ACWA Power’s net profit surges 35 percent to $274m in H1
ACWA Power’s total revenue saw a marginal year-on-year increase of 2.58%, reaching SR2.81 billion
Net profit for the second quarter soared by 112.92 percent from SR291.17 million in the first three months
Updated 04 August 2024
Arab News
RIYADH: Saudi utility giant ACWA Power reported a 35.46 percent increase in net profit for the first half of 2024, reaching SR926.79 million ($246.88 million), compared to the same period last year.
In a statement to the Saudi Stock Exchange, the company attributed the earnings rise to higher gross profit, driven by increased revenues, as well as growth from a higher profit share from equity-accounted investees and increased finance income.
This comes as ACWA Power aims to lead Saudi Arabia’s energy transition and expand globally, targeting high-growth economies. The company plans to raise SR7.13 billion in capital to triple assets under management by 2030, supporting its growth and financial stability.
“Our financial results renew our confidence in pursuing our ambitious growth agenda and allow us to accelerate our mission of delivering low-cost and responsible water and power globally,” Marco Arcelli, CEO of ACWA Power, said in a statement.
In the first half of 2024, ACWA Power’s total revenue saw a marginal year-on-year increase of 2.58 percent, reaching SR2.81 billion.
“Despite the operational challenges witnessed in a few assets, the diversity of our asset base, as well as our business model, has allowed us to grow our operating and net profit in the first six months of this year,” said Abdulhameed Al-Muhaidib, chief financial officer at ACWA Power.
The company’s net profit for the second quarter surged by 52.17 percent to SR630.62 million compared to the same period the previous year.
Net profit for the second quarter soared by 112.92 percent from SR291.17 million in the first three months.
As an early mover in green hydrogen and sustainable projects, the company aims to explore opportunities beyond the Kingdom, focusing on renewables and avoiding coal and oil investments as it works toward net zero by 2050.
During the first half of this year, the firm, 50 percent owned by the Public Investment Fund, expanded its portfolio by adding a record 10.5 gigawatts of renewable power generation capacity.
In May, it signed a power purchase agreement with the National Electric Grid of Uzbekistan for up to 5GW Aral Wind with BESS project, Central Asia’s largest wind farm and ACWA Power’s 15th project in the region.
In June, the Riyadh-based company signed another three PPAs for large-scale photovoltaic solar projects in Saudi Arabia, with a combined capacity of 5.5GW and a total investment cost of SR12.3 billion, as part of the fourth round of the ACWA Power-Public Investment Fund Strategic Framework Agreement.
Saudi Arabia charts global leadership path with landmark deals in 2024
Updated 49 min 23 sec ago
MOHAMMED AL-KINANI
JEDDAH: Saudi Arabia’s Vision 2030 agenda gained significant momentum in 2024, with the Kingdom securing a series of high-profile strategic partnerships that span multiple industries.
These deals, coupled with the country’s ongoing reforms, are positioning Saudi Arabia as a global economic and financial powerhouse. Experts emphasize that these agreements have long-term potential to diversify the Kingdom’s economy and reduce its dependency on oil revenues.
In the past year, Saudi Arabia signed key agreements with international governments and corporations in sectors including education, tourism, IT, finance, manufacturing, and renewable energy, according to Yaseen Ghulam, associate professor of economics and director of research at Al-Yamamah University in Riyadh.
Tourism sector takes off
The Saudi Tourism Authority reached a major milestone in May by unveiling the Kingdom’s unique summer destinations at the Arabian Travel Market. This initiative resulted in over 40 new agreements, including partnerships with Saudia, Riyadh Air, flyadeal, Noon, and China’s i2i Group.
“Tourism is expected to play a major role in the Kingdom’s economic transformation,” Ghulam said, underscoring the importance of these agreements in promoting the sector and creating new employment opportunities, particularly for youth and women. These efforts are in line with Vision 2030’s broader objectives. Saudi Arabia aims to develop year-round attractions and position itself as a top global destination. By blending traditional culture with modern experiences, the Kingdom is appealing to both domestic and international tourists, further strengthening its tourism strategy.
Strategic alliances
Abdullah Al-Maghlouth, a member of the Saudi Economic Association, pointed out that the Kingdom’s strategic alliances focus on diversifying the economy, attracting foreign investments, and boosting trade with international partners. These partnerships span regions, including the US, China, Europe, and Africa, and cover sectors such as technology, infrastructure, tourism, education, and renewable energy.
“These partnerships include collaborations with the US, China, European countries, and African nations, focusing on areas like energy, technology, infrastructure, tourism, education, and renewable energy,” he explained.
The agreements target key areas such as reducing reliance on oil, improving infrastructure, and fostering innovation while supporting flagship projects like NEOM, Qiddiya, and The Red Sea Project.
“These alliances will improve product and service quality, promote innovation, and help Saudi companies adopt modern technologies,” Al-Maghlouth added.
Education sector
2024 also saw significant strides in education. In November, top American universities visited Saudi Arabia, leading to an agreement aimed at strengthening academic and scientific cooperation. This partnership will increase exchanges between students and faculty, foster joint research projects, and introduce advanced academic programs.
Additionally, Saudi Arabia’s Technical and Vocational Training Corp. launched a cooperation program with the UK’s Department for Business and Trade, reinforcing the Kingdom’s growing reputation as a hub for international academic collaborations.
Another key development was a service agreement between the University of Strathclyde and Princess Nourah bint Abdulrahman University, signaling an open door for more British universities to establish partnerships in Saudi Arabia.
HIGHLIGHTS
These partnerships span regions, including the US, China, Europe, and Africa, and cover sectors such as technology, infrastructure, tourism, education, and renewable energy.
The agreements target key areas such as reducing reliance on oil, improving infrastructure, and fostering innovation while supporting flagship projects like NEOM, Qiddiya, and The Red Sea Project.
In November, top American universities visited Saudi Arabia, leading to an agreement aimed at strengthening academic and scientific cooperation.
Saudi Arabia signed a major agreement with NASA in 2024 to strengthen ties in space exploration, research, and education.
LEAP 24, a major tech event organized by the Saudi Data and Artificial Intelligence Authority, resulted in agreements worth $24 billion to boost AI research and digital technology localization.
Space and digital transformation
In a groundbreaking move, Saudi Arabia signed a major agreement with NASA in 2024 to strengthen ties in space exploration, research, and education. “This agreement has a huge significance and shall pave the way for further collaboration and related economic activities,” said Ghulam.
On the digital front, LEAP 24, a major tech event organized by the Saudi Data and Artificial Intelligence Authority, resulted in agreements worth $24 billion to boost AI research and digital technology localization.
Highlights include Amazon’s $5.3 billion investment in training initiatives, including the AWS Saudi Arabia Women’s Skills Initiative, which aims to train 4,000 women. Additionally, Aramco Digital announced partnerships with US tech companies to build the world’s largest AI supercomputer center in Saudi Arabia.
“All these agreements are expected to generate employment opportunities and help diversify the economy greatly,” Ghulam said.
Abdullah Al-Maghlouth, a member of the Saudi Economic Association, pointed out that the Kingdom’s strategic alliances focus on diversifying the economy.
Construction, renewable energy sectors
In the construction sector, a notable partnership was formed between Saudi Arabia’s National Housing Co. and China’s CITIC Construction. The agreement focuses on developing industrial cities and logistics zones to support residential projects and strengthen the real estate sector. Ghulam emphasized that these zones would boost construction, support local industries, expand the domestic materials market, and improve housing quality.
Renewable energy also made waves in 2024. In January, ACWA Power, a Saudi company, led a $1.5 billion wind energy project in Egypt, one of the largest onshore wind energy projects globally. “This initiative will provide electricity to 1 million homes in Egypt and reduce carbon emissions by 2.4 million tonnes annually,” Ghulam pointed out.
This project not only supports Egypt’s energy needs but also solidifies ACWA Power’s position as a key player in the global renewable energy sector, alongside other leading Saudi brands like Aramco and the Public Investment Fund.
PIF’s expanding role
The Public Investment Fund continues to be a driving force behind the Kingdom’s economic transformation. Since 2017, PIF has created nearly 644,000 jobs and launched 94 new businesses. In 2024, PIF acquired a 15 percent stake in Heathrow Airport for $4.12 billion, signaling its intent to expand its influence in global infrastructure projects.
PIF also partnered with Google Cloud to establish an AI hub in Saudi Arabia, a project that is expected to contribute $71 billion to the country’s GDP over the next eight years.
“This cooperation seeks to strengthen the Saudi workforce and assist the country’s goal of a 50 percent increase in the information and communication technology industry in coming years,” Ghulam noted.
In the renewable energy sector, PIF has been instrumental in localizing the production of wind turbines, solar cells, and other renewable technologies. In partnership with Jinko Solar and Vision Industries, PIF is working to produce solar power ingots and wafers, further advancing Saudi Arabia’s green energy ambitions.
Additionally, in April, PIF joined forces with BlackRock to launch a multi-asset investment platform in Riyadh, aimed at expanding Saudi Arabia’s capital markets and attracting global investors.
A transformative year
The strategic partnerships and investments forged by Saudi Arabia in 2024 reflect the Kingdom’s commitment to economic innovation, diversification, and global collaboration. By focusing on developing human capital, cutting-edge industries, and sustainable growth, Saudi Arabia is positioning itself as a leader on the world stage across multiple sectors.
Saudi Arabia’s flynas launches Dammam-Red Sea flights to boost tourism connectivity
New service operates twice weekly, on Thursdays and Saturdays
RSI is key in helping the Kingdom attract a significant amount of tourists by 2030
Updated 29 December 2024
NADIN HASSAN
RIYADH: Saudi low-cost airline flynas has launched a new direct route connecting Dammam’s King Fahd International Airport to the Red Sea, enhancing access to the Kingdom’s premier tourism destination.
The inaugural flight, which landed on Dec. 26, marked the first direct connection between the Eastern Province and the Red Sea International Airport.
The new routes support Saudi Arabia’s Vision 2030, which aims to make the Kingdom a global tourism hub by enhancing connectivity and infrastructure, while RSI is key in helping the nation attract a significant amount of tourists by the end of the decade.
The new service operates twice weekly, on Thursdays and Saturdays, and complements existing flights from Riyadh and Jeddah, strengthening RSI’s role as a domestic and international tourism hub.
We're partnering with @flynas to introduce two weekly flights between Dammam and @RSI_airport. With our airport's strategic location, within three hours of 250 million people, we're one step closer to transforming it into a global travel hub.
Since September 2023, The Red Sea destination has hosted visitors at its five luxury resorts, supported by national carrier Saudia’s regular domestic services.
In 2024, RSI achieved another milestone by welcoming its first international flight from Dubai International Airport, operated by flydubai.
These developments highlight RSI’s growing role as a key gateway to Saudi Arabia’s tourism offerings.
Once fully operational, RSI will run entirely on renewable energy generated by 760,500 photovoltaic panels and one of the world’s largest off-grid battery energy storage systems.
Current airside operations, including lighting, navigation, and meteorological equipment, are already exclusively powered by renewable energy.
Upon its completion in 2030, the expansive development will feature 50 resorts offering up to 8,000 hotel rooms and more than 1,000 residential units across 22 islands and six inland sites.
The development will also feature luxury marinas, golf courses, diverse dining options, and entertainment facilities, positioning it as a global leader in sustainable and luxury tourism.
In November, flynas added two new African destinations to its network beginning on Jan. 8.
The airline will operate three weekly flights from Riyadh to Uganda and three from Jeddah to Djibouti, according to the company’s statement.
Starting today, we're introducing two weekly flights to and from Dammam, making travel easier for domestic visitors. As we prepare for the main terminal’s opening next year, RSI is on its way to becoming a world-class hub. pic.twitter.com/Z7I5xSh4qJ
The expansion is part of the airline’s “We Connect the World to the Kingdom” initiative and supports Saudi Arabia’s National Civil Aviation Strategy, which aims to expand connectivity to 250 international destinations and reach 330 million passengers.
The routes to Uganda and Djibouti also align with Saudi Arabia’s goal of welcoming 150 million tourists annually by 2030 and advancing the Pilgrims Experience Program, which seeks to streamline travel access to the holy cities of Makkah and Madinah.
Red Sea International is strategically located to serve 250 million people within a three-hour flight radius, covering the Middle East, parts of Europe, and Africa.
NEOM’s Oxagon leads the way in sustainable industrial revolution
Oxagon has become a global model for future industrial development
It has continued to leverage cutting-edge technologies to revolutionize logistics and manufacturing operations
Updated 23 min 58 sec ago
Reem Walid
RIYADH: Oxagon, the industrial cornerstone of NEOM, has solidified its position as a critical hub for logistics and manufacturing, perfectly aligned with Saudi Arabia’s Vision 2030.
Through a blend of innovation, sustainability, and technological progress, Oxagon has become a global model for future industrial development. Spanning approximately 50 sq. km, it ranks among the largest floating industrial complexes worldwide and is on track to achieve 100 percent renewable energy use by 2030.
The accomplishments of 2024 underscore Oxagon’s commitment to economic diversification and environmental responsibility, offering valuable lessons for businesses. By prioritizing sustainability, embracing cutting-edge technologies, and showcasing adaptability, Oxagon sets new benchmarks for the logistics and manufacturing sectors.
Driving sustainability
Oxagon stands as a beacon of sustainable practices within logistics and manufacturing. Paolo Carlomagno, partner at Arthur D. Little Middle East, said that Oxagon’s initiatives align with the core objectives of Saudi Vision 2030, aiming to create a diversified economy while reducing environmental impact.
“For example, Oxagon’s logistics operations integrate renewable energy sources, such as solar and wind, which have collectively reduced carbon emissions by an estimated 25 percent compared to traditional models,” Carlomagno explained.
Paolo Carlomagno, partner at Arthur D. Little Middle East, notes that Oxagon’s initiatives align with the core objectives of Saudi Vision 2030, aiming to create a diversified economy while reducing environmental impact.
“Additionally, the manufacturing ecosystem embraces circular economy principles, focusing on resource efficiency and waste minimization. By 2026, Oxagon’s waste-to-resource initiatives are projected to recycle 90 percent of industrial waste generated within the facility,” he added.
Carlomagno further emphasized that advanced systems such as green building technologies and smart water management are integral to Oxagon’s strategy to minimize its environmental footprint.
“For instance, Oxagon employs advanced desalination techniques that use 40 percent less energy than conventional methods, providing a sustainable water supply for both industrial operations and local communities,” he noted. “These efforts create a resilient, eco-friendly industrial ecosystem capable of adapting to future challenges.”
Collaboration is central to Oxagon’s strategy, with partnerships with global corporations like Siemens and Schneider Electric driving the accelerated adoption of sustainable practices.
“These collaborations have led to the implementation of innovative solutions, such as energy-efficient manufacturing systems and low-carbon supply chain logistics, setting a standard for the region and beyond,” he added.
FASTFACTS
Oxagon’s logistics operations integrate renewable energy sources, such as solar and wind, which have collectively reduced carbon emissions by an estimated 25 percent compared to traditional models.
Oxagon employs advanced desalination techniques that use 40 percent less energy than conventional methods, providing a sustainable water supply for both industrial operations and local communities.
Real-time demand forecasting has allowed Oxagon’s partners to reduce inventory holding costs by 20 percent, reflecting its agility in a dynamic global market.
Technological innovations
In 2024, Oxagon has continued to leverage cutting-edge technologies to revolutionize logistics and manufacturing operations. Carlomagno noted that technologies such as artificial intelligence, robotics, and the Internet of Things have played a crucial role in streamlining processes, enhancing predictive maintenance, and optimizing inventory management, resulting in efficiency gains of approximately 30 percent compared to 2023.
“One notable advancement has been the integration of autonomous electric vehicles within its logistics network. These vehicles, combined with AI-driven route optimization algorithms, have reduced delivery times by 20 percent and operational costs by 15 percent,” he said.
“Additionally, smart manufacturing hubs equipped with IoT-enabled machinery have increased production accuracy by 25 percent, while reducing downtime through predictive maintenance protocols.”
Looking forward, Carlomagno highlighted that Oxagon’s commitment to emerging technologies promises further industry disruption.
“The adoption of blockchain for transparent supply chain management is expected to reduce fraud and improve traceability, while quantum computing — currently under exploration — offers the potential to solve complex logistical challenges at unprecedented speeds. Such innovations are expected to drive a projected 10 percent annual growth rate in Oxagon’s industrial output over the next five years,” he said.
Federico Pienovi, chief business officer and CEO for APAC & MENA at Globant, outlined Oxagon’s use of AI-driven analytics, blockchain-enabled supply chain management, and autonomous systems to create a highly connected and efficient operational ecosystem. These advancements have improved transparency, reduced inefficiencies, and streamlined processes, enabling smarter decision-making.
“For example, AI and machine learning have played pivotal roles in logistics, enabling predictive models that optimize shipping schedules. By analyzing port availability in real-time, these systems ensure vessels depart and arrive with precision, avoiding costly delays and idle time. Similarly, blockchain technology ensures supply chain transparency, building trust and resilience across global operations,” said the CEO.
In manufacturing, robotics, supported by AI, has revolutionized production lines, offering unmatched precision, scalability, and flexibility.
“IoT sensors have elevated predictive maintenance to a new level, reducing downtime and enhancing overall equipment efficiency. Combined, these innovations are driving higher product quality, creative business models, and smarter scalability,” he said.
Federico Pienovi, chief business officer and CEO for APAC & MENA at Globant, outlined Oxagon’s use of AI-driven analytics, blockchain-enabled supply chain management, and autonomous systems to create a highly connected and efficient operational ecosystem.
Looking to the future, Pienovi emphasized that Oxagon’s connected experiences will further enhance operations, not just in factories and logistics but also for employees. By integrating data from IoT, AI, and machine learning, Oxagon offers seamless workflows while maintaining a people-centric approach, improving employee satisfaction, operational agility, and productivity.
Evolving market dynamics
As global markets evolve, Oxagon provides a model for how businesses can adapt and thrive. Carlomagno noted that Oxagon’s strategy revolves around three core pillars: collaboration, sustainability, and digital transformation. By forming strategic partnerships with technology providers, academic institutions, and multinational corporations, Oxagon has positioned itself as an innovation hub.
“For example, a partnership with MIT enabled the establishment of a data-driven logistics optimization platform that has increased supply chain efficiency by 15 percent,” he said.
Oxagon’s consumer-centric approach also sets it apart. By leveraging data analytics and consumer feedback loops, the company ensures its products and services meet evolving market demands.
“For instance, real-time demand forecasting has allowed Oxagon’s partners to reduce inventory holding costs by 20 percent, reflecting its agility in a dynamic global market,” said Carlomagno.
Pienovi emphasized that embracing digital transformation is a critical strategy for future success.
“Oxagon has placed advanced technologies like AI, IoT, edge computing, and automation at the core of its operations. By integrating predictive AI models, Oxagon has optimized its supply chain management, enabling it to forecast demand and identify the most efficient logistics routes,” he said.
The CEO added: “At the same time, IoT sensors and robust platforms have elevated operational efficiency, improved product quality, and enhanced risk mitigation efforts. These technologies have not only transformed manufacturing and logistics but have also paved the way for connected experiences, where personalized insights enhance decision-making across operations.”
Sustainability remains a key pillar of Oxagon’s strategy. “By integrating circular economy principles, Oxagon has redefined what it means to operate in an environmentally conscious manner, aligning itself with the growing consumer demand for responsible and eco-friendly brands. Its efforts in sustainability are not merely a corporate responsibility but also a strategic driver for differentiation in the global market,” said Pienovi.
In an increasingly digital business environment, Pienovi highlighted the growing importance of data privacy and cybersecurity.
“Oxagon’s commitment to compliance with regulations, such as Saudi Arabia’s NCA and international standards, underscores its focus on maintaining trust and ensuring secure operations,” he concluded.
As global business becomes more interconnected, Oxagon’s initiatives in 2024 provide a powerful model for how businesses can successfully adapt by integrating innovation, sustainability, and collaboration.
Jordan to record nearly 3% economic growth in 2025, experts project
Projected growth aligns with the government’s recent corrective measures in the final quarter of 2024
Jordan has maintained a steady average growth rate of 2.5% over the past decade, according to the World Bank
Updated 10 min 47 sec ago
Reem Walid
RIYADH: Jordan is set to experience an economic growth rate between 2.5 percent and 3 percent in 2025, bolstered by improvements in the business environment and increased investments, according to economic experts.
Adli Kandah noted that this growth would likely lead to a slight reduction in unemployment, although challenges in the labor market persist, the Jordan News Agency reported.
The projected growth aligns with the government’s recent corrective measures in the final quarter of 2024, including reduced penalties for unlicensed vehicles and tax cuts for electric cars. These steps are part of a broader effort to improve economic conditions and enhance both financial and social stability.
Jordan has maintained a steady average growth rate of 2.5 percent over the past decade, according to the World Bank, providing a solid foundation for future economic expansion.
Kandah also highlighted positive indicators, including regional developments that could benefit Jordan, particularly in foreign trade and investment sectors. He pointed to potential gains from developments in Syria, especially if international sanctions are lifted.
Raad Al-Tal, professor of Economics at the University of Jordan, noted that the country’s political stability and economic reforms have helped it remain resilient. Despite regional geopolitical challenges, including the ongoing situation in Gaza, Jordan has shown adaptability.
“The tourism sector, in particular, has shown notable recovery, bolstered by improved regional security and increased visitor numbers,” Al-Tal said, as reported by Pentra.
He also emphasized the positive impact of remittances from Jordanian expatriates, which have strengthened the country’s monetary reserves.
Ahmad Al-Majali, an economic researcher, also confirmed that despite external pressures and regional political turbulence, Jordan’s economy has shown positive performance in 2024.
Al-Majali attributed this resilience to the central role of monetary policy in maintaining stability and the progress achieved under the Economic Modernization Vision.
“The monetary policy has served as a fundamental pillar for the economy during this period,” he said.
He further emphasized that the Economic Modernization Vision has spurred optimism among investors, contributing to increased economic activity.
Looking ahead to 2025, experts anticipate that lower global interest rates could reduce local financing costs, providing an additional boost to investment. However, they stress that continued economic reforms and efficient public spending are crucial to sustaining this positive trajectory.
Public finances of GCC countries show surplus in 2024, 2025: report
GCC countries posted a financial surplus of $134 billion in 2022, representing 6.1% of their GDP
Total public spending in the GCC reached its highest level in 2023, hitting $639 billion
Updated 29 December 2024
Nirmal Narayanan
RIYADH: Public finances in the Gulf Cooperation Council countries are expected to maintain a stable trajectory, with a projected stabilization of public debt at 28 percent of the gross domestic product in 2024 and 2025.
According to the latest data from the Gulf Statistical Center, the region’s fiscal outlook remains positive, building on a surplus of $2 billion in 2023, Emirati news agency WAM reported.
This comes as GCC countries posted a financial surplus of $134 billion in 2022, representing 6.1 percent of their GDP. Public debt reached approximately $628 billion in 2023, compared to $144 billion in 2014, while the debt-to-GDP ratio peaked at 40.3 percent in 2020 before declining to 29.8 percent in 2023.
Earlier this month, Saudi Arabia reached a milestone in public financial management by successfully transitioning to the International Public Sector Accounting Standards on an accrual basis. The move aligns with the Kingdom’s broader efforts to modernize its public sector financial practices as part of its Vision 2030 agenda.
GCC-Stat said that financial risks for countries in the region will remain low in the short term, driven by forecasts of locally and globally stable or declining interest rates.
Citing recent reports from credit rating agencies, GCC-Stat added that the credit attractiveness of the regional countries is expected to improve, which will allow for the rescheduling of public debts at lower financial costs.
Affirming the growth of GCC economies, credit rating agency Moody’s projected in November that Saudi Arabia’s economy will grow by 1.7 percent this year, before accelerating to 4.7 percent in 2025 and 2026. The agency also forecasted that the UAE’s economy will expand by 3.8 percent in 2024 and 4.8 percent in 2025.
GCC-Stat said that the fiscal budget reforms planned by GCC nations could contribute to striking a balance between maintaining economic growth and sustaining public spending.
According to the report, total public revenues in the GCC amounted to $641 billion in 2023, with oil revenues contributing 62 per cent. In 2022, public revenues in the region totaled $723 billion, with oil revenues accounting for 67 percent.
Total public spending in the GCC reached its highest level in 2023, hitting $639 billion. The report said that current spending accounted for 85 percent of public spending in 2023, while investment spending comprised 15 percent.
