Qatar Airways orders 20 Boeing 777X long-haul jets
The order was worth $8.8 billion at catalogue prices
Qatar Airways held out the prospect of a ‘sizeable’ order for wide-body jets around the turn of the year
Updated 23 July 2024
Agencies
FARNBOROUGH, United Kingdom: Qatar Airways on Tuesday ordered 20 Boeing 777X long-haul aircraft worth $8.8 billion at list prices, boosting the US aviation giant at Britain’s Farnborough International Airshow.
“Qatar Airways is proud to announce an expansion to the existing Boeing 777X aircraft order with an additional 20, totalling 94 Boeing 777X aircraft,” said the airline’s chief executive Badr Mohammed Al-Meer.
“We... are an industry leader and operate one of the youngest fleets, offering unparalleled innovation and quality. Keeping an eye on the future, we continue to ensure that all Qatar Airways passengers are only met with the best products and services available in the industry.”
The order was worth $8.8 billion at catalogue prices although major aviation customers typically secure big discounts from aircraft manufacturers.
Boeing’s 777X began test flights earlier this month in preparation for certification to enter service. That is expected in 2025, which is five years behind schedule.
A look back at the exciting reveal at Farnborough!
The blockbuster news came on the second day of the biennial Farnborough Airshow, which traditionally features a dogfight between Airbus and Boeing for multi-billion-dollar orders.
More plane orders flowed in at the Airshow on Tuesday despite supply chain pressures on jetmakers and the complaints from airlines about delivery delays.
Airbus announced deals with Japan Airlines and Virgin Atlantic, while Boeing bagged an order from Macquarie Airfinance.
Delegates have been expecting limited deal-making at this year’s showcase aviation industry event, with Airbus and Boeing sold out for several years of production and struggling to ramp up output amid supply chain problems.
Delays in plane deliveries have limited some airlines’ ability to take advantage of a post-pandemic travel boom which some say is starting to fade.
“I think all of us on the airline side are slightly surprised by the long impact of COVID on the supply chain,” Virgin Atlantic CEO Shai Weiss told Reuters, as his airline ordered seven Airbus A330-900s in a deal worth $807 million, according to estimated delivery prices from Cirium Ascend.
“We’re urging our ... engine suppliers, the manufacturers, to do everything they can to get back on track.”
Boeing in particular had to scale back production as it came under legal and regulatory scrutiny after a panel blew off mid-air on a near-new 737 MAX 9 in January.
Lt-General Salem Bin Hamad Al-Nabit, Chief of Staff of the Qatari Armed Forces and Defence Advisor Group Captain Frazier Nicholson, visited our Group Chief Executive Officer, Engr. Badr Mohammed Al-Meer at our Qatar Airways chalet at Farnborough International Airshow. #FIA2024… pic.twitter.com/nvgbi1fFBC
RUNNING PLANES FOR LONGER
Japan Airlines finalized an order for 20 Airbus A350-900 and 11 A321neo jets to be delivered from 2028, worth just over $3 billion in total, according to Cirium Ascend estimates.
The airline had said in March it would buy 21 wide-body A350s and 11 A321neo narrow-body jets, but it is only ordering 20 A350s now as it will receive one as a replacement for a jet destroyed in January in a collision with a Coast Guard aircraft.
Macquarie Airfinance, meanwhile, ordered 20 Boeing 737 MAX-8 planes to be delivered in 2029-2030, worth just over $1 billion, according Cirium Ascend estimates.
Get a glimpse of the new Business Class Product at the Qatar Airways Discover Lounge, Hall 1 Entrance
Also at the show, Al-Meer said Qatar Airways would decide on a “sizeable” new order of wide-body jets around the end of this year or in the first quarter of 2025.
He added the company had also decided to extend the service life of its Airbus A380 jets and would carry out upgrades including new wifi.
Airlines are increasingly looking to run existing planes for longer as jetmakers struggle to deliver on their order backlogs.
Consultancy Bain said in a report last week that airlines faced their longest-ever waits for engine maintenance amid the shortfall in new aircraft, adding to their costs.
British Airways CEO Sean Doyle said at the air show that his airline was being “very vigilant” on new plane deliveries, but that at the moment “our planes are broadly coming in the timelines that we need them to come.” (With AFP and Reuters)
Saudi Arabia records 21% surge in credit card loans to reach $8bn
Updated 30 August 2024
Dayan Abou Tine
RIYADH: Saudi banks recorded a 21 percent annual surge in credit card loans in the second quarter of 2024, reaching SR30.04 billion ($8.01 billion), according to official data.
Figures from the Saudi Central Bank, also known as SAMA, showed that this is the highest quarterly figure reported, and the most substantial annual growth seen in a year.
Consumer loans – typically paid back in installment, used for significant purchases and often featuring lower fixed interest rates than credit cards – rose by a modest 2 percent to reach SR452.32 billion during this period.
According to SAMA, these loans exclude real estate financing, finance leasing and margin lending.
In their Critical Consumer 2024 report, consultancy firm AlixPartners stated that Saudi Arabia’s preference for digital and credit card payments matches that of Switzerland and surpasses Germany.
Payment cards are dominating Saudi Arabia’s financing ecosystem, driven by government-led economic inclusion initiatives under Vision 2030. This strategy focuses on digital transformation and reducing cash transactions in favor of electronic payments.
The adoption of contactless transactions, accelerated by the COVID-19 pandemic, has fueled the growth of card usage. Additionally, rising banking penetration, improved infrastructure, and increased retailer acceptance, are driving the market’s development.
The government’s push to reduce cash reliance and promote fintech innovation under Vision 2030 is further advancing the payment card market.
According to a July report by Global Data, key players in Saudi Arabia’s cards and payments market include Al Rajhi Bank, Saudi National Bank, and SAB, as well as Alinma Bank, and Visa.
To boost card penetration, banks are tailoring credit cards to different customer segments.
A Titanium Mastercard is Shariah compliant, and provides perks including free VIP lounge access, purchase protection, and installment options.
Some banks target students with a Visa Signature credit card, designed for those enrolled in accredited Saudi universities, and offering installment payment options along with reward points through the Akthr Program.
According to Global Data, recent developments in Saudi Arabia’s cards and payments market include the launch of pilot digital banking services by two of the three licensed digital banks – STC Bank and D360 – in 2023, as noted in the Financial Sector Development Program annual report.
Additionally, Buy Now Pay Later services are growing in popularity, especially among Generation Z consumers.
To regulate this emerging market, the Saudi Central Bank introduced new rules for regulating BNPL companies in December 2023.
These included establishing licensing requirements for such firms and setting minimum standards for offering these services, focusing on consumer protection, sector growth, and sustainability.
Rules also focused on provisions on licensing, internal regulatory measures, information security, and financial crime prevention, along with guidelines for supervision and compliance.
BNPL services can contribute to a more dynamic, inclusive, and innovative payment market in Saudi Arabia, supporting both consumer needs and business growth.
Consumer spending in Saudi Arabia is expected to remain strong in the coming year, despite global economic uncertainties, according to a study by management consulting firm AlixPartners.
This resilience stands in contrast to the broader Europe, the Middle East and Africa region, where 37 percent of consumers plan to cut back on spending in 2024 compared to the previous year, according to the study.
Saudi Arabia’s stable spending environment persists amid global challenges like persistent inflation and geopolitical instability, with some sectors still grappling with post-pandemic recovery.
In contrast, Saudi consumers are increasingly embracing online shopping, with e-commerce growing in popularity. The study showed that while international companies currently dominate this retail landscape, there is a noticeable shift toward homegrown businesses.
The AlixPartners study showed that Saudi Arabia is at the forefront of artificial intelligence adoption for shopping research, with consumers showing strong enthusiasm for innovative solutions like AI-powered tools for holiday bookings.
According to TechSci Research, Saudi Arabia’s AI market in retail and e-commerce was valued at $245 million in 2023 and is expected to experience substantial growth from 2025 to 2029.
According to the study, the sector is evolving rapidly as technology reshape customer experiences, streamline operations, and improve business decision-making.
AI-powered chatbots and virtual assistants are increasingly common, offering personalized customer support and enhancing engagement, while recommendation engines use advanced algorithms to analyze consumer preferences and provide customized product suggestions, boosting sales and satisfaction.
Additionally, AI optimizes supply chain management through predictive analytics and machine learning, reducing costs and ensuring product availability.
Startup Wrap – Regional venture activity sees mix of funding, acquisitions, and accelerator graduations
Updated 30 August 2024
Nour El-Shaeri
RIYADH: The startup ecosystem in the Middle East continues to evolve, marked by significant funding rounds, strategic acquisitions, and new investment initiatives.
An alliance of investors and family offices based in the Gulf Cooperation Council has launched Waad Investment, a firm with a targeted value of SR750 million ($200 million), making it the largest such private entity dedicated to supporting growth-stage startups in the region, according to a release.
The alliance, led by Saudi businessman Yaser Al-Ghamdi, founder and chief investment operations officer of Waad Investment, involves a collaboration with the AlMajed and AlMisfer family offices to create a platform for entrepreneurial growth.
Waad Investment is designed to foster the private sector’s role in driving innovation and economic development, with a particular focus on providing not only financial investments but also a network of connections, mentorship, and guidance to startups.
“The company will bridge the financial gap many startups face and will offer comprehensive support that includes financial investment, mentorship, and guidance,” said Al-Ghamdi.
The firm is part of a broader vision to enhance the innovation landscape in the GCC, with family offices and investors aiming to generate a diverse and sustainable economy based on knowledge and technology.
15 startups graduate from the first cohort of TDF’s Grow Accelerator program
The Tourism Development Fund, a national enabler of the sector in Saudi Arabia, showcased the progress of 15 startups, which have collectively attracted investments worth over SR18 million to date, in its latest demo day.
The exhibition was for the graduates of the inaugural cohort of its “TDF Grow Accelerator” program at the King Abdullah Financial District Conference Center in Riyadh.
The event attracted investment pioneers, entrepreneurs, media representatives, and key stakeholders within the tourism sector.
Qusai Al-Fakhri, CEO of TDF, highlighted the critical role of the fund’s programs in promoting innovation and sustainable growth in the Kingdom’s tourism industry.
In a speech delivered on his behalf by Prince Saud Bin Mohammed, executive director of TDF Grow, Al-Fakhri expressed pride in the achievements of the startups, and said: “This success reflects our ongoing commitment to supporting entrepreneurial ideas and promising initiatives that contribute to efficiently implementing the national tourism strategy and reinforcing the Kingdom’s standing as a global tourism destination.”
KBW Ventures invests in Saudi Arabia’s KASO
KASO co-founders Manar Al-Kassar and Ahmed Soliman. KASO
KBW Ventures, led by Prince Khaled bin Al-Waleed, has announced an investment in Saudi business-to-business food tech startup KASO.
The company specializes in streamlining procurement processes for the food and beverage sector by digitizing and automating the logistics between restaurants and suppliers.
Prince Khaled noted that KASO had been under KBW Ventures’ consideration for some time before the investment was made.
“We want to grow our allocation into B2B SaaS. KASO not only checks the boxes on return parameters; we also like to see visibility of 10x return for early stage opportunities,” Prince Al-Waleed said.
This investment aligns with KBW Ventures’ broader strategy of supporting sustainability-driven sectors, including food security, alternative proteins, carbon capture, and agricultural technology.
UAE’s Powder Beauty secures pre-series A funding to scale in Saudi Arabia
UAE-based e-commerce platform Powder Beauty has successfully closed its pre-series A funding round, led by Sophia Collective and NKEHL, Nithin and Nikhil Kamath.
The round also saw participation from several regional angel investors, including Maha Taibah. The specific value of the funding was not disclosed.
Founded in 2018 by Ayat Toufeeq, Amina Grimen, and Marriam Mossall, Powder Beauty focuses on offering eco-conscious beauty products to its customers.
“With this funding round, we’re driven to build on our leading position in this largely untapped but fast-growing market,” Toufeeq, CEO of Powder Beauty, said.
“We’re delighted to have received this support from investors like the Sophia Collective, a platform whose vision aligns strongly with ours,” she added.
The newly secured funds will be used to scale the company’s operations in Saudi Arabia, furthering its growth in the region.
UAE’s Verofax secures $3m in a bridge round
UAE-based Web3 services provider Verofax has secured $3 million in a bridge funding round, led by King Abdullah University for Science and Technology, Plug & Play Tech Center, Navig8 Group, and Trove Capital UK.
Additional participants included Jawa Brothers Advisory, Alzamil Pedco CVC, and Tracecore CVC.
Founded in 2018 by Wassim Merheby and Jamil Zablah, Verofax leverages Web3 technologies like augmented reality, blockchain, and artificial intelligence to enhance marketing experiences.
The new funding will support Verofax’s expansion in the Middle East and Europe, including AI-powered guides for the GCC and sports fan guides in the EU and North America.
In 2022, Verofax raised $1.5 million in a pre-Series A round, led by Benson Oak Ventures, with participation from 500 Global, Wami Capital, and Vernalis Capital.
Kuwait’s Sakan acquires Qatari proptech Hapondo
Abdullah Al Saleh, CEO of Sakan and Ahmad Al-Khanji, co-founder and CEO of Hapondo. Sakan
Kuwait-based proptech company Sakan has acquired Hapondo, a Qatari real estate marketing platform, for an undisclosed amount.
Sakan, established in 2016 by Abdullah Al-Saleh, operates as a real estate marketplace across several GCC countries, including Kuwait, Saudi Arabia, Oman, and Bahrain.
Hapondo, founded in 2019 by Ahmad Al-Khanji, specializes in providing a comprehensive map and photo search for residential units in Qatar.
The acquisition is aimed at expanding Sakan’s services in Qatar by leveraging Hapondo’s existing network and relationships with clients and real estate developers.
Web3 streaming platform myco raises $10 million in Series A
UAE-based Web3 streaming platform myco has completed the first closing of its Series A funding round, raising $10 million at a post-money valuation of $80 million.
The round was backed by Daman Investments, Aptos Labs, B Digital, Mocha Ventures, Art3 Foundation, Ghaf Capital Partners, Mix Media Network, Factor6 Capital Partners, and Enjinstarter, alongside 88 accredited investors who participated through Republic.com.
Founded in 2021 by Umair Masoom and Somair Rizvi, myco is a content streaming application that integrates ad-based and subscription video on demand within a decentralized environment.
The fresh funds will support myco’s expansion into new markets and partnerships, following its recent growth into North America and Egypt. The company plans to conclude a second closing of their series A by early 2025.
“Myco has already demonstrated our ability to scale in key markets, achieving exceptional metrics in user growth, retention, revenue, and community building. With this new capital, we plan to replicate our success by expanding into markets with similar demographics and strong regional partnerships.” said Masoom, managing director of the firm.
Bahrain’s Tenmou invests in two local startups
Nawaf Al-Kooheji, CEO of Tenmou. Tenmou
Bahrain-based angel investment company Tenmou has invested in two Bahraini startups – Tajweed and Travilege.
Founded in 2021 by Salman Al-Marzooq, Travilege is an enterprise resource planning software designed for travel agencies, while Tajweed, founded by Khalil Alqaheri, is a digital platform focused on teaching the Holy Qur’an and Arabic language.
Tenmou’s investment aligns with its strategy to promote angel investing in technology startups that have rapid expansion potential.
The company is focused on fostering a robust ecosystem for tech-driven businesses in Bahrain and the wider region.
Red Sea Global launches Saudi Arabia’s 2nd water aerodrome after GACA approval
Updated 30 August 2024
Arab News
RIYADH: A second water aerodrome is set to be opened in the Red Sea tourist development after an operating license was secured, it has been announced.
The move means passengers will be able to arrive on Sheybarah Island, home to the Shebara resort, by seaplane – with the facility opening to guests in September.
General Authority for Civil Aviation President Abdulaziz bin Abdullah Al-Duailej handed the license for the water aerodrome to Red Sea Global’s CEO John Pagano, saying the granting of the permit forms part of GACA’s transformation program to boost competition and investment in support of Saudi Arabia’s Vision 2030 agenda.
Minister of Transport and Logistics Services Saleh AI-Jasser was also in attendance, according to the Saudi Press Agency.
RSG is one of Saudi Arabia’s giga-projects, and is set to boast 50 hotels across 28,000 sq. km, by 2030, with an ambition of hosting 300,000 guests a year.
“This license is one of the final stepping stones toward opening Shebara to the world. Soon, guests will be arriving by seaplane to this iconic resort in anticipation of enjoying a truly peerless escape,” said Pagano.
“As owners of the Kingdom’s first seaplane airline and its only two water aerodromes up until now, we are firmly establishing ourselves as leaders within tourism and aviation,” he added.
In 2023, RSG secured the first operating license for a water aerodrome in Saudi Arabia, at Ummahat Island.
It has been servicing passengers to and from the St. Regis Red Sea Resort and Nujuma, a Ritz Carlton Reserve, since they opened on the island earlier in 2024.
More than 520 flights carrying over 1,200 passengers were completed in the first half of the year on a fleet of Cessnas, and RSG expects to transport 3,800 passengers before the end of 2024.
In 2023, RSG also announced the launch of its subsidiary business Fly Red Sea, the Kingdom’s first seaplane company and water aerodrome operator.
It was established to enable the transport of guests to the Red Sea’s islands' resorts, and will eventually add connections to neighboring destinations and developments such as AMAALA and Al Wajh Airport.
Upon full completion in 2030, the destination will offer up to 8,000 hotel rooms and more than 1,000 residential properties across 22 islands and six inland sites.
The destination will also include luxury marinas, golf courses, and leisure facilities.
Oil Updates – crude inches up on Middle East supply concerns
Updated 30 August 2024
Reuters
HOUSTON/SINGAPORE: Oil prices inched higher on Friday as investors weighed supply concerns in the Middle East, although signs of weakened demand limited gains.
Brent crude futures for October delivery, which expire on Friday, were up 23 cents, or 0.3 percent, at $80.17 a barrel by 7:10 a.m. Saudi time. The more actively traded contract for November rose 20 cents, or 0.2 percent, to $79.02.
US West Texas Intermediate crude futures gained 18 cents, or 0.2 percent, to $76.09.
Both benchmarks settled more than $1 higher on Thursday on oil supply concerns, up 1.5 percent and 1.7 percent respectively for the week so far.
“Ongoing concerns over dented Libyan supplies were magnified by Iraq’s plans to tame production, which together can dent the global supplies of oil,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.
“However, the somber economic outlook of mainland China, the world’s largest importer of crude oil, continues to be a constant headwind on oil demand.”
More than half of Libya’s oil production, or about 700,000 barrels per day, was offline on Thursday and exports were halted at several ports following a standoff between rival political factions.
Libyan production losses could reach between 900,000 and 1 million bpd and last for several weeks, according to consulting firm, Rapidan Energy Group.
Meanwhile, Iraqi supplies are also expected to shrink after the country’s output surpassed its OPEC+ quota, a source with direct knowledge of the matter told Reuters on Thursday.
Iraq plans to reduce its oil output to between 3.85 million and 3.9 million bpd next month.
Brent and WTI, however, are still headed for declines of 0.7 percent and 2.3 percent for August, their second straight monthly drops.
Worries over demand continue to weigh on the market, with US inventory data showing a crude stock draw for the week ended on Aug. 23 around a third smaller than expected.
“The market is concerned about the medium-term outlook, with oil balances for 2025 looking weak,” ANZ analysts said in a note.
“We believe OPEC will have no choice but to delay the phase out of voluntary production cuts if it wants higher prices,” the ANZ analysts said.
OPEC and allies, together known as OPEC+, is set to gradually phase out voluntary production cuts of 2.2 million bpd over the course of a year from October 2024 to September 2025.
ISLAMABAD: Finance Minister Muhammad Aurangzeb said on Thursday the federal government was introducing new policy measures to streamline investment processes and provide incentives for foreign investors, Radio Pakistan reported.
The government says it is committed to improving Pakistan’s investment climate as the South Asian country struggles to meet external financial needs to get approval for a $7 billion IMF bailout loan and fights a growing militancy problem.
Last month, Aurangzeb said Pakistan will focus on meeting its external financing needs by speaking with foreign governments and lenders to draw foreign investment as well as seeking loan rollovers. The government is also seeking to focus on more sustainable forms of external financing such as direct investment and climate financing.
Pakistan and the IMF reached an agreement for the 37-month loan program last month. The IMF has said the program is subject to approval from its executive board and obtaining “timely confirmation of necessary financing assurances from Pakistan’s development and bilateral partners.”
On Thursday, the finance minister chaired a review meeting with representatives from joint venture investment companies, including the Pak-Brunei Investment Company Limited and Saudi-Pak Industrial and Agricultural Investment Company in Islamabad.
“Aurangzeb expressed government’s unwavering commitment to creating an enabling environment for private sector investment, recognizing the critical role that joint venture companies like Pak-Brunei Investment Company Limited and Saudi-Pak Industrial and Agricultural Investment Company can play in driving economic growth,” Radio Pakistan said. “He underscored the importance of these ventures in attracting foreign direct investment.”
According to state media, the CEO of the Pak-Brunei Investment Company Limited gave an overview about the portfolio of the company and its major initiatives in Pakistan.
“The role of Pak-Brunei Investment Company Limited in promoting economic cooperation between Pakistan and Brunei by facilitating investments in Industry and Agricultural sectors, through financial services, real estate, and SME’s support was highlighted,” the report said.
The CEO of Saudi-Pak Industrial and Agricultural Investment Company also gave a presentation about the major development initiatives of the company for promoting Islamic finance, food security, digital finance, trade, and agriculture and livestock in Pakistan.
Various aspects of the operations of these companies, including investment strategies, performance metrics, and key impediments affecting their growth, were also discussed.
“Both companies presented their achievements and challenges, highlighting areas that require policy support to overcome obstacles in their operational landscape. The discussion also focused on potential areas for future investments and collaborations through more government-to-government initiatives in order to support priority sectors,” Radio Pakistan said.
“The Finance Minister appreciated both companies and specifically applauded the implementation strategies of Saudi Arabia’s Vision 2030 for achieving their targets within a few years, and stressed that Pakistan is keen on learning those strategies.”
Aurangzeb has held a flurry of meetings with heads of foreign banks and companies in recent weeks in a push to bring in more investment. Last week he held meetings with top officials of Dubai Islamic Bank and Mashreq Bank to “discuss the economic outlook and explore investment opportunities in Pakistan.”
Pakistan is in talks with Saudi Arabia, the United Arab Emirates and China to meet gross financing needs under the IMF program, Aurangzeb said in July following a trip to China to seek energy sector debt reprofiling.
Rollovers or disbursements on loans from Pakistan’s long-time allies, in addition to financing from the IMF, have helped Pakistan meet its external financing needs in the past.
Tough conditionalities placed by the IMF, such as raising tax on agricultural incomes and lifting electricity prices, have prompted concerns about poor and middle class Pakistanis grappling with rising inflation and the prospect of higher taxes.
Bringing in foreign investors may become harder as Pakistan’s security situation deteriorates. On Sunday, separatist militants launched a series of coordinated attacks in the southwestern province of Balochistan, killing over 53 people, including at least 19 soldiers and police. Attacks across the country by religiously motivated groups like the Pakistan Taliban have also been on the rise in recent months.