DUBAI/MILAN/PARIS: The naming of a new boss at Etihad Airways presents the Gulf carrier with an opportunity to rethink its aggressive expansion strategy after the failure of minority-owned Alitalia underlined the big barriers to global growth. Ray Gammell was appointed interim CEO this week, days after Alitalia sought bankruptcy protection with $3.3 billion of debt. He replaces veteran boss James Hogan.
Hogan’s strategy was to buy up minority stakes in myriad airlines but the struggles of that strategy, most recently with Alitalia, are emblematic of a quandary peculiar to the industry. The path to growth for airlines often lies in gaining access to rivals’ routes. Yet in the EU, which mainly operates as one nation in aviation, foreigners cannot majority-own an airline. At Alitalia, the lack of full control meant that Etihad could not deal effectively with labor problems.
Since 2011, Abu Dhabi’s state-owned Etihad has spent billions of dollars buying minority stakes from Europe to Australia as it races to catch up with regional rivals Emirates and Qatar Airways.
Alitalia was Etihad’s eighth and most high-profile bet. But the €560 million ($609 million) investment lies in tatters, placing Hogan’s wider strategy under the microscope after staff overwhelmingly rejected its latest restructuring plans. Now the future of Etihad’s other leading investment, in Air Berlin, is also in doubt as the Gulf carrier pursues a strategy review that began last year. Like Alitalia, the German carrier has made big losses and it said two weeks ago it was seeking a new partner, which could include a new investor.
An Etihad spokesman said its review was ongoing but declined to comment on how its strategy might change or the impact of Alitalia’s failure on its global plans.
But a senior source at the Gulf carrier said lessons would be learned from the Italian investment and they would play a role in shaping future strategy.
Etihad’s strategy has allowed it to cut costs by pooling items like airplane procurement while offering a larger network; it says it brings together 600 destinations and over 700 aircraft.
Hogan’s “approach to partnerships did not pan out, but a few of his principles are still valid,” said Will Horton, a senior analyst at Australian aviation consultancy CAPA.
Etihad’s efforts to grow through minority stakes have at times been compared to Swissair’s failed “Hunter” strategy of the 1990s. Swissair’s buying binge, often acquiring stakes in ailing airlines, contributed to huge losses which eventually saw it grounded in 2001 and sold to Germany’s Lufthansa in 2005.
Hogan has always rejected the comparison, saying Etihad was doing things differently to Swissair and had demonstrated it could control costs. Etihad and its rivals have demonstrated spectacular growth but are increasingly pressured by a slowing Gulf economy due to relatively low oil prices. They have chosen different strategies to sidestep the regulatory dilemma governing foreign ownership and pursue global expansion.
Qatar Airways, like many other carriers, has entered one of three global alliances. These give some access to other carriers’ traffic rights without breaking ownership rules but allow only limited control over route-planning and costs.
Dubai’s Emirates, by contrast, mainly operates alone — an approach that gives it control of over its network and costs but also means it carries all the risk. The Middle East’s largest airline reported a drop in annual profit on Thursday for the first time in five years.
As the youngest of the three major Middle Eastern carriers, 14-year-old Etihad has looked to catch up and followed a third path of buying into other airlines to expand its reach.
When Hogan rescued Alitalia in 2014 after months of negotiations, he had been encouraged by two reformist prime ministers, Enrico Letta and his successor Matteo Renzi. Letta flew to Abu Dhabi to help clinch the deal.
“When Etihad arrived in 2014, we thought this time it would finally work, that this was it,” said Alitalia pilot Stefano Di Cesare of the Fit-Cisl union. Yet, Italian industry leaders say Etihad underestimated the country’s tangled politics and chronic labor strife.
Italian executives, officials and unions said in interviews with Reuters that alienating Alitalia’s workforce was among a series of missteps that ended Etihad’s Italian dream. Many also say Etihad underestimated the blistering growth of low-cost carriers Ryanair and easyJet. Without a majority stake, Etihad’s influence was limited despite being the largest single investor on 49 percent. And despite the lure of Italy’s important tourism market, it was forced to watch Alitalia’s efficient rivals mop up the benefits.
“There is no doubt that the idea to manage the company from Abu Dhabi was a very serious mistake,” Italian Industry Minister Carlo Calenda told Parliament last week.
The Etihad spokesman said Alitalia had been in financial trouble for decades and that its investment was welcomed wholeheartedly in Italy. Etihad believed the new restructuring plan developed by Alitalia’s management would have addressed its problems, he added.
In Germany too, Etihad had seen Air Berlin, its first investment in 2011, as the door to unrestricted access in a market where it has limited traffic rights with its own planes. But that airline has seen losses widen to a record €782 million in 2016. For now, Etihad continues to provide funding. Air Berlin says Etihad has granted another loan facility of €350 million and a letter of support for at least 18 months. But industry sources say Etihad could exit Air Berlin by seeking a deal with German flag carrier Lufthansa, with which Etihad is keen to work.
Lufthansa CEO Carsten Spohr said on Friday he had held talks with Abu Dhabi about the future of Air Berlin, but that it was up to the emirate to resolve Air Berlin’s €1.2 billion debt problem, which also prevents Lufthansa buying it.
Other investments such as Air Serbia and Air Seychelles have been more successful. There, Etihad was given hands-on management control and benefited from close diplomatic ties.
Even as the carrier picks up the pieces of its European adventure, Etihad faces its own restructuring that sources close to the company say has seen near-daily redundancies.
This may also weigh on the strategic decision facing Gammell, as he takes up his interim post this week, followed in coming months by a permanent successor to Hogan.
New Etihad boss to rethink strategy after Alitalia dream fails
New Etihad boss to rethink strategy after Alitalia dream fails
OPEC sees solid 2nd-half of 2025 for world economy, trims 2026 supply
LONDON/MOSCOW: OPEC said on Monday it expected the global economy to remain resilient in the second half of this year despite concerns about trade conflicts and trimmed its forecast for growth in oil supply from producers outside the wider OPEC+ group in 2026.
In a monthly report, the Organization of the Petroleum Exporting Countries left its forecasts for global oil demand growth unchanged in 2025 and 2026, after reductions in April, saying the economic outlook was robust despite trade concerns.
“The global economy has outperformed expectations so far in the first half of 2025,” OPEC said in the report.
“This strong base from the first half of 2025 is anticipated to provide support and sufficient momentum into a sound second half of 2025. However, the growth trend is expected to moderate slightly on a quarterly basis.”
OPEC also said supply from countries outside the Declaration of Cooperation — the formal name for OPEC+ — will rise by about 730,000 barrels per day in 2026, down 70,000 bpd from last month’s forecast.
Lower supply growth from outside OPEC+, which groups the Organization of the Petroleum Exporting Countries plus Russia and other allies, would make it easier for the wider group to balance the market. Rapid growth from US shale and from other countries has weighed on prices in recent years. (
PIF earns perfect score on Global SWF Index
RIYADH: Saudi Arabia’s Public Investment Fund earned a perfect score in the 2025 Global SWF Index, ranking it among just nine sovereign wealth funds worldwide for top governance, sustainability, and resilience.
The report from the sovereign investor benchmarking firm evaluates 200 of the world’s largest state-owned investment institutions across 25 indicators.
PIF’s flawless score this year marks a major milestone in its institutional development, following steady progress from 92 percent in 2023 to 96 percent in 2024. In contrast, the Saudi fund scored just 28 percent in 2020, according to Global SWF data.
In 2025, only nine sovereign investors globally achieved a full 100 percent score. Of those, three were based in the Europe–Middle East–Africa region: PIF, Ireland’s National Treasury Management Agency, and Nigeria’s Sovereign Investment Authority.
The Saudi fund led the group within EMEA and was the only Middle Eastern institution to reach a perfect score.
The 2024 report described PIF as “continuing to lead the charge,” highlighting that the fund voluntarily publishes an allocation and impact report as well as a self-assessment aligned with the Santiago Principles — despite not being a member of the International Forum of Sovereign Wealth Funds.
PIF’s sustainability strategy operates within the Kingdom’s broader drive for spending efficiency, a theme highlighted in a March analysis by PwC and Consultancy ME.
The report noted that public funds, anchored by institutions like PIF, are now being redirected toward high-impact sectors such as healthcare, tourism, and logistics, as well as artificial intelligence, combining fiscal prudence with strategic vision.
Moreover, a Strategy& whitepaper outlined how the nation is investing heavily in its energy transition — targeting approximately $235 billion toward renewables by 2030 and embedding efficiency mandates for state utilities — to support its net-zero ambitions and long-term economic resilience.
This alignment of sustainable investment and cost discipline reinforces PIF’s role in delivering value-driven transformation in line with Vision 2030.
The fund’s elevation to the top tier was driven by enhanced climate-risk disclosures, the launch of a dedicated sustainability report, strengthened board oversight, and the implementation of comprehensive business continuity frameworks.
These changes helped it secure full marks in all 25 areas of the GSR Scoreboard — 10 for governance, 10 for sustainability, and 5 for resilience.
With over $925 billion in assets under management, PIF is a cornerstone of Saudi Arabia’s Vision 2030, investing across strategic sectors, including tourism and logistics, as well as AI and renewable energy. Its strong transparency credentials and environmental, social and governance alignment have helped it build trust with global partners and signal its readiness for large-scale cross-border investment.
According to the 2024 PIF Effect report, the fund’s strategic projects, ranging from green bond issuances to renewable energy infrastructure, have generated a significant impact throughout Saudi Arabia and the world, enhancing local job creation, technology transfer, and environmental outcomes.
A February analysis by Consultancy ME underscored how the Kingdom’s broader focus on “spending efficiency is driving growth and building resilience,” with PIF playing a central role by prioritizing cost-effective, high-impact initiatives aligned with Vision 2030 objectives.
The full 2025 GSR report will be released on July 1.
Saudi Arabia advances net-zero goal with landmark carbon credit deal
RIYADH: More than 30 million tonnes of high-integrity carbon credits are set to be delivered by 2030 under an agreement aimed at supporting Saudi Arabia’s net-zero ambitions.
The long-term deal was signed between ENOWA — NEOM’s energy and water subsidiary — and the Voluntary Carbon Market Co., a unit of the Public Investment Fund.
According to the Saudi Press Agency, the credits will be sourced from global climate action projects, primarily in the Global South, with the first batch scheduled for delivery via the market platform in December.
This agreement is a key step in the Kingdom’s efforts to build a scalable voluntary carbon market, and will enable ENOWA to offset its current emissions as it develops renewable infrastructure to power NEOM’s future sectors and projects.
The deal also contributes to Saudi Arabia’s broader goal of achieving net-zero emissions by 2060 through the development of a robust carbon trading infrastructure focused on high-quality credits and meaningful climate impact.
“The long-term agreement with ENOWA aims to facilitate the delivery of more than 30 million tonnes of carbon credits by 2030. It represents a key milestone in the Kingdom’s journey to drive growth in global voluntary carbon markets,” said Riham El-Gizy, CEO of the Voluntary Carbon Market Co.
“As ENOWA develops an advanced renewable and clean energy system to power NEOM’s sectors and projects, this agreement will help it offset its current emissions and lay the foundation for long-term clean energy infrastructure,” she added.
VCM, which was established in October 2022 by PIF and the Saudi Tadawul Group, is 80 percent owned by the sovereign wealth fund. It operates a comprehensive ecosystem that includes an investment fund for climate mitigation projects, a carbon credit trading platform, and advisory services to support emissions reductions.
The global voluntary carbon market is projected to expand significantly, from an estimated $2 billion in 2020 to around $250 billion by 2050.
El-Gizy highlighted that the agreement also supports climate projects in the Global South by providing essential financing guarantees, helping developers plan with more certainty.
“To reach global net-zero emissions, climate-friendly projects that reduce or remove carbon from the atmosphere not only need funding but enhanced credibility,” she said.
Jens Madrian, acting CEO of ENOWA, emphasized the importance of the partnership for NEOM’s sustainability goals.
“ENOWA is working to meet NEOM’s energy needs sustainably. Over the past two years, we have acquired high-integrity carbon credits from the Voluntary Carbon Market auctions, and we are pleased to be the first company in the Kingdom to sign a long-term, large-scale agreement with the market,” he said.
The VCM launched Saudi Arabia’s first voluntary carbon credit trading platform on Nov. 12, 2024. The system offers secure transactions, price discovery tools, and access to carbon credit project data — forming the backbone of the Kingdom’s entry into the global market.
Integrated with international registries, the platform also supports Shariah-compliant infrastructure and includes features such as auctions, quote requests, and over-the-counter trading. A spot trading market is expected to launch in 2025.
ENOWA has previously participated in carbon credit auctions held in Saudi Arabia in 2022 and Kenya in 2023. These efforts align with NEOM’s wider objectives of building a sustainable urban model, fostering economic diversification, and improving quality of life.
Egypt’s annual inflation rises to 16.8% in May
- Analysis pointed to a renewed uptick in food prices and challenging base effects
- Increase influenced by rising prices of pharmaceutical products and fresh fruits
RIYADH: Egypt’s annual urban headline inflation rate rose to 16.8 percent in May, up from 13.9 percent in April, driven primarily by continued non-food price pressures, according to official data.
Released by the Central Bank of Egypt, the analysis pointed to a renewed uptick in food prices and challenging base effects, as the same period last year saw negative inflation.
These inflation trends come as Egypt’s broader economic landscape continues to be shaped by both domestic and global pressures. The government is navigating a delicate recovery amid external shocks, ongoing structural reforms, and efforts to manage public debt. Despite signs of resilience in credit and growth, inflation remains a key concern for both policymakers and households.
This backdrop helps explain Moody’s February decision to affirm Egypt’s Caa1 long-term foreign and local currency ratings with a positive outlook, citing improved prospects for debt servicing.
It also aligns with the country’s reported real gross domestic product growth of 3.9 percent in the first half of the current fiscal year, a signal of economic resilience, according to Prime Minister Mostafa Madbouly in May.
The newly released CBE report said: “The increase was particularly influenced by rising prices of pharmaceutical products and fresh fruits. Additionally, a moderate rise in inland transportation costs contributed to overall inflation, reflecting the second-round effects of April’s fuel price hike.”
It added: “Similarly, annual core inflation accelerated to 13.1 percent in May 2025 from 10.4 percent in April 2025. This increase reflects higher monthly core inflation, registering 1.6 percent in May 2025 compared to 1.2 percent in April 2025, as well as unfavorable base effects compared to the negative 0.8 percent recorded in May 2024.”
According to the financial institution, core inflation is a version of the headline consumer price index that removes the effects of short-term price shocks, allowing for a clearer view of long-term inflation trends by focusing only on stable, ongoing price changes rather than temporary fluctuations.
The report further indicated that monthly core inflation dynamics in May were influenced by rising prices in both food and non-food categories, such as engine oil, restaurant and cafe services, local transport, and housing rents. Seasonal effects linked to Eid Al-Adha also contributed, particularly with increased costs for Hajj and Umrah, clothing, and meat.
“Monthly core inflation recorded 1.6 percent in May 2025, reflecting the impact of previously mentioned changes in core CPI items. Retail items and services contributed to monthly core inflation by 0.74 and 0.68 percentage points, respectively, while core food contributed 0.22 percentage points,” the report said.
It also revealed that monthly urban headline inflation rose to 1.9 percent in May, up from 1.3 percent in April, primarily fueled by ongoing price pressures, along with increases in volatile food prices and public services such as inland transport and health care.
“Likewise, annual rural headline inflation increased to 16.2 percent in May 2025, compared with 13.1 percent in April 2025, with annual nationwide headline inflation rising to 16.5 percent in May 2025 from 13.5 percent in April 2025,” the CBE report said.
In May, Madbouly said that the country is preparing to transition away from its current economic reform program with the International Monetary Fund, which is scheduled to conclude by late 2026 or early 2027.
He said at the time that the government is developing a long-term national economic strategy that will extend to 2030, focusing on sustaining growth without relying on international institutions, according to an official release.
The remarks come as Egypt works to stabilize an economy that has been strained by record inflation, a weakening currency, and rising debt. In recent years, the government has implemented reforms aimed at unlocking external financing, attracting Gulf-backed investments, and completing a record sale of state assets.
Saudi Arabia adds 2 new shipping services, expanding reach to 19 destinations
JEDDAH: Connectivity across Saudi Arabia’s ports is set to improve with the addition of two new shipping services, expanding the Kingdom’s maritime trade reach to 19 global destinations.
The Saudi Ports Authority, known as Mawani, announced the launch of the IM2 shipping service at Jeddah Islamic Port, operated by Emirates Line and Wan Hai — marking the 22nd service added since the start of 2025.
With a handling capacity of 2,800 twenty-foot equivalent units, the service connects Jeddah to three major international ports — Mundra in India, Alexandria in Egypt, and Mersin in Turkiye.
The developments are part of Mawani’s ongoing efforts to enhance Saudi Arabia’s ranking in global performance indicators, support national export flows in line with the National Transport and Logistics Strategy, and solidify the Kingdom’s role as a pivotal logistics gateway connecting Asia, Africa, and Europe.
In a statement, Mawani said: “This service will contribute to enhancing the competitiveness of Saudi ports, facilitating global trade, opening new business opportunities, and raising the operational efficiency of Jeddah Islamic Port.”
This follows the introduction of the “Chinook Clanga” service by Mediterranean Shipping Co. a day earlier at King Abdulaziz Port in Dammam and Jubail Commercial Port. The new route connects Saudi Arabia’s eastern ports to 16 regional and global destinations.
The MSC service, initially announced in March, strengthens links between the Arabian Gulf and key ports such as Khalifa Bin Salman Port in Bahrain, Hamad Port in Qatar, Nhava Sheva in India, Colombo in Sri Lanka, and Singapore.
It also connects to Vung Tau and Haiphong in Vietnam; Nansha, Yantian, Ningbo, Shanghai, and Qingdao in China; and Busan in South Korea; as well as Seattle in the US; and Vancouver and Prince Rupert in Canada.
In line with Vision 2030, Saudi Arabia is accelerating efforts to become one of the world’s top 10 logistics hubs, with the maritime sector playing a central role.
Under its National Transport and Logistics Strategy, the Kingdom also aims to raise the sector’s gross domestic product contribution from 6 to 10 percent by 2030.
In 2024, Saudi ports handled over 320 million tonnes of cargo — a 14.45 percent year-on-year increase — while container exports grew 8.86 percent to exceed 2.8 million TEUs, according to Mawani.
Mawani also launched several initiatives in 2024, including new logistics zones at Jeddah Islamic Port and King Abdulaziz Port in Dammam, backed by SR2.9 billion ($773 million) in private investment.
These are part of a broader SR10 billion plan to develop 18 logistics parks nationwide.
