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UAE and Kenya finalize terms of Comprehensive Economic Partnership Agreement

UAE and Kenya finalize terms of Comprehensive Economic Partnership Agreement
The new agreement is described as marking a “significant milestone” in the UAE’s trade deal program.
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Updated 23 February 2024
Arab News
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UAE and Kenya finalize terms of Comprehensive Economic Partnership Agreement

UAE and Kenya finalize terms of Comprehensive Economic Partnership Agreement
Updated 23 February 2024
Arab News
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RIYADH: The UAE and Kenya have concluded negotiations on a trade deal that will boost investment flows in logistics, healthcare, and travel and tourism between the two countries. 

The Comprehensive Economic Partnership Agreement will enhance market access for businesses on both sides, according to a press release.

Investments in the infrastructure and ICT sectors are also set to benefit, and the deal will also see a platform for small and medium enterprise cooperation and expansion on both sides.

Kenya's economy experienced real annual GDP growth of 5 percent in 2023, up from 4.8 percent in the previous 12 months. 

Its services sector, which accounts for 53.6 percent of Kenya’s economy, and agriculture sector, comprising around a quarter of national GDP, offer vast potential for UAE businesses looking to expand into the region, the release added.

The UAE’s Minister of Foreign Trade Thani bin Ahmed Al-Zeyoudi described the new agreement as marking a “significant milestone” in the country’s trade deal program.

He added: “It is a testament to our commitment to strengthening economic ties with the African continent and to creating new opportunities for businesses and investors in both of our countries. 

“The UAE-Kenya CEPA will not only boost trade and investment, but also foster innovation and sustainable growth in key sectors such as agriculture, technology and tourism. 

“We look forward to deepening our relationship with Kenya and to further expanding our presence in Africa as a trusted partner and investor.”

Kenya’s Cabinet Secretary for Investments, Trade and Industry Rebecca Miano said the agreement was testament to her government’s drive to use international commerce as “a key lever of economic growth and transformation.”

She added: “The Comprehensive Economic Partnership Agreement with the United Arab Emirates will play a key role in these efforts, enabling our exports to reach important markets in Asia and the Middle East, and also in stimulating the investment inflows that will further develop our national capabilities. We look forward to its implementation and the mutual benefits it will deliver.”

In 2023, the UAE’s non-oil trade in goods reached an all-time high of $710 billion, a 12.6 percent increase on 2022 – and 34.7 percent more than 2021. 

The UAE has already concluded 10 CEPAs, including with India, Israel, and Indonesia, as well as Türkiye, Georgia, and South Korea.

Topics: UAE Kenya Comprehensive Economic Partnership Agreement

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Saudi Arabia unveils world’s largest food park in Jeddah, eyes $5.3bn in investments

Saudi Arabia unveils world’s largest food park in Jeddah, eyes $5.3bn in investments
Updated 6 sec ago
MOHAMMED AL-KINANI
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Saudi Arabia unveils world’s largest food park in Jeddah, eyes $5.3bn in investments

Saudi Arabia unveils world’s largest food park in Jeddah, eyes $5.3bn in investments
Updated 6 sec ago
MOHAMMED AL-KINANI

JEDDAH: Saudi Arabia has officially launched the Jeddah Food Cluster, a major project aimed at transforming the city into a global business hub with an investment target of SR20 billion ($5.3 billion).

Spanning 11 million sq. meters, the cluster is now recognized by Guinness World Records as the largest food park in the world by area. The development is expected to create over 43,000 jobs, driving both local and national economic growth.

The opening ceremony, held on Nov. 24, was led by Prince Saud bin Mishal, deputy governor of Makkah, under the patronage of Prince Khaled Al-Faisal, governor of the Makkah region. It was attended by high-ranking officials, including Saudi Minister of Industry and Mineral Resources Bandar Alkhorayef.

The inauguration of the cluster aligns with Saudi Arabia’s Vision 2030, which seeks to strengthen food security, achieve self-sufficiency, develop food value chains, and establish the Kingdom as a regional hub for attracting both domestic and international investment in the food sector.

Located in Jeddah’s Second and Third Industrial Cities, the Jeddah Food Cluster is part of a larger industrial network in the Makkah region, which also includes industrial cities in Makkah and Taif. This region, which spans more than 50 million sq. meters, hosts over 2,000 industrial facilities specializing in sectors such as food production, pharmaceuticals, metals, and chemicals. The new food cluster is designed to enhance industrial productivity through cutting-edge infrastructure and strategic investments in key enablers.

Currently, the cluster houses 124 operational factories with investments totaling SR4.4 billion. These factories are estimated to produce around 4 million tonnes of goods annually across 10 industrial sectors and provide jobs for over 7,000 workers.

It also features 76 ready-to-use factories that comply with Saudi Food and Drug Authority standards. Additionally, the cluster has built a central laboratory to improve food quality and safety, as well as over 134,000 sq. meters of shared cold and dry storage facilities. By concentrating suppliers in one location, the cluster aims to create a sustainable, efficient supply chain.

The economic impact of the Jeddah Food Cluster is expected to be substantial, with national exports projected to increase by SR8 billion. The development is also anticipated to create thousands of job opportunities, particularly in the industrial and logistics sectors, and contribute approximately SR7 billion to Saudi Arabia’s GDP over the next decade. This aligns with the broader objectives of Saudi Arabia’s National Industrial Strategy and the National Industrial Development and Logistics Program, which aim to foster economic diversification and sustainable growth.

At the ceremony, MODON, the Saudi Authority for Industrial Cities and Technology Zones, announced that the Jeddah Food Cluster had achieved a significant milestone, receiving recognition from a global organization. Prince Saud also toured an exhibition showcasing the involvement of private companies and government entities in the food supply chain. This was followed by the presentation of the global recognition certificate.

Several memorandums of understanding and agreements were signed during the event. These partnerships, which include collaborations with Umm Al-Qura University, the National Academy for Industry, and Halal Products Development Co., focus on developing specialized training programs, improving food safety, and promoting quality control within the food industry.

Alkhorayef, in his speech, emphasized that the Jeddah Food Cluster represents more than just an industrial project—it is a key element in the Kingdom’s broader strategy for sustainable economic growth.

“Through this cluster, we aim to leverage the ministry’s capabilities to serve Jeddah, the Kingdom’s economic hub, and a prime investment destination,” he said.

He also highlighted the importance of connecting manufacturers, suppliers, and service providers to boost innovation and competitiveness, as well as to create new job opportunities, particularly for Saudi youth.

On the sidelines of the event, a panel discussion titled “The Future of Global Food Supply Chain Resilience for Innovation and Sustainability” was held, featuring industry leaders such as Abdullah bin Nasser Al-Badr, CEO of Almarai, Betty Ka, director of supply chain and delivery at the UN World Food Program, and Fabio Maia de Oliveira, general investment director at JBS Saudi Arabia. The panel explored strategies for building resilient and sustainable global food supply chains.

The launch of the Jeddah Food Cluster marks a significant step in Saudi Arabia’s ongoing efforts to diversify its economy and strengthen its position as a global leader in the food industry.

Topics: Investment

Oil Updates – prices ease but remain near 2-week highs on Russia, Iran tensions

Oil Updates – prices ease but remain near 2-week highs on Russia, Iran tensions
Updated 25 November 2024
Reuters
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Oil Updates – prices ease but remain near 2-week highs on Russia, Iran tensions

Oil Updates – prices ease but remain near 2-week highs on Russia, Iran tensions
Updated 25 November 2024
Reuters

SINGAPORE: Oil prices retreated on Monday following 6 percent gains last week, but remained near two-week highs as geopolitical tensions grew between Western powers and major oil producers Russia and Iran, raising risks of supply disruption.

Brent crude futures slipped 26 cents, or 0.35 percent, to $74.91 a barrel by 7:40 a.m. Saudi time, while US West Texas Intermediate crude futures were at $70.97 a barrel, down 27 cents, or 0.38 percent.

Both contracts last week notched their biggest weekly gains since late September to reach their highest settlement levels since Nov. 7 after Russia fired a hypersonic missile at Ukraine in a warning to the US and UK following strikes by Kyiv on Russia using US and British weapons.

“Oil prices are starting the new week with some slight cool-off as market participants await more cues from geopolitical developments and the Fed’s policy outlook to set the tone,” said Yeap Jun Rong, market strategist at IG.

“Tensions between Ukraine and Russia have edged up a notch lately, leading to some pricing for the risks of a wider escalation potentially impacting oil supplies.”

As both Ukraine and Russia vie to gain some leverage ahead of any upcoming negotiations under a Trump administration, the tensions may likely persist into the year-end, keeping Brent prices supported around $70-$80, Yeap added.

In addition, Iran reacted to a resolution passed by the UN nuclear watchdog on Thursday by ordering measures such as activating various new and advanced centrifuges used in enriching uranium.

“The IAEA censure and Iran’s response heightens the likelihood that Trump will look to enforce sanctions against Iran’s oil exports when he comes into power,” Vivek Dhar, a commodities strategist at Commonwealth Bank of Australia said in a note.

Enforced sanctions could sideline about 1 million barrels per day of Iran’s oil exports, about 1 percent of global oil supply, he said.

The Iranian foreign ministry said on Sunday that it will hold talks about its disputed nuclear program with three European powers on Nov. 29.

“Markets are concerned not only about damage to oil ports and infrastructure, but also the possibility of war contagion and involvement of more countries,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

Investors were also focused on rising crude oil demand at China and India, the world’s top and third-largest importers, respectively.

China’s crude imports rebounded in November as lower prices drew stockpiling demand while Indian refiners increased crude throughput by 3 percent on year to 5.04 million bpd in October, buoyed by fuel exports.

For the week, traders will be eyeing US personal consumption expenditures data, due on Wednesday, as that will likely inform the Federal Reserve’s policy meeting scheduled for Dec. 17-18, Sachdeva said.
 

Topics: oil updates oil prices

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Saudi Arabia’s private debt market targets over $1.77bn by Q3 2024: report

Saudi Arabia’s private debt market targets over $1.77bn by Q3 2024: report
Updated 24 November 2024
Reem Walid
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Saudi Arabia’s private debt market targets over $1.77bn by Q3 2024: report

Saudi Arabia’s private debt market targets over $1.77bn by Q3 2024: report
Updated 24 November 2024
Reem Walid

RIYADH: Saudi Arabia’s private debt market is experiencing significant growth, with eight active funds targeting to raise over $1.77 billion in capital by the third quarter of 2024, according to a new report.

This growth is driven by a sharp rise in investor confidence, with 97 percent of Middle East-based institutional investors now viewing the Kingdom as the most promising market for private debt in the coming year, up from 82 percent in 2023, based on Preqin survey data.

The report, titled “Territory Guide: The Rise of Private Debt Funds in Saudi Arabia 2024,” was published in collaboration with Saudi Venture Capital Co. It highlights the increasing interest from both regional and global investors, fueled by the positive outcomes of the Kingdom's Vision 2030 reforms.

The findings align with the fact that Saudi Arabia accounts for up to 27.5 percent of private debt fund transactions in the Middle East and North Africa region between 2016 and the third quarter of 2024.

In 2022, private debt funds focused on Saudi Arabia raised a record $335 million in total capital, a sharp rise from the $32 million raised by a single fund in 2003.

“This first-of-its-kind report highlights the emergence of private debt funds as a key asset class in Saudi Arabia, driven by the Kingdom’s Vision 2030 and its ambition to diversify the economy,” said Nabeel Koshak, CEO and board member at SVC.

“At SVC, we continue our commitment to support the development of such reports that provide policymakers, investors, and founders with insights and data to inform strategic decisions and policies to nurture the private capital ecosystem further,” Koshak added.

David Dawkins, lead author of the report at Preqin, commented: “Global investment firms are not alone in closely watching the growth and evolution of Saudi Arabia’s nascent private debt industry.”

Dawkins also noted: “For other developing economies in the Middle East and beyond, Saudi Arabia’s success in this area will strengthen the impetus for improving transparency to secure the capital needed for sustainable growth in a net-zero world.”

The study further revealed that among all private debt funds with investments tied to Saudi Arabia that concluded between 2016 and the third quarter of 2024, mezzanine funds accounted for 50 percent of total exposure, with direct lending and venture debt funds closely following at 30 percent and 20 percent, respectively.

Support for startups and small to medium-sized enterprises in the Kingdom is also reflected in the high proportion of venture debt, which represents 75 percent of all funds in the market with Saudi Arabia exposure.

The report also highlighted that private debt marked its second consecutive year as the asset class with the highest proportion of Middle Eastern investors intending to increase their investments in the coming year. Nearly 58 percent of investors expressed this sentiment, up from 50 percent in 2023.

The percentage of investors considering private debt the most promising asset class in the region rose by 12 percentage points, from 31 percent in 2023.

Private debt is expected to further bolster Saudi Arabia’s growing entrepreneurial community as the nation advances toward its Vision 2030 goals. Since 2018, new regulatory frameworks have been implemented, ushering in an era of increased transparency and equity within the private debt sector, closely aligned with the Kingdom’s broader investment vision.

Topics: debt Capital

Closing Bell: Saudi main index rises to close at 11,864 

Closing Bell: Saudi main index rises to close at 11,864 
Updated 24 November 2024
Reem Walid  
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Closing Bell: Saudi main index rises to close at 11,864 

Closing Bell: Saudi main index rises to close at 11,864 
Updated 24 November 2024
Reem Walid  

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Sunday, gaining 24.38 points, or 0.21 percent, to close at 11,864.90. 

The benchmark index recorded a trading turnover of SR4.22 billion ($1.12 billion), with 124 stocks advancing and 99 declining. 

The Kingdom’s parallel market Nomu also posted gains, climbing 345.06 points, or 1.13 percent, to close at 30,885.34, as 49 stocks advanced and 32 declined. 

The MSCI Tadawul Index increased by 4.74 points, or 0.32 percent, to close at 1,491.56. 

The best-performing stock of the day was Arabian Contracting Services Co., whose share price surged 9.97 percent to SR167.60. 

Other notable gainers included Saudi Reinsurance Co., rising 4.97 percent to SR45.45, and Saudi Public Transport Co., which climbed 3.98 percent to SR23.00.     

Al-Baha Investment and Development Co. led the decliners, falling 6.06 percent to SR0.31. Aldrees Petroleum and Transport Services Co. dropped 4.33 percent to SR123.60, and Batic Investments and Logistics Co. declined 3.23 percent to SR3.59. 

Leejam Sports Co. announced the opening of four new fitness centers. These include a men’s center and the first ladies’ center in Al-Rass city, Qassim Province, as well as the first men’s and ladies’ centers in Al-Qunfidah city, Makkah Province.  

Branded under “Fitness Time” and “Fitness Time - Ladies,” the centers will feature state-of-the-art facilities, high-spec sports equipment, and modern designs. 

The financial impact of these openings is expected to reflect in the fourth quarter of 2024. Despite the announcement, Leejam Sports Co. closed the session at SR180, down 0.34 percent. 

Obeikan Glass Co. reported a net profit of SR29.89 million for the nine months ending Sept. 30, a 58.3 percent drop from the same period in 2023. The decline was attributed to lower average selling prices due to global market conditions and increased administrative expenses related to a new investment in a subsidiary, Saudi Aluminum Casting Foundry.  

The stock ended at SR49.60, down 1.59 percent. 

United Mining Industries Co. announced the issuance of two exploration licenses for gypsum and anhydrite ore from the Ministry of Industry and Mineral Resources. The company plans to conduct studies to determine the availability of raw materials, with financial impacts to be announced upon completion.  

Its stock closed at SR39.60, up 0.26 percent.

Topics: TASI Tadawul Stock Market

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Morgan Stanley receives approval to establish regional HQ in Saudi Arabia

Morgan Stanley receives approval to establish regional HQ in Saudi Arabia
Updated 24 November 2024
Nirmal Narayanan
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Morgan Stanley receives approval to establish regional HQ in Saudi Arabia

Morgan Stanley receives approval to establish regional HQ in Saudi Arabia
Updated 24 November 2024
Nirmal Narayanan

RIYADH: US-based investment bank Morgan Stanley has been granted approval to establish its regional headquarters in Saudi Arabia, as the Kingdom continues to attract international investment.

This move aligns with Saudi Arabia’s regional headquarters program, which offers businesses various incentives, including a 30-year exemption from corporate income tax and withholding tax on headquarters activities, as well as access to discounts and support services.

Saudi Investment Minister Khalid Al-Falih confirmed the progress of this initiative in October, stating that the Kingdom has successfully attracted 540 international companies to set up regional headquarters in Riyadh—exceeding its 2030 target of 500.

“Establishing a regional HQ in Riyadh reflects the growth and development of Saudi Arabia and is a natural progression of our long history in the region,” said Abdulaziz Alajaji, Morgan Stanley’s CEO for Saudi Arabia and co-head of the bank’s Middle East and North Africa operations, according to Bloomberg.

Morgan Stanley first entered the Saudi market in 2007, launching an equity trading business in Riyadh, followed by the establishment of a Saudi equity fund in 2009.

This approval follows a similar move by Citigroup earlier this month, with the bank also receiving approval to establish its regional headquarters in Saudi Arabia.

Fahad Aldeweesh, CEO of Citi Saudi Arabia, emphasized that this development would support the firm’s future growth in the Kingdom.

Goldman Sachs, another major Wall Street bank, also received approval in May to set up its regional headquarters in Saudi Arabia.

Prominent international firms that have already established regional headquarters in Saudi Arabia include BlackRock, Northern Trust, Bechtel, PepsiCo, IHG Hotels and Resorts, PwC, and Deloitte.

In addition, a recent report from Knight Frank noted that Saudi Arabia's regional headquarters program has led to increased demand for office space in Riyadh, with the city’s office stock expected to grow by 1 million sq. meters by 2026.

In August, Kuwait’s Markaz Financial Center echoed this sentiment, predicting a significant uptick in the Kingdom’s real estate market during the second half of the year, driven by the regional headquarters program.

Topics: Regional HQ program

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