LONDON: Moving Qantas’ stopover hub from Dubai back to Singapore next year will have limited impact on the emirate’s tourism sector, according to industry experts.
While Dubai pitches itself as the ideal stopover destination for travelers looking to break up long-haul journeys between Europe, Africa and Asia, the actual volume of passengers on Qantas flights that opt to spend a few days in the emirate mid-journey is fairly limited, said Will Horton, senior analyst for North Asia and Middle East, at Capa — Centre for Aviation.
“We’re talking about relatively small volumes in terms of capacity. Most of the passengers continued onwards to London and only some made a stopover in Dubai,” he said.
From March 2018, Qantas’ daily A380 London-Dubai-Sydney flight will be rerouted via Singapore. The switch back to the Australian airline’s original stopover hub was announced at the end of August when Dubai’s flagship airline Emirates and Qantas confirmed the extension of their partnership agreement originally signed in 2012.
Qantas previously announced in April that it would replace its existing London-Dubai-Melbourne service with a direct Dreamliner service flying from London-Perth-Melbourne.
The rerouting of the two major long-haul services away from Dubai will inevitably have some impact on the number of stopover tourists visiting the emirate, said Neil Hansford, aviation analyst and chairman at Strategic Aviation Solutions, based in Australia.
He said that the move could cause Dubai to suffer a net loss of 6,000 seats per week, with each seat representing a potential tourist to Dubai.
“On an annualized basis, it is 300,000 seats,” he said, estimating that around 10 percent of those travelers might stop over for a night in Dubai. This equates to around 30,000 people or about 15,000 rooms per year at a value of $1.5 million — plus additional spending on meals out, taxis and shopping, he said.
Yet, the potential loss of stopover tourists could be a lot worse, if Dubai had been more successful in winning over Qantas’ transit passenger traffic. Hansford said that some travelers actively avoided transiting over Dubai, opting to fly with Singapore Airlines between Australia and Europe instead.
“Dubai got the tourist model wrong and never really gave good reasons to break the journey,” he said. “Dubai was never seen as good value and too much designer label shopping appealing to a small percentage of the transit traffic.
“Dubai has never lived up to its potential due to quality of airport operations and handling compared to top airports like Singapore,” he added.
Statistics from Dubai’s tourism department suggest that Dubai had limited appeal among tourists from Australasia — Qantas’ home market — with the region only accounting for 2 percent of Dubai’s total number of overnight tourists (staying one night or more) during the first half of this year, a figure largely the same as the proportion recorded in 2016.
Other analysts are less pessimistic about Dubai’s appeal and see any loss of transit passengers flying on Qantas being easily offset by other airlines — mainly Emirates — taking Qantas’ slots at Dubai International Airport.
“Qantas’ slots will certainly be used and we could see Emirates look at ways to increase its presence in Australia,” said Horton. He said that the original partnership helped Emirates gain more momentum in Australia and New Zealand through various codeshares.
“That element remains even after Qantas exits Dubai, so Emirates still has high relevancy in Australia and New Zealand it can leverage for future growth,” he said.
A spokesperson from Qantas said that under the partnership customers can access over 2,000 routes on the combined networks of Qantas and Emirates.
Saj Ahmad, aviation analyst at Strategic Aero Research agreed that Dubai as a tourism hub will not suffer from the Qantas move, with increased flights from Emirates helping draw in more potential stopover tourists. “I don't think it will impact Dubai because Emirates is the biggest operator there and so with Qantas moving hubs, they’ll have more flights and routes. Qantas’ shift gives Emirates more key slots.”
“Emirates has enough traffic to flow and make up any loss via Qantas,” he said.
The outlook for Dubai’s tourism sector remains positive. A total of 8.06 million international overnight tourists arrived in Dubai during the first half of this year, a 10.6 percent increase over the same period last year, according to Dubai’s tourism department. The leading source market was India, followed by Saudi Arabia and the UK.
Dubai International Airport recorded one of its busiest months on record last month, with more than 8 million passengers passing through in August, according to Dubai Airports spokesperson Lorne Riley. The airport is on track to serve 89 million passengers in 2017, she said. The airport recorded 83.6 million passengers in 2016.
Demand for hotel rooms also remains high. Average occupancy across all hotel categories in Dubai stood at 76.1 percent in July year-to-date, according to data from STR, a data benchmarking company. This marks an increase of 1.5 percent increase on the same time period the year before.
Qantas’ Singapore switch won’t damage Dubai tourism, claim industry analysts
Qantas’ Singapore switch won’t damage Dubai tourism, claim industry analysts
Oil Updates — prices set for weekly gain on China stimulus optimism
RIYADH: Oil prices were little changed on Friday but were set for a weekly rise amid optimism that economic stimulus efforts will prompt a recovery in China, but a stronger dollar capped gains, according to Reuters.
Brent crude futures fell 2 cents to $73.24 a barrel by 08:35 a.m. Saudi time. US West Texas Intermediate crude was at $69.61, down 1 cent, from Thursday’s close. However, on a weekly basis, Brent was up 0.4 percent and WTI rose 0.2 percent.
The World Bank on Thursday raised its forecast for China’s economic growth in 2024 and 2025, but warned that subdued household and business confidence, along with headwinds in the property sector, would keep weighing it down next year.
China, the world’s biggest oil importer, revised upwards its 2023 gross domestic product estimate by 2.7 percent, but also said the change would have little impact on growth this year.
Chinese authorities have agreed to issue 3 trillion yuan ($411 billion) worth of special treasury bonds next year, Reuters reported this week citing sources, as Beijing ramps up fiscal stimulus to revive a faltering economy.
However, a stronger US dollar weighed on oil prices and capped gains. The greenback has risen about 7 percent this quarter and remained pinned at a near two-year peak against major peers after the Federal Reserve signaled slower rate cuts in 2025.
A stronger dollar makes oil more expensive for holders of other currencies.
The latest weekly report on US inventories from the American Petroleum Institute industry group showed crude stocks fell last week by 3.2 million barrels, market sources said on Tuesday. API/S
Traders will be waiting to see if the official inventory report from the US Energy Information Administration confirms the decline. The EIA data is due at 9 p.m. Saudi time on Friday, later than normal because of the Christmas holiday.
Analysts in a Reuters poll expect crude inventories fell by about 1.9 million barrels in the week to Dec. 20, while gasoline and distillate inventories are seen falling by 1.1 million barrels and 0.3 million barrels respectively.
ROSHN launches first residential community in Makkah
JEDDAH: Saudi Arabia’s leading property developer, ROSHN, has officially launched its first residential community in Makkah, marking a significant milestone in the company’s efforts to improve the city’s living standards while supporting the national development goals outlined in Vision 2030.
The launch event for the Al-Manar Community project, which is ROSHN’s inaugural residential development in Makkah, took place under the patronage of Makkah Gov. Prince Khaled Al-Faisal. The groundbreaking ceremony was attended by a host of prominent figures, including Makkah Mayor Musaed bin Abdulaziz Al-Dawood, Royal Commission for Makkah and Holy Sites CEO Saleh bin Ibrahim Al-Rasheed, Real Estate General Authority CEO Abdullah Al-Hammad, and ROSHN’s acting CEO Khaled Jawhar. The event also saw participation from officials across both the public and private sectors.
Strategically positioned, the Al-Manar community is just a 20-minute drive from the Grand Mosque, less than an hour from King Abdulaziz International Airport in Jeddah, and only two minutes from Makkah’s western gateway. The development’s design thoughtfully integrates the region’s rich cultural and architectural heritage, blending modernity with tradition.
The Saudi government, under Vision 2030, has set ambitious targets to boost homeownership among citizens, aiming for 70 percent by the end of the decade.
ROSHN is playing a pivotal role in achieving this goal by developing large-scale residential projects that offer high-quality and affordable housing options for Saudi citizens. These initiatives are in line with the government’s strategy to expand the housing sector, elevate living standards, and provide homes for the country’s growing population.
At the ceremony, attendees were given a tour of model villas and previewed the diverse residential designs available within the community. The Al-Manar development will feature a variety of villas alongside essential amenities such as schools, mosques, shopping centers, healthcare facilities, open spaces, and recreational areas.
Khaled Jawhar, acting CEO of ROSHN, explained that the project spans over 21 million sq. meters and will provide more than 33,000 housing units. Additionally, it will offer more than 150 facilities designed to meet the needs of residents and support community well-being.
Saleh bin Ibrahim Al-Rasheed, CEO of the Royal Commission for Makkah and Holy Sites, emphasized the significance of the Al-Manar community as the first fully integrated ROSHN development in Makkah.
“Located at the city’s western gateway, within the Haram boundaries, this project reflects our commitment to facilitating impactful developments that drive long-term growth and sustainability,” Al-Rasheed said.
Saudi Venture Capital Invests $24bn in Jadwa GCC Private Equity Fund 1
RIYADH: Saudi Venture Capital has invested over SR90 billion ($24 billion) in the Jadwa GCC Private Equity Fund 1.
The fund aims to raise SR1.5 billion, with a hard cap of SR2 billion, and marks Jadwa’s first regional blind-pool private equity fund, a press release issued on Thursday said.
It said the fund will focus on investing in a diversified portfolio of high-potential private equity opportunities across Saudi Arabia and the wider Gulf Cooperation Council region.
Commenting on the development, Nabeel Koshak, CEO and board member of SVC, said:
“Our investment in the private equity fund by Jadwa is aligned with SVC’s strategy of supporting the evolving private equity ecosystem in Saudi Arabia. This investment will stimulate and sustain funding for high-potential companies in Saudi Arabia, contributing to the economic diversification objectives of Saudi Vision 2030.”
Founded in 2018, SVC is a subsidiary of the SME Bank, part of the National Development Fund. Its mission is to stimulate and sustain financing for startups and small and medium enterprises at various stages—from pre-seed to pre-IPO—through investments in funds as well as direct investments into emerging companies.
Tariq Al-Sudairy, managing director and CEO of Jadwa Investment, added: “We are excited to have SVC on board as an investor in Jadwa GCC Private Equity Fund 1. This partnership reflects our shared commitment to identifying and nurturing high-potential companies across the GCC, with the goal of creating long-term value for our clients.”
Jadwa Investment is a leading investment management and advisory firm in the MENA region.
Closing Bell: Saudi main index slips to close at 11,859
- Parallel market Nomu declined by 120.35 points, or 0.39%, to close at 30,886.71
- MSCI Tadawul Index also dropped 3.44 points, or 0.23%, to end at 1,490.30
RIYADH: Saudi Arabia’s Tadawul All Share Index slipped on Thursday, losing 32.85 points, or 0.28 percent, to close at 11,859.47.
The total trading turnover of the benchmark index reached SR2.80 billion ($747 million), as 78 stocks advanced and 143 retreated.
The Kingdom’s parallel market Nomu declined by 120.35 points, or 0.39 percent, to close at 30,886.71, with 37 stocks advancing and 38 retreating.
The MSCI Tadawul Index also dropped 3.44 points, or 0.23 percent, to end at 1,490.30.
The best-performing stock of the day was Rasan Information Technology Co., whose share price surged 7.58 percent to SR79.50. Other top performers included The Mediterranean and Gulf Insurance and Reinsurance Co., which rose by 7.17 percent to SR24.80, and The National Co. for Glass Industries, up 4.15 percent to SR55.20.
On the downside, Saudi Research and Media Group recorded the steepest drop, falling 3.86 percent to SR269.00. Al-Baha Investment and Development Co. saw its share price decline by 3.85 percent to SR0.50, while Red Sea International Co. dropped 3.63 percent to SR58.40.
On the announcement front, Mutakamela Insurance Co. launched its new identity and brand name, Mutakamela, following regulatory approvals and shareholder consent at its extraordinary general assembly meeting.
Mutakamela ended the session unchanged at SR14.78.
Al-Yamamah Steel Industries Co. reported a net profit of SR70.8 million for the year ending Sept. 30, a significant turnaround from the SR130.14 million loss recorded in the previous year. The profit increase was attributed to reduced costs in the construction sector by 20.82 percent, electricity by 7.56 percent, and solar energy by 10.35 percent.
Additionally, the company’s board recommended distributing SR25.4 million in cash dividends to shareholders for the fiscal year ending Sept. 30. Eligible shareholders will receive a dividend of SR0.50 per share, representing 5 percent of the share’s par value, with 50.8 million shares eligible for the payout.
Al-Yamamah Steel closed the session at SR35.00, down 1.75 percent.
Arabian Contracting Services Co. secured a project worth SR563 million with the Royal Commission for Riyadh City to invest in and lease internal advertising spaces within the King Abdulaziz Public Transport Project in Riyadh.
The 10-year agreement aligns with the company’s strategy to expand its advertising activities.
Its stock rose 0.68 percent to close at SR149.00.
Bank Al-Jazira announced the start of issuing its Additional Tier 1 Sukuk under a SR5 billion program through private placement. The issuance amount and terms will be determined based on market conditions, with a minimum subscription of SR1 million.
The sukuk offer price, par value, and return will also be market-dependent. The bank has appointed Al-Jazira Capital, Al-Rajhi Capital, and HSBC Saudi Arabia as joint lead managers and dealers.
Bank Al-Jazira’s stock rose 0.96 percent to close at SR18.68.
Turkiye lowers interest rate to 47.5%
- Central bank now expects inflation to reach 44% at the end of 2024
- Decision signals the start of an easing cycle after eight months of steady policy
ISTANBUL: Turkiye’s central bank lowered its key interest rate on Thursday, the first cut in nearly two years as it battles with double-digit inflation.
The bank’s monetary policy committee decided to reduce the policy rate from 50 percent to 47.5 percent, with a statement citing improvement in “inflation expectations and pricing behavior.”
The last cut was in February 2023.
The central bank began to raise interest rates last year to battle soaring prices, after President Recep Tayyip Erdogan dropped his opposition to orthodox monetary policy.
It has kept the main rate stable at 50 percent since March.
Thursday’s decision signals the start of an easing cycle after eight months of steady policy.
The bank said the decisiveness over its tight monetary stance “is bringing down the underlying trend of monthly inflation and strengthening the disinflation process.”
In November, Turkiye’s annual inflation rate slowed for the sixth month in a row, at 47.1 percent.
The central bank now expects inflation to reach 44 percent at the end of 2024, up from a previous estimate in August of 38 percent.
The bank said the level of the policy rate would be determined in a way to ensure the tightness required by the projected disinflation path, taking into account both realized and expected inflation.
This week, the central bank announced that it would hold fewer policy meetings next year.
“The Committee will make its decisions prudently on a meeting-by-meeting basis with a focus on the inflation outlook,” the bank said, adding it would “decisively use all the tools at its disposal in line with its main objective of price stability.”
The bank “will make its decisions in a predictable, data-driven and transparent framework,” it added.
Hakan Kara, former chief economist at the central bank, welcomed the cut as “very reasonable and balanced start” that came with a “cautious/optimistic communication.”
“In my opinion, the central bank is doing its best. From now on, the ball is in other policies,” Kara commented on social media platform X, including in the pace of spending and regulations on critical institutions.
The rate slash comes amid a moderate increase in Turkiye’s minimum wage after several rounds of negotiations.
The net monthly minimum wage has been raised by 30 percent to 22,104 lira ($600), beginning from Jan. 1 — far below the demands of the workers union.
The union had demanded a 70 percent increase.
Erdogan welcomed the rise this week and said: “We once again remained true to our promise not to let our workers be crushed by inflation.”
