Saudi Aramco, Sumitomo Chemical waive $1bn debt for Petro Rabigh

The move aligns with Aramco’s plans to expand its downstream operations and Sumitomo Chemical’s transition from commodity to specialty chemicals. File
The move aligns with Aramco’s plans to expand its downstream operations and Sumitomo Chemical’s transition from commodity to specialty chemicals. File
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Updated 29 August 2024
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Saudi Aramco, Sumitomo Chemical waive $1bn debt for Petro Rabigh

Saudi Aramco, Sumitomo Chemical waive $1bn debt for Petro Rabigh
  • Aramco and Sumitomo Chemical have each agreed to waive $500 million in revolving shareholder loans and any associated commissions
  • Debt waiver is part of broader turnaround strategy to enhance Petro Rabigh’s profitability, balance sheet, and liquidity

RIYADH: Saudi oil giant Rabigh Refining and Petrochemical Co., known as Petro Rabigh, has had $1 billion in debt waived by its two largest shareholders as part of its refinery upgrade plans.

According to a statement on Tadawul, Saudi Arabia’s Aramco and Japan’s Sumitomo Chemical Co. have each agreed to waive $500 million in revolving shareholder loans and any associated commissions.

RSLs are loans from shareholders that can be drawn upon and repaid multiple times within a set period, typically used to support operations, finance projects, or address short-term cash flow needs.

This debt waiver is part of a broader turnaround strategy aimed at enhancing Petro Rabigh’s profitability, balance sheet, and liquidity.

The move aligns with Aramco’s plans to expand its downstream operations and Sumitomo Chemical’s transition from commodity to specialty chemicals.

Earlier in August, Aramco announced it would acquire an additional 22.5 percent stake in Petro Rabigh from Sumitomo Chemical for $702 million. This acquisition, priced at SR7 per share, is expected to make Aramco the majority shareholder with approximately 60 percent of the stake, reducing Sumitomo Chemical’s share to 15 percent.

The filing revealed that these agreements are related-party transactions, with Aramco and Sumitomo Chemical each owning 37.5 percent of Petro Rabigh. The debt waiver is anticipated to positively impact the company’s financial position, which will be detailed in a future announcement.

When the initial acquisition announcement was made, Sumitomo Chemical indicated it would reinvest the proceeds into Petro Rabigh, while Aramco pledged additional funding to match Sumitomo Chemical’s $702 million. The combined funding is set to reach $1.4 billion. Additionally, both companies agreed to phased loan waivers totaling $750 million each, resulting in a $1.5 billion reduction in Petro Rabigh’s liabilities.


ACWA Power secures $703m for Egyptian wind power plant 

ACWA Power secures $703m for Egyptian wind power plant 
Updated 1 min 50 sec ago
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ACWA Power secures $703m for Egyptian wind power plant 

ACWA Power secures $703m for Egyptian wind power plant 

RIYADH: Saudi utility giant ACWA Power has secured SR2.63 billion ($703 million) in financing to develop, operate, and maintain a 1,100-megawatt wind power plant in Egypt’s Suez governorate. 

In a statement to Tadawul, the company said the funding was sourced from the European Bank for Reconstruction and Development, African Development Bank, and British International Investment. 

Additional lenders include DEG Deutsche Investitions, the OPEC Fund for International Development, and Arab Petroleum Investments Corp., with a loan tenure of 20 years. 

The project aligns with Egypt’s green energy ambitions, aiming to generate 42 percent of the nation’s electricity from renewable sources. 

Principal debt for the project was financed by Standard Chartered Bank and Arab Bank through the European Bank for Reconstruction and Development’s B financing structure. The total investment cost of the plant is SR4.13 billion, with ACWA Power holding a 70 percent stake. 

The firm plays a pivotal role in Saudi Arabia’s renewable energy strategy, contributing to the Kingdom’s goal of generating 50 percent of its power from green sources. The Tadawul-listed company’s operations span 13 countries, underscoring its global ambitions in the utility sector. 

ACWA Power recently announced its entry into China, securing over 1 gigawatt of renewable energy projects. These initiatives, which include solar photovoltaic and wind energy, are jointly owned with leading Chinese renewable energy firms. 

Earlier this month, ACWA Power launched three renewable projects in Uzbekistan, involving wind, solar, and battery storage, with a combined investment of $3 billion. 

In October, the company signed four agreements worth SR6.69 billion during the Future Investment Initiative in Riyadh, targeting renewable energy and storage projects across the Gulf Cooperation Council region, China, Central Asia, and North Africa. 

The firm’s net profit for the first nine months of 2024 rose 15.74 percent year on year to SR1.25 billion, driven by increased revenue from electricity sales and operation and maintenance activities. 

Founded in 2004, ACWA Power manages a portfolio of 90 projects valued at SR94 billion, according to its website. The company continues to expand its footprint as a leader in renewable energy and utility services worldwide


Saudi Arabia, Canada to strengthen economic ties after high-level meeting

Saudi Arabia, Canada to strengthen economic ties after high-level meeting
Updated 4 min 47 sec ago
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Saudi Arabia, Canada to strengthen economic ties after high-level meeting

Saudi Arabia, Canada to strengthen economic ties after high-level meeting

RIYADH: Economic cooperation was the focus of a high-level meeting between a top Saudi official and the Canadian Ambassador as relations between the nations continue to progress.

The Kingdom’s Minister of Economy and Planning Faisal Al-Ibrahim held talks with Jean-Philippe Linteau at his department’s headquarters in Riyadh, according to the Saudi Press Agency.

This meeting signifies a positive development in Saudi-Canadian relations, which were restored in May 2023 after a five-year diplomatic rift. 

The restoration followed discussions between Saudi Crown Prince Mohammed bin Salman and Canadian Prime Minister Justin Trudeau on the sidelines of the Asia-Pacific Economic Cooperation forum in Bangkok in November 2022.

Since normalizing relations, Canada is keen to build a “great relationship” with the Kingdom, Linteau said during an interview with Arab News in February.

The recent meeting between Al-Ibrahim and the top diplomat reinforces their commitment to deepening cooperation and tackling mutual challenges.

In January, Saudi Arabia and Canada agreed to re-exchange trade delegations, aiming to improve economic relations and increase trade and investment volumes.

Hassan Al-Huwaizi, president of the Saudi Chambers of Commerce, emphasized that establishing a joint business council would provide a platform for business leaders to promote activities and engage in partnerships, facilitating continuous interaction and information exchange about market opportunities.


2024 marks Saudi Arabia’s bold leap toward technological leadership

2024 marks Saudi Arabia’s bold leap toward technological leadership
Updated 30 sec ago
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2024 marks Saudi Arabia’s bold leap toward technological leadership

2024 marks Saudi Arabia’s bold leap toward technological leadership
  • Kingdom launched ALLaM, a generative AI model tailored specifically for the Arabic language
  • Technology also played a critical role during the Hajj season

RIYADH: Saudi Arabia’s digital transformation journey reached new heights in 2024, solidifying its position as a global leader in technology and innovation. 

Guided by Vision 2030, the Kingdom continued to reshape its economic and social landscapes through extensive digital initiatives spanning government, the private sector, and international partnerships. From advancements in artificial intelligence to significant strides in the digital economy, Saudi Arabia’s achievements over the past year set the stage for even bolder ambitions in 2025.

Revolutionary achievements

One of the standout accomplishments of 2024 was the consolidation of government data. The creation of a centralized data lake integrated 27 large systems with over 322 systems in the National Data Bank. This initiative not only enhanced the quality of national data but also automated data-sharing processes, fostering collaboration across entities and delivering substantial cost savings.

Saudi Arabia also launched ALLaM, a generative AI model tailored specifically for the Arabic language. Integrated into IBM’s Watsonx platform, ALLaM was recognized as the leading generative AI model for Arabic, as measured by the Arabic MMLU benchmark. This innovation underscored the Kingdom’s commitment to preserving its cultural and linguistic heritage while advancing global AI standards.

“Saudi Arabia’s digital transformation initiatives, driven by Vision 2030, have created a strong foundation for the Kingdom to emerge as a global leader in technology and innovation,” said Louise Bou Rached, sales director for the Middle East, North Africa, and Turkiye region at Milestone Systems, in an interview with Arab News. 

She continued: “The strategic focus on AI, IoT (Internet of Things), 5G, and cloud infrastructure is enabling the development of smart cities, digital governance, and innovative industries.”

Bou Rached highlighted initiatives like NEOM and The Line, which combine cutting-edge technology with sustainability to redefine urban living and attract global attention. “This transformation is enhancing the Kingdom’s international reputation and driving economic diversification, positioning Saudi Arabia as a model for other nations aspiring to achieve technological leadership,” she said.

A key element in this transformation has been the integration of advanced video management systems across smart city projects, improving security, efficiency, and data-driven decision making. “VMS technology ensures the seamless operation of urban environments and aligns with the Kingdom’s broader vision of fostering a secure and intelligent ecosystem,” Bou Rached added.

Technology also played a critical role during the Hajj season, with advanced AI solutions ensuring the safety and well-being of millions of pilgrims. Smart platforms like Basier and Sawaher deployed over 400 AI-linked cameras across key locations, including tunnels and the Jamarat facility. These systems provided real-time crowd density analysis, enabling authorities to address emergencies efficiently. This initiative marked a significant leap in combining AI with large-scale event management.

“Projects involving smart cities, artificial intelligence, and renewable energy are shaping new industries and lifestyles in Saudi Arabia,” said Arun Leslie John, the chief market analyst at Century Financial, in an interview with Arab News. Smart cities like NEOM, he noted, are redefining urban living with intelligent systems that optimize resource management, sustainability, and citizen engagement.

“AI is reshaping industries, from health care to logistics, by enabling predictive analytics, automating processes, and improving efficiency,” he added. John also pointed out that the implementation of Open RAN technology is “seriously changing the scene of the country’s telecommunications sector, offering flexible and cost-efficient network infrastructure, essential for extending 5G and upcoming 6G networks.” 

“Companies specializing in such technologies can take advantage of the emergent demand for improved telecommunication solutions,” John said.

AI discussions

Saudi Arabia reinforced its position as a global AI leader by hosting the third Global AI Summit, which brought together world leaders, researchers, and industry experts to discuss ethics, developments, and the future of AI. The event emphasized the Kingdom’s commitment to becoming a hub for AI innovation.

The country also launched the Open Access National Gateway, providing scientists and researchers access to more than 1,000 advanced laboratories. This initiative bolstered Saudi Arabia’s ability to attract top talent, foster innovation, and drive scientific breakthroughs across various fields. 

The establishment of the National Semiconductor Hub marked a significant milestone in the Kingdom’s drive for technological independence. Launched in partnership with top institutions like King Abdullah University of Science and Technology, the hub supports multiple initiatives, including a joint master’s program with the University of California and Princess Nourah University. Over 850 professionals were trained to localize semiconductor technology, further cementing Saudi Arabia’s place in the global tech landscape.

“Saudi Arabia’s investment in space exploration is about exploring the cosmos and leveraging satellite technology to advance telecommunications, agriculture, and disaster management. These advancements are driving diversification away from oil dependency, creating a high-tech economy that attracts global investments and cultivates homegrown innovation,” Bou Rached noted.

Saudi Arabia’s digital transformation efforts received global recognition in 2024. The Kingdom achieved several milestones such as securing the second place among G20 countries in the ICT Development Index and sixth place globally in the UN E-Government Development Index, climbing 25 positions.

These achievements underscored Saudi Arabia’s progress in delivering efficient, accessible, and citizen-centric digital services.

In the space sector, Saudi Arabia celebrated the graduation of 15 startups from the Space Tech Entrepreneurship Program, which offered financial support, training, and mentorship. This initiative attracted both domestic and international investments, highlighting the Kingdom’s growing influence in the space industry.

The Kingdom also secured over SR41 billion ($10.9 billion) in foreign and domestic investments in technology and data centers in 2024. These investments were complemented by enhancements to digital infrastructure, including efforts to localize emerging technologies and establish a thriving innovation ecosystem.

Notable initiatives included the Cloud First Policy, which prioritized cloud-based solutions across government entities and the expansion of 5G networks, positioning Saudi Arabia among the top 10 countries globally for mobile Internet speeds.

In March, the Kingdom unveiled an updated Digital Transformation Index, designed to elevate public sector adherence to technological advancements. The revised standards, reduced from 125 to 96, aimed to improve the quality of e-government services in line with Vision 2030. More than 233 entities participated in workshops to refine methodologies, contributing to an 85.53 percent overall progress rate in digital transformation.

‘Into New Worlds’

Scheduled for February 2025 in Riyadh, LEAP – the Kingdom’s premier tech-focused conference and exhibition – will bring together 1,000 expert speakers, 680 startups, and over 215,000 global attendees. Under the theme “Into New Worlds,” the event will explore cutting-edge technologies and their practical applications. The 2024 edition of LEAP surpassed previous ones, with agreements worth more than $12 billion being signed.

Greater achievements on the horizon

Saudi Arabia’s roadmap for 2025 builds on the transformative momentum of 2024, with ambitious plans designed to further elevate the Kingdom’s global standing in technology and innovation. In AI and data advancements, efforts will focus on increasing the number of datasets in the National Data Bank to improve accessibility and foster greater collaboration.

The adoption of AI across government entities will be further strengthened to stimulate innovation and improve service delivery. Expanding the scope of the National Smart Cities Platform will be a key priority, with an emphasis on security, safety, and sustainability, while introducing new use cases to enhance quality of life and environmental conservation.

In space exploration, Saudi Arabia plans to manufacture and launch a satellite dedicated to investigating space weather as part of the Artemis 2 mission to the moon. Economically, the Kingdom aims to bolster the ICT sector’s contribution to its gross domestic product by introducing two additional multibillion-dollar companies, bringing the total number of such companies to eight.

As 2025 unfolds, Saudi Arabia is poised to continue shaping the future of technology, creating growth opportunities, and enhancing the quality of life for its citizens. By building on its 2024 achievements, the Kingdom is well-positioned to realize its Vision 2030 goals and establish itself as a global leader in the digital era.


Saudi banks’ mortgage lending surges to near 3-year high of $2.7bn

Saudi banks’ mortgage lending surges to near 3-year high of $2.7bn
Updated 31 December 2024
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Saudi banks’ mortgage lending surges to near 3-year high of $2.7bn

Saudi banks’ mortgage lending surges to near 3-year high of $2.7bn

RIYADH: Saudi banks issued SR10.06 billion ($2.7 billion) in new residential mortgages in November, a 51.23 percent increase compared to the same month last year, according to recent data. 

Figures from the Kingdom’s central bank, also known as SAMA, show this is the highest monthly amount in over two years, underscoring robust activity in the Saudi housing market. 

Houses accounted for the majority of these loans at SR6.5 billion, or 65 percent, followed by apartments at 31 percent and land purchases at 4 percent. 

This comes as Saudi Arabia’s residential market continued to show strong demand fundamentals in the third quarter of 2024, with annual growth in sales transaction volumes across major metropolitan areas such as Riyadh, Jeddah, and Dammam, according to a report released earlier this month by CBRE Middle East, a global leader in commercial real estate. 

Apartment lending saw the highest annual growth rate, surging 60.6 percent, followed by houses at 49 percent and land at 24.35 percent in November, SAMA showed. 

The steady rise in the share of apartment financing, increasing from 14 percent in 2018 to 31 percent in 2024, highlights a notable shift in Saudi Arabia’s residential real estate landscape.

These homes are increasingly favored by expatriates and smaller families, offering a cost-effective alternative to traditional houses. 

They also cater to the affordability needs of young Saudis entering the housing market amid escalating property prices. 

Conversely, the share of house financing has declined from 75 percent in 2018 to 65 percent in 2024, reflecting changing demographics and lifestyle preferences. 

Riyadh, in particular, has witnessed a surge in demand fueled by population growth and a steady inflow of expatriates attracted by expanding job opportunities. 

Over the 12 months leading to the third quarter, transaction volumes in Riyadh surged by 31 percent year on year, reaching 24,000 sales, according to the CBRE report. 

However, this heightened demand has outpaced the supply of new housing units, leading to supply constraints and further driving up real estate prices. 

CBRE report showed that the average villa price in Riyadh has increased by more than 5 percent over the past year, with further value growth expected in 2025 as high-quality modern inventory is completed and supply-demand dynamics remain tight. 

Villa sales values in Riyadh currently average nearly SR6,000 per sq. meter, with potential for further growth in the coming quarters. Apartment growth has been more modest at approximately 4 percent year on year, with prices now averaging close to SR5,000 per sq. meter, the report added. 

The Kingdom is accelerating residential construction, particularly in Riyadh, as part of its Vision 2030 agenda to accommodate a growing population and attract international talent. 

While major projects are underway to address the housing shortage, supply constraints remain a pressing challenge. 

Limited land availability and construction delays have intensified the housing crunch, pushing property prices higher. These challenges are most pronounced in urban centers like Riyadh, where the demand-supply gap is particularly acute. 

The transformation of Saudi Arabia’s housing market reflects broader economic and societal changes. 

As the Kingdom continues efforts to diversify its economy, attract foreign investment, and enhance quality of life, demand for varied housing options, including apartments, is expected to grow. 

SAMA’s latest figures highlight a market in transition, adapting to the needs of a dynamic and evolving population. 

With ongoing construction and strategic urban planning, Saudi Arabia aims to balance demand and supply, ensuring sustainable growth in its residential real estate sector. 


Saudi Arabia’s unemployment rate hits 3.7%: GASTAT

Saudi Arabia’s unemployment rate hits 3.7%: GASTAT
Updated 31 December 2024
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Saudi Arabia’s unemployment rate hits 3.7%: GASTAT

Saudi Arabia’s unemployment rate hits 3.7%: GASTAT
  • Labor force participation across Saudis and non-Saudis reached 66.6%
  • Unemployment rate increased by 0.4 percentage points

RIYADH: Saudi Arabia’s unemployment rate dropped to 3.7 percent in the third quarter of 2024, down 0.5 percentage points from last year, official data showed. 

According to data released by the General Authority for Statistics, labor force participation across Saudis and non-Saudis reached 66.6 percent during the third quarter, reflecting a year-on-year increase of 0.2 percentage points and a quarterly rise of 0.4 percentage points. 

The unemployment rate increased by 0.4 percentage points compared to the second quarter of this year. 

Saudi Arabia’s improving job market aligns with Vision 2030, the Kingdom’s blueprint for creating job opportunities for Saudis and driving economic growth. Strengthening the labor market is key to the Kingdom’s long-term socio-economic strategy. 

Joblessness among Saudi nationals rose slightly to 7.8 percent in the third quarter, up 0.7 percentage points from the previous quarter but down 1 percentage point compared to the same period in 2023.

The labor force participation rate for Saudis rose by 0.7 percentage points quarter on quarter to 51.5 percent. 

“The employment-to-population ratio for Saudis also increased by 0.2 percentage points compared to the second quarter of 2024, reaching 47.4 percent, and increased by 1.1 percentage points compared to the third quarter of 2023,” said GASTAT. 

To address unemployment, Saudi Arabia launched Jadarat, a unified employment platform, in June to connect job seekers with opportunities in both the public and private sectors. 

The participation rate for Saudi females reached 36.2 percent in the third quarter, an increase of 0.8 percentage points compared to the second quarter. 

“The employment-to-population ratio of Saudi females increased by 0.5 percentage points reaching 31.3 percent. Meanwhile, the unemployment rate of Saudi females increased by 0.8 percentage points recording 13.6 percent, compared to the previous quarter of 2024,” said GASTAT. 

Among Saudi men, labor force participation climbed to 66.9 percent, up 0.6 percentage points quarter on quarter, while their unemployment rate increased by 0.7 percentage points to 4.7 percent. 

GASTAT’s data highlighted that 95.6 percent of unemployed Saudis are open to working in the private sector. Of these, 77.5 percent of women and 91.1 percent of men are willing to work at least eight hours a day. 

Additionally, 60.9 percent of unemployed Saudi women and 44 percent of unemployed Saudi men are willing to commute at least one hour to their workplace.