Abu Dhabi airports report 40% surge in travelers

Abu Dhabi airports report 40% surge in travelers
The terminal at Abu Dhabi International Airport for Etihad Airways. Shutterstock
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Updated 04 July 2024
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Abu Dhabi airports report 40% surge in travelers

Abu Dhabi airports report 40% surge in travelers

RIYADH: Abu Dhabi’s airports saw around 22.4 million travelers in 2023, a 40 percent increase from the previous year, driven largely by passengers from the Indian subcontinent, official data showed.       

In a report by the Statistics Centre - Abu Dhabi, it was revealed that annual arrivals through the emirate’s airports in 2023 reached over 11.1 million, with departures standing at 11.3 million, reported the Emirates News Agency, also known as WAM.   

The increase in figures coincides with several air transport agreements concluded by the country’s General Civil Aviation Authority as well as improvements made during 2023.     

It also underscores the aviation sector’s significant achievement in managing air traffic and ensuring the smooth and safe arrival and departure of all COP28 guests.    

In regard to aircraft traffic, Abu Dhabi’s airports experienced significant increases in 2023, with Zayed International Airport handling 141,225 flights, marking a 27.8 percent rise from 2022’s 110,536 flights. 

Meanwhile, Al-Ain International Airport recorded 8,409 flights last year, up from 7,598 flights in 2022.    

The report further showed that the Indian subcontinent topped the list of arrivals through Abu Dhabi’s airports by country of origin, with about 3.2 million travelers by the end of 2023.  

This was followed by Western Europe with 1.9 million, Asia with 1.7 million, as well as Gulf Cooperation Council countries with around 1.6 million, and East Asia with 822,777 travelers. 

The Indian subcontinent also led in the number of departures from the emirate’s airports last year, with around 3.5 million travelers, followed by South America with 1.9 million, Asia with 1.7 million, and GCC countries with 1.6 million. 

At Al-Ain International Airport in 2023, arrivals totaled 51,067 travelers, while departures numbered 43,945, with 1,763 transiting through the airport and 1,011 through Zayed International Airport.  

In terms of cargo traffic across the emirate, 319,993 tonnes of goods were imported last year, primarily from Asia with 138,187 tonnes, while exports reached 238,644 tonnes, led by Western Europe with 98,089 tonnes. 

Meanwhile, Al-Ain International Airport handled 1,263 tonnes of exports and 501 tonnes of imports in 2023.  

In December 2023, a senior civil aviation executive projected that the UAE’s airports would accommodate 135 million passengers in 2024, reflecting a 4 percent increase from the previous year.  

Speaking to local newspaper Emarat Al-Youm, Saif Al-Suwaidi, director general of the General Civil Aviation Authority, noted positive indicators indicating growth in flights and destinations for national carriers. 

He also anticipated growth from countries such as Canada, South Korea, the Philippines, Bangladesh, and Sri Lanka. 


Saudi Re boosts capital by $71m in PIF subscription deal

Saudi Re boosts capital by $71m in PIF subscription deal
Updated 07 July 2024
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Saudi Re boosts capital by $71m in PIF subscription deal

Saudi Re boosts capital by $71m in PIF subscription deal

RIYADH: Saudi Reinsurance Co. plans to increase its capital by SR267.3 million ($71 million) through a strategic subscription agreement with the Public Investment Fund, aimed at enhancing its financial position. 

The binding subscription agreement, signed on July 4, will see the Kingdom’s first reinsurance company raise its capital from SR891 million to SR1.15 billion. This increase will be achieved through the issuance of 26.73 million new ordinary shares, each valued at SR10, according to a recent bourse filing. 

The new shares, representing 30 percent of the company’s current capital, will be fully subscribed by PIF at a subscription price of SR16 per share, resulting in a total subscription amount of SR427.68 million.  

This transaction will give PIF a 23.08 percent ownership stake in the company following the capital increase.  

The agreement, initially outlined in a non-binding memorandum of understanding on Oct. 8, 2023, and extended on Dec. 25, 2023, for an additional six months, underscores the growing business environment within the Kingdom.  

Saudi Re’s capital increase, supported by PIF’s subscription, enhances its financial strength and competitive position.  

This capital increase aligns with Saudi Arabia’s Vision 2030 goals, promoting a robust investment climate, economic diversification, and bolstering the Kingdom’s insurance sector. 

Finalization of the capital increase is subject to approvals from regulatory bodies including the Insurance Authority, Capital Market Authority, Saudi Stock Exchange, and the company’s Extraordinary General Assembly. 

Upon completion, Saudi Re will appoint three PIF-nominated members to its board of directors.  Al Rajhi Financial Co. is serving as the financial advisor to Saudi Reinsurance Co., while GIB Capital is advising PIF on the transaction. 

Earlier this year, the Kingdom’s sovereign wealth fund raised its stake in Middle East Paper Co. to 23.08 percent through a similar capital infusion. 

In a press statement, PIF stated that the deal will empower MEPCO to expand its production, enhance operational efficiency, and contribute to environmental stability. This move aligns with PIF’s sustainability goals and reflects its commitment to fostering environmentally responsible practices in the acquired company.  


World economic growth resilient in June despite PMI dip: S&P Global 

World economic growth resilient in June despite PMI dip: S&P Global 
Updated 07 July 2024
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World economic growth resilient in June despite PMI dip: S&P Global 

World economic growth resilient in June despite PMI dip: S&P Global 

RIYADH: International economic growth showed resilience in June, maintaining the second-highest level observed in the past 13 months, according to S&P Global’s latest report based on the Purchasing Managers’ Index. 

The JP Morgan global composite PMI, compiled by S&P Global, edged down to 52.9 in June from 53.7 in May. This slight decrease reflects a slowdown in the expansion rates of manufacturing production and service sector business activities worldwide. 

Amidst this global trend, Saudi Arabia’s non-oil private sector PMI stayed strong at 55 in June, fueled by rising demand, increased output levels, and a notable uptick in employment. 

A PMI reading above 50 signifies economic expansion, while below 50 indicates contraction. It measures economic trends in manufacturing based on monthly surveys of supply chain managers covering upstream and downstream activities. 

“The global all-industry output PMI stepped back 0.8 percentage points to 52.9 in June, with the decline fairly broad-based across sectors and regions. Although suggesting some momentum loss at midyear, the index is still consistent with a solid pace of expansion in global gross domestic product,” said Bennett Parrish, global economist at JP Morgan.  

He added: “Declines in the new orders and future output PMIs may raise the risk of growth moderating further, but another move up in the employment PMI suggests that underlying fundamentals remain resilient.”  

US and India growth accelerates 

The report highlighted accelerated PMI growth rates in the US, India, and Brazil. In the US, output expanded at the fastest pace since April 2022, driven by robust services activity which offset subdued manufacturing growth. 

India led the BRIC economies with strong growth momentum recovering from an election-related dip in May, marking one of its strongest performances in 14 years across goods and services sectors. 

Similarly, Brazil sustained strong expansion throughout the year with both service and manufacturing sectors contributing positively after a near-stalled growth in May. 

“June saw a further slight acceleration of growth in the US, bucking a broader developed world slowdown, while India continued to lead the emerging markets by a wide margin,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.  

In contrast, output fell in Canada, having risen briefly in May for the first time in a year, led by a weakened service sector. 

“Japan also slipped back into decline. Although only marginal, the downturn was the first recorded for seven months. A first fall in services sector output for 22 months was partly countered by a rise in manufacturing output for the first time in 13 months,” added Williamson.  

Russia reported a slight output contraction, marking its first decline in 17 months as a significant drop in services activity countered resilient manufacturing growth. 

Growth also slowed in China, albeit merely paying back some of the substantial gains witnessed in May to still register one of the strongest expansions over the past year. However, robust growth in the Asian giant’s manufacturing sector helped counter a marked slowing in services activities in June.  

Meanwhile, the UK reported an eighth successive monthly expansion. However, growth slowed in manufacturing and services to result in the weakest upturn this year, albeit partly blamed on a pause in spending ahead of the upcoming election, S&P Global added.  

Global sub-sectors stable 

The US-based firm noted that growth became more broad-based across all global sub-sectors amidst the slowing of expansion.  

“All of the 25 sub-sectors covered by the PMI avoided contraction globally in June for the first time since July 2021. Expansions were reported across the board bar general industrials, which reported stable output,” said Williamson.  

The report noted that output rose at the quickest pace in the financial services category, while solid expansions were also seen in the business services, consumer goods and intermediate goods sectors.  

However, the rate of expansion was relatively mild in the consumer services sector.  

“Other noteworthy developments include a two-year high for chemicals and plastics output and a 28-month high for forestry and paper products, while the autos and parts sector rounded off its best quarter since early 2021,” the analysis added.  

Global employment increased for the second consecutive month in June, with the pace of job growth reaching its highest in a year across both manufacturing and service sectors.  

“Stronger increases in staffing levels were initiated in both the manufacturing and service sectors, with the sharper increase again registered in the latter. Of the nations covered by the survey, only China and Germany saw reductions in staffing levels,” said S&P Global.  

Future outlook  

Looking ahead, S&P Global warned of darkening near-term global prospects in June, with business expectations for the year ahead reaching a seven-month low, particularly affected by post-election uncertainties in India and Europe, including the UK and France. 

“However, sentiment was also pulled lower by concern over the demand environment going forward, as reflected in a pull-back in new orders growth from May’s one-year high, which left backlogs of work largely unchanged again during the month. The latter is typically a sign of current capacity being sufficient to meet existing demand,” the agency concluded. 


Saudi tech sector surges with AI and Cloud service registrations in Q2

Saudi tech sector surges with AI and Cloud service registrations in Q2
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Saudi tech sector surges with AI and Cloud service registrations in Q2

Saudi tech sector surges with AI and Cloud service registrations in Q2

RIYADH: The Saudi tech industry saw strong growth in the second quarter, with registrations for artificial intelligence technologies and cloud computing services rising by 53 percent and 43 percent, respectively.

According to the Ministry of Commerce’s quarterly business sector bulletin, Saudi the Kingdom issued 8,948 official identification cards for AI technologies during the second quarter, compared to 5,820 issued in the same quarter last year. Additionally, 2,358 such documents were issued for cloud computing services, up from 1,648 in the same quarter of the previous year. 

This surge aligns with Saudi Arabia’s strong global market competitiveness, as the nation ranks 16th out of 67 countries in the World Competitiveness Ranking by the International Institute for Management Development. 

Riyadh accounted for the largest share of AI technology permits with 5,492, followed by Makkah with 1,789, the Eastern Province with 939, Madinah with 254, and Asir with 115. 

The data also revealed a surge in the arts, entertainment, and leisure sector, with 20,465 commercial records issued in the second quarter of this year, up from 16,438 in the same period last year. 

In a notable expansion for the electronic games sector, the ministry recorded 336 registrations in the second quarter of this year, up from 260 in the same quarter the previous year, indicating a 29 percent growth. 

Meanwhile, there were 8,213 issuances for ground passenger transport services in cities and suburbs in the second quarter, up from 6,227 in the same period last year. 

Additionally, the short-term accommodation sector experienced a 22 percent increase, issuing 22,435 business records compared to 18,398 in the same quarter last year. 

The mining and quarrying sector recorded 7,871 registrations, up from 6,671 in the same quarter last year. 

Meanwhile, the pharmaceuticals and medical products business saw a 34 percent increase in issuance, with 1,155 commercial records issued compared to 859 in the same quarter the previous year. 

This comes as the ministry issued more than 120,000 commercial registrations in the second quarter of 2024, marking a 78 percent year-on-year increase. Specifically, a total of 121,521 official identification cards for businesses were issued during the period, up from 68,222 in the same period last year. 


Oman’s non-oil sector drives GDP to $27bn in Q1 2024

Oman’s non-oil sector drives GDP to $27bn in Q1 2024
Updated 07 July 2024
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Oman’s non-oil sector drives GDP to $27bn in Q1 2024

Oman’s non-oil sector drives GDP to $27bn in Q1 2024

RIYADH: A rise in Oman’s non-oil activities boosted the country’s gross domestic product by 0.8 percent year-on-year to 10.45 billion Omani rials ($27.15 billion) in the first quarter of 2024. 

Preliminary data from the National Centre for Statistics and Information showed that non-oil activities recorded a value of 7.18 billion rials at the end of the first quarter, reflecting a 3.9 percent surge compared to the same period in 2023. 

This aligns with Oman’s economic outlook, which remains favorable, with real growth expected to reach 1.5 percent in 2024, driven by increased gas production and diversification efforts. 

Additionally, it supports the government’s efforts to advance governance and efficiency reforms, such as the plan announced in January to boost the economy through the launch of the Future Fund Oman by the Oman Investment Authority. This plan aims to attract foreign investment and bolster investments in local small and medium-sized enterprises. 

However, the data also revealed that crude oil activities amounted to 2.99 billion rials, a decrease of 4.4 percent compared to the same period last year. 

Similarly, natural gas activities dropped 0.1 percent year-on-year to 524.4 million rials in the first three months of 2024. 

Furthermore, total industrial activities recorded 2.18 billion rials, compared to 1.91 billion rials at the end of the first quarter of 2023. 

In June, a report from OIA indicated that Oman’s sovereign wealth fund saw its total assets grow by an estimated 7.4 percent year-on-year, reaching 19.24 billion rials in 2023. 

The report noted a 9.95 percent return on investment for the year, as announced in a post on X. 

The rise in numbers highlighted the authority’s role in driving economic growth and stability within the Middle Eastern country.    

Moreover, the robust performance reflected the OIA’s strategic investment approach and effective management of its diverse portfolio.     

Furthermore, the results were in line with OIA’s mission to oversee and develop the nation’s funds and assets, build financial reserves, and implement government policies aimed at advancing key economic sectors. 


Saudi banks’ aggregate profit reaches 14-month high of $2bn

Saudi banks’ aggregate profit reaches 14-month high of $2bn
Updated 07 July 2024
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Saudi banks’ aggregate profit reaches 14-month high of $2bn

Saudi banks’ aggregate profit reaches 14-month high of $2bn

RIYADH: Saudi banks aggregate profit reached a 14-month high of SR7.33 billion ($1.96 billion) in May, marking an annual 16 percent rise, newly released data has revealed.

According to the Saudi Central Bank, also known as SAMA, these figures represent profits before zakat and taxes. 

Cumulatively, from the beginning of the year to the end of May, banks recorded a total profit of SR34.78 billion, compared to SR31.12 billion during the same period last year.

In June, a McKinsey report highlighted that high hydrocarbon prices, rapid economic expansion, and low unemployment, along with favorable demographics, ambitious public investments, and moderate inflation, have collectively bolstered robust balance sheets and strong margins among Saudi banks.

This region has been enjoying an evolving regulatory environment marked by greater openness, new frameworks for innovation, and measures to improve the ease of doing business.

All Gulf Cooperation Council countries maintain their currencies pegged to the US dollar, causing regional interest rates to closely mirror movements in Washington. In 2023, as the Federal Reserve’s monetary policy increased financing costs in the GCC, both local and global bank profits surged.

Concurrently, headline inflation was moderate, estimated at 2.6 percent in 2023 and projected to decrease to 2.3 percent in 2024 according to McKinsey.

According to the firm, all GCC banks outperformed their counterparts in developed and many emerging markets, remaining on a rapid growth trajectory. They primarily rely on stable domestic deposits, which have proven resilient during economic downturns.

In comparison to April, banks’ profits before zakat and tax rose by 9 percent, marking the highest monthly increase in the past five months.

McKinsey nevertheless highlighted the potential risk to the GCC banking sector if interest rates were to fall and bank managers were to be complacent.

This complacency might deter them from pursuing ambitious transformation initiatives that are crucial for long-term sustainability and growth.

The firm warned that the current high-interest-rate environment, which has bolstered bank profitability, may not persist indefinitely. 

If inflationary pressures in the US ease, the Federal Reserve could adjust its monetary policy, potentially lowering interest rates, and thus reduce bank profits.

The advice is for bank executives to not assume that high profits are the new norm and instead prepare for potential future declines in profitability.

It suggests that banks should use their current strong financial position to invest in transformative changes and cost reductions. By doing so, they can enhance efficiency and resilience, ensuring they remain competitive even when interest rates decrease.

The International Monetary Fund praised SAMA’s efforts to safeguard the Kingdom’s financial stability in a June report. It has emphasized that the central bank continues to advance the modernization of regulatory and supervisory frameworks.

Significant progress has been made in developing its financial safety net framework, encompassing bank resolution, emergency liquidity assistance arrangements, and deposit protection fund.