Goldman Sachs, Mubadala sign $1bn private credit partnership to invest in Asia Pacific
Goldman Sachs, Mubadala sign $1bn private credit partnership to invest in Asia Pacific /node/2466786/business-economy
Goldman Sachs, Mubadala sign $1bn private credit partnership to invest in Asia Pacific
To be managed by Private Credit at Goldman Sachs Alternatives, with dedicated on-the-ground teams across multiple Asia Pacific markets, the partnership aims to deploy long-term capital, offering customized private credit solutions to high-quality companies and sponsors in the region, according to a press statement. Shutterstock
Goldman Sachs, Mubadala sign $1bn private credit partnership to invest in Asia Pacific
Updated 26 February 2024
ARAB NEWS
RIYADH: Business entities in the Asia Pacific region are poised to benefit from a $1 billion partnership between Emirati firm Mubadala Investment Co. and Goldman Sachs.
To be managed by Private Credit at Goldman Sachs Alternatives, with dedicated on-the-ground teams across multiple Asia Pacific markets, the partnership aims to deploy long-term capital, offering customized private credit solutions to high-quality companies and sponsors in the region, according to a press statement.
The release added that the global Private Credit team, consisting of 165 experienced credit investment professionals managing over $110 billion in assets, leverages Goldman Sachs’ network and capabilities to source and underwrite global lending opportunities.
Marc Nachmann, global head of asset and wealth management at Goldman Sachs, said: “This partnership bolsters the expansion of our Asia Credit platform and investment in new opportunities across the Asia Pacific region where bespoke credit solutions are needed.”
He added: “We continue to believe our rigorous underwriting and dedicated on-the-ground sourcing provides us differentiated investment opportunities.”
The collaboration plans to invest across the private credit spectrum, targeting multiple Asia Pacific markets, with a particular focus on India.
This aligns with both firms’ endeavors to continue scaling their investment activity in the growing Asia Pacific credit market.
“The diverse and rapidly growing economies, as well as the increasing private equity deal volumes, are significantly driving demand in Asia Pacific for customized credit solutions from non-traditional lenders,” said Omar Eraiqat, deputy CEO of diversified investments at Mubadala.
“This partnership with Goldman Sachs compliments our aspirations to grow our private credit exposure in Asia Pacific, a region that is central to Mubadala’s strategic growth initiatives,” he added.
Meanwhile, the Global Head of Private Credit at Goldman Sachs Alternatives Greg Olafson, said: “With strong economic growth in the region and favorable conditions for private lenders to support the growth of leading companies by providing flexible, long-term capital, we believe we are at the early stages of a defining era for private credit in Asia Pacific.”
Head of Credit Investments at Mubadala Fabrizio Bocciardi, also said: “We look forward to working alongside Goldman Sachs to unlock new opportunities throughout the Asia Pacific region, a leading driver of global economic growth.”
Since 2009, Mubadala’s Credit Investments unit has been interested in private debt prospects, with a particular focus on direct lending to the middle market as well as large-cap firms across a wide range of industries and asset classes.
Oil Updates – crude gains more than $1 after OPEC+ delays output hike
Brent up 1.9 percent, WTI up 2 percent
OPEC+ delays December output hike by one month
Updated 04 November 2024
Reuters
BEIJING/SINGAPORE: Oil prices extended gains on Monday, rising more than $1 on a decision by OPEC+ to delay by a month plans to increase output, while the market braced for a week that spans a US presidential election and a key meeting in China.
Brent futures rose by $1.39 per barrel, or 1.9 percent, to stand at $74.49 a barrel by 10:22 a.m. Saudi time. US West Texas Intermediate crude rose by $1.41 a barrel, or 2.0 percent, to stand at $70.90.
On Sunday, OPEC+, which includes the Organization of the Petroleum Exporting Countries plus Russia and other allies, said it would extend its output cut of 2.2 million barrels per day for another month in December, with an increase already delayed from October because of falling prices and weak demand.
The grouping had been due to increase output by 180,000 bpd from December.
“While the delay until January does not change fundamentals significantly, it does potentially leave the market having to rethink the strategy of OPEC+,” ING analysts said in a note.
The delay bucked the expectations of some in the market for OPEC+ to deliver the planned hike in output, they added.
“This delayed supply increase means that maybe the group are more willing to support prices than many believe,” they said.
The group is set to gradually unwind the 2.2-million-bpd cut over the coming months, while another 3.66 million bpd of production cuts will stay until the end of 2025.
Brent and WTI posted weekly declines last week of about 4 percent and 3 percent, respectively, as record US output weighed on prices. But both contracts edged up on Friday on reports that Iran could launch a retaliatory strike on Israel within days.
On Thursday, US news website Axios said Israeli intelligence suggested that Iran was preparing to attack Israel from Iraq within days, citing two unidentified Israeli sources.
It is questionable whether the price uptrend will be sustained as previous initial positive reaction to the delayed output hike and geopolitical tension have eventually fizzled off, said Yeap Jun Rong, a market strategist at IG.
For now, oil prices may stay in a broad consolidation range, with any upside likely to find some resistance at the level of $78.50, he added.
Markets await Tuesday’s US presidential election, with polls showing Democratic Vice President Kamala Harris and Republican former President Donald Trump neck-and-neck.
And on Thursday, economists expect the US Federal Reserve to cut interest rates by 25 basis points.
In China, the Standing Committee of the National People’s Congress meets from Monday to Friday and is expected to approve additional stimulus to boost the slowing economy, though analysts say the bulk may go to help cut local government debt.
Pakistan set to deliver fourth consecutive rate cut today to revive economy
All 15 investors and analysts surveyed by Reuters expect the central bank to cut rates next week
Policymakers continue efforts to revive a fragile economy as inflation eases off recent record highs
Updated 04 November 2024
Reuters
KARACHI: Pakistan’s central bank is expected to cut its key interest rate further at its policy meeting today, Monday, with policymakers continuing their efforts to revive a fragile economy as inflation eases off recent record highs.
The central bank, the State Bank of Pakistan, has slashed the benchmark policy rate to 17.5 percent from an all time-high of 22 percent in three consecutive policy meetings since June, having last reduced it by 200 basis points in September.
All 15 investors and analysts surveyed by Reuters expect the central bank to cut rates. Two expect a 150 bps cut, twelve predict a 200 bps reduction, and one forecasts a 250 bps cut.
Economic activity has stabilized since last summer when the country came close to a default before an eleventh hour bailout by the International Monetary Fund (IMF).
The IMF, which in September gave a boost to Pakistan’s struggling economy by approving a long-awaited $7 billion facility, said that the South Asian nation had taken key steps to restore economic stability with consistent policy implementation under the 2023-24 standby arrangement.
While the economy has started to gradually recover, and inflation has moved sharply down from a multi-decade high of nearly 40 percent in May 2023, analysts say further rate cuts are needed to bolster growth.
Mustafa Pasha, Chief Investment Officer at Lakson Investments, said rates must drop under 15 percent and hold below that for six months to have a material impact.
The IMF in its latest October report forecast Pakistan’s gross domestic product growth at 3.2 percent for the fiscal year ending June 2025, up from 2.4 percent in fiscal 2024.
The government expects annual inflation to have come in at 6-7 percent last month and slow further to 5.5-6.5 percent in November.
However, inflation could pick up again in 2025, driven by electricity and gas tariff hikes under the new $7 billion IMF bailout, and the potential impact of taxes on the retail and wholesale sector proposed in the June budget.
Ahmad Mobeen, senior economist at S&P Global Market Intelligence, said that while lower rates will offer some relief to the manufacturing sector, the benefits may be limited due to “elevated input costs, driven by high electricity and gas tariffs, combined with global supply and shipping constraints.”
Sindalah showcases Saudi Arabia’s investment potential, says commentator Ali Shihabi
Likens Kingdom’s approach to giga-projects to that of venture capitalist following launch of NEOM’s new tourism destination
Updated 04 November 2024
Arab News
DUBAI: Sindalah Island, NEOM’s new luxury tourism destination under construction on Saudi Arabia’s Red Sea coast, represents a critical milestone in the Kingdom’s economic transformation and proves many of its early doubters wrong, Saudi commentator Ali Shihabi has said.
Appearing on Arab News’ current affairs program “Frankly Speaking,” Shihabi highlighted the significance of Sindalah, saying its launch marked an important shift in global perceptions of the Kingdom as a holiday destination and as an investment opportunity.
“The launch of Sindalah was very, very important because you needed proof of a concept on the ground to show what can be done,” he said.
“For people to come and see it and feel it and enjoy it and experience it” validates the vision that Saudi Arabia has for NEOM and similar projects.
Sindalah Island, which will feature world-class yachting, luxury hotels and a golf club, could soon rival the likes of Monaco or Greece as a global destination. It is the latest in a bevy of megaprojects under construction across the Kingdom as part of the Vision 2030 transformation.
Sindalah Island is the latest in a bevy of megaprojects under construction across the Kingdom as part of the Vision 2030 transformation. (NEOM photo)
This transformation is already drawing the interest of major investors. Shihabi mentioned a recent conversation with an Indian investor planning to establish a $15 billion steel plant in the Kingdom, describing it as an “exciting opportunity” that showcases the nation’s appeal to foreign investors.
“His group will be investing a billion dollars in equity,” Shihabi told “Frankly Speaking” host Katie Jensen. “And he was very excited about the potential, the structure of incentives that are given to foreign investors, whether industrial investors, whether it’s the SIDF (Saudi Industrial Development Fund), or other facilities that the Saudi government makes available for foreign investors, and the good size domestic market also for different products.”
In Shihabi’s view, the Saudi government’s approach to giga-projects like NEOM is akin to that of a venture capitalist. The government has taken on the financial risk of building and launching these projects to attract global investors.
“It was a theoretical opportunity and you needed the Kingdom to be the venture capitalist really: to build the first models, even if those are loss leaders, because you needed a proof of concept on the ground,” he said.
Ali Shihabi, an author and commentator on the politics and economics of Saudi Arabia, speaks with Frankly Speaking host Katie Jensen. (AN photo by Abdulrahman bin Shalhoub)
Shihabi said Saudi Arabia’s Red Sea coastline, largely untouched by mass tourism, is “one of the last, if not the last, unspoiled virgin territory of exquisite seafront.”
By acting as an initial investor, the government aims to establish Saudi Arabia as a legitimate luxury destination and to cultivate demand among global tourists.
While Shihabi acknowledged that it will take time for Saudi Arabia to fully emerge as a tourism hub, he is confident that the foundation stones are in place. “Putting Saudi Arabia on the tourist mindset and map is going to take a number of years,” he said.
However, the momentum of these projects and Saudi Arabia’s investments in infrastructure, marketing, and partnerships are advancing the Kingdom’s vision to create an attractive and competitive tourism sector in the region.
“It will take time for tourists to get used to the concept of coming to the Kingdom as a tourist destination,” said Shihabi. “But I think that the foundation stones are being put in place successfully.”
The recent annual conference of the Future Investment Initiative in Riyadh, commonly referred to as “Davos in the desert,” showcased the Kingdom’s commitment to becoming a significant player on the global stage.
Shihabi, who is both an author and commentator on the politics and economics of Saudi Arabia, acknowledged that FII plays a valuable role in promoting the Kingdom’s image and helping international investors understand the scale and seriousness of Vision 2030.
Ali Shihabi is an author and commentator on the politics and economics of Saudi Arabia. (AN photo by Abdulrahman bin Shalhoub)
With the launch of projects like Sindalah and explosion of opportunities in NEOM, Saudi Arabia is gradually redefining its reputation on the world stage. However, Shihabi said changing global perceptions will require time and continued openness.
“The Kingdom has never been good at communication,” he said. “One of the deep structural problems the Kingdom had was it was closed off to the world. And the big change has been the opening up of the Kingdom to the world now.
“I encourage Western journalists, always, just to take a tourist visa, get on the plane and go and see things the way they are and the way they are developing and changing. And I can hardly think of a journalist who, having made the effort, has not changed his opinion of the Kingdom from what he had before he came to the Kingdom.
“The story really is a good one to be told on the ground and much easier to be told on the ground than to be explained in theory abroad. And there are a lot of skeptics; there are a lot of cynics.
“There’s a certain amount, I guess you can say, in the world of … I don’t want to exaggerate and use the word racism, but sort of prejudice toward Arabs and Muslims, which carries over to the Kingdom, prejudice against oil wealth. And a lot of historical baggage that the Kingdom has carried, which continues to affect its image.
“But I think that the more we open up the country and the more we allow people to come in and the more we allow people to see the changes on the ground, the better the image becomes.”
OPEC countries extend 2.2m bpd voluntary production cut until end of December
Originally implemented in April and November 2023, these additional reductions aim to stabilize the global oil market
Updated 04 November 2024
Arab News
LONDON: OPEC announced on Sunday that eight key OPEC+ member nations have agreed to extend their voluntary production cuts of 2.2 million barrels per day through December.
The countries are Saudi Arabia, Russia, and Iraq, as well as the UAE, Kuwait, Kazakhstan, Algeria, and Oman.
Originally implemented in April and November 2023, these additional reductions aim to stabilize the global oil market, according to a statement from the OPEC Secretariat.
The countries emphasized their commitment to full adherence to the Declaration of Cooperation, which includes monitoring the production adjustments to ensure compliance.
The 53rd meeting of the Joint Ministerial Monitoring Committee, held on April 3, underscored this dedication, establishing a timeline for the eight nations to fully offset any overproduction by September 2025.
Both Iraq and the Russia-Kazakhstan alliance recently reiterated their strong support for the agreement, pledging to uphold their compensation schedules.
Number of hotel rooms in Saudi Arabia surges 107% in Q3
Room licenses doubled to over 3,950, as opposed to 2,000 permits in the third quarter of last year
Kingdom aims to create over 1 million tourism-related jobs, driving economic growth and increasing its global travel footprint
Updated 03 November 2024
NOUR EL-SHAERI
RIYADH: Saudi Arabia’s tourism sector experienced a 107 percent increase in hotel rooms year-on-year in the third quarter of the year, according to official data.
The Kingdom’s hospitality industry saw room numbers increase from 214,600 in the third quarter of last year to 443,200 during the same period in 2024.
Room licenses also doubled to over 3,950, as opposed to 2,000 permits in the third quarter of last year.
Saudi Arabia has ambitious tourism objectives, aiming to attract 150 million visitors annually by the end of the decade as part of its Vision 2030 plan.
The initiative is key to diversifying the country’s economy beyond oil, with tourism expected to become a necessary pillar of the Kingdom’s gross domestic product.
The nation has plans for investments exceeding $1 trillion for new attractions and infrastructure, including the Red Sea initiative and NEOM, a $500 billion mega-city.
An accessible e-visa program has also been introduced to facilitate international travel.
By focusing on heritage sites, luxury resorts, and cultural experiences, the Kingdom aims to create over 1 million tourism-related jobs, driving economic growth and increasing its global travel footprint.
In February, Saudi Arabia’s Minister of Tourism Ahmed Al-Khateeb announced plans to add 250,000 hotel rooms by 2030, with 75,000 to be developed through private sector contracts.
During a ministerial panel session at the Private Sector Forum in Riyadh, Al-Khateeb said the total number of hotel rooms in the Kingdom had reached 280,000 by the end of 2023.
He also said that the target for 2030 is approximately 550,000 hotel rooms, emphasizing the high quality of current and upcoming projects, which will position Saudi Arabia among the top global destinations.
The minister added that the tourism sector had reached a 10 percent contribution to GDP and a 7 percent contribution to non-oil GDP.
Al-Khateeb said that the Kingdom has surpassed its original target of attracting 100 million tourists by 2030, reporting 100 million visitors so far, including 77 million domestic and 27 million international travelers.
