Saudi Arabia is next battleground for e-commerce titans

Shoppers take a stroll through Riyadh's Kingdom Centre Shopping Mall. The Kingdom is being targeted by global e-commerce corporations. (Getty Images)
Updated 18 May 2018
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Saudi Arabia is next battleground for e-commerce titans

  • KSA online sales expected to surge to $13.9 billion by 2021
  • Overall GCC e-commerce to grow to $24 billion by end of decade

The battle for Saudi Arabia’s online shoppers is on.

One year on from the Amazon-Souq deal, the Kingdom's youthful population is being increasingly targeted by the region's burgeoning e-commerce industry.

With the largest economy in the GCC and the youngest Internet-connected population in the world, the Kingdom represents a golden goose for the world’s online retail players.

Online sales in Saudi Arabia are expected to surge to $13.9 billion by 2021 from about $8.7 billion in 2017, according to market researcher BMI.

The overall GCC e-commerce market is now tipped to grow to $24 billion by the end of the decade, say management consultancy A.T. Kearney.

UAE-born Souq.com, which was acquired by Amazon in 2017, has already built up a following and brand relationships in Saudi Arabia since its launch in 2005.
After months of delays, Noon.com also launched in the Saudi market in December last year, after starting up in the UAE earlier in the year.

Investors in Noon.com, including Emaar chairman Mohamed Alabbar and Saudi Arabia’s sovereign wealth fund, have put $1 billion into the project.

Saudi Arabia offers great scope for retail players looking to expand said Sam Blatteis, CEO of The MENA Catalysts and ex-Google head of Gulf government affairs.

As he puts it: “The Kingdom’s population has already expanded 50 percent since the start of the millennium, and has the highest YouTube and Twitter usage on earth. At this point, the pace of change has never been this fast, and yet it will never be this slow again.”

He said: “Tech titans from the world’s two largest economies – China and Silicon Valley – are signaling they plan to expand in Saudi Arabia. The Kingdom’s 2030 vision is only 12 years away and Saudi’s ‘Generation Y’ leadership is increasingly running the country. They are moving mountains to overhaul strategic industries from transportation to education legalizing ride-hailing apps to rolling out coding classes in schools nationally.”

As competition heats up in the marketplace and more players join the fray, trends will lean to specialization, said Monica Peart, senior forecasting director at E-Marketer.

“As more local e-commerce players arrive on the scene, you will start to see price competition and product competition. They will start to specialize, which will engender even more e-commerce activity,” added Peart.

But for e-commerce to really take off in Saudi Arabia and the wider GCC, shoppers “must be able to find better goods online than on the local shelves," said Peart.

She added: "For this scenario to become a reality, the region will need to ramp up its last-mile services, time-to-delivery, online ranges and its choice of payment gateways."

According to Walid Mansour, managing partner at Middle East Venture Partners (MEVP), which has investment in several e-commerce related ventures, including last-mile delivery company One Click, “e-commerce is growing at a very fast pace but faces challenges.”

Mansour highlights lack of data analytics as a key hindrance to the market. “What’s needed to boost the online commerce market is data, including predictive data, which leads to insights for actions, as well as automated marketing services,” he said. “But of course, there are a lot of (e-commerce) players in the market now, which means there is a lot of growth potential. The market is getting better … but it’s not there yet.”


Saudi Cabinet approves land transport system to enhance efficiency, sustainability 

Updated 19 February 2025
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Saudi Cabinet approves land transport system to enhance efficiency, sustainability 

JEDDAH: Saudi Arabia’s Cabinet has approved a comprehensive land transport system aimed at modernizing road networks and integrating advanced technologies to enhance efficiency and sustainability. 

The system, approved at a Cabinet session in Riyadh and chaired by Crown Prince Mohammed bin Salman, is designed to streamline regulations and drive environmentally friendly growth in the industry, the Saudi Press Agency reported. 

It also aligns with global trends toward sustainable and connected transport infrastructure, reinforcing Saudi Arabia’s ambition to lead in logistics and mobility innovation.

With more than 73,000 km of roads, Saudi Arabia ranks among global leaders in terms of connectivity, according to the Transport General Authority. 

Saleh bin Nasser Al-Jasser, minister of transport and logistics services and chairman of the TGA board, said the decision supports the regulation and development of land transport across various sectors, aligning it with the Kingdom’s rapid economic expansion. 

“This includes the adoption of modern technologies in transportation and sustainable mobility, the regulation of transport facilities, the activation of professional and technical qualifications, and the establishment of clear obligations for licensees, along with defining the rights and responsibilities of beneficiaries,” Al-Jasser said. 

The new system, he noted, reflects the leadership’s ongoing support for the transport and logistics sector, reinforcing its role in driving economic growth and investment. 

It is also expected to contribute to the objectives of the National Transport and Logistics Strategy, which seeks to improve mobility, enhance quality of life, and facilitate economic activities with high standards of safety, efficiency, and service delivery. 

Al-Jasser emphasized that the system would create investment opportunities, ensure fair competition, and strengthen the private sector’s role as a key partner in development. 

“This will increase the sector’s contribution to the national economy and further establish the Kingdom as a global leader in integrated transport services, in line with Saudi Arabia’s Vision 2030, helping to build a sustainable and prosperous future,” he said. 

Under the new framework, the TGA will classify key road transport activities, including passenger and cargo transport, and car rentals. Service providers will be required to comply with operational and technical conditions set by regulators, while violations will be subject to penalties. 

The system also introduces stricter rules on foreign cargo truck operations, aiming to regulate entry and enforce compliance with local transport laws. 

Additionally, passenger transport operators will be prohibited from soliciting customers directly, such as calling out to passengers or following them to offer services. 


Brazil adheres to OPEC+ cooperation letter; no output caps

Updated 19 February 2025
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Brazil adheres to OPEC+ cooperation letter; no output caps

SAO PAULO: Brazil has decided to adhere to the declaration of cooperation of the OPEC+ group of oil-producing countries, the local energy ministry said on Tuesday, formalizing a move it had initially announced in 2023.

Brazil is the largest oil producer in South America. Its output hit 4.32 million barrels of oil equivalent per day in 2024, according to the country’s oil regulator.

It will join nations such as Saudi Arabia and Russia in the group’s declaration, but is not expected to take part in its coordinated output caps.

The move shows Brazil’s “growing relevance in the oil and gas market,” the mines and energy ministry said in a statement, adding, however, that the country would “continue to develop its energy policy in line with its own interests.”

“It is important to highlight that the declaration does not include the participation of countries in decisions aimed at cutting oil production,” the ministry said.

Brazil first said it was going to join the OPEC+ cooperation in late 2023, but President Luiz Inacio Lula da Silva reiterated at the time the country had no intention to be a full member, instead acting as an “observer.”

The country on Tuesday has also decided to become a member of the International Renewable Energy Agency (IRENA) and the International Energy Agency (IEA), the government said.


Saudi ACWA Power expands portfolio with $693m acquisitions in Bahrain, Kuwait

Updated 19 February 2025
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Saudi ACWA Power expands portfolio with $693m acquisitions in Bahrain, Kuwait

RIYADH: Saudi utility giant ACWA Power has strengthened its portfolio by acquiring a $693 million stake in power generation and water desalination companies in Bahrain and Kuwait.

The company has secured holdings in four companies after buying the shares held by the regional subsidiary of French utility developer Engie.

The deal includes a 45 percent interest in both the Al-Ezzel and Al-Dur projects as well as a 30 percent holding in the Al-Hidd facility, all situated in Bahrain. 

It also sees ACWA Power acquire an 18 percent stake in Az Zour North in Kuwait.

The move falls in line with ACWA Power’s strategy to be at the forefront of the energy transition by delivering reliable and responsible power, desalinated water, and green hydrogen at low cost in Saudi Arabia and the wider Gulf Cooperation Council and attractive high-growth markets based on a de-risked and contracted business model.

“This acquisition represents a pivotal milestone for ACWA Power, reinforcing our position as global leader in water desalination. We consolidate our presence in Bahrain where we are already a reliable supplier of power and water, and we enter Kuwait, where we recently submitted a bid for a large power and desalination plant,” CEO of ACWA Power Marco Arcelli said. 

“Reinforcing our presence in each country will allow us to further develop our people there and localize our operations more, providing safe and reliable supplies to the local communities and industries,” he added.

ACWA Power will also acquire a portfolio of companies responsible for the operation and maintenance of the four assets, specifically Az Zour North O&M Co., with a 50 percent stake and complete ownership of Al-Ezzel O&M Co.

The deals cover operating capacities of 4.61 gigawatts of gas-fired power generation and 1.11 million cubic meters per day of water desalination facilities, as well as the related operations and maintenance companies in the two countries, according to a statement.

Chief Investment and Development Officer of ACWA Power Thomas Brostrom said: “By making its inaugural entry into the Kuwaiti market through the acquisition of a stake in the Az-Zour North Facility, ACWA Power has achieved a significant milestone in its strategic efforts to expand its presence within the regional energy and water desalination sector.”

The secured contracted revenue streams from the acquired assets align well with the firm’s broader strategy of tripling its assets under management to $250 billion by 2030.


Qatar commits to investing $10bn in India

Updated 19 February 2025
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Qatar commits to investing $10bn in India

NEW DELHI: Qatar has committed to investing $10 billion in India across various sectors, the two nations said in a joint statement on Tuesday, after Qatar’s Emir Sheikh Tamim bin Hamad Al-Thani visited New Delhi.

Indian Prime Minister Narendra Modi said he had a “very productive meeting” with Qatar’s Emir, who was on a two-day visit to New Delhi.

“Trade featured prominently in our talks. We want to increase and diversify India-Qatar trade linkages,” Modi said in a post on X. It was the first such visit by a Qatari Emir to the South Asian nation in 10 years.

According to the statement, Qatar will invest $10 billion in India in infrastructure, technology, manufacturing, food security, logistics, hospitality and other sectors.

The two countries will aim to double their annual trade to $28 billion in the next five years and are exploring the signing of a free trade agreement, the Indian foreign ministry said earlier in the day.

Bilateral trade between the two nations stood at $18.77 billion in the fiscal year that ended in March 2023, mainly comprising liquefied natural gas imports from Qatar.

Qatar accounted for more than 48 percent of India’s LNG imports that year.

The two sides said they would work to enhance bilateral energy cooperation, including mutual investments in energy infrastructure, as well as look at settlement of bilateral trade in their respective currencies. 


Oil Updates — crude gains on US, Russia supply worries; market seeks Ukraine talks clarity

Updated 19 February 2025
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Oil Updates — crude gains on US, Russia supply worries; market seeks Ukraine talks clarity

HOUSTON/SINGAPORE: Oil prices edged up on Wednesday amid worries of oil supply disruptions in the US and Russia, and as markets awaited clarity on the Ukraine peace talks.

Brent crude futures were up 14 cents, or 0.2 percent, at $75.98 a barrel at 7:50 a.m. Saudi time, and possibly set for a third day of gains.

US West Texas Intermediate crude futures for March rose 16 cents, or 0.2 percent, to $72.01, up 1.8 percent from the close on Friday after not settling on Monday because of the Presidents’ Day public holiday. The March contract expires on Thursday and the more active April contract gained 14 cents, or 0.2 percent, to $71.97.

“The psychologically important $70 level appears to have held firm, aided by the Ukrainian drone attack on the Russian oil pumping station and fears that cold weather in the US may curtail supply,” said IG market analyst Tony Sycamore.

“On top of that there is some speculation that OPEC+ may decide to delay its planned supply increase in April,” he said, referring to the Organization of the Petroleum Exporting Countries and allies.

Russia said oil flows through the Caspian Pipeline Consortium, a major route for crude exports from Kazakhstan, were reduced by 30 percent to 40 percent on Tuesday after a Ukrainian drone attack on a pumping station. A 30 percent cut would equate to the loss of 380,000 barrels per day of supply to the market, according to Reuters calculations.

Meanwhile, cold weather threatened US oil supply, with the North Dakota Pipeline Authority estimating that production in the country’s No. 3 producing state would be down by as much as 150,000 bpd.

US President Donald Trump’s administration said on Tuesday it had agreed to hold more talks with Russia on ending the war in Ukraine. A deal could ease or help remove sanctions that have disrupted the flows of Russian oil shipments.

Analysts at Goldman Sachs said a potential Ukraine-Russia peace deal and associated easing in sanctions on Russia is unlikely to significantly raise Russia oil flows.

“We believe that Russia crude oil production is constrained by its OPEC+ 9 million barrels per day production target rather than current sanctions, which are affecting the destination but not the volume of oil exports,” they said in a report.

Israel and Hamas will also begin indirect negotiations on a second stage of the Gaza ceasefire deal, officials said on Tuesday.

However, Trump said on Tuesday he intends to impose auto tariffs “in the neighborhood of 25 percent” and similar duties on semiconductors and pharmaceutical imports.

Tariffs could raise prices for consumer products, weaken the economy and reduce demand for fuel.