Saudi-Uzbek Joint Committee signs several private sector deals

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The Saudi-Uzbek Joint Committee signs several memoranda of understanding during its sixth meeting. (SPA)
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The Saudi-Uzbek Joint Committee signs several memoranda of understanding during its sixth meeting. (SPA)
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Updated 22 December 2023
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Saudi-Uzbek Joint Committee signs several private sector deals

  • The meeting aimed to identify specific areas of cooperation between the two countries

RIYADH: The Saudi-Uzbek Joint Committee held its sixth meeting in Riyadh on Thursday, where several agreements were signed between the private sectors of both countries, the Saudi Press Agency reported on Friday.

The meeting, which aimed to identify specific areas of cooperation between the two countries, was chaired by Saudi Minister of Investment Khalid Al-Falih and Uzbek Deputy Prime Minister Jamshid Khodjaev.

Al-Falih emphasized the compatibility of economic goals through Uzbekistan’s National Development Strategy 2023-2030, the Kingdom’s Vision 2030, and the National Investment Strategy.

He also pledged full support for the efforts of the Saudi-Uzbek Business Council, which plays a crucial role in bringing together the private sectors of both countries.

Al-Falih said that the meeting would discuss around 50 potential investment opportunities worth approximately $31 billion in Uzbekistan, adding that these projects aim to achieve the target of $110 billion in foreign investments within the goals of the Uzbekistan 2030 strategy.

The meeting tackled several topics related to bilateral cooperation in the economic, trade, and investment fields. It also reviewed the promising investment opportunities between the two countries and the business environment in both nations and emphasized the importance of strengthening joint work for future partnerships.

Both sides praised the achievements of launching joint projects and investments in the energy sector, renewable energy, health, infrastructure, agriculture, and human resources development.


Saudi Ministry of Commerce refers 44 business for prosecution over illegal competitions and discounts

Updated 5 sec ago
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Saudi Ministry of Commerce refers 44 business for prosecution over illegal competitions and discounts

RIYADH: Saudi Arabia’s Ministry of Commerce has taken action against 44 commercial establishments for organizing contests and sales promotions without the necessary licensing. 

These businesses have been referred to the Public Prosecution for potential penalties under the Anti-Commercial Fraud Law. 

The ministry underscored the legal requirement for brick-and-mortar businesses and online stores to obtain a license before conducting contests or offering discounts. 

Failure to comply with these regulations constitutes a violation of the Anti-Commercial Fraud Law. 

The ministry stated it actively monitors compliance, aiming to identify violations and prevent deceptive or misleading practices that could harm consumers. 

Under the Anti-Commercial Fraud Law, violators can face severe penalties, including imprisonment for up to three years and fines of up to SR1 million. 

Additionally, the law permits the publicizing of violators’ names after definitive judicial rulings are issued by the competent courts. 

The Anti-Commercial Fraud Law was originally issued in 2008, with its latest amendment approved in 2019 to enhance its effectiveness in addressing evolving commercial fraud issues. 

The law was established to address a growing need for consumer protection in the face of increasing commercial activities, both in traditional marketplaces and online. 

It aims to ensure transparency, fairness, and legality in commercial transactions by imposing strict penalties on businesses that engage in fraudulent practices such as misrepresenting products, false advertising, and conducting unlicensed promotions or contests. 

By enforcing this law, the Saudi government seeks to maintain a trustworthy market environment, safeguard consumer rights, and uphold fair competition among businesses as the commercial sector grows. 

Vision 2030 is transforming the Kingdom’s commercial sector by enforcing regulations like the Anti-Commercial Fraud Law. 

The undertaking aims to increase the private sector’s contribution to the gross domestic product from 40 percent to 65 percent and boost non-oil exports from 16 percent to 50 percent of the non-oil GDP. 

It also seeks to attract more foreign direct investment, targeting an increase from 3.8 percent to 5.7 percent of GDP. These initiatives drive market transparency, ensure legal compliance, and foster a more diverse and competitive economy. 

In March, the ministry initiated punitive measures against several commercial establishments and individuals for organizing retail lottery prize draws that required consumers to make purchases as a prerequisite for participation. 

The ministry summoned the offending parties to proceed with legal actions before referring their cases to the Public Prosecution. 

At the time, the ministry emphasized that businesses and individuals should not impose purchasing requirements for consumers to enter contests, offers, or raffles. Additionally, practices such as including a contest voucher within a product or raising prices during promotional events are prohibited. 

The ministry reiterated that demanding payment or purchase as a condition for contest entry constitutes a lottery activity, which is banned in the Kingdom under current regulations. 


Qatar’s industrial production rises by 6% in July, driven by mining sector growth

Updated 16 September 2024
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Qatar’s industrial production rises by 6% in July, driven by mining sector growth

  • National Planning Council reported a month-on-month increase of 5.5% in the mining sector in July
  • Non-energy private sector continued to grow at the beginning of the second half of 2024

RIYADH: Qatar’s industrial production index rose by 6 percent in July, reaching 103.2 points, driven by the mining sector, official data showed. 

The National Planning Council reported a month-on-month increase of 5.5 percent in the mining sector in July, primarily due to higher production of crude oil, petroleum, and natural gas. Other mining and quarrying activities also grew by 11 percent. 

In the manufacturing sector, the index increased by 7.6 percent in July compared to the previous month. The growth was led by refined petroleum products, which rose by 13.3 percent, followed by basic metals at 12.4 percent, and chemicals and chemical products at 7.2 percent. 

This comes as Qatar’s non-energy private sector continued to grow at the beginning of the second half of the year, according to the latest Purchasing Managers’ Index survey from the Qatar Financial Center, compiled by S&P Global. The PMI registered 51.3 in July, down from June’s 23-month high of 55.9 but still indicating overall improvement in business conditions. 

Qatar’s monthly IPI is a key indicator of industrial sector performance, measuring output across mining, manufacturing, electricity, and water supply. 

Each sector has different weights in the index, with mining and quarrying at 82.46 percent, manufacturing at 15.85 percent, electricity, gas, steam, and air conditioning supply at 1.16 percent, and water supply at 0.53 percent. 

The July data also revealed a 4 percent decline in the IPI compared to the previous year. The mining sector experienced a 5 percent year-on-year decline due to reduced crude oil and natural gas output, despite a 3.6 percent increase in other mining and quarrying activities. 

The manufacturing sector saw a slight annual decline of 0.3 percent, driven by decreases in basic metals and cement. 

Meanwhile, the electricity and gas sector saw a 7.2 percent rise in electricity production compared to June and an 8.2 percent increase compared to July 2023. The water supply sector grew by 6.5 percent month-on-month and 0.5 percent year-on-year. 

In a report released last month, Standard Chartered forecasted that Qatar is poised to restore government revenues to pre-2014 oil price shock levels and double its economy by 2031. 

The UK-based bank attributed this recovery to Qatar’s strategic position in the global energy market and its ongoing efforts toward economic diversification. 


Saudi Arabia’s capital market institutions post 27% rise in operating revenue to $1.1bn: CMA

Updated 16 September 2024
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Saudi Arabia’s capital market institutions post 27% rise in operating revenue to $1.1bn: CMA

RIYADH: Saudi Arabia’s capital market institutions reported a 27 percent surge in operating income in the second quarter of 2024 – reaching SR4.1 billion ($1.1 billion).

Data released by the Kingdom’s Capital Market Authority indicated that the standout performer was asset management, contributing the largest revenue share at 31 percent, totaling SR1.28 billion — a 22 percent rise compared to the same period last year.

Investments followed closely, accounting for 30 percent of income at SR1.21 billion, which marked a 15 percent decline from the previous year.

Dealing activities ranked third, generating SR603.67 million, representing a 15 percent share and a 22 percent year-on-year increase.

Meanwhile, investment-banking revenues soared by 66 percent, reaching SR406.18 million and comprising 10 percent of total income.

The combined net profit, reflecting earnings after all expenses, zakat, and taxes, decreased by 3 percent to SR2.05 billion, down from SR2.13 billion in the same quarter last year.

This decline was largely driven by a rise in non-operating expenses, significantly impacting the bottom line.

On the trading front, the Saudi market led with SR900.35 billion, capturing 94 percent of the total traded value by local capital market institutions.

In contrast, US markets accounted for just 6.1 percent, totaling SR58.56 billion. The remaining share was distributed among other markets, including those in the Gulf Cooperation Council and the wider Arab world, Asia, and Europe.

According to the report, these institutions saw a significant boost in their aggregate balance sheet, with total assets climbing 29 percent to nearly SR73.25 billion, up from SR56.83 billion in the same quarter of 2023.

Liabilities surged by 68.73 percent year-on-year, reaching SR27.79 billion. Meanwhile, shareholders’ equity grew by 13 percent compared to the previous year, totaling SR45.42 billion.

According to a KPMG report, the Saudi stock exchange has swiftly evolved from a local market with limited options into the world’s 10th-largest by market capitalization.

This remarkable growth is largely attributed to reforms implemented by Tadawul and the Capital Market Authority, aligning with Vision 2030’s goals of economic diversification.

The report highlighted that increased foreign investment has significantly bolstered these reforms.

The Kingdom’s capital markets have remained resilient despite global economic uncertainties, such as high inflation and geopolitical tensions.

In 2022 alone, they attracted SR50.8 billion through initial public offerings and rights issues. This surge in market activity is fueled by improved liquidity, heightened investor confidence, and the government’s push for privatization and economic expansion, all supported by favorable oil prices.

Saudi Arabia’s CMA launched a strategic plan for 2024-2026 to enhance its debt market and asset management industry, highlighted during the September Debt Markets and Derivatives Forum held in Riyadh.

The plan includes over 40 initiatives focused on increasing market transparency, introducing special-purpose acquisition companies, and facilitating Saudi depositary receipts to attract local and international investors.

Key goals include boosting the stock market’s value to 80.8 percent of gross domestic product by 2025 and expanding the debt market to 24.1 percent of GDP. The strategy also emphasizes regulatory reforms, fintech growth, and improved investor protection to establish the Kingdom as a leading global financial hub in line with Vision 2030.


ADX imposes mandatory insider trading blackout ahead of Q3 results 

Updated 16 September 2024
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ADX imposes mandatory insider trading blackout ahead of Q3 results 

  • Restriction prohibits board members, executives, and employees with insider information from trading shares until earnings are fully disclosed.
  • Rule designed to ensure transparency and prevent insider trading ahead of major financial disclosures

RIYADH: A mandatory 15-day blackout on insider trading has been enforced by the Abu Dhabi Securities Exchange, effective Sept. 16, as companies prepare to release their third-quarter 2024 financial results. 

The restriction, in line with Securities and Commodities Authority regulations, prohibits board members, executives, and employees with insider information from trading shares until the earnings are fully disclosed. 

According to a report by state news agency WAM, the decision follows Article 14 of the Securities and Commodities Authority Board of Directors’ Decision No. 2/R of 2001, which outlines regulations on trading, clearing, settlement, transfer of ownership, and custody of securities. 

The rule is designed to ensure transparency and prevent insider trading ahead of major financial disclosures. 

Insider trading involves the buying or selling of a publicly traded company’s stock by individuals who possess non-public, material information about the company. This practice is not allowed because it gives an unfair advantage to people with inside information, which can affect the fairness of the market and reduce trust among investors. 

The report also stated that the resolution will be shared with the SCA, all listed companies, ADX departments, accredited brokers, and investors. 

Established in 2000, ADX facilitates the trading of various securities, including shares from public and private companies, debt instruments, exchange-traded funds, derivatives, and other financial instruments approved by the UAE’s SCA. 

On Aug. 30, WAM reported that ADX has become the most active and liquid ETF market in the Middle East and North Africa region, with notable value and volume since the start of the year. 

ETF trading on the exchange totaled 1.86 billion dirhams ($506.46 million) in the first eight months of 2024. The trading volume for ETFs on ADX reached approximately 450.7 million units, with 19,853 transactions recorded. 

Earlier this month, ADX also welcomed the listing of $1 billion in green bonds issued by Abu Dhabi Future Energy Co., known as Masdar. 

The green bonds are split into two tranches: the first, valued at $500 million, has a fixed interest rate of 4.87 percent and matures on July 25, 2029; the second tranche, also $500 million, offers a 5.25 percent interest rate and matures on July 25, 2034. 

WAM reported that the bond issuance witnessed strong demand from both international and domestic investors, with subscription orders peaking at $4.6 billion, representing an oversubscription of 4.6 times.


SMEs account for 90% of Saudi industrial and mining sectors: Minister

Updated 16 September 2024
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SMEs account for 90% of Saudi industrial and mining sectors: Minister

  • Minister of Industry and Mineral Resources, Bandar Alkhorayef made the announcement during a dialogue session at an event organized by Monsha’at
  • During the Industry and Mineral Resources Pioneers week, officials highlighted the impact of pioneering projects in the sector

RIYADH: Small and medium enterprises constitute 90 percent of Saudi Arabia’s industry and minerals companies, revealing that the sector is not “exclusive” to top players, according to a senior official.

The comments by the Kingdom’s Minister of Industry and Mineral Resources, Bandar Alkhorayef, were made during a dialogue session at an event organized by the General Authority for Small and Medium Enterprises, known as Monsha’at, the Saudi Press Agency reported.

During the Industry and Mineral Resources Pioneers week, officials highlighted the impact of pioneering projects in the sector, underlining how industrial technical applications, often led by SMEs, effectively resolve challenges in large-scale industries, SPA said. 

In recent years, the Saudi government has launched several initiatives to bolster SMEs’ presence and participation in various sectors, including industry and mining. 

These undertakings, spearheaded by entities such as Monsha’at, focus on providing a range of support services, including financing, licensing facilitation, and business development support. 

Programs like the SME loan guarantee program – known as Kafalah – and the Saudi Venture Capital Co. are designed to enhance access to capital, mitigating one of the significant challenges faced by smaller companies.

Other examples of SMEs demonstrating innovative capabilities in the sector include improving mine preservation, environmental safety, and productivity.

This reflects the broader trend within Saudi Arabia, where SMEs increasingly leverage technology and innovation to address complex industrial challenges.

In an interview with Alekhbariya, the minister said due to facilitating regulation efforts in the Kingdom, “opening a factory is easier than opening a restaurant.” 

He added that the government is “working on building factories and leasing them to investors to support them and ease the burden on them,” as part of its goal to bolster entrepreneurs and sustain their projects.

The Saudi government’s support extends beyond facilitating market entry for SMEs. There is a concerted effort to ensure the long-term sustainability of these enterprises, helping them navigate the industry landscape and overcome operational hurdles. 

The mining sector, in particular, presents a wealth of opportunities, and the ministry has identified over 100 initiatives and incentives designed to empower entrepreneurs and SME owners within this space. 

This focus on creating a supportive ecosystem is intended to encourage more entrepreneurs to explore the untapped potential of the mining sector.

The initiatives are part of a broader strategy to cultivate a vibrant SME sector capable of contributing significantly to Saudi Arabia’s economic growth and diversification. 

By providing the necessary tools, resources, and regulatory support, the government aims to harness the full potential of SMEs, ensuring they remain a driving force in the country’s industrial and economic development. 

As Saudi Arabia continues to transform its economic landscape, the empowerment and growth of SMEs will remain at the forefront of this journey.