Saudi Arabia tells Farnborough air show of plans to become global defense powerhouse

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Updated 20 July 2022
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Saudi Arabia tells Farnborough air show of plans to become global defense powerhouse

  • Saudi Arabia’s key defense stakeholders are attending the Farnborough International Airshow, as the Kingdom seeks to showcase its burgeoning defense industry opportunities
  • 74 opportunities worth billions of dollars for investors, says GAMI governor

FARNBOROUGH: Saudi Arabia plans to develop its nascent defense industry into a global powerhouse with a strategic mix of domestic spending on education, research and development, and significant local and foreign investment.

This plan was outlined on Monday in a statement issued by the General Authority for Military Industries’ Governor Eng. Ahmad Al-Ohali, on the opening day of the Farnborough International Air Show in the UK, which runs until July 22. GAMI’s role is to bring together key players, covering a range of areas from manufacturing to education.

Al-Ohali opened the Kingdom’s pavilion at the show. This is the first Farnborough event since 2018 because the 2020 edition was cancelled. The industry is now recovering from the pandemic that ravaged the sector.

“As one of the world’s 20 biggest economies, the Kingdom is opening itself up to international investment and on an unprecedented scale. This has been our journey since 2017 and under the guidance of Vision 2030. It is an exciting prospect for any original equipment manufacturer or any other investor around the world to become a part of this journey of transformation,” Al-Ohali stated.

“With the localization and technology development plans, supply chain program, our human capital strategy, the World Defense Show, and many other programs, Saudi Arabia will not only expand its footprint in the global defense industry, but also become a hub for innovation in defense,” he added.

“Saudi Arabia today is an investment powerhouse and our reforms over the past several years are proof that we are ready to take all necessary measures to maintain and build on the momentum,” Al-Ohali said.

With Saudi Arabia’s goal of localizing more than 50 percent of its expenditure on defense by 2030, GAMI hopes to develop its nascent industry by collaborating with different stakeholders in the defense and security sectors.

“For example, we have identified our platforms (and) localization plans, developed a robust industrial and services supply chain program, a Military Industry Human Capital program, organized the World Defense Show, and much more. None of this would have been possible if we didn’t have the support of other government stakeholders like the Ministry of Defense and other security ministries, as well as the public and private sector players such as Saudi Arabian Military Industries, and the local and international original equipment manufacturers.”

A key to this expansion has been a supply chain program that would streamline processes in manufacturing and services. “This program has shined a light on the gaps in our local supply chain, which has translated into more than 74 investment opportunities worth billions of dollars for investors all over the world.”

The organization has determined six defense segments that present opportunities for investment, including land for manufacturing; maintenance repair and overhaul fixed wing; electronics; unmanned aerial vehicles; maintenance and repair for the navy; and production of personnel equipment.

Al-Ohali added that one of the key aspects of the program has been the establishment of the Military Industry Marketplace. MIM is a digital gateway into the defense ecosystem for investors and suppliers.

“GAMI does not only determine the investment opportunities in our localization initiatives, but we also make it easier for local and global investors to find the right opportunity and the right strategic partner for them in the Kingdom. Again, these are all key components of our effort to create a healthy, strong, sustainable ecosystem,” Al-Ohali said.

When talking about the Kingdom’s components of the local defense ecosystem, Al-Ohali said it included manufacturing, services, innovation, and education.

“These are all crucial aspects of a well-developed defense sector, but they all have one thing at their absolute core: Talented and skilled human capital. No sector can fully reach its potential without access to local talent, supported by education and training. This is why we have developed a Military Industry Human Capital strategy to make sure our greatest asset, the youth of our nation, is empowered to become the future leaders and innovators of the defense sector.

“Innovation, research and technology in the defense ecosystem is vital for sustainable localization. We are working closely with the newly established General Authority for Defense development to guide the defense technology development.”

Al-Ohali said training of young people was a key component of the strategy. “One such initiative is the National Academy of Military Industries, whereby GAMI is establishing an independent academy to train, upskill, and enable the national personnel that will ultimately help us realize our localization goals.”

Meanwhile, in other developments at the show, the European airplane manufacturer Airbus and several airlines said on Monday they had signed letters of intent to buy carbon removal credits to offset the emissions from air travel.

Airbus was joined by Air Canada, Air France-KLM, EasyJet, International Airlines Group, LATAM Airlines Group, Lufthansa Group and Virgin Atlantic, who have committed to engage in “negotiations on the possible pre-purchase of verified and durable carbon removal credits starting in 2025.”

In further news, General Electric Chief Executive Larry Culp said on Monday a new “GE Aerospace” brand for its aviation business pointed to a “wider strategic aperture” that could eventually lead to the industrial giant entering new businesses.

Asked at the Farnborough Airshow if that meant a greater appetite for acquisitions as the conglomerate prepares to split into three, Culp said any changes would be “first and foremost organic, and then and only then inorganic opportunities.”

Also at the show on Monday, the head of Qatar Airways said an “epidemic” of home working has contributed to staff shortages that are being widely blamed for travel disruption in Europe this summer.

The aviation sector is struggling to secure staff needed to cope with a post-pandemic surge in air travel, prompting London’s Heathrow Airport to impose curbs on capacity to avoid delays, in a move that led to tensions with Dubai’s Emirates.

In opening the show earlier in the day, outgoing Prime Minister Boris Johnson talked about the economy and alluded to his exit from Downing Street. “This government believes in aviation and its power to bring jobs and growth to the entire country.”

“After three years in the cockpit ... I am now handing over the controls seamlessly to someone else. I don’t know who,” he added, sparking laughter from delegates.

(With Agencies)


Washington says Pakistan needs to address barriers to American exports, companies

Updated 05 June 2025
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Washington says Pakistan needs to address barriers to American exports, companies

  • Islamabad, Washington last week kicked off negotiations after President Trump announced tariffs on countries, including Pakistan
  • Talks expected to “sail through” but Pakistan’s textile industry may take a hit if they fail, warns financial analyst Shankar Talreja

KARACHI: Pakistan’s government needs to address its tariff and non-tariff barriers against American exports and companies, a spokesperson at the US consulate general in Karachi said on Thursday as both nations seek to forge closer trade ties through negotiations.

Reva Gupta, the spokesperson at the US consulate general in Karachi, made the comments a week after Pakistan and the US started what the official described as “dynamic” negotiations with Finance Minister Muhammad Aurangzeb on Washington’s imposition of tariffs.

The talks take place as US President Donald Trump imposed steep tariffs on a number of countries earlier this year, a move widely viewed as a setback for the global economy still recovering from the coronavirus pandemic. Pakistan faces a potential 29 percent tariff, currently under a 90-day pause announced in April, on its exports to the US due to a $3 billion trade surplus with the world’s biggest economy.

“In our bilateral engagements with Pakistan, we always message the need to jointly tackle challenges to our trade relationship, including the need for Pakistan to address its longstanding tariff and non-tariff barriers against US exports and companies,” Gupta told Arab News.

The tariffs could be a setback to Islamabad’s hectic efforts aimed at navigating a tricky path to economic recovery. Pakistan hopes to achieve sustainable economic growth driven by exports.

The US is Pakistan’s largest export destination. American exports to Pakistan were valued at $2.1 billion in 2024, up 4.4 percent ($90.9 million) from 2023, according to US government data. The import of goods from Pakistan to the US totaled $5.1 billion in 2024, up 4.9 percent ($238.7 million) from 2023.

“The United States and Pakistan share a robust economic relationship going back decades, of which trade and investment are key elements,” Gupta said. “That the United States remains Pakistan’s largest export market globally is a testament to this strong partnership”.

Gupta, however, referred to US Trade Representative’s (USTR) National Trade Estimate Report which highlights significant foreign barriers to US exports in various countries, including Pakistan.

 The USTR details tariff and non-tariff hurdles ranging from Pakistan charging higher tariffs to US businesses to the closure of Internet services, imposing a ban on US beef imports and “perceived politicization” of the anti-graft National Accountability Bureau body.

“US companies have cited concerns that Pakistan has been imposing high tariff rates and, in some cases, additional duties, on products such as automobiles and finished goods,” the report said.

Qamar Sarwar Abbasi, a spokesperson of Pakistan’s finance ministry, did not respond to Arab News’ request for comment.

Some prominent American companies operating in Pakistan include Pepsi-Cola, General Electric International, Procter and Gamble, Pfizer and DuPont, according to the International Trade Administration, a US government agency.

Experts have warned the tariffs could harm Pakistan’s competitiveness in the global market, especially if regional exporters such as China, Bangladesh and Vietnam redirect more goods to Europe, intensifying competition in alternative markets.

‘LIKELY TO SAIL THROUGH’

However, economist Shankar Talreja, who is also the director of research at Topline Securities Ltd. brokerage form, said talks between Washington and Islamabad are likely to “sail through.”

“Pak-US trade talks are likely to sail through as Pakistan exports are primarily based on labor-intensive industry such as textile,” Talreja told Arab News.

He said Pakistan is likely to increase its import of agricultural commodities such as cotton and petroleum products from the US to fill the trade deficit.

But if talks fail, Pakistani textile exports may be adversely affected, he said.

“If talks are not successful, Pakistan textile exports may get hurt in future assuming other countries will successfully negotiate with the US,” the analyst warned.

The textile industry attracts the largest amount of foreign exchange for Pakistan, fetching $17 billion for the cash-strapped nation in FY2024.


Saudi Arabia, UAE lead global office quality fit-out investments: JLL  

Updated 05 June 2025
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Saudi Arabia, UAE lead global office quality fit-out investments: JLL  

RIYADH: Saudi Arabia and the UAE are leading global investments in high-end office fit-outs, averaging over $2,400 per sq. meter, well above the global benchmark of $1,830, according to a new report.

An analysis by real estate advisory firm JLL, based on data from 25 countries, found that companies in both Gulf countries are prioritizing workspace upgrades as part of broader return-to-office strategies.

In the Middle East and Africa, corporate sentiment remains focused on targeted investments in design and functionality to support hybrid working models and enhance employee productivity. 

The report added that initiatives in Saudi Arabia such as the regional headquarters program are playing a crucial role in driving demand for Grade A office spaces in the Kingdom. It offers incentives such as a 30-year corporate income tax exemption and withholding tax relief, alongside regulatory support for multinationals operating in the Kingdom. 

Maroun Deeb, head of project and development services for Saudi Arabia and Bahrain at JLL, said: “The general optimism toward investing in workspaces is likely to continue throughout 2025 as growth-oriented corporations invest in office fit-outs to support their hybrid workplace policies.”  

He added: “Targeted investments to enhance employee experience will see an increased focus on workplace design, innovative technology solutions, and refurbishment opportunities amid growing interest in healthier, energy-efficient workspaces.”  

According to the analysis, companies in Saudi Arabia and the UAE are investing more on fit-outs to enhance workplace experience and employee performance. 

The report added that Saudi Arabia and the UAE are among the premium global markets for quality fit-out investments on par with London, New York and Sydney. 

JLL analyzed data from 25 countries and found that sustainability is a key driver in many relocation strategies and office fit-outs. 

Some 68 percent of organizations globally plan to increase investment in sustainability performance in the next five years. 

In the Middle East and Africa region, the sentiment is strongest in Saudi Arabia and the UAE, where 78 percent of corporate real estate leaders aim to enhance value through sustainability. 

The report, however, added that organizations in the region face challenges in meeting sustainability requirements due to limited suitable stock and high costs of upgrading older buildings. 

JLL added that early planning and integration of sustainability targets in relocation strategies and fit-out projects is crucial to address challenges. 

“Offices that embrace innovative technologies and sustainable design principles and have higher levels of green certification command a premium, especially in Dubai,” said Gary Tracey, head of project and development services UAE at JLL.  

He added: “Investments to improve sustainability will mitigate future operational expenses, remaining highly attractive to tenants seeking modern, efficient workplaces.”  

The report further said that supply chain disruptions in 2024 disproportionately affected the office market in the Middle East and North Africa, tightening project timeframes and escalating pricing. 

“From environmental and smart building systems to adaptive workspaces and settings, supply chain engagement is critical in managing costs and allowing for innovation in future-focused workspaces,” said JLL.  

The report added that mechanical and electrical services now account for a higher proportion of office spend as stricter environmental and sustainability standards require more complex systems. 

With 39 percent spending on M&E services, Cairo ranks among the top cities globally for average proportion of costs per sq. meter for such services, followed by Dubai at 30 percent and Riyadh at 29 percent. 

In April, in a separate analysis, JLL said that the global office sector is rebounding as companies scale back hybrid employment options, increasing demand for workspaces. 

In that report, JLL revealed that 59 percent of organizations globally are increasing investments in design and fit-outs.


Saudi Arabia and Syria explore investment cooperation in bid to boost economic integration 

Updated 05 June 2025
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Saudi Arabia and Syria explore investment cooperation in bid to boost economic integration 

RIYADH: Saudi Arabia and Syria are set to advance economic cooperation following a virtual meeting between the Kingdom’s Minister of Investment Khalid Al-Falih and the Middle Eastern country’s Minister of Economy and Industry Mohammad Al-Shaar. 

The two sides reviewed prospects for investment partnerships and discussed opportunities to expand collaboration in both public and private sectors, according to a report by the Saudi Press Agency. 

The discussions focused on promoting high-quality investments across productive and service industries, with the goal of supporting Syria’s economic development and enhancing regional financial integration. 

The meeting also examined ways to build a favorable environment for cross-border investments that can contribute to long-term stability. 

Syria is undertaking significant efforts to revive its economy following years of conflict. The transitional government, led by President Ahmed Al-Sharaa, has initiated reforms, including the privatization of state enterprises, the lifting of import restrictions, and the encouragement of foreign investment. 

Notable developments encompass a $7 billion energy infrastructure agreement with a Qatari-led consortium, the reopening of the Damascus Securities Exchange, and a $300 million fiber-optic project involving Gulf telecom firms. 

“Al-Falih emphasized the importance of creating an enabling environment for expanding regional investment partnerships,” SPA said. 

He added that Saudi Arabia is keen to assist in stabilizing and developing the Syrian economy, which he described as essential for serving mutual interests and promoting regional economic prosperity. 

Additionally, the Kingdom and Qatar have pledged financial support for Syrian public sector salaries in May. 

These initiatives, alongside the easing of Western sanctions, aim to stabilize the economy and attract international investment. 

The talks are part of broader Saudi efforts to expand its global investment footprint and strengthen economic ties across regions. 

In May, Saudi Foreign Minister Prince Faisal bin Farhan visited Damascus, where he met Al-Sharaa and pledged Saudi-Qatari support for Syria’s public sector, with a particular focus on energy and infrastructure investments. 

The Kingdom has also ramped up high-level international engagements this year. Minister of Finance Mohammed Al-Jadaan participated in the Saudi-US Investment Forum in Riyadh in May to discuss cross-border investment opportunities. 

In April, Al-Jadaan met with Pakistan’s Finance Minister Muhammad Aurangzeb in Washington to deepen financial and economic cooperation. 

Additionally, Minister of Economy and Planning Faisal Alibrahim signed a memorandum of understanding with Spain on May 22 to promote trade diversification and new investment opportunities. 

Alibrahim also represented Saudi Arabia at the World Government Summit in Dubai in February to advance Vision 2030 partnerships. 

 


Saudi Arabia’s Port of NEOM installs 1st automated cranes, targets 2026 launch

Updated 05 June 2025
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Saudi Arabia’s Port of NEOM installs 1st automated cranes, targets 2026 launch

RIYADH: Saudi Arabia’s $500-billion giga-project NEOM has installed the Kingdom’s first fully automated, remote-controlled cranes at its Red Sea port as it moves ahead with plans to begin operations in 2026. 

The delivery of next-generation ship-to-shore and electric rubber-tyred gantry cranes marks a key milestone in the development of Terminal 1, which will accommodate the world’s largest container ships. NEOM is aiming to position the facility as a global logistics hub connecting Asia, Europe, and Africa. 

The facility supports Saudi Arabia’s Vision 2030 by contributing to economic diversification through enhanced trade, logistics, and industrial capabilities. As global supply chains shift toward resilience and efficiency, NEOM’s strategic Red Sea location positions it as a vital link between Asia, Europe, and Africa. 

Sean Kelly, managing director of Port of NEOM, said: “The arrival of our first automated cranes marks a tangible milestone as we lay the foundations for an advanced, future-ready port.” 

He added: “We’re not only accelerating industrial growth in northwest Saudi Arabia, but we’re also setting a new benchmark for performance, efficiency, innovation and establishing a vital trade gateway for the Kingdom and the region beyond.” 

The new cranes will enable high-efficiency operations while allowing remote control from ergonomic workstations.  

Infrastructure developments, including a 900-meter quay wall and an 18.5-meter-deep channel, ensure the port can handle the largest vessels transiting the Suez Canal. Terminal 1 will also feature horizontal transport automation, boosting logistics capacity and regional industrial growth.

Alongside infrastructure upgrades, the port is investing in local talent development. A specialized program is training Saudi workers, including women, for high-tech roles such as remote crane operations. Ten participants from Saudi Arabia’s Tabuk region are currently in a two-year program combining technical training and mentorship.  

Trainee Hajjer Alatawi said: “This experience has shown me that port logistics is far more complex than just moving cargo; it’s about teamwork, precision and responsibility. Seeing more Saudi women entering this space gives me hope for a future where industries are defined by skills, not gender.” 
 
The press release added that by empowering Saudi workers with high-tech skills, “Port of NEOM is supporting NEOM’s vision of being a catalyst for a sustainable, diverse and innovative ecosystem that enables regional economic resilience and advances the goals of Saudi Vision 2030.”


UAE’s power capacity set to reach 79.1GW by 2035: GlobalData

Updated 05 June 2025
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UAE’s power capacity set to reach 79.1GW by 2035: GlobalData

RIYADH: The power capacity of the UAE is expected to reach 79.1 gigawatts by 2035, registering a compound annual growth rate of 3.4 percent from 2024, according to a report.

Findings from data analytics and consulting company GlobalData stated that annual power generation in the Emirates is expected to increase at a CAGR of 3.8 percent from 2024 to 2035, reaching 281.3 terawatt-hours. 

Boosting power capacity is essential for the UAE as energy demand rises alongside a rapidly growing population, which is expected to reach 11.9 million by the end of the decade, up from 11 million today.

A significant factor contributing to this increased energy consumption is the high expatriate population, which accounts for around 88 percent of the total and drives the growth in residential and commercial energy needs.

“The power sector in the UAE offers abundant opportunities for investors, with the government poised to make significant investments in the expansion and modernization of its generation and supply infrastructure,” said Attaurrahman Ojindaram Saibasan, power analyst at GlobalData. 

He added: “The anticipated increase in capacity is projected to occur predominantly in gas-based thermal power, as opposed to oil, where capacity is expected to remain stable. Manufacturers of gas turbines stand to benefit from this surge in gas-fired power capacity.” 

GlobalData further said that the climate conditions in the UAE are exceptionally conducive to solar power generation, prompting the government to allocate extensive tracts of undeveloped land for solar parks, including both photovoltaic and concentrated solar power installations. 

The report added that the UAE has the capability to not only meet local demand using solar energy but also cater to export needs.

The country is taking significant steps to bolster its renewable energy capacity, especially solar power, as a core strategy to address climate change. 

It is targeting a clean energy capacity of 14.2GW by the end of this decade and is planning to invest between $40.84 billion and $54.45 billion to triple renewable energy contribution by 2030. 

“Over the past decade, the UAE has experienced a marked increase in electricity demand, necessitating the importation of natural gas from Qatar,” said Saibasan. 

He added: “In response to this growing demand and to diversify its energy portfolio, the UAE has strategically shifted away from exclusive dependence on natural gas, expanding into renewable and nuclear energy sectors.” 

GlobalData further stated that the development of mega urban projects, such as Masdar City and Expo City Dubai, also highlights the need for sustainable energy solutions. 

“These smart cities are at the forefront of innovation, yet they also contribute to higher electricity consumption. Consequently, this trend necessitates the expansion of the electrical grid and investment in smart infrastructure to meet the evolving demands,” Saibasan concluded.