INTERVIEW: Ritz-Carlton Riyadh’s GM spells out two-fold challenge for Kingdom’s hotel industry

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Updated 15 March 2020
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INTERVIEW: Ritz-Carlton Riyadh’s GM spells out two-fold challenge for Kingdom’s hotel industry

  • Hotel manager’s career trajectory reflects an almost-military discipline instilled in him by his father, a major general
  • "To run a hotel properly you need discipline, smartness and attention to detail,” says GM Mohammed Marghalani

DUBAI: For a few weeks in late 2017, the Ritz-Carlton in Riyadh became probably the most famous hotel in the world when it was used to accommodate people involved in Saudi Arabia’s high-profile anti-corruption investigation.

But ever since, it has been “business as usual,” according to the general manager, Mohammed Marghalani  — taking care of the visiting presidents, heads of state and business leaders that make up most of the luxury hotel’s clientele, as well as the occasional honeymoon couple or affluent tourist family wanting a bit of up-market rest and relaxation in the Kingdom’s capital.

“I’ve worked at several big hotels in the Kingdom, but the Ritz-Carlton is different. It is the major hub for all government events in the capital. I was here when President Trump visited, and for events like GCC summits and the Future Investment Initiatives (FII), and have seen a lot of Hollywood celebrities here. There is nothing quite like it in Saudi Arabia,” he told Arab News.

Anybody who has spent any time at the monumental structure northeast of downtown Riyadh, or the equally imposing King Abdul Aziz Conference Center next door, would surely agree. In fact, it is arguable that there is nothing quite like the Ritz-Carlton Riyadh anywhere else in the world.

Whereas most luxury hotels will have a presidential suite for the use of elite guests, the Ritz has 49 “royal suites,” each designed to head-of-state specifications; it has 48 executive suites that would be classed as “presidential” in many five-star establishments; and it has 396 deluxe rooms.

If you get lucky on the “dynamic rate” system used by most hotels, like airlines, to match demand with supply, you might get a deluxe room at the weekend for a bargain SR1,000 ($270) per night; but a royal suite can cost anything between SR15,000 and SR45,000.

It has one of the biggest all-day dining restaurants in the world, the Al-Orjouan, which can seat 450 guests at a time, as well as other fine-dining establishments with European, Asian and Arabic cuisine; it has a luxury swimming pool and spa complex; and it has the Strike bowing alley, popular with families at weekends.


BIO

Born: Riyadh, 1982

Education: 

  • Prince Sultan College for Tourism and Management, Abha KSA
  • Glion Institute of Higher Education, Switzerland.
  • Ecole hoteliere de Lausanne in Switzerland, MBA

Career

  • Manager in training, Four Seasons KSA
  • Chief accountant, Fairmont-Raffles-Swissotel, Riyadh
  • General Manager, Ritz-Carlton Riyadh

Set in 52 acres of landscaped gardens, it was originally planned as a luxurious “guest palace” for official visits, but management of the hotel was soon handed over to Ritz-Carlton as a profitable commercial proposition.

Marghalani joined the Ritz-Carlton in its pre-opening period in 2011, after stints at Fairmont and Four Season properties in the Kingdom, focusing on the financial side of hotel management. He was appointed general manager at the beginning of this year.

His career trajectory reflects an almost-military discipline instilled in him by his father, a major general in the security forces. “All my friends at school were focused on engineering, management and medical careers, but my father told me to get into hospitality and tourism when I left high school in 2000. He told me I would be a pioneer, and now I value his vision,” Marghalani said.

“The hotel business has some similarities to the military, I’ve noticed. To run a hotel properly you need discipline, smartness and attention to detail,” he said.

After a spell in the Prince Sultan College for Tourism and Management in Abha in the Kingdom, he graduated in hospitality and tourism management in 2006 from the Glion Institute of Higher Education in Switzerland, followed by an MBA from the Ecole hoteliere de Lausanne in the same country. 

A few years later, the hotel and tourism sector in Saudi Arabia would take off under the Vision 2030 strategy to diversify away from oil dependency, which placed great emphasis on two big initiatives: Providing leisure facilities at home for Saudi citizens more used to spending leisure time abroad; and encouraging foreign tourists to come to the Kingdom.

By 2030, tourism is expected to grow to 10 percent of the Kingdom’s GDP, worth about $100 billion, and provide 1.5 million new jobs for the young workforce serving the needs of a projected 100 million visitors per year. It is an ambitious program for a country mainly accustomed in the past to catering for the needs of religious pilgrims to the Two Holy Mosques in Makkah and Madinah for Hajj and Umrah.

There is a big number of international brands looking at developments in some of the mega- projects, like Neom, the Red Sea, AlUla and Qiddiya.

The challenge for Saudi Arabia is two-fold, Marghalani believes: First, in providing the right number of hotels across the market range; and second, in equipping Saudis with the skills to run them to international standards.

“From all I’ve heard in the industry, I know the pipeline for new hotels in Saudi Arabia is there, even just over the next three years. There is a big number of international brands looking at developments in some of the mega-projects, like NEOM, the Red Sea, AlUla and Qiddiya,” he said.

But the immediate need is for accommodation to house the thousands of attendees to the G20 summit in November, when the leaders of the most important countries on the planet will be arriving in the Kingdom for their annual power gathering, along with their significant entourages and thousands of media representatives.

“All the studies I’ve seen show that we have enough capacity in the five-star space, with existing stock and planned openings. There is probably a need for more mid-range hotel accommodation, which I am sure the authorities and investors are looking at seriously,” he said.

On the question of Saudi manpower for all those new establishments, he pointed to the success of the Tahseen program developed in partnership between the Kingdom, the Marriott International hotel chain — which owns the Ritz-Carlton brand — and Cornell University of New York, which trains young Saudis in hospitality skills and is now entering its third year. Some of the big megaproject developments, such as Qiddiya and the Red Sea Development, have their own schemes to assist Saudis in training for the hospitality business.

The customer profile of the average Ritz-Carlton guest is rather different from most other hotels in the Kingdom, Marghalani said. About 45 percent of its business comes from what he calls “special corporate” — the consultants, executives and bankers who travel to the Kingdom for business during the week, when the hotel is usually full.

Roughly the same proportion of revenue comes from government groups and events, the most notable being the FII annual gathering when, again, the hotel is full.

The remaining 10 percent are made up of Saudis visiting Riyadh from other cities, or from “honeymooners, weekenders, transients and normal tourists” who want a bit of Ritz luxury during a holiday in the Kingdom.

“I think this last category will grow in 2020 with the opening up of online visas for foreign tourists. We saw a big increase in this sort of business at the end of last year for the Riyadh Season and the WWE wrestling event. When Qiddiya opens, it will be another boost for us — it’s only a short drive from the Ritz-Carlton,” he said.

But the big event this year will be the G20, although the main venue for the event has not been decided yet. The leaders’ summit are so big and well attended that few venues can expect to stage the whole event, while security also demands some segregation of the elite from rest of the delegates and media.

“I’m not sure where the main event will be, that is up to the G20 authorities. But the Ritz-Carlton is usually the main hub for similar events to the G20, like FII,” he said.

There has been some speculation that the FII event, usually staged in October, might be postponed because of the G20 event coming just a month later, but Marghalani saw no issue. “FII has been held here for the last three years and each time it has been better and more successful. I can see no reason why there might be a conflict with G20,” he said.

For an establishment that has become inextricably connected with the Saudi and global elite, the hotel has an active program of social and community engagement — giving uneaten food to the Riyadh needy, recycling water in the grounds, and charitable programs in the Holy Month of Ramadan.

“And we have all LED lightbulbs throughout the hotel,” Marghalani said. With so many grand chandeliers, that must run into the tens of thousands, and make for a considerable energy saving.


Closing Bell: Saudi benchmark index edges higher to close at 10,974

Updated 25 June 2025
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Closing Bell: Saudi benchmark index edges higher to close at 10,974

  • MSCI Tadawul 30 Index rose 0.06% to 1,407.47
  • Parallel market Nomu lost 0.05% to close at 26,837.30

RIYADH: Saudi Arabia’s main stock index closed slightly higher on Wednesday, as gains in select industrial and infrastructure stocks offset broader market weakness.

The Tadawul All Share Index added 9.7 points, or 0.09 percent, finishing the session at 10,973.98. Total trading turnover was SR6.10 billion ($1.62 billion), with 180 stocks advancing while 66 declined.

The MSCI Tadawul 30 Index also recorded a modest gain, rising 0.06 percent to 1,407.47.

In contrast, the parallel market Nomu dipped slightly, losing 13.49 points, or 0.05 percent, to close at 26,837.30. A total of 35 stocks posted gains on Nomu, while 45 ended in the red.

Sustained Infrastructure Holding Co. led the market with a sharp 9.89 percent increase to SR30.55, followed by Saudi Printing and Packaging Co., which rose 9.83 percent to SR11.84. Saudi Arabia Refineries Co. also saw strong momentum, climbing 5.48 percent to a new yearly high of SR63.50.

Among the session’s notable losers, Specialized Medical Co. dropped 3.36 percent to SR24.16, Zamil Industrial Investment Co. slipped 2.29 percent to SR40.60, and Arabian Contracting Services Co. fell 2.12 percent to SR96.90.

Meanwhile, Saudi Arabian Mining Co., known as Ma’aden, received shareholder approval to raise its capital from SR38.03 billion to SR38.89 billion during its extraordinary general assembly meeting held on June 24. The 2.26 percent increase will lift the number of issued ordinary shares from 3.80 billion to 3.89 billion.

According to a company disclosure on the Saudi Exchange, the capital hike will be carried out through the issuance of 85.98 million new ordinary shares at a par value of SR10. These shares will be allocated as part of an acquisition agreement to purchase full ownership of two subsidiaries: Ma’aden Bauxite and Alumina Co. and Ma’aden Aluminium Co.

Under the transaction, Ma’aden will acquire all 128.01 million shares held by AWA Saudi in the bauxite firm, representing 25.1 percent of its capital, along with 165 million shares held by Alcoa Saudi in the aluminum unit—also a 25.1 percent stake.

Shares of Ma’aden rose 0.2 percent to end the day at SR50.70.

Red Sea International Co. also announced plans to publicly list its subsidiary, Fundamental Installation for Electric Work Co. Ltd., subject to regulatory and shareholder approval. The decision was approved by the board in a resolution passed on June 23 and implemented the following day.

While Red Sea International will not offer any of its own shares in the IPO, the move is considered a significant transaction due to the subsidiary’s strategic role in the group’s operations. The company’s stock rose 0.12 percent to close at SR42.50.


Saudi Arabia’s non-oil exports climb 24.6% in April: GASTAT 

Updated 25 June 2025
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Saudi Arabia’s non-oil exports climb 24.6% in April: GASTAT 

  • National non-oil exports — excluding re-exports — grew 6.8%
  • Machinery, electrical equipment, and parts accounted for 27.7% of total imports

RIYADH: Saudi Arabia’s non-oil exports saw an annual rise of 24.6 percent in April, reaching SR28.36 billion ($7.56 billion) thanks to a sharp increase in re-exports and a strong performance in chemicals and plastics.

According to data released by the General Authority for Statistics, national non-oil exports — excluding re-exports — grew 6.8 percent during the month, while the value of re-exported goods increased 72 percent. 

Saudi Arabia’s non-oil exports hit a record SR515 billion ($137 billion) in 2024, up 13 percent from 2023 and over 113 percent since the launch of Vision 2030 in 2016, which aims to diversify the Kingdom’s economy and reduce its dependence on oil by expanding industrial, mining, and service sectors. 

The strong non-oil export performance comes as the World Bank projects Gulf economic growth to accelerate to 3.2 percent in 2025 and 4.5 percent in 2026, driven by the rollback of OPEC+ oil production cuts and continued momentum in non-oil sectors.

In its latest release, GASTAT stated: “Among the most important non-oil exports are plastics, rubber, and their products, which constituted 21.7 percent of total non-oil exports, recording a 4.0 percent increase compared to April 2024.” It added that chemical products followed at 21 percent of the total, with a 2.3 percent year-on-year increase.

The release stated that merchandise exports decreased by 10.9 percent in April compared to the same month of the previous year, as a result of a 21.2 percent decrease in oil exports. 

“Consequently, the percentage of oil exports out of total exports decreased from 77.5 percent in April 2024 to 68.6 percent in April 2025,” said the report. 

This led to a narrowing of the trade surplus by 61.7 percent compared to the same period last year

The ratio of non-oil exports, including re-exports, to imports rose to 37.2 percent in April, up from 35.4 percent a year earlier — largely due to the increases in non-oil exports and imports of 24.6 percent and 18.3 percent, respectively. 

On the import side, machinery, electrical equipment, and parts accounted for 27.7 percent of total imports, rising 25.4 percent year on year. Transportation equipment and parts followed at 17.2 percent, with a 64.5 percent surge.

China remained Saudi Arabia’s top export destination, accounting for 12.6 percent of the total in April. Japan ranked second at 10.1 percent, followed by the UAE at 9.8 percent.

Other key destinations included India, South Korea, and the US, as well as Egypt, Malta, Poland, and Bahrain — with exports to these 10 markets comprising 67.5 percent of total exports.

On the import front, China was also the top origin, representing 25 percent of the total, followed by the US at 7.5 percent and the UAE at 6.8 percent. 

Imports from India, Germany, and Japan, as well as Italy, Switzerland, the UK, and France, together made up 66.3 percent of the total.

In terms of customs points, the King Abdulaziz Sea Port in Dammam handled 26 percent of total imports in April, followed by Jeddah Islamic Sea Port at 20.4 percent, King Khalid International Airport in Riyadh at 13.9 percent, King Abdulaziz International Airport at 12.6 percent, and King Fahd International Airport in Dammam at 5.7 percent. 

These five ports together accounted for 78.6 percent of total merchandise imports.

The strong performance in non-oil exports comes after Fitch Ratings in February affirmed Saudi Arabia’s long-term foreign-currency issuer default rating at ‘A+’ with a stable outlook, citing the Kingdom’s robust fiscal and external balance sheets. The agency also noted that Vision 2030 has played a central role in diversifying one of the Middle East’s strongest economies.


Education sector leads weekly POS surge with 666% value spike despite overall drop

Updated 25 June 2025
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Education sector leads weekly POS surge with 666% value spike despite overall drop

  • Spending on transportation increased by 28.7%
  • Construction and building materials saw a 25.6% uptick

RIYADH: Saudi Arabia’s point-of-sale spending in the education sector saw a weekly rise of 666 percent to reach SR193.26 million ($51.53 million) by June 21, according to official data.

The latest figures from the Saudi Central Bank, known as SAMA, also showed the number of POS transactions in the sector nearly doubled, climbing by 98.1 percent, indicating a significant rebound in consumer activity in this segment.

This sharp increase in educational spending came despite a 1.5 percent decline in the total value of POS transactions across the Kingdom, which dropped from SR11.1 billion to SR10.9 billion over the same period.

The weekly data further showed that transaction values rose in several other sectors, although none matched the scale of growth seen in the education division.

Spending on transportation increased by 28.7 percent, while construction and building materials saw a 25.6 percent uptick in value.

Telecommunication and health sectors both posted gains of 4.8 percent and 16.8 percent, respectively.

The electronics and electric devices segment recorded a 16.8 percent rise in spending value, and the furniture sector grew by 4.4 percent.

Slight increases were also observed in the public utilities and miscellaneous goods and services sectors, which grew by 3.5 percent and 2.1 percent, respectively.

However, several categories experienced downturns. The largest declines in transaction values were reported in the hotels and recreation and culture sectors, which fell by 9.1 percent and 14.7 percent, respectively.

Regionally, Riyadh remained the top city for POS spending, logging over SR3.91 billion in transactions, a 9.1 percent increase from the previous week. Dammam and Khobar also recorded gains, with spending in Dammam up by 8.4 percent and in Khobar by 5.1 percent.

Cities such as Makkah and Madinah recorded double-digit declines, down by 24.2 percent and 11.7 percent, respectively, in total POS transaction values.

Jeddah maintained a steady performance, with spending remaining flat at SR1.6 billion, while Tabuk saw a slight uptick of 3 percent in value.

Spending in restaurants and cafes dropped by 12.8 percent, while beverage and food transactions declined by 7.2 percent.

Jewelry purchases also contracted by 12.8 percent, and clothing and footwear fell by 7.2 percent. Other sectors, such as gas stations and the category, also saw declines of 5.1 percent.

Overall, the total number of POS transactions across all sectors dipped slightly by 0.6 percent week on week, totaling just over 202.5 million transactions during the reporting period.


Fitch affirms UAE’s ‘AA-’ rating on strong external buffers, fiscal prudence

Updated 25 June 2025
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Fitch affirms UAE’s ‘AA-’ rating on strong external buffers, fiscal prudence

  • Outlook benefits from Abu Dhabi’s sovereign net foreign assets — amounting to 157% of GDP
  • Fitch forecasts UAE GDP to grow by 5.2% in 2025

RIYADH: The UAE’s long-term foreign-currency rating has been affirmed at “AA-” with a stable outlook by Fitch, reflecting the country’s consolidated government debt, strong net external asset position, and high gross domestic product per capita. 

The US-based rating agency noted that this outlook benefits from Abu Dhabi’s sovereign net foreign assets — amounting to 157 percent of the UAE’s gross domestic product in 2024 — which rank among the highest of all Fitch-rated sovereigns. 

The agency noted the ongoing regional geopolitical risks, but it assumes the conflict involving Israel, the US, and Iran will be contained and short-lived. 

The report comes as Israel and Iran agreed to a ceasefire brokered by the US, which took effect on June 24, following 12 days of conflict that raised fears of a broader regional escalation. 

In its commentary, Fitch Ratings stated: “A regional conflagration would pose a risk to Abu Dhabi’s hydrocarbon infrastructure and to Dubai as a trade, tourism and financial hub,” 

Fitch estimated the UAE’s consolidated fiscal surplus stood at 7.1 percent of GDP in 2024, following a level of 8.6 percent in 2023. Shutterstock

It emphasized that “the UAE’s ratings could absorb some short-term disruptions given large fiscal and external buffers.” 

Fitch’s assessment follows S&P Global’s recent assignment of “AA/A‑1+” with a stable outlook for its foreign and local currency sovereign credit ratings to the UAE, citing the country’s strong fiscal and external positions. 

The agency also noted that the UAE’s sizable asset cushion would help shield it from oil price volatility and regional geopolitical tensions. 

Fitch estimated the UAE’s consolidated fiscal surplus stood at 7.1 percent of GDP in 2024, following a level of 8.6 percent in 2023, with surpluses in Abu Dhabi and Dubai and budget deficits in Ras Al Khaimah and Sharjah. 

It projected a fiscal breakeven oil price of $45–$50 per barrel in 2025 and 2026, excluding investment income, which Fitch attributed partly to “rising oil production volumes and the significant share of spending by GREs (government-related entities).” 

“We forecast the consolidated surplus at 5.3 percent of GDP in 2025 and 5.9 percent in 2026. Narrower deficits in Sharjah and higher oil production levels in Abu Dhabi will mitigate the forecast drop in oil prices from $79.5 per barrel in 2024 to $65/bbl in 2025 and 2026,” Fitch said. 

It added: “Dubai will retain a budget surplus.” 

With regard to the federal government’s budget, Fitch stated that it remains below 4 percent of GDP and is primarily focused on core services.

Despite moderate direct debt, Fitch views the UAE’s economy as highly leveraged. Shutterstock

The report emphasized that the federal budget must remain balanced by law, leaving limited scope for borrowing or adjustment. From 2026 onward, corporate tax revenue is expected to help offset reduced grants from Abu Dhabi. 

Despite moderate direct debt, Fitch views the UAE’s economy as highly leveraged. “We estimate overall contingent liabilities from GREs of the emirates and the FG in 2023 at about 62 percent of UAE 2023 GDP,” the report said, though it acknowledged that many state-owned entities are financially sound. 

Fitch forecasts UAE GDP to grow by 5.2 percent in 2025, supported by a 9 percent increase in oil production from Abu Dhabi and strong non-oil growth of over 4 percent, driven by investment and population expansion. However, it warned of risks from “lower oil prices and global growth uncertainties.” 

Earlier this month, the UAE Central Bank’s Quarterly Economic Review for December 2024 reported that the country’s GDP reached 1.77 trillion dirhams ($481.4 billion) in 2024, growing 4 percent. Non-oil sectors contributed 75.5 percent of the total — highlighting continued economic diversification. 

The central bank maintained its real GDP growth forecast at 4 percent for 2024, with an anticipated acceleration to 4.5 percent in 2025 and 5.5 percent in 2026. 

On governance, Fitch said the UAE maintains an ESG Relevance Score of “5[+]” for political stability, rule of law, and institutional quality.

The agency credited the UAE’s “record of domestic political stability, strong institutional capacity, effective rule of law and a low level of corruption,” referencing World Bank Governance Indicators, where the country ranks in the 70th percentile.


Lebanon’s economy to benefit from World Bank’s $250m recovery boost

Updated 25 June 2025
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Lebanon’s economy to benefit from World Bank’s $250m recovery boost

JEDDAH: Lebanon’s battered infrastructure and strained public services are set for a boost, as the World Bank has approved $250 million to launch a broader $1 billion recovery and reconstruction initiative.

In a statement on Wednesday, the World Bank announced that its board of executive directors had approved the funding a day earlier under the Lebanon Emergency Assistance Project.

The project follows a phased approach to address response, recovery, and reconstruction, focusing on prioritizing and sequencing interventions to achieve maximum economic and social impact in the shortest possible time.

“The Rapid Damage and Needs Assessment of the impact of the conflict in Lebanon between Oct. 8, 2023, and Dec. 20, 2024, estimated total direct damages across 10 sectors at $7.2 billion, and reconstruction and recovery needs at $11 billion,” the bank said in its press release.

It added that around $1.1 billion in damage had been sustained by key infrastructure and facilities vital to public well-being and economic activity. Affected sectors include transportation, energy, water, healthcare, education, and municipal services.

“Considering the scale of needs, the LEAP was designed to support restoration of public infrastructure and buildings, given this is a precondition to economic and social recovery,” the release explained.

According to a separate World Bank report released earlier this month, Lebanon’s cumulative gross domestic product had contracted by nearly 40 percent since 2019. Meanwhile, the Lebanese pound has lost more than 98 percent of its value, driving triple-digit inflation through 2023.

The study highlighted how the collapse of the banking sector and the currency’s crash turned Lebanon into a dollarized, cash-based economy worth $9.8 billion — about 45.7 percent of GDP in 2022.

“The conflict has introduced another shock to Lebanon’s already crisis-ridden economy. While the economic contraction was anticipated to bottom out in 2023, following five years of sustained sharp contraction, the conflict and its spillovers have had negative knock-on effects on economic growth in 2023, continuing into 2024,” the report said.

It further noted that since July 2023, the Lebanese pound has stabilized at 89,500 to the US dollar, which helped bring inflation down to double digits in 2024 for the first time since March 2020, following three consecutive years of triple-digit inflation.

Lebanon’s Prime Minister Nawaf Salam welcomed the news on social media, writing on his X account: “I welcome the World Bank Board’s approval of the $250 million Lebanon Emergency Assistance Project, which represents a key step toward reconstruction by addressing damage to critical infrastructure and essential services in areas affected by the conflict.”

He added that the assistance reinforces national recovery efforts within a government-led implementation framework and paves the way for attracting further much-needed financing.

Jean-Christophe Carret, the World Bank’s Middle East division director, said: “Given Lebanon’s large reconstruction needs, the LEAP is structured as a $1 billion scalable framework with an initial $250 million contribution from the World Bank and the ability to efficiently absorb additional financing — whether grants or loans — under a unified, government-led implementation structure that emphasizes transparency, accountability, and results.”

Carret noted that the framework offers a credible platform for development partners to align their support with Lebanon’s reform agenda and amplify the impact of long-term recovery efforts.

According to the statement, the financing will enable immediate interventions to fast-track recovery and return to normalcy. This includes the safe and efficient handling of rubble to maximize recycling and reuse.

To ensure timely implementation, the government has undertaken key reforms within the project’s implementing body, the Council for Development and Reconstruction, the statement said.

It added that LEAP will be carried out under the strategic guidance of the prime minister’s office, with coordination across relevant ministries through the Council of Ministers. The Ministry of Public Works and Transport will oversee project implementation, while the Ministry of Environment will monitor environmental and social compliance, including rubble management.