Energy price cap will be your undoing: Russia’s foreign ministry spokeswoman
Energy price cap will be your undoing: Russia’s foreign ministry spokeswoman/node/2159411/business-economy
Energy price cap will be your undoing: Russia’s foreign ministry spokeswoman
Russia’s foreign ministry spokeswoman, Maria Zakharova, said the West did not understand how such steps would ultimately impact their own countries (AFP)
Energy price cap will be your undoing: Russia’s foreign ministry spokeswoman
Updated 09 September 2022
Reuters
LONDON: Russia warned the West on Friday that plans to try to cap the price of Russia’s oil and gas exports in retaliation for the war in Ukraine would fail and ultimately lead to the instability of the US and Europe.
The confrontation over Ukraine has prompted EU customers to reduce their purchases of Russian energy while both the G7 and the EU are trying to impose a price cap on Russian oil and gas.
Just before the EU announced a price cap on Russian gas on Wednesday, President Vladimir Putin threatened to sever supplies if such limits were imposed, warning the West it would freeze like the wolf’s tail in a fairy tale.
The Group of Seven major industrialized countries wants to impose an oil price cap that would deny insurance, finance and brokering to oil cargoes priced above a yet to be set price cap on crude and two oil products.
Russia’s foreign ministry spokeswoman, Maria Zakharova, said the West did not understand how such steps would ultimately impact their own countries, which would ultimately slip up.
“The collective West does not understand: the introduction of a cap on prices for Russian energy resources will lead to a slippery floor under its own feet,” Zakharova said.
Russia’s top lawmaker said on Friday that the West’s plans would fail and that prices would soar far beyond their attempted artificial price ceiling.
“What G7 state officials call a price ‘ceiling’ will become a price floor,” Vyacheslav Volodin, the speaker of Russia’s lower house of parliament, the Duma, wrote on his Telegram channel. “The global market is not limited to seven countries.”
The remarks from Moscow indicate the depth of the confrontation with the West which Putin says is a declining US-dominated coalition which aims to shackle — or even destroy — Russia. The EU says it is in an energy war with Russia.
EU energy ministers met on Friday to try to find a way to protect citizens from sky-high energy prices and prevent power utilities from collapsing.
“We are in an energy war with Russia,” Czech Industry Minister Jozef Sikela said as he arrived at the emergency Brussels meeting.
’Energy War’
Western attempts to punish the world’s biggest producer of natural resources ranging from oil and gas to gold, metals, coal and timber is not an easy task, especially when China, India and other consumers are still happy to continue buying.
Still, Putin’s threat to reorient flows of Russian oil and gas eastwards would amount to the biggest turn in Russian energy policy since the Soviets built gas pipelines westwards to Europe from Siberia in the early 1970s.
Russia is the world’s second largest oil exporter after Saudi Arabia, the world’s top natural gas exporter. Europe usually imports about 40 percent of its gas and 30 percent of its oil from Russia.
Since the war began, EU customers have pledged to reduce their reliance on Russian energy while Russia has cut or shut down supplies on three of its biggest westward gas pipelines while oil supplies have been redirected eastwards.
Russia’s Gazprom has for years been studying the possibility for a major new gas pipeline — the Power of Siberia 2 — to travel through Mongolia taking Russian gas to China.
The proposed pipeline could carry 50 billion cubic meters of natural gas a year, Gazprom says — slightly less than the Nord Stream 1, the currently shutdown pipeline which links Russia to Germany under the Baltic Sea.
The existing Power of Siberia pipeline, which runs from Russia to China, was launched at the end of 2019 with an annual capacity of 61 bcm per year. (Reporting by Reuters; editing by Guy Faulconbridge)
Saudi-based Walaa Cooperative Insurance Co. maintains ‘A-’ rating: S&P Global
S&P expects Walaa to maintain this level of capital adequacy over the next two years
It also expects the company to gradually improve its combined ratio to about 98% in 2025—2026
Updated 26 January 2025
NOUR EL-SHAERI
RIYADH: Saudi Arabia’s Walaa Cooperative Insurance Co. maintained its “A-” long-term insurer financial strength rating by S&P Global, with a stable outlook.
The New York-based credit rating agency also affirmed its “gcAAA” long-term Gulf Cooperation Council regional scale rating and “ksaAAA” long-term Saudi national scale assessment for Walaa, highlighting the insurer’s capital position and planned business growth initiatives.
This comes as the company completed an SR468 million ($124.8 million) rights issue in December, initially announced in September 2023.
The additional capital will support the firm’s growth strategy and enhance its regulatory solvency margin.
S&P said Walaa’s capital adequacy exceeded its 99.99 percent confidence level before the reserve increase, with the recent capital injection further strengthening the company’s financial stability.
The rating agency expects Walaa to maintain this level of capital adequacy over the next two years, underpinning its stable outlook.
The firm’s stock price has already seen a significant 5.26 percent increase by 2:20 p.m. Saudi time to reach SR24.
Despite its strong capital position, Walaa’s operating performance has lagged behind similarly rated peers, according to S&P.
At the end of the third quarter of last year, the company ranked as the fifth largest insurer in the Kingdom, with insurance revenue reaching SR2.4 million and a growth rate of 17 percent.
However, the insurer faced challenges in profitability, driven by its medical insurance segment.
The combined ratio — a key measure of underwriting performance — stood at 101 percent for the third quarter of 2024, compared to 98 percent during the same period the previous year.
While the motor insurance segment, which experienced losses between 2021 and 2023, returned to profitability in 2024, reporting a service result of SR18 million for the third quarter, Walaa’s medical insurance business posted a significant loss of SR85 million during the same period.
This marks a sharp decline from the SR4 million loss recorded in the third quarter of 2023. The company plans to expand its medical insurance segment over the next two years, aiming for breakeven by the year’s end.
S&P said the goal may be challenging due to the competitive and concentrated nature of the medical insurance market in Saudi Arabia, which is projected to reach $4.33 billion this year, according to German online data gathering platform Statista.
The medical segment is dominated by The Co. for Cooperative Insurance and Bupa Arabia for Cooperative Insurance, which collectively accounted for 76 percent of market revenue and most of the segment’s profitability in the third quarter of 2024, according to S&P.
Walaa’s ability to achieve breakeven in this segment will play a critical role in the recovery of its overall performance.
S&P expects Walaa to gradually improve its combined ratio to about 98 percent in 2025— 2026 as it continues to diversify its business and recover its operating performance.
The agency also flagged potential risks, including the possibility of a negative rating action if Walaa’s underwriting performance is weaker than its local and regional peers or if its capital adequacy falls below the 99.95 percent confidence level.
S&P views the likelihood of a rating upgrade as limited during the outlook period. Any positive rating action would depend on Walaa’s ability to significantly increase and diversify its premium income without impairing operating performance, while maintaining capital adequacy at the 99.99 percent confidence level and a low-risk investment portfolio.
World leaders to attend Saudi Real Estate Future Forum 2025 for industry-shaping discussions
Event will gather over 300 speakers from 85 countries to lead discussions on the direction of real estate
Key themes and sessions at RFF 2025 will encompass various topics, with over 30 high-level dialogue events and 25 in-depth workshops
Updated 26 January 2025
MIGUEL HADCHITY
RIYADH: The Real Estate Future Forum is set to serve as a global hub for industry leaders, policymakers, and investors as Saudi Arabia transitions toward a diversified and innovation-driven economy.
The event will be held from Jan. 27— 29 at the Four Seasons Hotel in Riyadh and will gather over 300 speakers from 85 countries to lead discussions on the direction of real estate.
Under the theme “Future for Humanity: Shaping Dreams into Reality,” RFF 2025 will focus on innovations, sustainability efforts, and investment strategies reshaping the global property market.
This year’s edition will also spotlight the Middle East’s $1 trillion real estate pipeline, which is driving changes in urban development and creating new regional economic opportunities.
Saudi Arabia at the forefront of real estate evolution
The Kingdom’s Vision 2030 reforms have positioned the country as a leader in real estate development, combining innovation, sustainability, and economic growth.
Forum participants will get an in-depth look at major projects, including NEOM, The Red Sea Project, and Diriyah Gate, and their economic impact and long-term sustainability.
The discussions will provide insights into how these initiatives are influencing the broader real estate landscape.
A $1 trillion opportunity for global transformation
With the Middle East witnessing an unprecedented wave of urban expansion, the real estate sector has immense opportunities and critical responsibilities.
This year’s forum will highlight how key stakeholders can leverage digital transformation, sustainable construction, and strategic investments to build cities that are economically viable, environmentally responsible, and socially inclusive.
Benjamin Deschietere, managing director and partner at Boston Consulting Group, underscored the urgency of sustainability in real estate development.
“The Middle East’s $1 trillion real estate pipeline offers a once-in-a-generation opportunity to rethink how we design and build our communities,” he told Arab News.
“With buildings accounting for more than one-third of global greenhouse gas emissions, decisions made today in the region’s transformative mega-projects will impact generations and have the potential to influence global standards for decades,” he added.
Deschietere said that sustainability in design, the use of greener materials, and advancements in construction and procurement practices are essential rather than optional.
He said cities built with these principles would be more resource-efficient, livable, and valuable in the long term, adding that developers who adopt these approaches would gain a significant competitive edge in the coming decades
Benjamin Deschietere, managing director and partner at Boston Consulting Group. Supplied
A holistic approach to sustainability and innovation
RFF 2025 will focus on environmental sustainability and social and economic resilience. With the Kingdom’s target of developing 1 million new housing units by 2030, the forum will discuss how sustainable urbanization can drive affordability, job creation, and social equity.
Edoardo Geraci, managing director and partner at BCG, told Arab News of the need for a paradigm shift. “Traditional real estate has often prioritized growth over sustainability, but the future demands a more holistic approach.”
He added that beyond reducing carbon emissions, sustainable development must also consider social outcomes, such as inclusivity, affordability, and job creation.
“Passive design principles and smart building technologies already enable a reduction of lifecycle carbon emissions by up to almost 40 percent, offering significant cost savings over time,” the expert said.
Geraci also said the Middle East has a distinct chance to demonstrate how well-planned urban development can improve the quality of life, restore natural resources, and establish new standards for sustainable and resilient cities on a global scale.
Edoardo Geraci, managing director and partner at Boston Consulting Group. Supplied
RFF 2025 themes and sessions
Key themes and sessions at this year’s forum will encompass various topics, with over 30 high-level dialogue events and 25 in-depth workshops.
Discussions on smart cities and digital transformation will explore the role of artificial intelligence and blockchain in real estate transactions and homeownership, innovations in smart buildings and urban infrastructure, and the impact of big data on market forecasting and investment strategies.
Sustainable real estate and green building innovations will be another focal point, addressing the shift toward net-zero developments and green architecture, sustainable financing models for eco-friendly projects, and case studies from leading sustainable cities and giga-projects.
Real estate investment and financing trends will be examined, with insights into alternative financing models for large-scale undertakings, the impact of global economic shifts on Middle Eastern real estate markets, and future trends in institutional investment and private sector involvement.
The forum will also highlight the role of giga-projects in economic growth, offering perspectives from key players behind NEOM, The Red Sea Project, and Diriyah Gate, while discussing how these developments are shaping tourism, hospitality, urban living, the intersection of real estate, entertainment, and sports infrastructure.
RFF 2025 will provide an outlook on integrating advanced technologies into the real estate sector. Panels will dive into emerging trends like virtual reality for property marketing, the role of the metaverse in digital real estate, and the use of robotics and 3D printing in construction. The implications of these technologies for efficiency, cost savings, and consumer experiences will be examined.
Another focus will be community-centered urban planning and sessions will address the importance of inclusivity and accessibility in development projects, exploring how innovative housing models and mixed-use initiatives can enhance quality of life and foster social and economic prosperity.
The forum will also discuss sustainable procurement practices and supply chain transformation, offering insights into minimizing waste and achieving carbon neutrality in mega-projects.
Don’t miss this rare opportunity at #RFF2025 to hear from former U.S. President Bill Clinton, as he shares his invaluable perspective on global leadership, the role of real estate in shaping sustainable economies, and the future of transformative policies.
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The three-day event is set to feature a distinguished lineup of speakers, including government officials, global investors, and media personalities who will provide valuable insights into industry-shaping trends.
Notable speakers include Majid Al-Hogail, Saudi minister of municipalities and housing; Turki bin Talal, governor of Asir region; Saud bin Talal, governor of Al-Ahsa; former US President Bill Clinton; international media influencer Piers Morgan; and global media commentator Tucker Carlson.
With Vision 2030 strongly supporting tourism and lifestyle projects, discussions will explore how cultural preservation and modern innovation coexist in urban developments.
Sessions will delve into the design of projects such as New Murabba and Trojena in NEOM, examining how these ventures are redefining the Kingdom’s global image while fostering sustainable growth.
Insights into the transformative impact of major sporting and entertainment events on real estate demand and city planning will highlight the sector’s potential to drive broader socio-economic change.
The 2025 forum is expected to eclipse those numbers, offering an even greater platform for deal-making, policy announcements, and strategic partnerships.
A Glimpse into the Future
The Kingdom’s real estate sector is on the cusp of a technological and financial revolution driven by digital transformation, sustainable design, and forward-thinking policies.
As Vision 2030 continues to guide the nation toward an economically diversified and innovation-driven future, RFF 2025 will serve as a platform for international investors, developers, and policymakers looking to tap into the region’s potential.
RFF 2025 will offer various opportunities for networking, collaboration, and sharing expertise, making it a key event in the ongoing development of the global real estate industry.
RIYADH: A rise in the prices of several categories led Oman’s inflation rate to increase by 0.7 percent in December year on year for the base year 2018, according to new data.
Released by the National Center for Statistics and Information, the data shows a rise in prices across various personal goods and services groups, including a 4.5 percent increase in personal goods and services, a 3.2 percent rise in health, and a 1.7 percent increase in food and non-alcoholic beverages.
The restaurants and hotels group also saw a surge of 0.8 percent, the culture and entertainment group rose by 0.6 percent, and the clothing and footwear group grew by 0.5 percent.
Additionally, the furniture, household equipment, and maintenance group increased by 0.4 percent, while the education group saw a slight rise of 0.1 percent.
This data aligns with broader resilience observed across the Gulf Cooperation Council region. An International Monetary Fund report released in December highlighted how GCC economies have successfully weathered recent shocks, supported by strong non-hydrocarbon growth and ongoing reforms.
Oman’s economic resilience has been recognized internationally, with its sovereign credit rating recently upgraded to investment grade.
This economic strength is further reflected in Oman’s 6.2 percent budget surplus and 2.4 percent current account gain in 2024, driven by prudent fiscal policies, high oil prices, and growing non-hydrocarbon exports.
The consumer price index data also revealed specific increases in food prices. For example, the vegetable group rose by 7.6 percent, the milk, cheese, and eggs group increased by 3.8 percent, and other food products not classified under another category saw a 3.7 percent rise.
Other food categories such as sugar, jam, honey, and sweets rose by 2.8 percent, the meat group increased by 2.6 percent, the fruits group rose by 2.2 percent, and oils and fats saw a 1.6 percent increase.
In contrast, the prices of the transportation group decreased by 0.8 percent, the non-alcoholic beverages group dropped by 0.5 percent, and the fish and seafood group saw a significant decrease of 6.3 percent.
Meanwhile, the prices of the housing, water, electricity, gas, and other fuels, communications, and tobacco groups remained stable. The data also revealed that the prices of the bread and grains group stayed unchanged.
Looking ahead, the nation predicts a modest 2.7 percent growth in gross domestic product (GDP) this year, while IMF projections released earlier this month forecast a slightly higher expansion of 3.1 percent.
Inflation has continued to ease in Oman, declining to 0.6 percent during the first 10 months of 2024, compared to 1.0 percent in 2023.
GCC records $1.5tn in trade volume, ranking sixth globally
Updated 26 January 2025
MOHAMMED AL-KINANI
JEDDAH: The Gulf Cooperation Council achieved a trade volume of $1.5 trillion in 2023, securing its position as the sixth-largest global trader, according to the latest data.
This figure represents 3.4 percent of global trade, highlighting the region’s growing economic importance. However, the GCC saw a 4 percent decline in trade volume compared to 2022, as reported in the 2023 GCC Foreign Trade Report issued by the Statistical Centre for the Cooperation Council for the Arab Countries of the Gulf.
The report also revealed that the GCC ranked third globally in the merchandise trade balance, with a surplus of $163.7 billion in 2023. This marks a sharp drop of 57.1 percent from the previous year’s surplus of $381.3 billion.
Despite these challenges, the region’s non-oil sectors have continued to grow, reflecting the GCC’s commitment to economic diversification. Additionally, the International Monetary Fund highlighted that foreign reserves held by GCC central banks are equivalent to approximately 10 months of the region’s import needs.
The IMF further noted that the GCC has established itself as a crucial hub for regional economic growth, aided by its open trade policies, liberal capital flows, and a welcoming approach to foreign labor.
The GCC’s position in global trade was also reinforced by its ranking as the fifth-largest exporter of commodities, contributing 3.1 percent of the world’s total. In 2023, the region’s commodity exports were valued at $0.8 trillion, though this marked a 14.5 percent decline compared to 2022.
On the flip side, merchandise imports into the GCC increased by 13.4 percent to reach $0.7 trillion, accounting for 2.7 percent of global imports.
When excluding intra-GCC trade, total goods trade fell by 4 percent, reaching $1.48 trillion in 2023. The decline was primarily driven by a 14.5 percent drop in commodity exports, which decreased from $962.6 billion in 2022 to $823.1 billion in 2023. Conversely, commodity imports rose by $78 billion, reaching $659.3 billion in 2023.
A significant decline in oil exports was also recorded. The GCC saw a 20.5 percent drop in oil exports, which totaled $525.5 billion in 2023, compared to $661.1 billion the previous year.
China was the GCC’s largest trading partner in 2023, with total commodity trade valued at $297.9 billion, far outpacing India, which ranked second at $150.4 billion.
The Asian country also remained the GCC’s top destination for commodity exports, accounting for 19.2 percent of the total at $158.3 billion, although this represented a 16.8 percent drop from 2022.
Moreover, China topped the list of countries supplying merchandise imports to the GCC, contributing 21.2 percent of the total imports, valued at $139.6 billion, up 10.8 percent from $126.0 billion in 2022.
Saudi Arabia raises local workforce quotas across key sectors
Updated 26 January 2025
Nour El-Shaeri
RIYADH: Saudi professionals in dentistry, pharmacy, accounting, and technical engineering will soon see expanded job opportunities as the Kingdom rolls out new Saudization targets under its Vision 2030 plan.
The HRSD, in collaboration with health, commerce, and housing authorities, is now focused on localizing 269 professions.
The initiative builds on earlier measures, such as increasing Saudization rates in radiology to 65 percent, medical laboratories to 70 percent, and physiotherapy and therapeutic nutrition to 80 percent last October.
Effective July 27, community pharmacies and medical complexes will be required to achieve a 35 percent Saudization rate, hospitals 65 percent, and other pharmacy-related businesses 55 percent, according to a Ministry of Human Resources and Social Development announcement. These rules will apply to companies employing five or more pharmacy professionals.
Saudization, launched in 2011, aims to increase Saudi employment in the private sector by setting industry-specific quotas for Saudi workers. This initiative has contributed to a significant drop in Saudi unemployment, which fell from 12.8 percent in 2018 to 7.1 percent by mid-2024, surpassing the original Vision 2030 goal of 8 percent. As a result, the Kingdom has updated its national target to a 5 percent unemployment rate by 2030.
In dentistry, the phased Saudization plan aims for a 45 percent rate by mid-2025, increasing to 55 percent in 2026. This will apply to dental practices with three or more professionals, with a minimum salary of SR9,000 ($2,399) to qualify.
For accounting, the HRSD, in partnership with the Ministry of Commerce, will gradually raise Saudization rates over the next five years, beginning on Oct. 27.
Initially, businesses with five or more accountants will need to meet a 40 percent localization target, with the goal of reaching 70 percent by the final phase.
Technical engineering will see a 30 percent Saudization requirement starting July 27, affecting companies with five or more technical engineers.
The ministry has provided detailed guidelines on its website to assist businesses in understanding the new rules, including implementation procedures and penalties for non-compliance.
