INTERVIEW: Middle East Rolls-Royce chief Cesar Habib prepares for push into Saudi Arabia

Cesar Habib, Rolls-Royce’s regional director for the Middle East and Africa, is preparing for a push into Saudi Arabia. (Illustration: Luis Grañena)
Updated 08 April 2019
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INTERVIEW: Middle East Rolls-Royce chief Cesar Habib prepares for push into Saudi Arabia

  • Habib describes Middle East's love affair with ‘car for kings and presidents’
  • The Cullinan — named after the largest diamond ever found — is Rolls-Royce’s latest super-luxury marque

DUBAI: The Middle East’s love affair with Rolls-Royce Motor Cars dates back more than 100 years, to the famous motto of Lawrence of Arabia that “a Rolls in the desert was above jewels,” as the wartime hero helped to promote the cause of Arab independence by deploying several armored cars made by the legendary British manufacturer.
Cesar Habib, Rolls-Royce’s regional director for the Middle East and Africa, has a modern version of that saying — “effortless everywhere” — and he applies it especially to the current jewel in the Rolls crown, the Cullinan.
“I remember when we had the first customer events here in the region, I put the customers into the car, and I said one thing I want to know: Did you experience the ‘effortless everywhere?’ And they came back and told me, Cesar, you were spot on,” he said.
The Cullinan — named after the largest diamond ever found — is Rolls-Royce’s latest super-luxury marque, selling for about SR2 million ($533,000, depending on the amount of bespoke work that goes into the model).
It is aimed at the upmarket SUV sector everywhere in the world, but particularly in the Middle East, where it simply ticks all the boxes for the wealthy regional car-lover — a big, luxurious, all-terrain vehicle that tells the world you, the owner, are a person of substance, demanding attention and respect.
“I believe it’s not just here (in the Middle East) but all over the world,” Habib said. “Everyone says they have got the best product on earth, the most exclusive product on earth and the most bespoke product on earth. They know it in Europe, but I think here in the Middle East it’s even more so, because they are really proud to own a Rolls-Royce. Anybody here who can afford one tries to buy one.”
The Rolls-Royce was the car of choice for rulers, princes and sheikhs who suddenly found themselves with huge levels of disposable income after the oil boom took off, and there are stories in the motor trade of mythical fleets of the vehicles sitting gleaming in palaces throughout the Arabian Gulf.
“It’s a car for kings and presidents,” Habib added.

This is what amazes me about bespoke — the interaction with the customer, making  just his or her car.

Cesar Habib


Some countries, it is said, will not allow expats to buy Rolls-Royce cars because they are reserved as a mark of royalty; in other places, new Rolls models are held for rulers and royalty first, and only released to the public when the rulers have had their fill.
Habib would not comment on those rumors, but he is sure of the allure of the Rolls-Royce brand. “Everybody knows that when someone buys a Rolls-Royce they want to make a statement about themselves,” he said.
Arab customers make that statement increasingly frequently. The showroom in Abu Dhabi was for several years the best-selling Rolls dealership in the world, and even though it has now been overtaken by a Chinese dealership, the Middle East helped Rolls to the best-ever year in its history in 2018, in terms of vehicles sold.
Rolls-Royce does not provide a breakdown of the number of cars sold in individual markets, but Habib said: “Saudi is a very important market and I think there is room to grow the brand there. How? By investing in the brand further and by being more prominently present in the market.”
In a reference to the transformation underway in the Kingdom as part of the Vision 2030 strategy, he added: “I think all the changes that are going on will play into our hands because we can go and show the brand as it is. We can do more events and invite more people. Previously, we held back a bit. We had conversations with Mohammed Yousuf Naghi (the long-standing dealer in Saudi Arabia) and we both agreed that we would take it to the next level.”
Habib detects some subtle differences in the Saudi market. “There is an increased level of expression among those in Jeddah, for example. They really get creative when selecting a Rolls-Royce — and it is very much a reflection of their more expressive personalities in how they have the car designed.”
The “expression” can reach some extraordinary heights in the Middle East market for Rolls-Royce. After some time working in the “bespoke” part of the Rolls-Royce business — the division that aims to give customers the exact car they want — Habib has a pretty good eye for regional taste.
Unusual color combinations are common, as are the idiosyncratic features discerning customers demand, such as Arabic calligraphy on the bodywork and interior.
“One customer, a collector, said he wanted a car where he could incorporate birthday features for his kids. I want my children to come into the car and look for their birthdays. So, we put a star constellation in the starlight roofing headliner, and we embroidered astrological signs into the door pockets, and in the folding tables as binary codes,” he said.
“Another gentleman wanted to give his wife a Rolls-Royce ‘love story’ for their wedding anniversary, and he designed it with us — a car with flowers inside. Behind each car there is a story,” he said.
Colors of bodywork are just as flamboyant. Cherry pink fuchsia, bright yellow, turquoise outside matching the same shade on the interior upholstery, have all featured in cars Habib has helped customers design. “You can’t argue colors, you can’t argue taste. That’s what I had to learn very quickly,” he said.
“This is what amazes me about bespoke — the interaction with the customer, making just his or her car. I don’t think you find this level of attention or service with any other manufacturer,” he added.

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BIO

BORN 

•1967 Tripoli, Lebanon

EDUCATION

•German School Lebanon

•University of Passau, Germany, diploma in business administration

CAREER

•Parts consultant, BMW, Germany

•Executive in after-sales, dealer and business development, BMW Dubai

•Executive for BMW in Iran

•After-sales marketing, Dubai BMW

•Global ownership services, Rolls-Royce, Goodwood, UK

•Bespoke, Dubai

•Regional director for Middle East and Africa, Rolls-Royce

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There has also been a shift in car driving patterns in the Kingdom, which could accelerate as more women get behind the wheel. The bigger Rolls-Royce models, such as the Phantom and the Ghost, have traditionally been seen as chauffeur-driven cars, but this is no longer strictly the case.
“They could be chauffeur-driven, but it depends on the situation. We find many owners want to drive themselves, but if they go out for an evening, for a function, they have their drivers. People enjoy driving our cars because, despite the fact they are big cars, they are effortless to drive,” Habib said.
The Wraith and Dawn — a coupe and a convertible — do not really lend themselves to chauffeur driving, and Habib sees a big potential market among wealthy women for those models.
And, of course, there is the Cullinan, heading the marketing drive this year, although apparently not much intense marketing was required.
“It has had an extremely positive reception. We had an order bank of nine months before anybody had even seen the car. We gave some people sneak previews, but even from (the information that) came into the press, people said they wanted that car,” he added.
The other essential part of the brand appeal of Rolls-Royce is its Britishness, despite the fact that since 2003 it has been owned by the German manufacturer BMW. “Everyone who thinks Rolls-Royce thinks Britain, they don’t think Germany — the British heritage of that brand, which we really nurture and maintain, it’s very important to keep the heritage of the brand.”
Most of the car’s styling and design is carried out in Goodwood in the UK, the home of Rolls-Royce for many years, while some technology and engineering come from Germany. That would continue, Habib stressed, even if there was a damaging Brexit separation of Britain from the EU.
“I don’t want to be political, but with Brexit we were always very firm in saying that whatever happens we are staying in Goodwood because we are a British brand,” he said.
Habib takes it as a compliment that other sectors of the luxury goods market use the brand name to define the exclusivity of their products — the “Rolls-Royce of watches” or the “Rolls-Royce of boats” — but he is also aware that those sectors provide some of the main competition for the company’s upmarket products.
“The challenge that we have is that we operate in the segment of ultra-high net-worth individuals. We are in the ultra-luxury segment, like some of the watchmakers, jewelry brands, leather goods manufacturers, private jet manufacturers, yacht builders, and the rest. We are in a different environment, competing with non-car manufacturers,” he said.
Habib sees the key part of his job as being as “customer- centric” as possible, and given his background in the bespoke business and ownership services, that is the part of the business he gets most satisfaction from, even expressing some regret he had less time to do this since getting the top regional job for Middle East and Africa last year.
“What I love to do is to talk and configure the car with each and every customer. This I love to do. Each and every customer is special and has their own story. If I had the time, I would like to sit with each of our customers and talk them through it. It’s very rewarding, almost artistic,” he said.
With his German-Lebanese heritage, Habib thinks he is uniquely equipped to carry on guiding customers in the region. “People tell me you are the right mix of Levant and German thinking — accuracy, attention to detail, and disciplined — but also understanding the culture in this region,” he said.


Saudi green bond market soars on sustainable financing shift

Updated 04 January 2025
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Saudi green bond market soars on sustainable financing shift

  • Kingdom’s Green Financing Framework provides a comprehensive roadmap for backing climate-focused initiatives

RIYADH: Saudi Arabia’s green bond market is experiencing dramatic growth, positioning the Kingdom as a major player in sustainable financing as it works to meet the ambitious objectives of Vision 2030.

Green bonds, together with sukuk, have seen a surge in popularity, offering critical funding for eco-friendly projects in areas such as renewable energy, sustainable water management, and waste reduction. 

Launched by the Ministry of Finance in March, Saudi Arabia’s Green Financing Framework provides a comprehensive roadmap for backing climate-focused initiatives, igniting interest from both domestic and foreign investors. 

This foundation underscored the Kingdom’s environmental commitments under initiatives like the Saudi Green Initiative, which aims to combat climate change, reach net-zero emissions by 2060, and drive a national transition toward sustainable practices.

CEO of Middle East and North Africa and Asia Pacific at Saxo Bank, Damian Hitchen highlighted their strategic value in an interview with Arab News: “Green bonds are a critical financial tool for advancing Saudi Arabia’s Vision 2030, especially in reducing oil reliance and promoting renewable energy.”

“They foster a more balanced and resilient economy by funding projects outside the oil sector, such as green infrastructure and renewable energy,” Hitchen explained.

Pioneering projects and government support fuel growth

Vision 2030 has made sustainability a cornerstone of Saudi Arabia’s economic strategy, launching the Saudi Green Initiative and the Circular Carbon Economy framework.

“The key factor responsible for the growth of green bonds is Saudi Arabia’s Vision 2030, which aims to reduce the nation’s dependency on oil and increase reliance on clean energy to protect the environment and diversify its economy,” said Vijay Valecha, chief investment officer at Century Financial. 

He added that “strong government support,” evident from initiatives like the Saudi Green Initiative, offers a framework for sustainable projects and regulatory support for green finance instruments.

Significant achievements include the $8 billion funding for NEOM’s green hydrogen plant — the largest such project in the Middle East. 

The growing awareness of environmental issues and the measures taken by the government to transition to a low-carbon future highlight the potential for green bonds.

Vijay Valecha, chief investment officer at Century Financial

Saxo Bank’s Hitchen noted that the Kingdom’s commitment to green bonds could set a regional precedent, adding: “Saudi Arabia is emerging as a key player in the GCC’s (Gulf Cooperation Council’s) green bond market, spurred by Vision 2030 and the Saudi Green Initiative, which prioritize renewable energy and carbon emission reductions.” 

Meanwhile, Century Financial’s Valecha saw that Saudi Arabia is rapidly catching up as a key player in this market, citing NEOM’s green hydrogen plant as “a significant development.”

Investor confidence in green bonds surges

Saudi Arabia’s sovereign wealth organization, the Public Investment Fund, first issued a green bond in 2022, underscoring its commitment by allocating billions of dollars toward green infrastructure, renewable energy, and sustainable water projects. 

Hitchen saw this as creating a ripple effect in the market.

“Investor appetite for green bonds in Saudi Arabia has grown substantially, with institutional and retail investors increasingly drawn to sustainable finance. A notable shift in demand has emerged as environmental, social, and governance factors gain importance in investment strategies,” he said.

Valecha confirmed this rising demand, noting that “the investor appetite for green bonds in Saudi Arabia, particularly from institutional investors, is significant and is surging rapidly.”

He added: “This is evident from recent green bond issuance by the Public Investment Fund, which raised $8.5 billion.”

Valecha anticipated that as the government continues to promote financial literacy and awareness around sustainable investing, retail participation will also rise, “particularly as more individuals understand the tangible benefits of green bonds.”

This growth in demand comes as PIF plans to direct an additional $19.4 billion toward green projects, reflecting confidence in the stability and potential of Saudi Arabia’s green bond market. 

“The growing awareness of environmental issues and the measures taken by the government to transition to a low-carbon future highlight the potential for green bonds,” Valecha added.

Driving economic diversification and long-term sustainability

The rapid growth of green bonds is not only drawing in substantial investments but also supporting Saudi Arabia’s economic diversification, promoting eco-friendly industries and generating new market opportunities. 

Hitchen said: “Green bonds contribute to long-term economic stability and resilience by funding these non-oil sectors. They are pivotal for renewable energy goals, financing projects like solar and wind power to help the Kingdom achieve up to 130 gigawatts of renewable energy by 2030.”

Valecha echoed the transformative impact of these investments, asserting that green bonds are key to “providing the necessary funding to support large-scale solar and wind power projects, thus reducing reliance on fossil fuels and transitioning the Saudi economy toward a low-carbon future.” 

This shift not only benefits the environment but also creates jobs and opens avenues for sustainable urban development, green transportation, and water conservation.

As the Kingdom’s financial markets continue to embrace green bonds, the regulatory framework and investor confidence have solidified, laying the groundwork for sustainable growth. 

Hitchen called for further steps to maintain this momentum, stressing the importance of “strengthening government support and establishing robust transparency standards to give investors confidence that their funds are driving genuine sustainability.” 

Valecha agreed, suggesting that a comprehensive green finance ecosystem is essential.

“The government should further strengthen the rules and regulations to boost investor confidence and attract more capital,” he said, adding: “A domestic green finance ecosystem, including ESG reporting standards and clearer tax incentives, can go a long way in supporting the demand for green bonds.”


Connecting the Kingdom: Saudi Arabia’s 5G revolution

Updated 04 January 2025
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Connecting the Kingdom: Saudi Arabia’s 5G revolution

  • Industry’s value is expected to reach $13.41 billion by 2029 — up from $2.1 billion in 2023

RIYADH: Healthcare, urban living and transportation are all being revolutionized in Saudi Arabia thanks to the Kingdom’s enthusiastic adoption of 5G technology, experts have told Arab News.

The industry’s value in Saudi Arabia is expected to reach $13.41 billion by 2029  — up from $2.1 billion in 2023 — as Vision 2030 initiatives drive the Kingdom’s economic diversification, according to analysis by TechSci Research.

While telecommunications is the obvious sector to benefit from the rollout of this technology — which promises significantly faster data speeds, more reliable connections, and the ability to connect a multitude of devices simultaneously — it will expand the capabilities of many industries.

Nader Kobrosli, a partner in management consulting firm Oliver Wyman’s Communications, Media and Technology practice, said his company forecasts that this technology could provide an $18 billion boost to the economy by 2030. 

5G will play a crucial role in nurturing a knowledge-based economy, generating new job opportunities, and attracting foreign investments.

Nader Kobrosli, partner at Oliver Wyman’s Communications, Media and Technology practice

“By enabling high-speed connectivity, 5G fuels the adoption of AI and IoT, facilitating real-time data insights and enhancing efficiency across all major sectors, including manufacturing, retail, energy, healthcare, and public services. This means 5G will play a crucial role in nurturing a knowledge-based economy, generating new job opportunities, and attracting foreign investments,” Kobrosli said.

5G making cities smarter

By enabling smart city applications, 5G technology plays a crucial role in the Kingdom’s vision to transform its urban spaces into efficient, sustainable, and highly connected ecosystems.

“For residents, 5G facilitates seamless connectivity, enhances public safety, and improves transportation with real-time traffic management and autonomous vehicle integration,” said Federico Pienovi, chief business officer and CEO for Asia and Pacific as well as Middle East and North Africa at software development company Globant. 

5G facilitates seamless connectivity, enhances public safety, and improves transportation with real-time traffic management and autonomous vehicle integration.

Federico Pienovi, chief business officer and CEO for Asia, Pacific and MENA at Globant

“It provides the infrastructure for data-driven insights, remote operations, and business automation, leading to increased productivity and cost efficiency. This connectivity ecosystem enriches everyday life, attracts talent, and drives economic growth, making Saudi Arabia a model for smart city development in the region,” he added. 

5G-led IoT services have already accelerated the proliferation of ‘smart’ services and industrial automation use cases.

Sauvik Tegta, partner at Kearney Middle East & Africa — Communications, Media, and Technology practice

Oliver Wyman’s Kobrosli noted that from energy savings to improved traffic flow, 5G will enhance urban living, and this in turn will attract significant investments and help position Saudi cities as models of innovation in the digital age.

“Residents and businesses will also benefit from this advanced infrastructure, and will enjoy a more connected, efficient, and environmentally-friendly urban environment,” he said.

Undoubtedly, 5G technology is an important catalyst in Saudi Arabia’s smart city initiatives, providing cutting-edge connectivity for  new cities like NEOM and Qiddiya and existing conurbations such as Riyadh and Makkah.

“Through smart poles that incorporate 5G cell sites, KSA’s smart cities are empowered with intelligent use cases that enhance urban living — from connected transportation networks to energy-efficient buildings and smart utilities, all of which contribute to sustainability goals,” said Hazem Galal, partner, Cities and Local Government global leader, Smart Mobility Global co-leader, at PwC Middle East. 

Through smart poles that incorporate 5G cell sites, KSA’s smart cities are empowered with intelligent use cases that enhance urban living.

Hazem Galal, partner, cities and local government global leader, smart mobility global co-leader, at PwC Middle East

Sauvik Tegta, partner at Kearney Middle East & Africa — Communications, Media, and Technology Practice, stressed that 5G is a core enabler, supporting Internet-of-Things-based capabilities in the near term, and more data-heavy and low latency capabilities in the mid-to-long term. 

“5G-led IoT services have already accelerated the proliferation of ‘smart’ services and industrial automation use cases such as smart parking, smart lighting, smart meters and grids effectively modernizing an aging infrastructure,” he said.

The Kearney partner added that “ubiquitous high-speed mobile connectivity” now enables convenient “anywhere-anytime services” that are fundamentally reshaping social and work-life habits.

5G transforming healthcare

The rollout of 5G infrastructure is revolutionizing healthcare in the Kingdom, particularly in how services such as telemedicine, remote diagnostics, and AI-powered patient care, are delivered.

From Globant perspective, Pienovi said: “The high speed and low latency of 5G enable healthcare providers to extend their reach to remote areas through telemedicine and remote monitoring, allowing patients to connect with specialists without traveling, ultimately reducing congestion in urban hospitals.”

He added that 5G facilitates the integration of Internet of Medical Things devices, which optimize resource management and reduce costs by offering real-time data on patient health. 

“Lastly, the low latency of 5G supports advanced applications like robotic surgeries and AI-driven diagnostics, enhancing precision and safety in medical interventions and improving overall patient outcomes,” Pienovi said. From PwC’s side, Galal emphasized that 5G’s low latency and high data capacity mean that healthcare providers can deliver real-time, high-quality care remotely, reaching patients in rural or underserved areas and thus enhancing access to care.

“While KSA is considered a highly urbanized country with more than 80 percent living in cities, the remaining population lives in rural areas, where access to a full range of health care services can be challenging. Furthermore, 5G’s capabilities in handling massive amounts of medical data securely and efficiently support advanced research, predictive analytics, and precision medicine, which are reshaping how healthcare is delivered and experienced in the Kingdom,” the PwC partner said.

Tegta from Kearney said that Saudi Arabia’s 5G infrastructure played a vital role in supporting healthcare services during the COVID-19 pandemic.

“As lockdowns took effect, 5G infrastructure became central to enabling telemedicine, remote patient monitoring, virtual consultations, and self-care. Public and private health care service providers were able to leverage multiple apps to enhance transparency, improve care coordination, accelerate communication, and enable faster response times,” the Kearney partner said.

“This foundation is expected to accelerate the adoption of more advanced digital healthcare services that will be proactive, personalized, predictive, and preventative. By 2030, services such as e-triaging, enhanced self-service and self-care, high-definition digital imaging, telesurgery, and connected ambulances will become commonplace,” he added.

Supporting education 

According to Ian Khan, a technology futurist and author who writes on the subject of AI, 5G makes virtual and augmented reality accessible in classrooms, meaning students can explore a historical site or conduct experiments in a virtual lab from anywhere.

“In fact, VR and AR in education are projected to grow significantly, with the global market expected to reach $12.6 billion by 2025, largely driven by 5G technology. It’s also helping teachers personalize lessons because they can instantly access data on student progress and adjust in real-time,” Khan told Arab News.

“For rural areas, 5G bridges gaps by making remote learning smooth and reliable, ensuring all students have access to quality education. It’s a huge step toward a digitally savvy, future-ready workforce,” he added.

Rajesh Duneja, Partner at Arthur D. Little Middle East, said 5G technology is set to transform education in Saudi Arabia through developments such as enabling immersive augmented reality and virtual reality applications, and allowing students to engage in interactive, hands-on learning environments that make complex topics more accessible and engaging. 

“Additionally, 5G’s high-speed connectivity will enhance the quality of video and audio for online classes, especially in remote areas where traditional Internet may be less reliable,” Duneja said.

He also flagged up how 5G supports a vast network of IoT devices in the classroom, from interactive whiteboards to smart desks, enabling personalized learning experiences that cater to each student’s needs.

Saudi Arabia’s signal to the world 

Technology futurist Khan said that Saudi Arabia’s leadership in 5G didn’t happen by accident and is the result of strategic planning.

“The Kingdom invested heavily in telecom infrastructure, spending an estimated $1.5 billion by 2022, which aligns with our Vision 2030 goals to diversify the economy through digital transformation,” Khan said.

“Strong public-private partnerships, particularly with telecom companies like STC and Zain, helped speed up 5G deployment. Progressive regulations by the Communications and Information Technology Commission have also made it easier for telecoms to innovate, boosting Saudi Arabia’s position not just regionally but globally,” he added.

Arthur D. Little’s Duneja said the government’s investment in an expansive fiber network has been critical as it supplies the high-capacity backhaul needed to support 5G’s bandwidth demands.

“Additionally, streamlined regulations for international Internet connectivity have enabled easier data flow and stronger connectivity options. Support from the Ministry of Communications and Information Technology has also been crucial, with efforts to promote a thriving digital economy that positions the Kingdom at the forefront of technological innovation in the region,” he added.

Ranking third in 5G download speed across Europe, the Middle East, and Africa, according to Opensignal, only underscores Saudi Arabia’s commitment to being a technology leader.

With its 5G speeds reaching around 272.6 Mbps, the Kingdom’s advanced infrastructure is on display for the world to see.

“This achievement lays a strong foundation for advances in everything from AI to smart cities. High-speed connectivity means we can support the next generation of tech innovations, like autonomous vehicles and IoT networks, that require reliable, fast data,” Khan said.

“It’s a signal to the world that Saudi Arabia is serious about its digital future, making it an attractive hub for global tech investments and partnerships,” the technology futurist added.


Egypt’s Connect Money gets ready to land in Saudi Arabia

Updated 04 January 2025
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Egypt’s Connect Money gets ready to land in Saudi Arabia

  • Firm officially planning to enter the Saudi market by mid-year 2025

RIYADH: Saudi Arabia’s fintech growth has grabbed the attention of Egypt’s Connect Money as the company commences its expansion plan.

Founded this year by Ayman Essawy, Marwan Kenawy, and Momtaz Moussa, Connect Money provides a white-label card issuing platform that allows businesses to offer debit and credit cards to their customers without building fintech infrastructure or securing regulatory licenses.

In an interview with Arab News, Essawy, the company’s CEO, stated that Connect Money is officially planning to enter the Saudi market by mid-year 2025 and will then aim to expand to Morocco.

“We see a very big opportunity toward expansion, especially in Saudi Arabia and Morocco. Saudi Arabia is one of the hot topics in the region and fintech is growing significantly,” he said.

“We have strong connections with the whole Saudi ecosystem, and we have built a good relationship with the regulators and leading financial providers there and partner banks,” he added.

“We found that there is a need for our services to further accelerate fintech growth in Saudi Arabia,” Essawy claimed.

The CEO further said that once the expansion to Saudi Arabia begins, 80 to 90 percent of the company’s focus will be dedicated toward the Kingdom.

“We have spent the last 10 years operating on the business-to-business side in our past ventures and we claim to have very good market understanding across different sectors,” he added.

He further claims that after operating in Saudi Arabia for seven years at his first venture, Dsquares, the founder was able to carefully identify the market gaps in the financial industry.

The CEO also takes pride in being a serial entrepreneur and the founder of Egypt’s largest coupon platform Lucky ONE.

A problem to solve

Essawy explained that the company solves three critical problems for any large enterprise planning to incorporate strong fintech solutions internally.

He cited “very long compliance and regulatory cycles” for these companies as an issue, adding: “These cycles occur because they do not have the capability to build an infrastructure since they already operate a core business be it telecom, logistics, and even oil and gas.”

The CEO went on to say: “Second is the very high cost of building the infrastructure, so first, it takes a very long time to get granted a license and second is that there’s a very high cost for building and operating this part of the business.” 

We have spent the last 10 years operating on the business-to-business side in our past ventures and we claim to have very good market understanding across different sectors.

Ayman Essawy, Connect Money CEO

Thirdly, Essawy explained that these entities usually look for reasons to turn cash users into cashless, a value-added service that Connect Money provides.

When asked why companies would even pursue such a solution, Essawy replied: “It’s one of two things. First, operational efficiencies, so turning cash cycles, which is very expensive in terms of efficiency and makes the business operational cycle much longer, cost of actually collecting cash or disbursing cash is already high.  “So, turning this operational role or operational service into a cashless service, and that happens through issuing white-label cards.”

He added: “Second is generating new revenue streams. These come from banking services such as transactions, credit, providing credit to businesses, basically financing with businesses and so on.” 

Essawy further said that the solution provided by Connect Money is basically putting all these services into a “one-stop shop” for embedded finance.

“This shop comes from getting the right approvals from regulators, issuing white-label cards, and providing a full managed service on top of that, as if I’m creating your small bank for your company,” he said.

The CEO cited the ride-hailing giant Uber as an example, stating that the solution would give the global company a small bank for its drivers to manage, open, and issue cards as well as create accounts and put incentives.

“This solution would be completely managed by Connect Money, yet the client has full ownership of the service,” he added. “Basically, as a company, you own the customers, you own the operations, and you own everything legally, but Connect Money is managing them on your behalf,” he explained.

The company has already incorporated itself into the Kingdom’s market and will soon announce the hiring of its Saudi-based founding member to lead the local office.

Business fundamentals

Connect Money has already seen significant traction in Egypt, landing eight contracts in under a year of operation. The company also has a 10-week go-to-market plan to onboard clients.

Essawy also stated that the company is currently the sole provider of such services in the region, but the founder also expects competition to increase as the market scales.

The founder explained that Saudi Arabia holds a different market segmentation, and that there is a misconception that the nation only consists of high-value customers.

“There is a lot to be tackled in the mid layers with the hyper growth that is taking place in the Kingdom,” he added.

“We believe that there is a significant opportunity for new segments and new mid-sized businesses that would require our services. We still believe that there is still a big gap between cash and cashless transactions which we aim to bridge,” he added.

He further emphasized that the market dynamics are almost completely different from Egypt.

Essawy also shared his view on the growing number of Egyptian companies expanding to Saudi Arabia, saying: “I’ve seen many companies expand to Saudi Arabia as a first choice and I don’t think this is a wise decision.”

He added: “I think each business model is dependent on what’s the end goal and where you can scale. In Saudi Arabia, you’ll find business but you’ll also find an expensive working environment.”

He further advises any company expanding to Saudi Arabia to reexamine their margins and growth pace before taking that step.


Saudi aviation sector soaring after record growth, major expansions

Updated 03 January 2025
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Saudi aviation sector soaring after record growth, major expansions

JEDDAH: Saudi Arabia’s aviation sector reached new heights over the past 12 months, marked by a surge in passenger numbers, a fleet expansion with new jet acquisitions, and strategic global partnerships.

These advancements are part of a broader vision to establish the Kingdom as a global aviation hub and a top-tier destination for travelers worldwide.

Saudi Arabia is investing billions of dollars as part of its Vision 2030 plan to diversify its economy away from fossil fuels, boosting its private sector, and enhancing connectivity, as well as solidifying its role in the global aviation industry.

As part of this plan, aviation goals for the Kingdom include delivering seamless experiences to 330 million passengers across over 250 destinations, and the transportation of 4.5 million tons of air cargo by 2030.

“This transformative strategy offers lucrative opportunities for the private sector to contribute to the realization of the country’s ambitions,” said President of the General Authority of Civil Aviation Abdulaziz bin Abdullah Al-Duailej.

He added that among these opportunities are the privatization potential of 27 airports, which are currently in preparation for transfer to private ownership.

“Moreover, numerous aircraft requests and destination openings have been approved, providing further avenues for private sector involvement in the sector’s growth and development.” Al-Duailej added.

Passenger numbers and air freight volume surges

Between January and September, Saudi Arabia’s aviation sector achieved record growth, with passenger numbers reaching 94 million, accounting for a 15 percent increase.

The number of flights also saw a 10 percent rise compared to 2023, while air freight volumes approached 1 million tonnes, reflecting a 52 percent increase.

These achievements were announced at GACA’s 14th Steering Committee Meeting for activating the National Strategy for the Aviation Sector, held in October in Dammam.

GACA President Abdulaziz bin Al-Duailej highlighted the expansion of air connectivity during this period, with flights departing to over 150 destinations weekly.

Saudi business aviation soars with Vision 2030 growth

Saudi Arabia’s business aviation sector is booming, driven by the Kingdom’s expanding economy, major government infrastructure investments, and a rising influx of high-net-worth individuals.

Valued at $1.2 billion in 2023, the sector is expected to grow at a compound annual rate of 8.88 percent from 2025 to 2029.

The growth was highlighted in the GACA’s roadmap, unveiled at Riyadh’s Future Aviation Forum in May.

Global firms tapped for King Salman Airport expansion

An image of how King Salman International Airport will look after it has been developed. File

In 2024, global firms such as Foster & Partners, Jacobs Engineering, Mace, and Nera were selected for the next phase of King Salman International Airport’s development in Riyadh.

Led by the King Salman International Airport Development Co., a subsidiary of the Kingdom’s Public Investment Fund, the collaborations will support the airport’s expansion, positioning it as a key hub for tourism and transportation.

Riyadh Air expands fleet, partnerships ahead of 2025 launch

In October, Riyadh Air signed an agreement to purchase 60 Airbus A321neo single-aisle aircraft as it plans to commence its operations in 2025. 

The deal was signed at the 8th Future Investment Initiative in Riyadh.

In the same month the company said that it had plans to order wide-body aircraft capable of seating more than 300 passengers in 2025.

In August, the new airline announced it had secured a multi-year agreement to become the official airline partner of Concacaf, the FIFA Confederation for North, Central America, and the Caribbean.

The deal aims to enhance the airline’s presence in global sports and support Concacaf’s national and club competitions across the Americas. 

In June, Riyadh Air signed agreements with Singapore Airlines and Air China, to establish strategic partnerships and expand its global network.

The agreements focus on interline connectivity, codeshare, frequent flyer programs, cargo services, customer experience, and digital innovation.

The company partnered with China Eastern Airlines to enhance connectivity and digital transformation and with Delta Air Lines to expand North American routes.

In April, the carrier announced a partnership with Artefact to build a data analytics platform and develop AI solutions, enabling hyper-personalization, improved guest experiences, and optimized operations. 

The collaboration aims to revolutionize Saudi aviation through advanced artificial intelligence applications.

“Through AI integration, we aim to redefine travel standards, offering personalized, seamless digital-first experience to our guests ahead of our maiden flight in 2025,” Abe Dev, the airline’s vice president of digital and innovation said.

In May, the airline said it had plans to bolster its aircraft lineup through additional orders, as it requires “a very large fleet” to establish itself alongside regional giants, according to its CEO Tony Douglas.

This move comes as the Kingdom’s second flag carrier ordered 39 Boeing 787-9 jets in 2023, with options for 33 more. “We’re going to make a number of additional orders,” Douglas said.

The airline’s initial destinations will include major cities in Europe, the US East Coast, and Canada, with the inaugural flight scheduled to depart by June 2025.

Saudia boosts aviation with key partnerships, fleet growth

The signing ceremony was attended by French President Emmanuel Macron, Saudi Arabian Airlines Corp. Chairman Saleh Al-Jasser, Saudia Group Director Gen. Ibrahim Al-Omar, and several other dignitaries and ministers. SPA

In December, Saudia entered a strategic partnership with Air France-KLM to expand and localize its maintenance, repair, and overhaul capabilities. This collaboration aims to enhance the Kingdom’s aviation infrastructure and contribute to its economic growth.

In July, the Saudia Group and German aerospace company Lilium NV, developer of fully electric vertical takeoff and landing aircraft, entered into an agreement to purchase 50 confirmed Lilium Jets, with an option for an additional 50 aircraft. The deal will make the Saudi carrier the first airline in the region to invest in sustainable air mobility.

In May, Saudia and Riyadh Air signed an agreement during the Future Aviation Forum to collaborate on training aviation professionals.

During the same event, Saudia Group announced a $19 billion order for 105 A320neo family aircraft, the largest Airbus deal in Saudi history. The planes, including A320neo and A321neo models, will be split between Saudia and its low-cost carrier flyadeal, with deliveries starting in early 2026.

Flyadeal receives first owned plane, aims for 100 by 2030

In 2024, Saudia’s low-cost airline flyadeal took delivery of its first wholly-owned aircraft, an Airbus A320neo.

Announcing the milestone in June, the airline revealed plans to expand its fleet to around 50 aircraft by the end of 2025, doubling to 100 by 2030. As part of its growth strategy, flyadeal also launched seven weekly flights between Riyadh and Sarajevo, utilizing an Airbus A320.

Looking ahead, the airline announced the addition of three new domestic routes starting January. Services from Dammam to Najran and four weekly flights to Tabuk commenced on Jan. 1, followed by three weekly flights to Yanbu starting from Jan. 2.

Flynas secures 280-aircraft deal amid record growth

Flynas, named the Best Low-Cost Airline in the Middle East for the seventh consecutive year, reported a 47 percent rise in passenger numbers, exceeding 7 million in the first half of 2024.

In November, the airline announced new African routes, with flights from Riyadh to Entebbe, Uganda, and Jeddah to Djibouti starting Jan. 8, 2025, under its “We Connect the World to the Kingdom” initiative.

In July, Flynas signed a deal at the Farnborough Airshow to purchase 160 Airbus aircraft, doubling its orders to 280 planes, including 30 wide-body A330neo and 130 narrow-body A320 models. The carrier also celebrated receiving its 53rd A320neo as part of a SR32 billion ($8.5 billion) order for 120 planes.


Saudi banks’ money supply hits $786bn, time and savings deposits share at 15-year high

Updated 03 January 2025
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Saudi banks’ money supply hits $786bn, time and savings deposits share at 15-year high

RIYADH: Saudi banks money supply reached SR2.95 trillion ($785.51 billion) in November, marking a 10.3 percent rise compared to the same month last year, according to official data.

Figures released by the Saudi Central Bank, also known as SAMA, revealed that time and savings deposits have reached their highest percentage share of the money supply in over 15 years, accounting for 33.61 percent or SR989.99 billion.

These deposits also recorded the fastest growth rate among all components of the money supply, increasing by 18.10 percent.

Demand deposits accounted for the largest share at 48.76 percent, a slight decline from their 50 percent share a year earlier, though they grew by 7.69 percent during this period. The remaining components collectively made up 17.63 percent of the total money supply.

Edmond Christou, senior industry analyst at Bloomberg Intelligence told Arab News, “Local lenders’ role in financing projects requires more cash, underpinning the likes of Saudi Fransi, ANB, Rajhi and SNB issuing euro-denominated medium-term notes.”

He added: “Saudi central bank putting state funds on time deposits helped bank cash flow, along with open market operations and $31 billion of debt sales since 2022 or $25 billion excluding SNB’s CDS.” 

According to the analyst, this surge in term deposits is a development driven by tighter liquidity conditions and elevated interest rates. The rise reflects strategic measures by local banks to navigate strong loan demand while attracting funds to stabilize their balance sheets.

Recent data from SAMA revealed that deposit growth is slightly behind loan issuance, putting some pressure on liquidity. Loans grew 13.33 percent year-on-year in November, outpacing the 10.52 percent increase in deposits. This imbalance has pushed banks to compete for depositors by offering attractive returns on term deposits.

Saudi Arabia has been driving substantial government projects to support its Vision 2030 ambitions, with a heavy emphasis on construction activity to transform its infrastructure, tourism, and overall economic landscape.

These projects, ranging from mega cities like NEOM to significant infrastructure developments, require vast amounts of funding, and banks have played a crucial role in financing them. To support these large-scale endeavors, the demand for credit has surged.

Interest rates in Saudi Arabia also reached elevated levels, partly due to the riyal’s peg to the US dollar, which has been influenced by the Federal Reserve’s tightening monetary policy aimed at combating inflation.

This led to a peak in interest rates, which climbed to as high as 6 percent. However, as inflation levels have moderated, there has been a shift in the monetary policy since September, with SAMA implementing three rate cuts — one of 50 basis points, followed by two additional 25 basis point reductions.

This shift signals a more accommodating policy stance, likely to ease some of the pressure on borrowing costs while maintaining financial stability.

The rise in term deposits underscores a shift in the Saudi banking sector’s approach to funding. Banks are incentivizing savers with higher returns to ensure stability, particularly as demand for credit grows due to Saudi Arabia’s ambitious Vision 2030 projects.

Term deposits provide a more predictable funding source compared to demand accounts, which can fluctuate significantly. The strategic shift helps banks align their funding structure with long-term lending requirements, particularly for infrastructure and construction projects.

Higher Saibor spread to boost funding

The elevated 115-basis point spread between the Saudi Interbank Offered Rate, known as Saibor, and the US Secured Overnight Financing Rate illustrates the tight liquidity landscape, according to Christou.

A higher Saibor compared to SOFR means that borrowing and funding costs in Saudi Arabia are relatively higher than those in the US. Historically, this spread hovered around 70 basis points, but sustained demand for credit has kept it significantly higher.

“The 115-bp Saibor spread over the secured overnight financing rate versus the normalized 70-bp historical range -nevertheless an improvement against the 2022 liquidity crisis – shows liquidity remains tight,” the analyst said.

In an environment where deposit inflows remain moderate, banks have also turned to external borrowing, including issuing euro-denominated bonds, to bridge funding gaps.

Local lenders like Al Rajhi Bank, Saudi National Bank, and Banque Saudi Fransi have leveraged such instruments to support their liquidity needs, according to the analyst.

While liquidity remains constrained, the current environment is an improvement over 2022 according to the analyst, when Saudi banks faced acute pressures due to surging credit demand.

SAMA’s debt issuance of over $31 billion since 2022, combined with other supportive measures, has alleviated some of the strain. However, the banking sector must continue to address systemic challenges to sustain long-term growth, Christou said.

Loan-to-Deposit ratio below limit

The loan-to-deposit ratio in Saudi banks has remained steady at 82.16 percent in November, despite the fact that loans grew by over 13 percent annually, which outpaced the deposits growth over the same period.

The LDR is a key indicator used by banks to measure the proportion of loans granted compared to the deposits they hold. In this case, even though the demand for loans has increased at a faster pace than deposit growth, the ratio has stayed below the regulatory limit of 90 percent.

The stability in the LDR is likely due to support from other sources of funding, such as debt issuance and private placements. These alternative funding methods have helped banks maintain their liquidity and ensure they can continue to lend without being overly reliant on deposits, according to Christou.

According to a June report by the International Monetary Fund, the Saudi banking sector is resilient, with stress tests indicating that both banks and non-financial businesses can withstand shocks, even in challenging scenarios.

However, close attention is needed to balance credit growth, funding, and systemic risks, especially as large-scale government projects under Vision 2030 accelerate.

While banks are well-capitalized, profitable, and maintain high liquidity with low nonperforming loans, there are potential risks tied to fast credit growth and the increasing reliance on non-deposit funding sources.

To manage these risks, SAMA may need to adjust its policies, such as revisiting loan-to-value limits, debt burden guidelines, and loan-to-deposit ratios.

Enhanced tools, like a countercyclical capital buffer, can also help prepare for future challenges. Moreover, better monitoring — such as tracking house prices and bank exposures to large projects — would provide a clearer picture of risks.