KAUST drives Vision 2030 with groundbreaking sustainability efforts 

Special KAUST is spearheading innovations in agriculture, energy, and water management, sectors vital to Saudi Arabia’s future.   
KAUST is spearheading innovations in agriculture, energy, and water management, sectors vital to Saudi Arabia’s future.   
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Updated 09 December 2024
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KAUST drives Vision 2030 with groundbreaking sustainability efforts 

KAUST drives Vision 2030 with groundbreaking sustainability efforts 
  • KAUST’s Accelerating Impact Strategy focuses on translating research into practical innovations, directly aligning with Vision 2030
  • KAUST is spearheading innovations in agriculture, energy, and water management, sectors vital to the Kingdom’s future

RIYADH: With a vision that merges innovative research and practical solutions, King Abdullah University of Science and Technology is shaping the future of Saudi Arabia by tackling sustainability challenges and driving economic innovation.   

Speaking to Arab News on the sidelines of the UN Convention to Combat Desertification COP16 in Riyadh, Sir Edward Byrne, the president of KAUST, emphasized the university’s critical role in achieving the Kingdom’s ambitious goals.

“KAUST has two major contributions to make: brilliant science to validate the principles and the direction forward, and technology implementation to enable the journey,” he said.   

KAUST’s Accelerating Impact Strategy focuses on translating research into practical innovations, directly aligning with Vision 2030.     

The university’s initiatives are addressing pressing environmental challenges, fostering economic development, and positioning KAUST as a global research leader.   

“We have several hundred projects currently geared to the environmental needs of the Kingdom,” Byrne said.      




Sir Edward Byrne, President of KAUST.

Turning vision into reality    

KAUST is spearheading innovations in agriculture, energy, and water management, sectors vital to Saudi Arabia’s future.    

The university’s Center for Sustainable Food Production is developing salt-resistant crops and advanced soil technologies to enhance dryland farming.   

“Our researchers are making better soil that holds water, enabling efficient farming with minimal resources,” Byrne said.  

In energy, KAUST is pioneering clean energy generation and battery storage solutions.   

“We’ve signed a memorandum on cryogenic carbon capture with the Ministry of Energy, showing how we can safely store carbon while transitioning to a diverse energy mix,” Byrne said. 

These innovations are not years away but are being developed and implemented now, benefiting both the Kingdom and the global community. 

Water sustainability is another priority. KAUST is exploring methods to reduce the energy cost of desalination by up to 90 percent. “Generating water is incredibly energy-intensive,” Byrne said.    

He added: “We’re looking at ways to make it far more efficient, which is crucial for the Kingdom’s sustainability goals.”   

KAUST’s contributions extend beyond the lab and into real-world applications, as Byrne highlighted partnerships with key entities such as SABIC, Saudi Aramco, and the Saudi Electricity Co., which are leveraging KAUST’s expertise to scale transformative technologies. 

Research backed by collaboration    

Prof. Sami Al-Ghamdi, a leading expert in environmental impact research at KAUST, highlighted the importance of collaboration.   

“Addressing sustainability and environmental issues requires partnerships,” Al-Ghamdi said.   

He added: “We work with ministries, companies like NEOM, and stakeholders to ensure our research translates into actionable solutions.”   

Al-Ghamdi stressed KAUST’s role in bridging the gap between science and implementation stating: “We don’t just create academic papers. We develop solutions that can be applied locally, nationally, and internationally.”   

 

For example, KAUST is advancing the Red Sea research agenda, previously underexplored, to tackle global challenges related to energy, water, and food security.   

Through startups and innovations, the university is driving real-world applications of its research.   

“We’re transforming lab research into market-ready solutions, addressing issues like climate and environmental sustainability,” Al-Ghamdi said.    

He pointed out that KAUST is also playing a significant role in promoting green jobs, aligning with global trends in sustainability-focused employment.    

Monitoring sustainability   

Prof. Matthew McCabe is at the forefront of KAUST’s Earth Observation Dashboard, a tool that monitors land degradation and restoration in real time.   




Prof. Matthew McCabe.

“We are looking for planetary variables that we can turn data into actionable intelligence. And that’s going to be of use for things like the Saudi Green Initiative and the African Forest Restoration Project,” McCabe said.   

The dashboard provides independent verification of restoration efforts, a critical need as global agreements like the Kunming-Montreal Protocol call for restoring 30 percent of land by 2030. 

“You will be aware that in COP there’s a number of targets and policies that have been signed by representative countries. The Kunming-Montreal Protocol, for instance, calls for the restoration of 30 percent of land by 2030,” McCabe said.     

He continued: “Their targets and signatures on pages. What we actually need is independent verification that these activities and actions are actually happening. The beauty of having a platform in space is that it can see everything. It sees everywhere. There’s no country that it’s not passing over at some point in time.”  

McCabe underscored the economic benefits of restoring ecosystems noting: “I think having a healthy environment is the centerpiece of a prosperous economy. Full stop, so certainly there's going to be a huge explosion in green jobs.”   

The platform’s capabilities extend beyond Saudi Arabia. “We’re using lessons learned here to support large-scale projects like Africa’s AFA100, which aims to restore 100 million hectares,” McCabe stated. 

He added: “We have shown we can get these actionable insights, turning data into knowledge. We’ve shown that we can do that here in the Kingdom. What we want to do is translate and scale that to everywhere, and we’re working with partners around the world.” 

This scalability ensures that innovations developed at KAUST can benefit global environmental restoration initiatives.    

Addressing land degradation   

In another interview with Arab News, Prof. Fernando Maestre at KAUST stressed that land is fundamental for achieving sustainability. 

“Our projects improve restoration activities and monitor biodiversity and carbon sequestration across Saudi ecosystems,” Maestre said.   

One critical gap Maestre’s team is addressing is the lack of data on soil organic carbon in arid regions.   

“There is a lack of data from Saudi Arabia, for instance, and for many other arid and hyperactive regions. One of the key objectives of our research program is to contribute to fill this gap, providing reliable data obtaining and standardize manner across major Saudi ecosystems on soil carbon,” he said.  

 

Maestre added: “Another key component for research is to provide the ground data that are needed to validate remote sensing approaches that are currently being used to monitor biodiversity and to characterize vegetation productivity, to achieving land degradation neutrality.”   

By combining advanced satellite technology with ground data, Maestre’s research supports both local and global sustainability efforts.   

However, Maestre emphasized the importance of local engagement. “Satellites won’t plant trees or move camels,” he said,  

He added: “We listen to local stakeholders and integrate their knowledge with cutting-edge science to create effective solutions.” 

Maestre’s approach involves building partnerships with local and international collaborators.   

“Collaboration is key to addressing global challenges. By working with over 200 scientists from 25 countries, we bring a global perspective to local issues,” he added.    

His team’s efforts are helping bridge the gap between research and real-world application, ensuring that science informs policy and practice effectively.    

 

A bright future ahead

Since its founding 15 years ago, KAUST has established itself as a global research powerhouse.   

“KAUST is only 15 years old in an incredibly short period of time, it’s recognized globally as one of the world’s truly great research universities that draws incredible engineering and scientific talent into the kingdom, and that’s happening in an ongoing way,” Byrne said. 

KAUST’s groundbreaking contributions are already transforming Saudi Arabia’s view on global science.    

Byrne emphasized the university’s role as a beacon for attracting scientific talent to the Kingdom. “KAUST’s success shows that Saudi Arabia can develop a world-class research university from the ground up, inspiring other initiatives like NEOM,” he said. 

Looking ahead, KAUST’s commitment to sustainability and innovation will continue to drive progress. 

By addressing challenges in energy, water, food, and land management, the university is ensuring that Saudi Arabia not only meets its Vision 2030 goals but sets an example for the world.  

“KAUST is the third great university I've led, and it is by far the most aligned with the world's needs. The work going on there at the moment to help develop a sustainable future for the planet is in my mind just incredible,” Byrne concluded. 

As the Kingdom advances its Vision 2030 goals, KAUST’s role in sustainability, economic development, and innovation is more vital than ever. 

With its unique combination of cutting-edge research, strategic partnerships, and actionable solutions, KAUST is not just shaping the future of Saudi Arabia but also setting a global benchmark for scientific excellence and sustainability. 


Saudi Arabia, UAE banks to post strong credit growth in 2025: Fitch Ratings

Saudi Arabia, UAE banks to post strong credit growth in 2025: Fitch Ratings
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Saudi Arabia, UAE banks to post strong credit growth in 2025: Fitch Ratings

Saudi Arabia, UAE banks to post strong credit growth in 2025: Fitch Ratings

RIYADH: Banks operating in Saudi Arabia and the UAE are expected to post strong credit growth in 2025, driven by high crude prices and the expansion of the non-oil economy, according to an analysis. 

In its latest report, Fitch Ratings projected that banks in the Kingdom will witness a financing growth of around 12 percent in 2025, about twice the average of the Gulf Cooperation Council region. 

The US-based agency added that corporates will account for almost 65 percent to 70 percent of new financing among Saudi banks in 2025. 

The analysis echoes similar views to those put forward by Moody’s in November, which predicted that Saudi Arabia’s Vision 2030 initiative, aimed at diversifying the Kingdom’s economy, could accelerate the growth of the banking sector in the country. 

In its report, Fitch Ratings said: “The operating environment for banks in the Kingdom is underpinned by high oil prices and government spending, which support the country’s giga-projects and the Vision 2030 strategy, resulting in solid non-oil gross domestic product growth.”

It added: “Fitch Ratings forecasts real non-oil GDP growth to average a still strong 4.5 percent over 2024–2025, compared to 5 percent over 2022–2023. We expect the sector’s financial metrics to remain strong in 2025.” 

The report said that the gradual execution of giga-projects should continue to underpin banks’ interest in this segment, although the current share of giga-project-related financing is minor for most rated banks.

However, the credit rating agency warned that the net foreign assets of banks in the Kingdom could continue to be negative in 2025 due to high-cost domestic term deposits and increased demand for foreign currencies. 

Regional outlook

According to the analysis, banks in the Middle East region are expected to maintain sound profitability, solid liquidity, and adequate capital buffers for their risk profiles in 2025, while asset quality should remain stable. 

In November, a report released by S&P Global said that banks in the GCC are expected to maintain strong asset quality, profitability, and ample liquidity through 2025 thanks to solid capitalization and well-managed balance sheets. 

S&P Global, however, warned that heightened geopolitical tensions and a sharp drop in oil prices could negatively affect the creditworthiness of financial institutions in the region. 

UAE

Fitch said that banks in the UAE will enjoy favorable business and operating conditions in 2025 thanks to high oil prices and increased economic activities. 

The analysis added that banks in the Emirates will achieve a loan growth of around 9 percent in 2025, a figure well above the GCC average but slightly below its Arab neighbor, Saudi Arabia. 

“We expect UAE banks’ funding and liquidity to remain strong and deposits will continue growing in line with lending. Liquidity will continue to be supported by large government deposits, driven by the sovereign’s solid net external assets position, still-strong fiscal metrics and recurring hydrocarbon revenues,” added Fitch. 

Egypt

The report highlighted the growth of the banking sector in Egypt and said that general business and operating conditions for financial institutions in the country are expected to improve next year. 

According to Fitch, falling inflation, improved investor confidence, and healthy foreign currency liquidity conditions are some of the major factors that could strengthen the banking sector in Egypt in 2025. 

Bahrain

In Bahrain, credit growth among banks is expected to be reasonable, albeit still modest, compared to GCC peers, at around 4.5 percent in 2025. 

“Fitch expects the business environment for banks in Bahrain to remain adequate, underpinned by some operating condition improvements. Lower lending rates should ease pressures on the sector’s corporate loan books, in particular real estate and contracting,” said the report. 

The credit rating agency predicted stable asset quality metrics for Bahraini banks in 2025, with lower rates providing relief to corporate borrowers and households and the sector profitability to remain sound.

Kuwait

According to the report, the banking sector’s credit growth in Kuwait is expected to hover between 5 percent and 6 percent in 2025, albeit hindered by still-high interest rates and only moderate real non-oil GDP growth. 

The analysis revealed that liquidity among Kuwaiti banks will remain strong next year due to large and stable deposits from government-related entities and gains from high oil prices. 

Oman

Fitch revealed that Oman’s Vision 2040 program aimed at diversifying the country’s economy could open more opportunities for banks in the future. 

“Oman’s Vision 2040 will provide growth opportunities for banks and ensure a healthy lending pipeline in key sectors of the economy, as well as reduce banks’ reliance on government spending in the long run. However, the absence of a deep capital market limits access for corporates to funding sources other than the country’s domestic banks,” said the study. 

The analysis added that liquidity among Omani banks will continue to be supported by stable government and government-related entity deposits, while high oil prices are expected to support the growth in customer deposits. 

Qatar

In Qatar, the general business and operating environment for banks are projected to improve in 2025. 

The report revealed that the credit growth among Qatari banks could pick up to 5.5 percent next year but will remain below that of Saudi Arabia and the UAE due to their particularly strong operating conditions. 

Jordan

In Jordan, the market conditions of banks are expected to remain challenging next year, while the sector will witness a lending growth of 3.5 percent. 

“The operating environment for banks in Jordan remains challenging due to below-potential and structurally weak real GDP growth, and high unemployment and geopolitical risks, which negatively affect tourism and exports,” concluded Fitch.


Fitch affirms Saudi Aramco at ‘A+’ with stable outlook

Fitch affirms Saudi Aramco at ‘A+’ with stable outlook
Updated 1 min 43 sec ago
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Fitch affirms Saudi Aramco at ‘A+’ with stable outlook

Fitch affirms Saudi Aramco at ‘A+’ with stable outlook

RIYADH: Fitch Ratings has reaffirmed Saudi Aramco’s long-term issuer default ratings at “A+” for both foreign- and local-currency ratings, with a stable outlook, reflecting the oil giant’s strong financial standing and its crucial role in the Saudi economy.

The rating is underpinned by Aramco’s robust financial profile, though it is capped by the rating of its majority shareholder, the Saudi government, which owns 81.48 percent of the company. The Public Investment Fund holds an additional 16 percent. According to Fitch, this structure influences Aramco’s ratings due to the government’s significant stake and control.

Fitch assigned Aramco a standalone credit profile of “aa+,” highlighting its solid financial position. The agency also gave the company a short-term IDR of “F1+,” which is aligned with the sovereign rating.

The affirmation comes after Aramco’s strong performance in 2023, when its total liquid production averaged 10.7 million barrels per day, and its hydrocarbon output reached 12.8 million barrels of oil equivalent per day. This performance outpaced major global peers, including Shell, TotalEnergies, and BP.

In its statement, Fitch noted that Aramco’s rating is constrained by Saudi Arabia’s rating, in line with Fitch’s Government-Related Entities Rating Criteria. This is due to the government’s substantial influence over Aramco, particularly its regulation of production levels in accordance with OPEC+ commitments.

Fitch also emphasized the company’s “Very Strong” governance, reflecting the government’s strategic oversight, including the ability to determine Aramco’s maximum sustainable oil production capacity.

Aramco’s conservative financial management further bolsters its credit profile, with the company’s leverage expected to remain lower than that of other major global oil and gas companies. Fitch also praised Aramco’s sustainable dividend policy, which is set to include a base dividend of $81.2 billion in 2024, with additional performance-linked payouts.

“Under our oil price assumptions, we expect Saudi Aramco’s capital expenditures and base dividend payments to be broadly covered by operating cash flow. We also assume that the company has the flexibility to adjust its dividend commitment if oil prices decline or if capital expenditures exceed current forecasts,” Fitch said.

In 2024, Aramco is expected to pay total dividends of $124 billion, including $43.1 billion in performance-linked payouts, reflecting record cash flows from 2022-23. Fitch forecasts a reduction in capital expenditures from $50 billion in 2024 to $35 billion by 2028, with annual dividends projected to decrease to $82 billion over the same period.

The agency also highlighted Aramco’s critical role in Saudi Arabia’s economy, noting the company’s importance as a key provider of feedstock for power generation and other essential industries, in addition to its vast reserves and production capacity.

Fitch anticipates that the Saudi government would provide support if needed, although the company’s strong financial position has historically not required direct state intervention.

On a national level, Fitch assigned Aramco a long-term rating of “AAA (sau)” based on its substantial reserve base, strong profitability, and market position.

The company’s standing was also compared favorably to other prominent Saudi entities, such as Saudi Basic Industries Corp. and Saudi Electricity Co., within Fitch’s National Scale Rating framework.


Robust manufacturing sector lifts Saudi industrial index by 5%: GASTAT

Robust manufacturing sector lifts Saudi industrial index by 5%: GASTAT
Updated 10 December 2024
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Robust manufacturing sector lifts Saudi industrial index by 5%: GASTAT

Robust manufacturing sector lifts Saudi industrial index by 5%: GASTAT

RIYADH: Saudi Arabia’s industrial production index rose by 5 percent year on year in October, driven by robust growth across key economic sectors, official data showed. 

According to figures from the General Authority for Statistics, the index also edged up 0.4 percent month on month, reaching 106.9 points. 

The mining and quarrying sub-index, which includes oil production, recorded a slight 0.4 percent annual increase, with oil output ticking up to 8.97 million barrels per day from 8.94 million a year earlier. 

Despite the annual increase, monthly performance for this sector remained stable with no significant changes recorded between September and October. 

The manufacturing sector continued its robust growth, recording a 12.4 percent year-on-year increase in October. This expansion was primarily driven by a 32.6 percent surge in the production of coke and refined petroleum products compared to the same month of 2023. 

Saudi Arabia’s industrial production, central to Vision 2030, is driving economic diversification through manufacturing and non-oil growth. 

Other contributors to the sector’s growth included the manufacture of chemicals and chemical products, which rose by 0.6 percent, and food products, which grew by 4.8 percent. 

On a month-to-month basis, the manufacturing sub-index advanced by 1.1 percent, driven by a 2.7 percent increase in coke and refined petroleum products and a 0.2 percent rise in chemicals and chemical products.  

Other manufacturing activities exhibited varied growth rates. The manufacture of non-metallic mineral products increased by 1.8 percent year-on-year and 0.8 percent month-on-month. 

Basic metals manufacturing expanded by 4.3 percent annually and 1 percent compared to the previous month. 

Paper and paper product manufacturing saw an 11 percent annual rise and a 1.1 percent monthly increase, while the production of electrical devices grew by 9.2 percent year-on-year and 0.1 percent month on month. 

Furniture manufacturing posted notable growth, rising 14.4 percent annually and 0.5 percent monthly. Other economic activities within the manufacturing sector recorded a 4.3 percent year-on-year increase and a 0.3 percent monthly uptick. 

In the utilities sector, the sub-index for electricity, gas, steam, and air conditioning supply rose by 6.2 percent year on year. Similarly, the sub-index for water supply and sewerage as well as waste management activities climbed by 8.4 percent over the same period. 

These sectors also recorded positive monthly growth. The sub-index for electricity, gas, steam, and air conditioning supply rose by 0.9 percent compared to September 2024, while the water supply, sewerage, and waste management sub-index increased by 1.4 percent. 

In October, oil-related activities expanded by 5.4 percent year on year and 0.5 percent month on month. 

Non-oil activities also showed solid growth, rising 4 percent annually and 0.3 percent monthly. This highlights Saudi Arabia’s commitment to diversifying its industrial base as part of its Vision 2030 initiative. 

The IPI tracks changes in industrial output, using the International Standard Industrial Classification framework to monitor sectors such as mining, manufacturing, utilities, and waste management. 


Pakistan stock market crosses 111,000 points on hopes of interest rate cut 

Pakistan stock market crosses 111,000 points on hopes of interest rate cut 
Updated 10 December 2024
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Pakistan stock market crosses 111,000 points on hopes of interest rate cut 

Pakistan stock market crosses 111,000 points on hopes of interest rate cut 
  • KSE-100 index climbed 1,482.06 points, or 1.35 percent, to reach 111,452.44 points
  • Pakistan slashed interest rates by 250 basis points in November to revive economy

ISLAMABAD: The Pakistan Stock Exchange (PSX) crossed 111,000 points during intra-day trading on Tuesday, analysts said, amid hopes of an interest rate cut.
The benchmark KSE-100 index climbed 1,482.06 points, or 1.35 percent, to reach 111,452.44 points from the previous close of 109,970.38 points, making it the 10th consecutive session when shares traded in green at the market.
Analysts credited the rally to positive sentiment prevailing in the market amid an optimistic overall outlook.
“Not unusual to see profit-taking come through after the steep recent increase,” Raza Jafri, head of equities at Intermarket Securities, told Arab News. “The overall outlook remains bullish though on reducing interest rates and the government’s commitment to reforms.”
Pakistan had slashed interest rate by 250 basis points in November to help revive a sluggish economy, amid a major drop in the annual inflation rate. The State Bank has slashed interest rate by 700 basis points (bps) in four consecutive meetings since June, bringing it to 15 percent.
According to a poll by Topline Securities, 71 percent of participants expect the central bank to announce a minimum rate cut of 200bps at the upcoming Monetary Policy Committee meeting on Dec. 16.
Arif Habib Corporation CEO Ahsan Mehanti said stocks remained bullish after National Savings Schemes rates were cut, amid speculation of further reductions.
“Robust economic indicators, rupee stability and recovery in global equities on receding geo-political tensions played a catalyst role in record surge at the PSX,” he told Arab News.
Pakistan’s annual consumer inflation also dropped to 4.9 percent in November below government projections, primarily due to a high base from the previous year. This marked a decline from 7.2 percent in October and a significant fall from the nearly 40 percent multi-decade high recorded in May 2023.


UAE to impose 15% minimum top-up tax on large multinationals from January

UAE to impose 15% minimum top-up tax on large multinationals from January
Updated 10 December 2024
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UAE to impose 15% minimum top-up tax on large multinationals from January

UAE to impose 15% minimum top-up tax on large multinationals from January
  • DMTT is part of the OECD’s global minimum corporate tax agreement which has 136 signatories
  • UAE’s finance ministry said it is also considering introducing several corporate tax incentives

DUBAI: The UAE will impose a minimum top-up tax (DMTT) of 15 percent on large multinational companies operating in the country starting in January, the finance ministry said on Monday as the government seeks to boost non-oil revenue.
The DMTT is part of the OECD’s global minimum corporate tax agreement which has 136 signatories, including the UAE, to ensure big companies pay a minimum 15 percent and to make tax avoidance harder.
In amendments to the corporate tax law, the UAE’s finance ministry said the DMTT will apply to companies with consolidated global revenue of 750 million euros ($793.50 million) or more in at least two out of the four financial years preceding the ones in which the tax comes into effect.
The UAE, including Dubai, is a hub for multinationals in the Middle East and the tax amendments come a year after the UAE began rolling out a 9 percent business tax, with exemptions for the many free zones that power it's economy.
The DMTT comes under the Organization for Economic Co-operation and Development’s Two-Pillar Solution, which stipulates that large multinational enterprises pay a minimum effective tax rate of 15 percent on profits in each country where they operate.
The UAE’s finance ministry said it is also considering introducing several corporate tax incentives, including one for research and development that would apply for tax periods starting in 2026.
The expenditure-based incentive would offer a potential 30 percent to 50 percent refundable tax credit depending on the size of the company’s operations in the UAE and revenue, the ministry added.
A refundable tax credit for high-value employment activities that would be granted to companies as a percentage of eligible income costs for employees is also being considered and could be applied as early as Jan. 1 2025, the ministry said.
Such proposed incentives remain subject to legislative approval.