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Saudi Arabia’s cabinet agreed to implement a broad reform plan known as Vision 2030, which is expected to involve sweeping change to diversify the economy beyond dependence on oil exports, state media reported on Monday.
The Kingdom announced sweeping economic reforms to reduce its dependence on oil and ensure long-term sustainable development, with plans for a massive $2 trillion sovereign fund to boost its global investment power.
In an exclusive interview with Al-Arabiya News Channel on Monday, Deputy Crown Prince Mohammed bin Salman, second deputy premier and defense minister, said the implementation of the Vision 2030 plan would likely see the country operate without oil income by 2020, without sacrificing current infrastructure projects. The plan would also see the development of the country’s tourism industry, building the capacity of its military industries, reduced subsidies to save money, job creation initiatives, an education system revamp and a Green Card-style residency system for Arabs and Muslims.
He said the plan includes the setting up of a restructured Public Investment Fund (PIF) worth $2 trillion by including the proceeds of a Saudi Aramco initial public offering (IPO), other assets of $600 billion, and state-owned real estate and industrial assets estimated at $1 trillion. It would have more than 10 percent of global investment capacity, he said.
Prince Mohammed said the sale of 5 percent of oil giant Saudi Aramco would be the “biggest IPO in history.” Aramco would have a holding company with an elected board, with subsidiaries also sold through IPOs. “The 5 percent is from the parent company,” he said. Aramco is the world’s leading oil company, producing about 10 million barrels a day, or about 10 percent of global production.
Prince Mohammad said the partial IPO would help transform Saudi Arabia into an investment-driven economy and turn the Kingdom into a global player. “The Saudi addiction to oil has disrupted the development of many sectors in previous years,” he was quoted as saying.
On the highly-anticipated topic of the American-style Green Card for expatriates in the Kingdom, the prince said the scheme would be ready in five years. “The Green Card will allow Muslims and Arabs to live in Saudi Arabia for a long time and will be a source of revenue for the government,” he said. Prince Mohammed also revealed plans to develop the country’s tourism industry but within the framework of “our beliefs and values,” revitalizing culture and entertainment, and building an Islamic museum. “How can the Kingdom be the holiest place for Muslims and have no Islamic museum?”
The prince said the Aramco IPO is also aimed at ensuring greater transparency to boost the confidence of investors. “In this day and age, no country can afford to not be transparent. There are many benefits to the Aramco proposal, and the most important and major one is transparency.”
He said the lack of transparency of Aramco has “upset” many people. If Aramco is listed then it would have to announce its results quarterly and be open to scrutiny by financial and other institutions locally and abroad, he said.
Prince Mohammed said the government would cut subsidies but limit its impact on low and middle income earners. However, it would be applied to everyone, “including princes and government ministers. This is a promise.”
The deputy crown prince also confirmed in the interview the government plans to reduce Saudi unemployment from 11.6 percent to 7 percent.
On defense, he said it made no sense for Saudi Arabia to be the world’s third-largest spender on arms but with no manufacturing industry. There were plans underway to set up factories for this purpose by 2017, initially wholly owned by the government but later listed on the Saudi bourse.
Prince Mohammed said that the Kingdom was adopting Vision 2030 “regardless of the oil price,” in reference to prices plunging to a 12-year low of $32 a barrel in January. “The Vision doesn’t require high spending but restructuring.” It focuses on the Kingdom’s strengths, its religion and Arab heritage, ability and location, he said.
Asked about the proposed King Salman Bridge over the Red Sea, announced last week in an agreement with Egypt, Prince Mohammed said the crossing would link Europe and Asia, provide building and investment opportunities, and help move billions’ worth of cargo across the Red Sea.
According to reports, the plan also envisages increasing the participation of women in the workplace, which has been growing rapidly over the past five years, from 22 percent to 30 percent.
Summary:
- Saudi is to sell less than 5 per cent of oil giant Aramco in IPO: deputy crown prince, Mohammed bin Salman.
- He expects the value of Aramco to exceed $2 trillion as the kingdom prepares to sell part of the company in what could be the world’s largest initial public offering. The valuation of Saudi Arabian Oil Co. hasn’t been completed.
- A new investment fund will turn the world’s top oil exporter into a global investment power, deputy crown prince, Mohammed bin Salman said. The kingdom’s existing Public Investment Fund (PIF) had made returns of 30 billion riyals ($8bn) in 2015. Asked whether he thought the management of PIF would be too autocratic, he said there would be an elected board that would make investment decisions for PIF.
- “We plan to set up a $2 trillion sovereign wealth fund … part of its assets will come from the sale of a small part of Aramco," he said.
- The Saudi stock index recovered from early losses and was up 1.8 per cent after the reform was outlined.
- A “green card" system will be introduced within five years to allow resident expatriates in the kingdom to have more rights in order to improve its investment climate. Sweeping reforms, of which the proposed green card is one, will be implemented even if oil prices rise back above $70 a barrel, prince Mohammed said.
- Plans for a military industries holding company fully owned by government at first and offered in IPO by end of 2017.
- The reform plan will not require major spending but will involve restructuring, prince Mohammed said, adding that spending on infrastructure projects would continue. He said that the government would restructure the housing ministry to help more citizens buy homes, said subsidies should not go to the rich, and said he aimed to reduce unemployment among Saudi nationals to 7 per cent from 11.6 per cent.
Sources: Arabnews.com, thenational.ae
Deputy Crown Prince Mohammad Bin Salman Al Saud announced in an interview with Bloomberg, that Saudi Arabia could introduce a system for its millions of expatriates that would be similar to the Green Card system in the US. He added that would help the kingdom generate new revenues for the national economy.
No details were given by Prince Mohammad, but with around nine million foreigners living in the vast kingdom, making up one third of the total population, the system would be a source for the country as it seeks to implement an ambitious package of new reforms and measures that will considerably improve its non-oil revenues and “raise at least an extra $100 billion a year by 2020, more than tripling non-oil income and balancing the budget.”
The emulation of the American Green Card system would be alongside more steps to restructure subsidies and the imposition of a value-added tax and a levy on energy and sugary drinks as well as luxury items, the deputy crown prince reportedly said.
Most of the foreigners in Saudi Arabia and fellow Gulf Cooperation Council (GCC) countries – Bahrain, Kuwait, Qatar, Oman and the United Arab Emirate – are Asians, mainly unskilled workers in the booming building and service sectors.
In his interview, Prince Mohammad expressed optimism the new measures would reinforce the government’s drive to reduce reliance on oil and to boost non-oil revenues.
With the dramatic slump of oil prices, the GCC countries have been looking at viable options to generate non-oil sources and reduce threats to fiscal stability and sustainability.
Experts believe that hydrocarbon exports represent more than 80 per cent of the total revenue in the GCC countries where taxation is almost absent.
The main non-oil revenue base in the GCC states currently includes customs duties and fees and charges.
Bahrain, the first GCC country to discover oil in 1932, has been leading the way in the diversification of non-oil resources.
Source: Gulf news
Emirates: addition of a second daily service between Geneva and Dubai
26 Mar 2016 Written by Admin SAE
Emirates announced early in January the expansion of its operation in Switzerland with the addition of a second daily service to Geneva effective 1st June 2016. The second daily flight will double capacity on the route and represents an overall increase of 26% for Emirates in Switzerland.
The new flight will be operated by a state-of-the-art Boeing 777-300ER aircraft in a three-class configuration, with eight Private Suites in First Class, 42 lie flat seats in Business Class, and 310 spacious seats in Economy Class.
“With natural landmarks like Lake Geneva, the Alps and Jura mountains, Geneva is an attractive destination. It also hosts the highest number of international organisations, like Europe’s United Nations and the Red Cross, making it a global hub for diplomacy and banking. Demand is strong year-round, with high traffic from Thailand, Australia, Hong Kong and the Indian Ocean, with travellers visiting the city for business and pleasure," commented Thierry Aucoc, Emirates’ Senior Vice President, Commercial Operations, Europe and Russia.
"Aside from more convenience for the growing number of Swiss travellers visiting Dubai, the additional frequency from Geneva will allow us to meet high demand and offer better connectivity for those travelling to countries like Africa, Indian Ocean islands, Bali and Thailand via our ultra-modern hub,” added Aucoc.
Robert Deillon, CEO, Genève Aéroport said: “We are very happy that Emirates will start a second daily frequency to Geneva meeting the growing demand in flight connectivity between our catchment area and long-haul markets in the Gulf region, Asia and Africa. This additional flight confirms Geneva’s position as very strong pole of attraction for business travellers, conference delegates and tourists from all over the world”.
Emirates flight EK83 will depart Dubai International Airport at 14:55hrs and arrive in Geneva at 19:50hrs. The outbound flight EK84 will depart Geneva at 21:45hrs and arrive in Dubai at 06:10hrs the following day.
With an additional cargo capacity of almost 20 tonnes per day in each direction, Emirates SkyCargo will offer better access for Swiss companies to economies around the world. Exports from Geneva include pharmaceutical products, automobile spare parts, chemicals and semi-conductors. The presence of international organisations like the Red Cross also generates high humanitarian cargo traffic on the route.
Customers on Emirates’ flights enjoy the famed hospitality of its multi-national Cabin Crew, including Swiss, as well as gourmet cuisine and Emirates’ award-winning ice entertainment system. With more than 2000 channels of on-demand entertainment, from movies, television programmes, games, audio books, and music from around the world, ice has been named the world’s best inflight entertainment system by Skytrax for 11 consecutive years.
As with all Emirates flights, passengers will benefit from a generous baggage allowance of 30kg in Economy Class, 40kg in Business Class and 50 kg in First Class. Passengers travelling in premium cabins will also enjoy lounge access as well as Chauffeur-drive service.
Source: Genève Aireport
Print baggage tags from home, travelling is even easier with Qatar Airways
26 Mar 2016 Written by Admin SAESince the beginning of the year, travelling with Qatar Airways from Genève Aéroport is even easier and more practical: in combination with the online registration, passengers can now print their baggage tag at home, at the same time as their boarding pass.
This service was already available for SWISS, Brussels Airlines and Iberia airlines. It complements the offer of services and comfort departing from Geneva.
Passengers have several possibilities to check their baggage at Genève Aéroport, allowing them to organise their departure depending on their preferences and needs.
Source: Genève Aireport
Qatar Airways will deploy a Boeing 787-8 «Dreamliner» between Doha and Geneva
26 Mar 2016 Written by Admin SAEStarting on July 1st, 2016, Qatar Airways will deploy a Boeing 787-8 «Dreamliner» between Doha and Geneva.
This aircraft will replace the previously operated Airbus A320 on the daily rotation between its base at Hamad International Airport and Geneva Airport.
The 787-8 has a total capacity of 254 seats, in 2-class configuration: 22 passengers in Business class and 232 in Economy.
For Geneva Airport, this route is first regular one with the long-awaited B787, the new benchmark in aeronautical technology.
The timetable remains almost unchanged with respect to the current situation, offering an evening flight eastbound and a morning service westbound. The Geneva departure takes place at 18:00 with a night landing in Doha at 1:10. On the way back, the plane leaves Qatar at 7:25 to reach Switzerland at 13:30 local time, on a daily basis.
The national carrier of Qatar operates to Geneva since 2007. Qatar Airways is member of the Oneworld alliance, already represented in Genva by such airlines as BA, Iberia, Finnair, etc. Doha, the capital of Qatar, is also a major hub for connections to Asia and Australia (new flights to Sydney since March 1st, 2016).
Source: Genève Aireport
(Arabianbusiness) Qatar’s government has allocated more than QR 3 billion ($825m) for small and medium size enterprises, according to arabianbusiness web site.
Prime Minister and Interior Minister HE Sheikh Abdullah bin Nasser bin Khalifa Al Thani said that the SME sector in Qatar enjoyed the support of Emir HH Sheikh Tamim bin Hamad Al Thani, adding that various governmental institutions worked on amending the necessary legislation, enacting supporting laws and providing necessary information and services, or establishing economic zones and finding financing solutions.
HH Prime Minister was speaking at the first Government Procurement and Contracting Conference & Exhibition (Moushtarayat), a three-day conference and exhibition organised by the Ministry of Finance and Qatar Development Bank (QDB) at Qatar National Convention Centre, 8th of March.
HE Sheikh Abdullah bin Saud Al Thani, who is also the chairman of the Board of Directors of QDB, also said that around 25 governmental and quasi-governmental entities were participating in the exhibition that should provide more than 450 real opportunities for the SME sector with a total value exceeding QR3 billion.
QDB launched the single window to make all information available to SMEs under one roof, in addition to providing direct financing to SMEs in excess of QR4.3 billion – its ‘Al Dhameen’ programme invested more than QR800 million and ‘Tasdeer’ program more than QR600m.
Qatar: Ministry of Economy and Commerce launched Mobile app to establish companies online
07 Mar 2016 Written by Admin SAE(MENAFN - Gulf Times) The Ministry of Economy and Commerce (MEC) has launched a new mobile service that enables the establishment of companies online, through its mobile application.
Saudi Arabia announces spending cuts, after posting record $98 billion budget deficit for 2015
31 Dec 2015 Written by Admin SAESaudi Arabia, its finances hit by low oil prices, announced plans to shrink a record state budget deficit with spending cuts, reforms to energy subsidies and a drive to raise revenues from taxes and privatisation.
Bahrain’s Prime Minister Prince Khalifa Bin Salman Al Khalifa has inaugurated the Dragon City, a Chinese shopping mall, on the island of Muharraq. The city was the fruitful outcome of the outstanding Bahraini-Chinese relations.
HRH Premier officially opened the mega project, which was built by Diyar Al Muharraq on a total land area of 115,000 square metres at a total cost of $100 million. It includes more than 360 wholesale and retail stores.
The opening of the City is a result of Bahrain’s reputation as a country with a successful investment environment, Prince Khalifa said at the opening ceremony.
The launch of new mega investment projects in the kingdom reflects the investors’ confidence in the strength of the Bahraini economy, Prince Khalifa was quoted by the Bahrain News Agency (BNA) as saying.
Such projects also consolidate the kingdom’s competitive potential in attracting more capital, which supports the government’s strategy that is aimed at diversifying its sources of income, he added.
About Dragon City:
At a total cost of $100 million, Dragon City is spread over a total land area of 115,000 square meters with a built up area of 56,000 square meters. It is the first of its kind development in Bahrain, which will offer unique wholesale and retail opportunities to local consumers, trade customers and tourists. Dragon City encompasses Dragon Mall and a themed "Dining Village".
The Mall design is influenced with Chinese architectural and cultural aspects incorporating over 360 commercial units for both retail & wholesale trade, and additionally a 4,500 square meter area designated for warehouses and a car park large enough to accommodate 1,500 cars.
Source: Bahrain News Agency http://www.bna.bh/portal/en/news/703455
According to the interview of Indrajit Sen with Salim bin Nasser Al Aufi, Undersecretary at the Ministry of Oil and Gas, at arabianindustry website, Oman’s oil production may go down a little bit in 2016, compared to 2015. One main reason for this drop is some planned activities that will take some production away. The focus will be more on activities that have as little impact as possible on production, including one or two rigs that they decided to shelve.
Oil prices have tumbled by over 40% since the start at the year, with brent crude - the global benchmark – presently trading at around $36 a barrel.
Asked if capital expenditure will be cut for 2016 in light of declining oil prices, the official said, “We have already planned in terms of what activities will be executed in 2016. We have reduced the budget to a large extent to the things that we think are very critical and are important for execution.”
“The only thing that probably remains for the companies to do is to go back and revise their own activities and make sure they become a little bit more efficient. But in terms of cutting activities, I think we have already gone past that bridge,” he noted.
Asked what the break-even cost of production for Oman would be, the undersecretary said, “We can go down to as low as it takes. It does not matter because.... ‘shutting in’ is going to cost us more money because you still need to pay for maintenance; you still need to pay for employment and so on.”
