BEIRUT: The Lebanese draft state budget for 2019 is the start of a “long road” and shows Lebanon is determined to tackle public sector waste, Prime Minister Saad Al-Hariri said, after his unity cabinet wrapped up marathon talks on the plan.
The budget finalized by the government on Friday cuts the deficit to 7.5% of GDP from 11.5% in 2018. It is seen as a critical test of Lebanon’s will to launch reforms that have been put off for years by a state riddled with corruption and waste.
“The 2019 budget is not the end. This budget is the beginning of a long road that we decided to take in order to lead the Lebanese economy to safety,” Hariri said in a speech at a Ramadan iftar meal on Saturday.
Lebanon’s bloated public sector is its biggest expense, followed by the cost of servicing a public debt equal to some 150% of GDP, one of the world’s heaviest debt burdens.
The government, which groups nearly all of Lebanon’s main political parties, met 19 times to agree on the budget. Hariri said the budget for 2020 would not take that much time “because now we know what we want to do.”
“The 2019 budget is the beginning of the process of what we want to do in 2020, 2021, 2022 and 2023,” he said, according to a transcript of his remarks sent by his office.
The cabinet is due to meet on Monday at the presidential palace to formally seal the process before the budget is referred to parliament.
The budget could help unlock some $11 billion in financing pledged at a Paris donors’ conference last year for infrastructure investment, if it wins the approval of donor countries and institutions.
Hariri said the budget was a message to the Lebanese, financial markets and friendly foreign states that Lebanon was determined to “address the weakness, imbalance and squander in the public sector.”
Measures to rein in the public sector wage bill include a three-year freeze in all types of state hiring and a cap on extra-salary bonuses. State pensions will also be taxed.
A big chunk of the deficit cut stems from tax increases including a 2% import tax and a hike in tax on interest payments.
The government also plans to cut some $660 million from the debt servicing bill by issuing treasury bonds at a 1% interest rate to the Lebanese banking sector.
Fears the budget would lead to cuts to state salaries, pensions or benefits triggered weeks of strikes and protests by public sector workers and military veterans.
Lebanese PM: new budget start of “a long road” to economic safety
Lebanese PM: new budget start of “a long road” to economic safety
- Lebanese PM said the new budget is only the start of the changes for the country
- Lebanon has one of the biggest debts in the world
Closing Bell: Tadawul closes higher on Monday as TASI edges up; Nomu surges over 300 points
- MSCI Tadawul 30 Index rose 2.47 points to settle at 1,384.58
- Parallel market Nomu climbed 314.77 points to close at 26,984
RIYADH: Saudi Arabia’s Tadawul All Share Index closed slightly higher on Monday, gaining 24.82 points, or 0.23 percent, to reach 10,850.09.
Total trading turnover on the main market stood at SR4 billion ($1 billion).
Market breadth remained mixed, with 116 gainers against 120 decliners. The MSCI Tadawul 30 Index rose 2.47 points, or 0.18 percent, to settle at 1,384.58.
The parallel market Nomu recorded a more pronounced gain, climbing 314.77 points, or 1.18 percent, to 26,984, with 31 stocks advancing and 49 retreating.
Savola Group led the main market gainers, advancing 4.48 percent to close at SR28.
United Carton Industries Co., which recently debuted on Tadawul, added 4.40 percent to close at SR42.70 with over SR217 million in traded value.
Other notable gainers included Aldawaa Medical Services Co., which rose 2.92 percent to SR77.60, Middle East Pharmaceutical Industries Co., up 2.82 percent to SR124, and Jabal Omar Development Co., which gained 2.76 percent to close at SR21.56.
On the downside, Riyad Bank posted the sharpest drop of the day, falling 3.51 percent to close at SR27.50.
Zamil Industrial Investment Co. dropped 2.76 percent to SR38.75, while Naseej International Trading Co. declined 2.86 percent to SR78.20.
Emaar The Economic City slipped 2.71 percent to SR12.92, and Abdullah Saad Mohammed Abo Moati for Bookstores Co. fell 2.45 percent to close at SR35.80.
On the announcement front, Al-Modawat Specialized Medical Co. disclosed that its board had passed a resolution to initiate the company’s transfer from the Parallel Market to the Main Market.
The move is subject to regulatory approvals and fulfillment of the market’s listing conditions. Shares of Al-Modawat ended the day down 1.84 percent at SR17.06.
Saudi Arabian Mining Co. announced that it has received approval from the Capital Market Authority to proceed with a capital increase in connection with its previously disclosed acquisition of full ownership in Maaden Bauxite and Alumina Co. and Maaden Aluminium Co.
The move is part of a share purchase and subscription agreement signed with AWA Saudi and Alcoa Saudi in 2024.
The capital increase will raise Ma’aden’s share capital from SR38.03 billion to SR38.89 billion through the issuance of 861.9 million new shares.
The newly issued shares will be used to acquire 100 percent of the shares held by AWA Saudi in MBAC and Alcoa Saudi in MAC, corresponding to 25.1 percent of the issued capital of each entity.
In total, Ma’aden will issue 89.98 million new shares to AWA Saudi and 165 million shares to Alcoa Saudi at a nominal value of SR10 per share.
The transaction is expected to be executed through a combination of share issuance and cash payment.
The company stated that further updates, including shareholder meeting arrangements for capital increase approval, will be announced in due course.
Shares of Ma’aden closed 0.92 percent higher on Monday at SR49.50.
Oman’s electrical machinery exports surge 141% in Q1 as industrial policy drives growth
- Non-oil exports rose by 8.6% year on year in the first quarter, reaching 1.618 billion rials
- Growth in the electrical equipment sector is being supported by major infrastructure developments
RIYADH: Exports of electrical machinery and equipment from Oman surged by 141 percent in the first quarter of 2025, reaching 128 million Omani rials ($332.8 million) compared to 53 million rials in the same period of 2024, according to official data.
The strong performance of the sector highlights its growing importance to the country’s industrial base and export competitiveness, the National Center for Statistics and Information revealed.
Officials have linked the sharp rise to rising demand across domestic and regional markets, driven by ongoing infrastructure expansion and increased investment in renewable energy projects.
In figures released in May, the Oman News Agency revealed that the country’s non-oil exports rose by 8.6 percent year on year in the first quarter of 2025, reaching 1.618 billion rials.
Commenting on the latest release, Khalid Al-Qassabi, director general of Industry at the Ministry of Commerce, Industry and Investment Promotion, stated that the positive results reflect the resilience and diversity of Oman’s industrial base, according to a report by the ONA.
“He noted that the ministry continues to implement integrated industrial policies aimed at enhancing the position of national products in regional and international markets and driving industrial exports to higher levels,” the news agency added.
Al-Qassabi said that growth in the electrical equipment sector is being supported by major infrastructure developments, such as the expansion of electricity networks, utilities, and new cities.
He also pointed to rising interest in renewable energy technologies, which is boosting demand for domestically manufactured components.
The sector is considered a strategic priority under Oman’s Industrial Strategy 2040, with the potential to enhance supply chains, increase national value-added, foster entrepreneurship, and support the localization of advanced technologies.
Jasim Al-Jadeedi, technical director in the Office of the Undersecretary for Commerce and Industry, reiterated the ministry’s focus on expanding the global presence of Omani industrial goods.
He said this is a central objective of the country’s industrial strategy and a key component of its economic diversification agenda under Oman Vision 2040.
Al-Jadheedi explained that several initiatives are underway to improve product quality and competitiveness, including support for manufacturers in meeting international technical standards.
He added that the government is working with relevant stakeholders to unlock new export markets through trade agreements, international exhibitions, and trade missions, while offering targeted incentives to local exporters.
The technical director also emphasized the importance of adopting advanced technologies, including artificial intelligence and Industry 4.0 tools, to enhance efficiency, reduce costs, and achieve sustainable industrial growth.
This sectoral expansion comes amid broader momentum in the industrial economy.
Total credit extended by Oman’s banking sector increased by 9 percent year-on-year to 33.6 billion rials by the end of April, indicating continued strength in financing for the private sector and industrial enterprises.
Non-oil industrial exports overall rose by 8.6 percent during the first quarter to 1.618 billion rials, up from 1.49 billion rials a year earlier.
Industrial goods accounted for 28 percent of total exports during the period, led by electrical machinery and mineral products, the latter of which recorded a 14.1 percent rise in exports to 462 million rials.
Riyadh mall rents up 4% as demand increases: Knight Frank
- Riyadh accounts for the largest share of the 4.9 million sq. meters of retail developments
- Other areas include Jeddah, Dammam Metropolitan Area, Khobar, and Dhahraneas include Jeddah, Dammam Metropolitan Area, Khobar, and Dhahran
RIYADH: Saudi Arabia’s capital is spearheading the Kingdom’s retail transformation, with mall rents seeing a 4 percent annual rise and 2.2 million sq. meters of shop space to be developed by 2030.
According to Knight Frank’s Spring 2025 Saudi Arabia Retail Market Overview, Riyadh accounts for the largest share of the 4.9 million sq. meters of retail developments planned across the Kingdom’s five largest cities by 2030.
These areas include Jeddah, Dammam Metropolitan Area, Khobar, and Dhahran.
The need for more retail space is evidenced by the average mall rent in the Saudi capital rising to SR2,848 ($765) per sq. meter by the end of March, according to the report, with occupancy rates up five percent to reach 92 percent in the first quarter of 2025.
The findings come as Saudi Arabia steps up efforts to become a global hub for tourism and business by the end of the decade, with the Real Estate General Authority projecting the property market to reach $101.62 billion by 2029, driven by an anticipated compound annual growth rate of 8 percent from 2024.
According to Knight Frank, Riyadh’s retail transformation is being accelerated by a combination of population growth, both domestic and expatriate, along with rising disposable incomes.
“Developers are prioritizing experiential formats, with over half of upcoming projects incorporating entertainment zones, dining experiences, and cinemas. These trends align with Vision 2030’s objective to create vibrant, leisure-centric urban spaces,” the report said.
In Jeddah, the retail market expanded with approximately 225,000 sq. meters of new space delivered in 2024, including Phase 1 of Souq 7 and Al Bahr Mall. The city’s total retail stock reached 2.9 million sq. meters. Rents in regional and super-regional malls rose two percent to SR2,513 per sq. meter, while occupancy declined slightly to 86 percent.
Jeddah is also set to see the launch of the Jawharat Mall by Cenomi Centers, a dedicated luxury retail district spanning 87,000 sq. meters, expected to be completed by the end of 2025. Another significant development, the Cove by Ezdihar, will deliver 70,000 sq. meters along Jeddah’s waterfront.
In the Dammam Metropolitan Area, retail performance remained stable. Rents in regional and super-regional malls rose slightly to SR2,285 per sq. meter, with community centers seeing a 1.25 percent increase. Occupancy rates held steady at around 90 percent.
New supply additions of 31,000 sq. meters in 2024 brought total retail stock to 1.4 million sq. meters.
Regional malls typically range from 30,000 sq. meters to 90,000 sq. meters and offer a broad mix of retail stores and services, often anchored by one or two department stores.
Super-regional malls exceed 90,000 sq. meters and include a wider variety of retail, dining, and entertainment options, serving a larger trade area and drawing visitors from across an entire metropolitan region.
Consumer spending in Saudi Arabia grew by 7 percent year-on-year to reach SR1.41 trillion in 2024, fueled by a surge in point-of-sale and e-commerce transactions, according to Knight Frank.
Of this, point-of-sale transactions reached SR668 billion, marking a 9 percent annual increase, while e-commerce grew by 26 percent to SR197.4 billion, reflecting the Kingdom’s accelerating shift toward digital consumption
Flagship destinations such as Riyadh Park and Al Nakheel Mall have continued to benefit from strong tenant demand and rising foot traffic, driven by integrated entertainment offerings, including cinemas and family attractions.
Riyadh’s total retail supply stood at 4 million sq. meters during the first quarter, bolstered by the launch of key projects like Solitaire Riyadh, a 65,000 sq. meter development blending upscale retail with leisure experiences.
An additional 540,000 sq. meters of retail space is expected to be added in 2025, bringing the total to 5.2 million sq. meters in 2026.
The report highlights that more than half of the upcoming projects are integrating entertainment zones, dining venues, and cinemas, aligning with Vision 2030’s goals of creating vibrant, leisure-centric urban environments.
Luxury retail is also gaining momentum, with international brands expanding their footprint to meet the growing demand for premium shopping.
Omnichannel strategies are becoming critical as digital payments and e-commerce continue to reshape consumer behavior.
The food and beverage sector emerged as a key contributor to retail activity, with restaurants and cafes accounting for 29.7 percent of all point-of-sale transactions in 2024.
This translates to SR198.6 billion, according to data from the Saudi Central Bank.
Projects such as Qiddiya, The Avenues Riyadh, and Jawharat Riyadh are expected to further redefine the urban retail landscape, offering lifestyle-oriented spaces that support the Kingdom’s broader economic diversification and quality-of-life goals.
Co-processing can help Middle East become sustainable aviation fuel hub: IATA official
- Senior vice president of sustainability and chief economist at IATA said the world should act now to increase the production of SAF
- Marie Owens Thomsen said governments in the Middle East region should create investment policies to attract more co-processing
NEW DELHI: The Middle East has all the potential to emerge as a global hub for sustainable aviation fuel production thanks to co-processing opportunities available in the region, according to a top official.
Speaking to Arab News on the sidelines of the International Air Transport Association’s Annual General Meeting in New Delhi, Marie Owens Thomsen, senior vice president of sustainability and chief economist at IATA, said that the world should act now to increase the production of SAF to meet decarbonization targets.
This comes as the region accelerates efforts to produce the fuel, with Saudi Arabia’s Nordic Electrofuel-backed project announcing in January a Jubail plant targeting 350 million liters annually by 2029, using renewable hydrogen and solar PV.
The UAE, meanwhile, aims for 700 million liters by 2031, supported by Emirates, Etihad, and Air Arabia. Emirates has secured over 3 million gallons from Neste for 2024–25 flights, while Shell began supplying SAF at Dubai Airport in 2023.
In her interview, Thomsen said: “The Middle East has huge opportunities for co-processing. What we are seeing across the world is insufficient production of SAF.”
Co-processing is the use of renewable feedstock in conventional fossil fuel units. This method allows existing traditional fuel refineries to seamlessly integrate renewable feedstocks into their production processes without the need for extensive infrastructural changes.
She added: “If this co-processing happens, then boom — we have a SAF plant. Clearly, the Middle East is uniquely positioned for this.”
Thomsen further said that governments in the Middle East region should create investment policies in such a way that oil producers will be more attracted to co-processing.
The use of SAF is widely considered a crucial development for the global aviation industry, as most countries have stipulated targets to achieve net zero as part of their energy transition efforts.
According to Thomsen, the world, on its current trajectory, is expected to produce 400 million tonnes of SAF by 2050, up from an estimated 2 million tonnes in 2025 and 1 million tonnes in 2024.
Amid this projected growth, Thomsen revealed that the world would require at least 500 million tonnes of SAF by 2050 to meet energy transition and sustainability goals.
“On the current trajectory, we will be a 100 million tonnes short in 2050. That is a dramatic shortfall. If we do not address it today, this shortfall may be even greater by the time we reach 2050,” said Thomsen.
She said this presents a challenge and dilemma because as long as jet engines power our flights, liquid fuels remain essential.
“Again, I repeat, the Middle East is uniquely positioned to help the world take a big step forward if we could immediately co-process. There are also lower-carbon fuels which occur naturally in the Middle East, which the world should explore,” she added.
Thomsen revealed that the aviation industry’s net profit margin is lower compared to other sectors, and expenses could rise as SAF gains.
However, she made it clear that effective ways should be adopted to increase the production of the fuel, so that the energy transition targets could be achieved by 2050.
On the opening day of the AGM, Willie Walsh, director general of IATA, also shared identical views, and said that sufficient government measures, including the implementation of effective policies, are needed to achieve decarbonization targets.
He added that ensuring the success of the Carbon Offsetting and Reduction Scheme for International Aviation is crucial to offsetting carbon emissions in the aviation sector.
Under CORSIA, an initiative launched by the International Civil Aviation Organization, airplane operators must purchase and cancel “emissions units” to offset the increase in CO2 emissions.
Pakistan inflation inches up 3.5% year-on-year in May 2025
- Inflation has cooled significantly, easing from 37.97% in May 2023
- Federal budget for fiscal year 2025-26 will be released on June 10
KARACHI: Pakistan’s annual inflation rate rose to 3.5% in May, higher than the April 2025 reading of 0.3%, data from the statistics bureau showed on Monday.
On a month-on-month basis, inflation decreased by 0.2% in May 2025, as compared to a decrease of 0.8% in the previous month and a decrease of 3.2% in May 2024. The CPI inflation average during 11MFY25 stood at 4.61%, compared to 24.52% in 11MFY24.
Inflation has cooled significantly, easing from 37.97% in May 2023.
The CPI reading is higher than the government’s expectations. In its monthly economic report released last week, the finance ministry expected inflation to ease to between 1.5% and 2% year-on-year in May, before picking up to 3%-4% in June.
“CPI inflation General, increased to 3.5% on year-on-year basis in May 2025 as compared to 0.3% of the previous month and 11.8% in May 2024,” the Pakistan Bureau of Statistics (PBS) said in its monthly report.
“On month-on-month basis, it decreased by 0.2% in May 2025 as compared to a decrease of 0.8% in the previous month and a decrease of 3.2% in May 2024.”
Food items, whose prices recorded an increase, included Eggs (24.38%), Chicken (8.63%), Condiments and Spices (5.50%), Sugar (4.07%), Gur (3.66%), Milk Powder (2.80%), Potatoes (1.64%), Butter (1.31%), Fresh Fruits (1.21%), Pulse Gram (1.09%), Beverages (0.87%), Meat (0.82%), Sweetmeat (0.79%) and Pulse Moong (0.53%).
Non-food items that witnessed an increase in rates were Cotton Cloth (3.20%), Motor Vehicles (1.86%), Postal Services (1.74%), Major Tools & Equipment (1.23%), Readymade Garments (1.02%), Tailoring (0.95%) and Cleaning & Laundry (0.65%).
The latest CPI reading was also higher than projections made by several brokerage houses.
JS Global projected Pakistan’s headline inflation to inch up to 2.7% in May.
“Pakistan’s CPI is expected to clock in at 2.7% for May. The base effect is now fading, signaling a return to normalized price trends. This is likely to take 11MFY25 average inflation to 4.7%, down from 11MFY24 average of 24.9%,” JS Global had said in a report.
Last month, the State Bank of Pakistan cut the key interest rate by 100 basis points (bps) to 11%, the lowest policy rate since March 2022 (9.75%). The central bank has cut the rate by 1,100 bps since June from an all-time high of 22%.
