SAO JOAO DA BOA VISTA, Brazil: A towering machine rumbles through the fields of Julio Rinco’s farm in the Brazilian state of Sao Paulo, engulfing whole coffee trees and shaking free beans that are collected by conveyor belts in its depths.
This automatic harvester is one of several innovations that have cut Rinco’s production costs to a level that few who use traditional, labor-intensive methods can match.
With increasing use of mechanization and other new technologies, the world’s top two coffee producers, Brazil and Vietnam, are achieving productivity growth that outstrips rivals in places such as Colombia, Central America and Africa.
They are set to tighten their grip.
A plunge in global coffee prices in recent months, to their lowest levels in 13 years, has begun to trigger a massive shake-out in the market in which only the most efficient producers will thrive, according to coffee traders and analysts.
Rival producers elsewhere in the world are increasingly likely to be driven to the margins, unable to make money from a crop they have grown for generations. Some are already turning to alternative crops while others are abandoning their farms completely.
Such shifts are almost irreversible for perennial crops like coffee, as the decision to abandon or cut down trees can hit production for several years.
“Brazil and Vietnam have had consistent increases in productivity, other countries have not,” said Jeffrey Sachs, director of the Center for Sustainable Development at Columbia University, citing advances in mechanization, selective crop breeding techniques and irrigation technology.
In Colombia and Central America, coffee is typically grown on hillsides where mechanization is more difficult, and hand-picking cherries has kept production costs relatively high. The African sector, meanwhile, is dominated by small-scale farmers often unable to raise the capital needed for new techniques.
Rinco bought his harvesting machine for around 600,000 reais ($155,600) and is paying the agricultural supplies company with coffee, delivering 400 bags a year over four years. This kind of bartering is common in Brazilian farming.
One such machine in Brazil replaces dozens of people in the field. Even with financing and fuel bills, farmers and machine manufacturers say there is a reduction of 40% to 60% on harvesting costs.
“Beyond the lower costs, it made my life less complicated,” said Rinco, relieved at no longer having the gruelling task of hiring suitable pickers every year for the harvest at his farm in the Sao Joao da Boa Vista area.
“People don’t want to pick coffee anymore, they go to town to find something else to do.”
Brazil and Vietnam now produce more than half the world’s coffee, up from less than a third 20 years ago, and the proportion is rising, US Department of Agriculture estimates show.
Leading producer Brazil alone accounts for over a third of global supply. In a clear sign of increased efficiency, it reported a record crop of 62 million bags last year and is expected to produce another record in 2020, the next on-year in the country’s biennial production cycle — despite the fact the coffee-planting area has been falling for the last six years.
Vietnam is also regularly setting production records while, by contrast, in Colombia the largest ever crop was harvested in the early 1990s and in Guatemala nearly two decades ago, USDA data shows.
In countries such as Guatemala and Honduras, growers who are increasingly abandoning farms are swelling the ranks of migrants trying to enter the United States.
Average yields in Brazil have risen sharply over the last decade with figures from the UN Food and Agriculture Organization showing an increase of more than 40% to about 1.5 tons per hectare. Vietnam has also seen yields rise from already strong levels, climbing about 18% to around 2.5 tons.
Colombia did show some growth, about 12%, but remains well behind at about 1 ton per hectare while in Central America there was a decline of around 3% to a meagre 0.6 tons.
Businessman Alexandre Gobbi and two partners decided to enter coffee farming in Brazil four years ago. They bought an area in Sao Sebastião do Paraíso, in the main producing belt in Minas Gerais state, and sought out state-of-the-art tech.
Today, his farm has equipment including an underground dripping irrigation system with artificial intelligence, considered the world’s most advanced.
“It does almost everything by itself. Reads humidity levels, tells me when to add water and fertilizer and by how much,” he told Reuters, pointing to the digital panels in his control room.
With the system, plus other equipment including harvesters, he has doubled average yields to around 60 bags per hectare, and can make a profit even with current low prices.
Arabica coffee futures on ICE Futures US, the most widely used global benchmark for coffee prices, fell in May to 87.60 cents per lb, the weakest level since September 2005.
Prices have since recovered slightly but remain at a level where few producers outside Brazil and Vietnam can make money.
Arabica beans, which provide a smoother and sweeter taste, constitute nearly two-thirds of the world’s coffee. More bitter and stronger robusta beans largely make up the rest of global supply, much of them hailing from Vietnam.
A warehouse owned by Vietnamese coffee exporter Simexco Dak Lak Ltd. in the town of Di An, near Ho Chi Minh City, illustrates the scale of Vietnam’s coffee operation.
Coffee is stacked in neat piles several meters high, awaiting export to Europe. The warehouse has enough capacity to store 20,000 tons during the harvest season.
“At the height of the harvest, having enough space to create an aisle to walk through the warehouse becomes a luxury,” said Thai Anh Tuan, who manages one of three warehouses for Simexco, which exports over 80,000 tons of robusta a year.
“Every tiny bit of space will be taken up by these little beans,” Tuan added. “We have to hire additional warehouses nearby for extra storage.”
Tuan also credited the steady increase of Vietnamese coffee exports over the last four to five years to an increase in innovative farming techniques, including intercropping — growing different crops together — and the use of better technology in irrigation and cultivation.
Coffee is still the key cash crop for Dak Lak, Vietnam’s largest coffee-producing province, although durians, jack fruit, mangoes and avocado trees have all been intercropped with coffee trees to maximize income in recent years, farmers told Reuters.
Ksor Tung, a coffee grower with a 10-hectare farm, said intercropping coffee with durian trees resulted in better protection from direct sunlight and pests.
“Farmers here have experimented with intercropping for nearly a decade,” Tung told Reuters.
“Peppers used to be the most popular tree when it comes to intercropping but for the past three years, with the prices falling, almost all farmers have turned to fruit trees instead,” said Tung, adding that farmers who intercrop can triple their income per hectare.
Farmers in Colombia face a far different future.
Battered by low prices and high costs, some are contemplating switching to other crops or selling up, despite tens of millions of dollars in government aid.
Jose Eliecer Sierra, 53, has farmed coffee for three decades but low prices have forced him to look at alternatives — Hass avocados and cattle among them.
“Avocados are in high demand abroad and it’s one of the options,” he said, standing amid some of his 41,000 coffee trees on a mist-shrouded mountainside near Pueblorrico, in Antioquia province.
“Another very tempting option that people are thinking about is cattle — knocking down coffee trees and planting grass for cows,” said Sierra.
It is not the first time Colombian coffee growers have looked to other crops for a better living. Many in the south — sometimes under pressure from armed groups — abandoned it for the more lucrative coca, the raw ingredient in cocaine, though coffee has since rebounded.
For some growers, even switching crops may not save them.
Uriel Posada, who worked for more than 30 years as a house painter in the United States, dreamed of coming home to Colombia to grow coffee. Now his land is up for sale.
“I’m up to my neck in debt,” the 52-year-old said, gazing up the steep hill where his 30,000 coffee trees are planted.
“Brazil has a huge advantage over us — the land is flat and they have machinery,” Posada said. “Here I have to pay a human being to go tree by tree, branch by branch and pick the red berries.”
Avocados and cattle are good alternatives, Posada said, but require start-up funds and transition time that many local growers do not have.
“I’ll sell, pay what I owe and go. End my Colombian dream.”
How Brazil and Vietnam are tightening their grip on the world’s coffee
How Brazil and Vietnam are tightening their grip on the world’s coffee
- A plunge in global coffee prices in recent months, to their lowest levels in 13 years, has begun to trigger a massive shake-out in the market in which only the most efficient producers will thrive
Closing Bell: Saudi main index slips to close at 12,059
RIYADH: Saudi Arabia’s Tadawul All Share Index slipped on Sunday, losing 39.80 points, or 0.33 percent, to close at 12,059.53.
The total trading turnover of the benchmark index was SR3.32 billion ($885 million), as 91 of the stocks advanced and 129 retreated.
On the other hand, the Kingdom’s parallel market Nomu gained 72.18 points, or 0.23 percent, to close at 31,173.07. This comes as 52 of the listed stocks advanced, while 35 retreated.
The MSCI Tadawul Index lost 5.47 points, or 0.36 percent, to close at 1,513.54.
The best-performing stock of the day was Saudi Cable Co., whose share price surged 8.49 percent to SR93.30.
Other top performers included Sumou Real Estate Co., whose share price rose 6.61 percent to SR47.60, as well as Walaa Cooperative Insurance Co., whose share price surged 3.45 percent to SR18.60.
Al-Baha Investment and Development Co. recorded the biggest drop, falling 6.06 percent to SR0.31.
Riyadh Cables Group Co. also saw its stock prices fall 3.07 percent to SR145.
On the announcements front, Saudi Tadawul Group Holding Co. announced the latest development regarding the acquisition of its subsidiary, Tadawul Advanced Solutions Co., or WAMID, of 51 percent shares in Direct Financial Network Co., by announcing the acquisition of 49 percent of the entire remaining shares in Direct Financial Network Co. for SR 220.5 million.
According to a Tadawul statement, the transaction is integral to WAMID’s growth strategy, supporting the group’s ambitious strategy.
The acquisition of 100 percent of the entire shares of the issued capital of Direct Financial Network Co. will create an opportunity to build new capabilities, elevate innovation in the regional capital markets, diversify revenues, and advance the capital market.
The acquisition value will be funded by the existing Saudi Tadawul Group Holding Co. Sharia-compliant banking facilities. The transaction is also expected to have a positive financial impact on the group over time.
Saudi Tadawul Group Holding Co. ended the session at SR223, up 0.18 percent.
Mufeed Co. announced that its board of directors has decided to distribute SR33 million in cash dividends to shareholders for the first half of 2024.
A bourse filing revealed that the total number of shares eligible for dividends amounted to 6.6 million, with the dividend per share at SR5. The statement also revealed that the percentage of dividends to the share par value stood at 50 percent.
Mufeed Co. ended the session at SR76 down 10.81 percent.
Salama Cooperative Insurance Co. announced the period for rights issue trading and new shares subscription from Dec. 17-29.
According to a Tadawul statement, holders of rights may exercise their right to subscribe to new shares, in full or in part, up to the number of rights available in their portfolios. Trading rights and subscribing to new shares will be conducted according to the terms outlined in the prospectus for registered shareholders and new investors.
Salama Cooperative Insurance Co. ended the session at SR17.32, down 0.81 percent.
UAE’s proptech Stake expands to Saudi Arabia, to consider regional HQ relocation, GM says
- Hanouf Bin Saeed said move aims to capitalize on rapidly growing real estate market driven by Saudi Vision 2030 initiatives
- After a successful closure of a $14 million funding round in June, Stake officially launched its operations in the Kingdom on Dec. 9
RIYADH: UAE real estate investment platform Stake is considering relocating its regional headquarters to Saudi Arabia, but no immediate plans have been finalized, according to a top official.
In an interview with Arab News, Hanouf Bin Saeed, general manager of Stake Saudi Arabia, said the move would align with the company’s strategy to expand its footprint in the Kingdom, capitalizing on the rapidly growing real estate market driven by Saudi Vision 2030 initiatives.
“In our next step, we aim to move the regional headquarters to Saudi Arabia,” she told Arab News. “Today, with the initiatives happening, it could be very soon. We don’t have a timeline, but our focus today is to grow our footprint in Saudi, build our team, (and) ensure that we have robust, stable growth in Saudi Arabia to be able to capitalize on opportunities and an unparalleled market that is happening in the real estate market today.”
Bin Saeed said the relocation is merely a possibility and the company’s immediate plans focus on expansion and building a solid foundation in the Kingdom.
After a successful closure of a $14 million funding round in June, Stake officially launched its operations in Saudi Arabia on Dec. 9, debuting with its first real estate investment opportunity, which was already 60 percent funded as of mid-December.
The platform, originally established in the UAE four years ago, allows individual investors to invest in real estate projects.
While property investing typically involves large amounts of upfront capital and an antiquated buying process, investors globally can access real estate through Stake from as little as SR500 ($136), the company said.
According to Bin Saeed, Stake has over 800,000 users from 170 countries and has facilitated real estate transactions exceeding $130 million in gross merchandise value in the UAE market. The platform has also distributed more than $5 million in dividends to investors from rental income.
Highlighting the strategic importance of Saudi Arabia for Stake’s expansion, she underscored the transformative economic initiatives under Vision 2030, including a goal to achieve 70 percent homeownership among Saudi nationals by 2030.
“The country is injecting real estate units into the Saudi market — above 500,000 units — just to be able to reach that percentage by 2030,” she said.
The Kingdom’s booming real estate sector, driven by residential, commercial, and hospitality demand, provides fertile ground for Stake’s mission of democratizing real estate investments, she added.
“For us in Stake, our mission is fully aligned with Vision 2030 when it comes to democratizing real estate investments,” Bin Saeed said.
“This is why Stake decided to come to Saudi Arabia, bringing the solution that has been built and successful in the UAE market to Saudi Arabia and to the Saudi market to be able to capitalize on the opportunities that are coming today,” she added.
Stake is one of the few platforms regulated by the Kingdom’s Capital Market Authority to cater to non-resident foreign investors, a key competitive advantage as the Saudi government works to position the country as a global investment hub, Bin Saeed added.
The platform obtained its CMA license in July and has since established an office and local team in Saudi Arabia, while also preparing to expand its fund offerings in the Kingdom significantly.
“For Stake, as we mentioned, we just launched with a fund which is around SR200 million, and our expectation for the coming six months is to launch funds with SR1 billion amount and move forward from there,” Bin Saeed said.
Stake is also eyeing opportunities in commercial real estate and office spaces as international businesses increasingly enter the Saudi market.
The Kingdom’s plans to host the FIFA World Cup in 2034 and the associated growth in the hospitality sector are expected to further boost rental income by 30 percent to 40 percent, according to Bin Saeed.
With the Kingdom’s rapidly evolving real estate landscape, Stake sees Saudi Arabia as a cornerstone of its regional growth strategy.
Bin Saeed stressed the company’s long-term commitment, saying: “We are tapping into different options when it comes to the real estate itself and to be able to localize the market and create these opportunities.”
Saudi Arabia invests $2.66bn to transform logistics infrastructure with 18 new zones
RIYADH: Saudi Arabia is strengthening its logistics infrastructure by developing 18 new logistics zones, with total investments exceeding SR10 billion ($2.66 billion), according to senior officials.
This move is part of the country’s broader strategy to attract both local and global investments. During the opening ceremony of the sixth edition of the Supply Chain Conference in Riyadh, Saleh Al-Jasser, minister of transport and logistics, announced that the Kingdom plans to increase the number of logistics zones from 22 to 59 by 2030.
“The Kingdom has successfully strengthened its logistical capabilities to support the national economy. This progress has attracted leading global companies to invest in the logistics sector,” Al-Jasser said.
He further stated: “Both local and international private sectors have committed to establishing several logistics zones, with contracts signed for the creation of 18 logistics zones in ports, totaling investments exceeding SR10 billion.”
Al-Jasser also highlighted the Kingdom’s rising position in the global container handling rankings. According to the UNCTAD report for 2024, Saudi Arabia gained an additional 231 points in the Liner Shipping Connectivity Index and added 30 new maritime shipping lines, underscoring the Kingdom’s key role in global trade.
“Saudi Arabia has played an active role in enhancing the efficiency of global supply chains and establishing the foundations necessary to ensure the smooth flow of goods and commodities across the region,” Al-Jasser said.
He added: “This has been achieved by leveraging the Kingdom’s strong and growing logistical capabilities, which include an advanced network of regional and international airports, a robust series of highly efficient ports, and modern railway and road networks. These assets accelerate shipping, handling, and export activities, linking the Kingdom to global markets.”
Al-Jasser emphasized the ongoing efforts to enhance the Kingdom’s position as a global logistics hub. He highlighted that the integration of various transport modes—such as ports, airports, and railways—into a unified and efficient system will boost competitiveness and facilitate seamless trade flows.
“The Kingdom will continue to enhance its logistical capabilities to facilitate exports, support supply chains, and improve its performance in global logistics indicators,” Al-Jasser said. He further emphasized: “The focus will remain on bolstering maritime shipping routes, expanding air freight operations, increasing rail freight capacities, and activating logistics centers to support sustainable development, further cementing the Kingdom's role as a global logistics hub and a vital link in international supply chains.”
Al-Jasser also underlined the importance of supply chains in Saudi Arabia’s broader economic strategy, noting their fundamental role in achieving the sustainability and integration goals set out in the National Transport and Logistics Strategy and Vision 2030.
“We consider them a fundamental pillar for achieving the sustainability and integration we aspire to, in line with the National Transport and Logistics Strategy and the Kingdom’s Vision 2030,” he said.
After his speech, Al-Jasser told Arab News that the growing interest from global multinational companies in Saudi Arabia’s logistics sector is a testament to the Kingdom’s strategic location and commitment to becoming a global logistics hub.
“This will not only create jobs for Saudis and make it more efficient for Saudi companies to operate, but will also enable various sectors across Saudi Arabia,” Al-Jasser said.
He added: “This comes as part of the implementation of the National Transport and Logistics Strategy, which stems from Vision 2030 that is inspired and steered by his royal highness the crown prince.”
Meanwhile, Minister of Industry and Mineral Resources Bander Alkhorayef emphasized the Kingdom’s natural resources and abundant energy supply as crucial advantages for its industrial sector.
“The diverse resources of the Kingdom, including its natural wealth and abundant energy supply, are all positive factors that make Saudi Arabia an important partner in the industrial sector,” he said.
Alkhorayef also highlighted the vital role logistics plays in enabling Saudi industries to compete globally, particularly given the limitations of the domestic market.
“The presence of robust supply chains and logistics services is of utmost importance in reducing costs for manufacturers and investors, while enhancing the Kingdom's overall competitiveness,” he stated.
He continued: “First, the natural resources available in the Kingdom are very large and are among the foundations of the main national strategies, especially the Industrial Strategy and the Mining Strategy. Maximizing the benefit from these resources is a priority, particularly in oil, gas, petrochemicals, and minerals.”
Alkhorayef further noted, “Secondly, the geographical location of the Kingdom qualifies it to connect different regions of the world. In addition, the excellent infrastructure and the availability of energy at globally competitive prices make the Kingdom a natural choice for many manufacturing industries, whether intermediate products to become final in other regions or vice versa.”
The minister also stressed Saudi Arabia’s strong domestic market, which is further bolstered by the Gulf region’s high purchasing power, making it an attractive market for various products, especially those in critical sectors such as food security, healthcare, pharmaceuticals, and water-related industries.
“Essentially, the Kingdom’s robust local demand and the Gulf’s economic strength create significant opportunities for businesses and investors in these essential sectors,” Alkhorayef added.
Reflecting on global challenges, including the COVID-19 pandemic, geopolitical conflicts, and disruptions in global supply chains, Alkhorayef acknowledged that these issues underscore the Kingdom’s potential to attract investments and use its resources and advanced technologies to address supply chain challenges.
He also highlighted Saudi Arabia’s success in re-exports, stating, “In 2024, re-exports reached SR61 billion, representing a 23 percent growth compared to the previous year.”
“This remarkable achievement was made possible through outstanding capabilities, robust infrastructure, and the seamless coordination among various entities,” he added.
Alkhorayef emphasized that Saudi Arabia’s strategic location and infrastructure are key enablers of its growing industrial sector. “The excellent infrastructure and the availability of energy at globally competitive prices make the Kingdom a natural choice for many manufacturing industries,” he said.
A new prospect in rail projects
Al-Jasser also discussed the Northern Train Line, which he described as the Kingdom’s largest rail project and a cornerstone for the mining sector. The line, connecting mining areas with key ports, plays a vital role in supporting industrial and economic growth.
“The Northern Train Line is likely the largest rail project in the Kingdom. It has been established as a foundation to enable the mining sector. Therefore, all infrastructure development plans are interconnected with the inputs from various sectors,” he said during the panel session.
Al-Jasser noted that the Saudi Railway Co. is currently expanding and duplicating the Northern Train Line with investments exceeding SR5 billion. This expansion is part of the Kingdom's broader plans to enhance the mining sector and ensure efficient connectivity between the railway and eastern ports, supporting both export and trade growth.
Through these efforts, Saudi Arabia is continuing to align its industrial and logistics sectors with the ambitious goals of Vision 2030, fostering a sustainable and globally competitive economy.
It is worth noting that the conference brings together an exclusive group of international experts and specialists, focused on sharing best practices and the latest methods to enhance supply chain performance and efficiency.
The program features a series of engaging dialogue sessions, as well as workshops and an entrepreneurship corner.
Additionally, a platform has been created to empower Saudi women in the supply chain sector, offering training and development opportunities to boost their contributions to the Saudi economy and open new career paths in key industries.
Oman’s GDP grows 2.6% in Q2, driven by non-hydrocarbon sector
- Real GDP also saw an increase of 1.9%, with the non-hydrocarbon sector contributing 4.2%
- etrochemical and plastics sector saw a 58% increase, while the mining industry dropped by 42%
JEDDAH: Oman’s nominal gross domestic product grew by 2.6 percent at the end of the second quarter of the year compared to the same period in 2023.
The growth was primarily driven by a 5 percent increase in the non-hydrocarbon sector. However, it was partially offset by a 1.4 percent reduction in hydrocarbon sector production, according to preliminary data from the National Center for Statistics and Information.
Real GDP also saw an increase of 1.9 percent, with the non-hydrocarbon sector contributing 4.2 percent to this expansion.
As of October, the average price of Omani oil increased by 2.5 percent to $82.6 per barrel, while oil production decreased by 5.4 percent to nearly 994,000 barrels per day. Additionally, the Consumer Price Index reflected a modest 0.6 percent year-on-year inflation as of October.
Non-oil exports, insured sales grow 5% in Q3
The sultanate’s non-oil exports and domestic sales insured by Credit Oman grew by 5 percent in the third quarter, reaching 272.8 million Omani rials ($708.8 million).
Domestic sales rose 15 percent to 126.9 million rials, while non-oil exports declined slightly by 2 percent to 145.9 million rials, according to official data reported by the country’s news agency.
The petrochemical and plastics sector saw a 58 percent increase, while the mining industry dropped by 42 percent. In the domestic market, packaging led growth with a 156 percent rise, while building materials declined by 12 percent. Consumer goods and food sales grew by 13 percent.
133 maritime tourism licenses issued
The Ministry of Transport, Communications, and Information Technology has said that the number of licenses issued for maritime tourist trips from the beginning of January to the end of August reached 133.
Eight firms are currently managing and operating the tourist marine docks in the governorates of Musandam, South Al-Batinah, Muscat, and Dhofar.
The Director General of Ports, Muhanna bin Moosa bin Baqir, said that the ministry oversees Oman’s maritime affairs, focusing on monitoring operational performance and ensuring compliance with international standards for ship security and port facilities. He added that his ministry aims to enhance the operational efficiency of these terminals.
Gas production and imports up 4.5% to 47.1bn cubic meters
The total domestic production and import of natural gas in Oman reached 47.1 billion cubic meters by the end of October, marking a 4.5 percent increase compared to 45.1 billion cubic meters in the same period last year.
According to statistics from the NCSI, industrial projects accounted for 51.1 percent of natural gas usage in the country by the end of October, totaling approximately 24.1 billion cubic meters.
The total natural gas usage reached 9.9 billion cubic meters in oil fields, 12.9 billion cubic meters in power stations, and 208.3 million cubic meters in industrial areas.
Non-associated natural gas production, including imports, amounted to 37.5 billion cubic meters, while associated production stood at 9.6 billion cubic meters by the end of the current year.
Oil exports reach 256.3m barrels by October
According to the same statistics, Oman’s total oil exports reached approximately 256.3 million barrels by the end of October, with an average price of $82.6 per barrel.
Oil exports accounted for 84.6 percent of the total oil production, which was 303.1 million barrels.
The data also revealed that crude oil production decreased by 6.6 percent, totaling 232.1 million barrels by the end of October. However, condensate production increased by 0.2 percent, reaching 71.1 million barrels. The average daily oil production was 993,900 barrels.
Japan, GCC strengthen economic ties with 1st round of FTA talks
- Talks covered trade in goods and services, customs procedures, digital trade, rules of origin, intellectual property, and general provisions
- It marks the beginning of a broader process aimed at strengthening trade relations
RIYADH: Economic ties between Japan and the Gulf Cooperation Council advanced with the successful completion of the first round of Free Trade Agreement negotiations in Riyadh on Dec. 12.
Led by Saudi Arabia’s General Authority for Foreign Trade, the discussions aimed to lay the groundwork for future trade agreements, covering key areas such as trade in goods and services, customs procedures, digital trade, rules of origin, intellectual property, and general provisions.
This milestone marks a significant step towards deeper economic collaboration between the two regions. Fareed Al-Asaly, deputy governor of International Organizations and Agreements at GAFT, underscored the importance of the talks, emphasizing that the agreement could lead to increased trade volumes and closer economic integration. He also noted that Japan is a key market for GCC exports.
The Saudi delegation included representatives from multiple ministries and government bodies, such as the ministries of energy, investment, environment, water and agriculture, industry and mineral resources, economy and planning, and interior.
Additionally, officials from the Saudi Authority for Intellectual Property, the Zakat, Tax, and Customs Authority, the National Cybersecurity Authority, the Saudi Export Development Authority, and the Saudi Central Bank participated in the discussions.
The conclusion of this first round of negotiations marks the beginning of a broader process aimed at strengthening trade relations and fostering economic cooperation between the GCC and Japan.
This year has already seen significant strides in the economic partnership between Saudi Arabia and Japan. In May, both nations agreed to collaborate on building global supply chains for clean energy resources, including hydrogen and ammonia. The goal is to establish a robust international network for clean energy.
In July, during Japanese Prime Minister Fumio Kishida’s visit to Saudi Arabia, the two countries exchanged 26 pre-signed economic agreements covering sectors such as healthcare, clean energy, mining, and digital innovation. Energy Minister Prince Abdulaziz bin Salman highlighted the long-standing energy partnership, noting that Saudi Arabia supplied around 40 percent of Japan’s oil in 2021.
In October, the Saudi Public Investment Fund signed five memorandums of understanding with Japanese financial institutions, with agreements worth up to $51 billion.
These deals aim to boost bilateral capital flows through both debt and equity, further solidifying the financial relationship between the two nations.
This continued collaboration signals a growing and mutually beneficial partnership between Japan and the GCC, with the potential to reshape regional economic dynamics and create new opportunities for growth and innovation.