, a taste for a better quality of life, and a preference for urban centers.
Meanwhile, the increased participation of women in the workforce will result in higher household spending power.
Under the Saudi Housing Vision Realization Program, the government aims to increase home ownership rates among Saudi nationals by 10 percent year on year. To achieve this, an increase in the availability of private sector funding for real estate and a boost to middle- and low-income housing stock, while also establishing cooperative social housing programs is needed to increase supply.
The country can also proactively plan for new concepts that are disrupting traditional brick-and-mortar real estate elsewhere such as co-working spaces, co-living developments, and online shopping.
Saudi population trends, combined with government reforms and potential economic growth, are supportive of a sustainable real estate market in the medium term and could see Saudi Arabia outperform neighboring countries.
source: zawya
At a time when economic tensions are never far from the world’s headlines, the role of trade as a tool for promoting mutual growth can seem a distant memory.
And yet amidst this increasingly competitive and inward-looking landscape, some respite can be found in the Middle East, an innovative and fresh region of nations racing to diversify their economies away from hydrocarbons.
The diversification of the region helps boost the Middle East market and make it an emerging champion for trade.
Stronger together
Boosting non-oil exports and foreign investments are essential steps for diversification. Over the last two decades, Gulf nations have sought to forge closer ties with one another, removing non-tariff barriers and entering into international trade agreements as an integrated group. As well as a GCC-wide Free Trade Agreement (FTA) and the broader Greater Arab Free Trade Area to promote intraregional trade, the Gulf Cooperation Council (GCC) currently holds FTAs with Singapore and the EFTA states of Norway, Iceland and Switzerland. The cooperation council is collectively negotiating several more, including with:
- China
- Australia
- Japan
- Korea
- New Zealand
- The European Union
First of its kind FTA
As well as entering into international Free Trade Agreements collectively, GCC members have also forged new partnerships independently. Of particular note is Bahrain’s FTA with the US – the first US FTA with any GCC country. Last year saw USD 1.2 billion total in imports and USD 683 million in exports from this trade agreement alone. Furthermore, it has been a boon to Bahrain’s rapidly growing manufacturing sector, attracting international companies seeking to benefit from the Kingdom’s low-cost business environment, advanced infrastructure, supportive regulation, highly skilled workforce and access to both the US and growing USD 1.5 trillion Gulf markets.
Tariff-free competitive edge
Take Confectionary giant Mondelez, which chose the Bahrain International Investment Park for its sixth global mega-plant – a ‘Factory of the Future’ the size of 300 football fields. According to Plant Director Omar Nassef, “The US FTA grants the Bahraini business a competitive edge of having tariff-free access to the giant economy of the US.” Every year Mondelez produces some 60 million Oreo cookies – around 72 metric tonnes – and is generating some USD 70 million of revenue coming from the Middle East market and its tariff-free edge.
Skilled workforce
Or take 205-year-old US home textiles producer WestPoint Home. According to COO Steven Burns, most of the company’s competitors are in countries like Pakistan, China and India. Having set up in Bahrain to take advantage of the ease of doing business, access to decision-makers and skilled workforce (they employ more than 160 Bahrainis) they now export 90 percent of their production, duty-free, to the US.
Supportive infrastructure
Take the example of Bell Racing Helmets, which according to Executive Director & Chairman Stephane Cohen set up in Bahrain to take advantage of the supportive infrastructure for entrepreneurs and businesses and the high quality of life. They have been benefiting from the US FTA ever since.
Bucking the global trend
The results of attracting these international businesses are starting to show. The latest World Investment Report (WIR 2019) from the UN Conference on Trade and Development found that global flows of foreign direct investment (FDI) had sunk to their lowest level since the global financial crisis. Despite this, the West Asian subregion, which includes the Middle East, bucked the global trend, seeing a three percent rise in FDI to a total of USD 29 billion. The report singled out Bahrain, which saw a 6 percent increase in FDI inflows, attributed in large part to growing interest in its manufacturing sector.
Strengthening relations at home and abroad
The Middle East has long been seen as one of the world’s most fractious regions. Yet the need to evolve and adapt to a rapidly changing world has brought many Middle Eastern countries closer together, boosting the Middle East market. It is an irony of the digital era that while we are more connected than ever before, there is a growing trend towards nationalism and protectionism. In such a climate, there may be lessons to learn from the Middle East, which is strengthening relations at home while forging new alliances and visits across the world. And growing stronger because of it.
source: bahrainedb
عقد اجتماع مجلس ادارة اتحاد غرف دول مجلس التعاون الخليجي (52 ) في العاصمة العمانية مسقط مؤخراً ، بحضور ومشاركة أصحاب السعاده رؤساء الاتحادات وغرف دول مجلس التعاون الخليجي .
وتم خلال الإجتماع مناقشة المواضيع المُدرجة على جدول أعمال الإجتماع وهي التصديق على محضر الإجتماع (51) لمجلس الإتحاد الذي عقد بدولة الكويت بتاريخ 19 يونيه 2019 ومتابعة تنفيذ القرارات الصادرة عنه، وإنتقال رئاسة الإتحاد للدورة (21) إلى غرفة تجارة وصناعة البحرين بدءاً من 10 فبراير 2020 ولغاية 10 فبراير 2022، ومناقشة التوصيات الصادرة عن الإجتماعين (45)، (46) للجنة القيادات التنفيذية، ومناقشة التعديلات المقترحة على النظامين الأساسي والداخلي للإتحاد، وإعتماد التقرير السنوي للأمانة العامة للإتحاد لعام 2018، ومناقشة مشروع البرنامج السنوي للأمانة العامة للإتحاد لعام 2020، ومناقشة مشروع الموازنة التقديرية للأمانة العامة للإتحاد لعام 2020، ومتابعة تطورات تشييد المقر الجديد للأمانة العامة للإتحاد.
كما تم على هامش الإجتماع التوقيع على مذكرة تفاهم للتعاون والتنسيق في التعليم الخاص بين غرفة تجارة وصناعة البحرين ومجلس الغرف السعودية، حيث وقعها من جانب غرفة تجارة وصناعة البحرين رئيسها السيد سمير عبدالله ناس بينما وقعها من جانب مجلس الغرف السعودية الدكتور سامي بن عبدالله العبيدي رئيس المجلس، ويأتي التوقيع على مذكرة التفاهم في اطار التعاون والتنسيق في التعليم الخاص بين اللجنة الوطنية للتعليم الخاص والتدريب بمجلس الغرف السعودية، ولجنة التعليم بغرفة تجارة وصناعة البحرين للتأكيد على الدور المهم لقطاع التعليم الخاص بكافة مراحله في منظومة التعليم بدول مجلس التعاون الخليجي وتعزيز اسهاماته في رفع نسبة الإستثمار في الإقتصاد المعرفي الخليجي وتطويره للوصول الى المنافسة المعرفية العالمية، انطلاقاً من مبدأ التكامل الإقتصادي بين الغرف التجارية الأعضاء في اتحاد غرف دول مجلس التعاون الخليجي .
Kuwait Investment Authority's decision to participate in the deal or not will depend on a "study" of the IPO
DUBAI- Saudi Aramco met investors in Dubai on Sunday to market its initial public offering (IPO), after trying to secure demand from Kuwait's sovereign wealth fund for the deal, worth up to $25.6 billion, which relies heavily on local and regional buyers.
Top executives of the Saudi state-owned oil giant, including Aramco's Chief Executive Amin Nasser, met officials of Kuwait's sovereign wealth fund weeks ago, a source familiar with the matter said, confirming an earlier report on Sunday in the Kuwaiti newspaper Alrai.
Meanwhile, Aramco's management including its finance head and advisers met with institutional investors at an IPO roadshow in Dubai on Sunday, the second outside Riyadh after the company decided to cancel all roadshows in developed markets.
The Kuwaiti newspaper said the Kuwait Investment Authority's (KIA) decision on whether to participate in the deal would depend on a "study" of the IPO.
Aramco said in an email it did not comment on specific investor meetings.
The KIA did not immediately respond to a Reuters request for comment. In late October, the KIA's managing director Farouk Bastaki said Aramco had not approached the fund then, but that the KIA would look at the IPO like any other investment.
Talks have taken place with sovereign investors including the Abu Dhabi Investment Authority, Singapore's GIC and other funds, sources have told Reuters.
DUBAI ROADSHOW
Aramco has struggled to attract a major cornerstone or anchor investor for its IPO, which could be potentially the world's biggest.
An executive at a London-based fund, who attended the roadshow in Dubai, told Reuters he was interested in the IPO, but declined to provide more details.
Some investors asked Aramco about the sustainability of its dividend policy.
Aramco has set a base dividend of $75 billion for five years.
A second executive at an investment firm said Aramco did not say whether that base level might grow.
The meeting was led by Aramco's senior vice president of finance, strategy and development, Khaled al-Dabbagh, and Yasser Mufti, the company's vice president of strategy and market analysis, sources said.
"The only thing left for comfort is the Saudi government, it’s fiscal policy and ability to sustain the dividends," said a fund manager. "If you’re OK with that, you’ll invest."
Over 20 people, wearing suits, walked into the presentation area at a luxury hotel in Dubai's financial district, but hotel security restricted entry for reporters.
Another roadshow is planned in Abu Dhabi on Monday.
"Looks like there's a lot of interest both from retail investors and institutions." K. V. Vijay Raghavan, group finance director at Dubai-based investment firm Arenco told Reuters after attending the roadshow.
"I wish it was more like $1.4 trillion to $1.5 trillion, but this is what it is," he said, referring to the company's aim to achieve a valuation of $1.6-$1.7 trillion.
However, he also said that looking at the investor interest, the IPO could hit the top end of the valuation range.
Aramco plans to sell 1.5% of the company. The deal is the centrepiece of Crown Prince Mohammed bin Salman's plans to diversify the Saudi economy away from its reliance on oil.
Saudi Arabia's central bank governor told Reuters on Sunday in Riyadh that it was monitoring banking indicators on a daily basis and was not seeing any impact on liquidity from the IPO.
source: zawyazawya
Attracting investors: Saudi Arabia issues 558 business licenses in H1 2019
29 Oct 2019 Written by Admin AdminSaudi Arabian General Investment Authority (SAGIA), which is responsible for increasing investments and supporting businesses in the kingdom, has issued 558 licenses in the first half of 2019.
“SAGIA has already issued 558 licenses in the first half of 2019, that's a 85 percent increase compared to the same period last year,” an official tweet from the investment authority confirmed.
New licenses approved for foreign businesses in Saudi Arabia jumped by 70 percent in the first quarter compared to the same time last year, mainly due to an increase in applications for business licenses from Britain and China which went up by 86 percent and 71 percent respectively.
Saudi Arabia is looking at foreign investment to reduce its dependence on the oil. Though Foreign Direct Investment numbers of the kingdom are not available, the growth in foreign licenses reflects its efforts to remove restrictions on foreign investments.
Saudi Arabia improved its ranking in the World Bank's latest Doing Business report, climbing 30 places to 62nd, driven mostly by reforms aimed at building more economic diversification.
According to the World Bank, Saudi Arabia's reforms included establishing a one-stop shop for business registration, introducing a secured transactions law and an insolvency law, improving protections for minority investors, and measures to bring more women into the workforce.
source: zawya
Arab Bank Switzerland Launches BTC and ETH Trading and Storage Services
29 Sep 2019 Written by Admin AdminThe Swiss subsidiary of Arab Bank, a banking giant in the Middle East, is starting to provide trade and storage services for BTC and ETH.
Thanks to this initiative, large-capital clients serviced by Arab Bank Switzerland, including business leaders and family entrepreneurs, can now access digital assets.
“We strongly believe that the blockchain will dramatically change the financial industry, and we intend to be one of the first banks to offer digital asset services for customers in a safe and regulated environment,” said Arab Robin CEO Serge Robin .
Regarding custodial services, the bank has partnered with Taurus Group, which has integrated its cold storage solution called TAURUS-PROTECT with the bank’s infrastructure.
Taurus notes that the solution uses the Federal Information Processing Standard (FIPS) 140-2, Certified Equipment Security Modules (HSM) Level 3, and “some of the safest hardware in the world”
“We now have a fully regulated and scalable infrastructure that we will use to provide our clients with institutional-grade digital asset services in addition to our traditional asset and credit management solutions,” said Rani Jabban, a member Board of Arab Bank Switzerland.
In February this year, the Swiss bank Julius Baer and SEBA, with the participation of the cryptocurrency company SEBA Crypto AG, began offering digital asset services.
source: omnia
