Saudi megaproject Qiddiya plans iconic buildings, metro link with Riyadh airport

Roughly a third of the 366 square kilometers (sqkm) of the land area of Qiddiya will be planned and developed in the first phase. (File/AFP)
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Updated 10 December 2020
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Saudi megaproject Qiddiya plans iconic buildings, metro link with Riyadh airport

Saudi Arabia’s megaproject Qiddiya will house iconic buildings as it works with companies to build a “disruptive destination”, offering a unique combination of innovative experiences in entertainment, sports and arts, Kareem Shamma, Chief Development Officer of Qiddiya Investment Company (QIC), told Argaam in an exclusive.

“There are plans to connect Riyadh’s airport by Metro to the heart of Qiddiya’s City Centre. Qiddiya will also be connected to other modes of Riyadh’s public transportation network,” he further added.

Roughly a third of the 366 square kilometers (sqkm) of the land area of Qiddiya will be planned and developed in the first phase. So far, the developer has awarded 10 construction contracts worth SAR 2 billion since the start of construction to Saudi companies.

The COVID-19 pandemic and the resulting economic situation have not had any significant detrimental impact on Qiddiya’s future plans or strategy, Shamma stated. The first phase is all set to open in 2023.

“There are many contracts and tenders in the pipeline as we begin to deliver the built environment,” the executive said, emphasizing the importance of making Qiddiya as accessible as possible.

Here are excerpts from Argaam’s interview with QIC’s chief development officer.

Q: What new contracts and tenders are planned during 2021?

There are many contracts and tenders in the pipeline as we begin to deliver the built environment. We currently have tenders out for the construction of the Plant Holding Nursery as we seek bids for procuring the professional construction supervision services.

We have large scale on-going contracts with local companies for mass grading, roads and bridges, site security and other enabling works. These firms include Haif Bin Mohammed Bin Abboud Alqahtani & Partners For Trading Contracting Co., Freyssinet Saudi Arabia Co. Ltd, Alkhorayef Water & Power Technologies, Saudi Pan Kingdom For Trading And Contracting (Sapac), Shibh Al Jazira Contracting Company (Sajco), and Abdulali Alajmi Co.

Q: Are you all set to open the first phase in 2023?

This year has been extremely busy as the project moves forward. We have awarded major contracts, and construction has continued on site with roads and bridge works, as well as mass earthworks in preparation for follow-on building work.

For our overall timeline, we will be continuing with both heavy construction and developing strategic partnerships well into 2022, after which we move into the testing and commissioning phases ahead of our grand opening date in 2023.

Q: Has Qiddiya masterplan undergone any change since its launch?

All masterplans for projects like this undergo modifications as progress is made. The concept masterplan has already been approved as of last year. There might be some changes to some assets as the more detailed masterplan evolves, but the overall concept of the project will remain unchanged.

Q: Can you share the plans for the new phases?

Qiddiya’s masterplan has been developed with the first phase scheduled to open in 2023. It will include over 60 projects and more than 300 activities across the creative, hospitality, arts and culture, entertainment and sporting sectors.

The phase 2, and subsequent phases, is planned for expanding Qiddiya’s offerings and growing the project’s capacity to enable sustainable growth of the project and to ensure repeat visitation.

Q: Did COVID-19 impact your work schedules?

The Qiddiya project covers a land area of some 366 sqkm, of which roughly one third will be planned and developed in the first phase. The COVID-19 pandemic and the resulting economic situation have not had any significant detrimental impact on our future plans or strategy.

We were able to prepare for the pandemic by empowering our staff with the right equipment and technology so that they were able to work remotely and continue a ‘business as usual’ approach. Adhering to government protocols, we have now opened our offices, and our staff is working here on alternate days and from home for the rest of the time.

Q: Is there any plan to have transportation links with Riyadh airport?

It is important to make Qiddiya as accessible as possible. There are plans to connect Riyadh’s airport by Metro to the heart of Qiddiya’s City Centre. The project will also be connected to other modes of Riyadh’s public transportation network. We hope that the public road connections to the site will be upgraded in the near future.

Q: What kind of sustainable infrastructure or green technologies do you plan to use in the mega project?

Qiddiya embraces the sustainability goals outlined in the Saudi Vision 2030 and has devised a sustainability policy which not only incorporates these initiatives to ultimately respect, protect and enhance our natural landscape but also elevates in importance four of these main pillars of sustainability.

These include efficient waste management through reducing quantities of waste, in the first instance, and re-using and recycling waste thereafter; increasing biodiversity on Qiddiya’s land; promoting the optimal use of our water resources by reducing consumption and utilizing and re-using water efficiently; and creating pleasant outdoor microclimates to encourage pedestrianization.

Given the special nature and responsibility of Qiddiya as a giga project, we have elevated these four key components of the overall sustainability platform, such that they will be given special attention and extraordinary effort throughout the entire lifecycle of Qiddiya, from construction to operation and beyond.

Q: Are you planning iconic projects within Qiddiya?

Qiddiya’s vision is to create a disruptive destination recognized on the world stage as the unique combination of the most innovative experiences in entertainment, sports and arts. Therefore, we are working with companies to create iconic buildings to house these activities and bring this vision to life.

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Kingdom approves 2025 annual borrowing plan with SR139bn funding target

Updated 6 sec ago
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Kingdom approves 2025 annual borrowing plan with SR139bn funding target

  • Strategic road map to manage country’s funding needs

RIYADH: Saudi Arabia’s Minister of Finance Mohammed Al-Jadaan on Sunday approved the annual borrowing plan for 2025, outlining a strategic road map for managing the Kingdom’s funding needs.

The plan, which has been endorsed by the National Debt Management Center’s board of directors, detailed developments in public debt in 2024, initiatives to strengthen local debt markets, and the 2025 funding framework, including a calendar for Saudi riyal-denominated sukuk issuances.

The projected funding requirement for 2025 is estimated at SR139 billion ($37 billion), according to a statement issued on Sunday.

The total encompasses two primary components: covering a fiscal deficit of SR101 billion, as highlighted in the Ministry of Finance’s official budget statement, and meeting the SR38 billion in principal repayments for debts maturing during the year.

To achieve its funding objectives, Saudi Arabia plans to enhance its access to both local and international financing channels and pursue innovative financing opportunities to stimulate economic growth, the statement added.

Moves will include private transactions such as export credit agency-backed initiatives, financing for infrastructure development, and capital expenditure projects.

The Kingdom will also explore opportunities to access new markets and issue debt in diverse currencies, depending on market conditions.


Closing Bell: Saudi main index slips to close at 12,069

Updated 05 January 2025
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Closing Bell: Saudi main index slips to close at 12,069

 

RIYADH: Saudi Arabia’s Tadawul All Share Index fell on Sunday, shedding 32.73 points, or 0.27 percent, to close at 12,069.82.

The total trading turnover for the benchmark index amounted to SR4.21 billion ($1.12 billion), with 119 stocks advancing and 106 retreating.

The Kingdom’s parallel market Nomu registered a gain of 48.69 points, or 0.16 percent, closing at 31,054.38. Out of the stocks listed on Nomu, 38 advanced while 41 declined. The MSCI Tadawul Index also declined, dropping 7.32 points, or 0.48 percent, to close at 1,509.84.

Among the top performers of the day was Saudi Reinsurance Co., whose stock surged 9.94 percent to SR59.70. 

Salama Cooperative Insurance Co. also posted a strong performance, with its share price rising 8.44 percent to SR21.06, while Riyadh Cables Group Co. saw its stock climb 6.34 percent to SR151.00. 

However, National Medical Care Co. recorded the day’s steepest decline, falling 3.49 percent to SR160.40. Emaar The Economic City and the Power and Water Utility Co. for Jubail and Yanbu also experienced losses, with their share prices dropping 3.06 percent to SR18.38 and 2.93 percent to SR53.00, respectively.

In corporate news, Al-Yamamah Steel Industries Co. announced the signing of a SR97.5 million contract with the Saudi-based Trading & Development Partnership. The agreement involves the supply of steel towers for constructing a 380-kilovolt ultra-high voltage transmission line in the Eastern Region. 

The contract, which will commence in May 2025, is expected to reflect on the company’s financial results starting from the third quarter of 2025. 

Shares of Al-Yamamah Steel ended the session 6.25 percent higher at SR36.40.

The Saudi Industrial Development Co. disclosed that its subsidiary, Global Co. for Marketing Sleeping Systems, also known as Sleep High, has secured a Shariah-compliant SR9 million credit facility from Riyadh Bank. 

The financing, guaranteed under the Kafalah Program, will be utilized to support the subsidiary’s working capital needs. SIDC shares closed 0.67 percent higher at SR30.00.

Saudi Arabian Amiantit Co. signed a memorandum of understanding with the Libyan Development & Reconstruction Fund to collaborate on water technology transfer, sewage treatment, and pipe production. 

The one-year agreement aims to localize industries in Libya, create employment opportunities, and transfer manufacturing expertise. It also includes plans to establish joint factories specializing in fiberglass and polyethylene pipes, as well as valves, to support Libyan national projects. 

Shares of Amiantit rose 1.90 percent to close at SR29.40.

United International Holding Co. announced the extension of its memorandum of understanding with Nowpay Corp. for an additional two months. The partnership aims to establish a payroll administration and processing firm in Saudi Arabia. 

The venture, which will require an initial investment of SR75 million, will be 75 percent owned by United International Holding and 25 percent by Nowpay Corp. 

The company’s stock closed 0.75 percent higher at SR187.40.

National Gypsum Co. revealed that it has signed an Islamic financing agreement with Riyadh Bank valued at SR35 million. The funds will be directed toward expanding operations and upgrading production lines. The financing will last for one and a half years and is backed by promissory notes and a property mortgage. 

The company’s share price remained unchanged at SR22.16.


Saudi listed firms see growth in 2024 with ACWA Power and Al Rajhi as top performers

Updated 05 January 2025
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Saudi listed firms see growth in 2024 with ACWA Power and Al Rajhi as top performers

RIYADH: Saudi Arabia’s listed companies witnessed significant growth in 2024, with ACWA Power and Al Rajhi Bank emerging as the top performers on the Tadawul All Share Index.

ACWA Power Co. led the index, contributing 295 points, followed by Al Rajhi Bank with a 207-point increase, according to data from SNB Capital cited by Al-Ekhbariya.

ACWA Power’s stock surged from SR255.89 at the start of 2024 to SR401.4 by year-end, reflecting big growth. Similarly, Al Rajhi Bank’s stock rose from SR86.8 to SR94.6 during the same period. Other notable contributors included Saudi Research and Media Group, adding 44 points to the index, Elm Co. with 43 points, and Ma’aden with 40 points.

However, not all listed companies experienced gains in 2024. Saudi Aramco recorded a significant decline, losing 177 points on the index as its stock price dropped from SR140 to SR111.8. SNB Capital fell by 70 points, followed by SABIC with a 62-point decrease, Banque Saudi Fransi with 32 points, and Sahara International Petrochemical Co., or Sipchem, with 30 points.

The Kingdom’s initial public offering market also saw robust activity in 2024, with 14 IPOs raising SR14.21 billion ($3.7 billion), marking a 19 percent year-on-year increase.

Almoosa Health and Fakeeh Care Group led the IPO market in terms of size, with Fakeeh attracting the highest individual participation, drawing 1.34 million unique investors.

Despite overall success, individual subscriptions accounted for only 13 percent of the total IPO volume, amounting to SR1.94 billion.

Modern Mills Co. led in subscription coverage, achieving a rate of 21.9 times, while the average individual coverage for the year’s IPOs stood at 11.87 times.

The food production sector dominated IPO activity, contributing 26.9 percent of total listings in 2024, with successful debuts by companies such as Modern Mills, Al-Rabie, and Al Arabiya.

IPO valuations varied significantly, with an average price-to-earnings ratio of 34 times. United International Holding recorded the lowest P/E, while Nice One topped the charts with a P/E of 118 times, making it the year’s most expensive IPO.

Looking ahead, SNB Capital forecasts an 8 percent annual profit growth for companies listed on the Tadawul in 2025, with the petrochemical sector expected to lead the way with a 74 percent rise in profits.


Saudi Arabia records robust GFCF growth in Q3 2024, fueled by non-government sector investments

Updated 05 January 2025
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Saudi Arabia records robust GFCF growth in Q3 2024, fueled by non-government sector investments

  • Non-oil sectors grew by 4.3 percent year-on-year
  • Unemployment rate dropped to 3.7 percent

RIYADH: Saudi Arabia solidified its status as a regional investment leader with a 7.4 percent year-on-year growth in gross fixed capital formation in the third quarter of 2024, led by the non-government sector.

The Ministry of Investment reported an 8.3 percent increase in the non-government division, reflecting the Kingdom’s ongoing efforts to boost private sector participation in its diversifying economy.

Government-related entities contributed to the overall GFCF growth, with a 2.3 percent increase in the third quarter of 2024.

The non-government sector’s performance aligns with Saudi Arabia’s Vision 2030 objectives, which aim to shift the economy from oil dependency by fostering a vibrant private division. 

In line with these goals, the Ministry of Investment issued 3,810 investment licenses in Q3 2024, marking a significant 73.7 percent year-on-year increase.

Non-oil sectors grew by 4.3 percent year-on-year during the same period, further supporting the Kingdom’s economic diversification efforts.

Key sectors saw notable growth, including wholesale and retail trade, restaurants, and hotels rose 5.8 percent, and construction increased 4.6 percent. Transport and communication grew by 4.5 percent, and finance and real estate advanced by 4.2 percent, driven by consumer spending and a dynamic financial sector.

These expansions contributed to the Kingdom’s overall real gross domestic product growth of 2.8 percent year-on-year for the quarter, despite a marginal 0.05 percent increase in oil activities.

The real estate sector also played a pivotal role in the third quarter of 2024, with the Real Estate Price Index rising by 2.6 percent y-o-y. While residential property costs increased by 1.6 percent, commercial properties saw a more pronounced growth of 6.4 percent. However, agricultural real estate prices declined by 8.7 percent, reflecting sectoral disparities. 

Complementing these trends, real estate loans by banks witnessed a 13.3 percent year-on-year increase, showcasing heightened investor interest in property development and acquisitions. 

Saudi Arabia’s economic resilience is further evident in labor market improvements. The unemployment rate dropped to 3.7 percent in this period, a 0.5 percentage point decrease from the same quarter in 2023. The Saudi unemployment rate fell to 7.8 percent, a one percentage point decline year-on-year.


Global growth expected to reach 3.2% amid monetary easing: report

Updated 05 January 2025
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Global growth expected to reach 3.2% amid monetary easing: report

  • QNB forecasts US Federal Reserve to cut rates by 75 bps and the European Central Bank by 150 bps
  • It predicts growth of 2.2% in 2025, down from 2.6% in 2024

RIYADH: Global economic growth is set to accelerate in 2025 as monetary easing, US resilience, and recoveries in Europe and China drive momentum, with Southeast Asian economies benefiting from positive spillovers.

The Qatar National Bank projects a 3.2 percent global growth rate, outpacing Bloomberg’s consensus of 3.1 percent, the state’s news agency QNA reported.

In its latest commentary, QNB anticipates growth in major economies, driven by controlled inflation, eased financial constraints, and policy adjustments by central banks. Emerging markets, specifically the Association of Southeast Asian Nations economies, are set to benefit from these advancements.

The report said that analysts have consistently underestimated global economic performance, as initial projections for 2023 and 2024 fell short of realized growth by 80 and 40 basis points, respectively.

“Analysts and economists have been proving to be over pessimistic when it comes to forecasting major economies and global growth in recent years,” reported QNA.

The national bank added: “In fact, over the last two years, initial expectations for growth were 80 basis points and 40 bps below realized growth in 2023 and 2024, respectively.”

It forecasts the US Federal Reserve to cut rates by 75 bps and the European Central Bank by 150 bps.

“This should support further investment and consumption growth, as credit becomes cheaper, new investment opportunities become more attractive, and the opportunity costs of spending decrease,” it added.

In the US, QNB predicts growth of 2.2 percent in 2025, down from 2.6 percent in 2024 but still above the long-term average of 2.3 percent.

“The US economy is expected to remain on a strong footing as labor markets are resilient, productivity is growing rapidly with fast technology adoption, and households have robust balance sheets with the strongest financial position in decades,” QNB said.

Europe and China are expected to recover from extended periods of stagnation. Growth in the European area is forecast to rise from 0.7 percent in 2024 to 1.0 percent in 2025, supported by lower energy prices and a rebound in global manufacturing demand.

China’s growth is projected to increase from 4.8 percent to 5.0 percent, driven by policy easing and renewed economic momentum.

Emerging Asian nations, particularly ASEAN economies, are set to benefit significantly. “Stronger growth in China is likely to be a significant tailwind to emerging Asia in general and ASEAN economies in particular,” QNB said.

The region’s five largest markets, including Indonesia, Malaysia, the Philippines, Singapore, and Thailand, are forecasted to grow by 5.2 percent in 2025, up from 4.4 percent in 2024.

“All in all, we expect to see a moderate acceleration of global growth in 2025, with significant monetary easing, a resilient US economy, a cyclical recovery in Europe and China, and positive spillovers to ASEAN economies,” QNB said.