Drones drive innovation and efficiency in Vision 2030

Drone are improving safety and efficiency in the energy sector by inspecting pipelines, refineries, and critical infrastructure. (saadef.com)
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Updated 07 December 2024
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Drones drive innovation and efficiency in Vision 2030

JEDDAH: Drone technology is emerging as a central pillar of Saudi Arabia’s push toward economic diversification, as the Kingdom leverages its Vision 2030 initiative to foster innovation across key industries.

From construction and oil to logistics and agriculture, drones are not only enhancing operational efficiency but are also central to achieving sustainability goals.

With strong government backing, the drone market in Saudi Arabia is poised for significant growth. Strategic investments and regulatory reforms are providing a conducive environment for drone technology, positioning the Kingdom as a regional leader in aerial innovation.

Rabih Bou Rached, founder and CEO of Dubai-based Falcon Eye Drones, a leader in Middle Eastern drone operations, emphasized that the unmanned aircraft are essential for Vision 2030, particularly in revitalizing industries, boosting operational efficiency and meeting sustainability objectives.

“The Saudi government’s commitment to technology adoption and strategic investments is facilitating drone integration across various sectors, creating new opportunities and innovations,” he said.

The drone sector is growing rapidly, supported by regulatory advancements and increasing demand from multiple industries. He cited a MarketsandMarkets report forecasting that the Middle East drone market would reach $5.54 billion by 2025, with Saudi Arabia driving much of this growth.

The report attributes this to sectors like construction, oil and gas, agriculture and logistics, which are leveraging drone technology to enhance productivity and reduce costs.

Drone impact on key sectors

In construction, drones are revolutionizing project management and site inspections. Bou Rached said the Saudi construction market, valued at $70.33 billion in 2024, was set to grow to $91.36 billion by 2029, with drones playing a key role in driving efficiency.

In the oil and gas sector, drones are used for inspection, monitoring and maintenance, helping reduce costs and improve safety by minimizing human intervention in hazardous environments.




Rabih Bou Rached, founder and CEO of Dubai-based Falcon Eye Drones. (Supplied)

“According to a report by PwC, drones can reduce inspection costs by up to 85 percent and enhance safety by minimizing human intervention in hazardous environments. Drones provide an effective solution for inspecting gas flares, monitoring pipelines, and detecting leaks, ensuring operational continuity, and improving safety,” Bou Rached added.

Despite the rapid growth, regulatory challenges persist. Bou Rached pointed out that while Saudi Arabia has made significant strides in developing drone-friendly regulations, there are still areas for improvement.

The General Authority of Civil Aviation is revising regulations to balance safety and innovation, with new efforts to streamline licensing and create clearer guidelines for commercial drone operations.

“As with most of the Middle East though, there are focus areas for development. The existing regulations concerning operational limits, airspace usage, and licensing requirements are under scrutiny by the powers that be, to allow for improved usage and development,” he said.

He stressed regulatory clarity was essential for maximizing drone capabilities across sectors: “Recent efforts include streamlined licensing processes and clearer guidelines for commercial drone operations.”

Job creation and future prospects

The integration of drones is expected to spur job creation and skills development, particularly in fields such as manufacturing, maintenance and data analysis.

Bou Rached foresees increased educational opportunities as universities offer programs focused on drone technology, robotics and artificial intelligence: “This technology is poised to be a catalyst for job creation and skills development,” he said.

Alhussain Al-Hazmi, CEO of Riyadh-based Lensic Drone Solutions, echoed Bou Rached’s optimism and highlighted the rapid adoption of drones across various sectors in Saudi Arabia.




Alhussain Alhazmi, CEO of Lensic Drone Solutions. (Supplied)

“Drone technology is playing a vital role in helping Saudi Arabia achieve its Vision 2030 goals, particularly in driving economic diversification and enhancing efficiency across key sectors,” Al-Hazmi said.

He noted the success of drones in defense, particularly for real-time surveillance and reducing human risk in dangerous environments.

The CEO also highlighted their growing use in logistics, citing a pilotless air taxi initiative during the 2024 Hajj to manage congestion and improve transport efficiency. “The logistics sector is also benefiting from drone technology. During the 2024 Hajj, the government successfully trialed pilotless air taxis to manage congestion and transport people more efficiently,” he said.

In the mining sector, Al-Hazmi’s company collaborates with Royal Road Arabia to enhance mineral exploration using advanced drones. These drones are equipped with hyperspectral scanners and other technologies to gather high-precision data, aiding in the exploration of copper and gold mines.

“These results demonstrate the power of drone technology in enhancing the discovery and exploration of valuable mineral resources,” he said.

Regulatory and infrastructure challenges

Despite the excitement surrounding drone technology, regulatory hurdles persist. Alhazmi pointed out that the approval process for drone operations, especially for advanced or heavy drones, can be cumbersome. The GACA restricts drones heavier than 24.99 kg, limiting their use to government projects, which restricts the private sector’s potential.

However, Al-Hazmi sees promise in the government’s ongoing efforts to streamline regulatory frameworks and foster collaboration with the private sector. “Clearer guidelines and faster approval processes are being developed to help companies operate more efficiently,” he said. “Collaboration between the government and the private sector is being actively encouraged to develop smoother, more efficient regulations that better meet industry needs.”

Both Bou Rached and Al-Hazmi agreed that drone technology holds immense potential in helping Saudi Arabia achieve its economic and technological goals.

As the industry matures, drones are expected to become integral to sectors such as public safety, urban planning, and energy. The integration of artificial intelligence and automation will further enhance the capabilities of drones, enabling them to handle data analysis, predictive maintenance, and autonomous operations.

“In the energy sector, drones inspect pipelines, power lines, and conduct environmental assessments, enhancing safety and efficiency,” said Al-Hazmi. “Drones assist farmers by monitoring crop health, optimizing water use, and promoting sustainable farming practices. Drones will also play a critical role in the development of Saudi Arabia’s smart cities, including NEOM, Qiddiya, and the Giga projects on the Red Sea.”

A bright future for drone technology

As Saudi Arabia moves toward its Vision 2030 objectives, drones are becoming a driving force for innovation and efficiency across key sectors. While challenges remain, the Kingdom’s commitment to developing a drone-friendly regulatory environment and fostering private-sector collaboration signals a promising future for the industry.

Both Bou Rached and Alhazmi are confident Saudi Arabia’s drone industry is poised for rapid growth, with the potential to lead not only in the Middle East but globally.

“The next decade could see drones becoming an integral part of key industries and economic evolution in Saudi Arabia,” Bou Rached said.

With continued regulatory reforms and strategic investments, Saudi Arabia is well-positioned to harness the full potential of drone technology as a key enabler of Vision 2030’s economic transformation. 


Rising geopolitical tensions impact global path toward net-zero emissions: WEF

Updated 13 December 2024
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Rising geopolitical tensions impact global path toward net-zero emissions: WEF

DUBAI: Rising geopolitical tensions, such as those in the Middle East, impact the global path toward net-zero emissions by driving up energy prices and straining global supply chains.

This is one of the findings of the World Economic Forum’s latest edition of the Net-Zero Industry Tracker, which tracks the progress of energy transition in eight sectors — steel, aluminum, cement, primary chemicals, oil and gas, aviation, shipping and trucking — that account for nearly 40 percent of global emissions.

The tracker “highlights opportunities and challenges to further accelerate GHG (greenhouse gas) emissions reductions in eight industrial and transport sectors that all play fundamental roles in driving global economic activity and connectivity, and in which reducing emissions can be challenging,” said Espen Mehlum, head of energy transition intelligence and regional acceleration at the Centre for Energy and Materials at WEF.

These eight sectors “achieved an impressive 0.9 percent reduction in absolute emissions from 2022 to 2023, compared to global energy-related emissions, which rose by 1.3 percent in the same period,” he told Arab News.

The current rate of progress, however, is not enough to meet net-zero targets. This will require an estimated $30 trillion in additional investments by 2050, with 57 percent coming from industries other than the eight mentioned in the report, as well as “good policies, technological progress and demand for green products,” said Mehlum. 

The tracker highlights the role of data and artificial intelligence as powerful tools to support the transition to net zero.

The use of generative AI holds the potential to improve capital efficiency by 5-7 percent, reducing capital requirements by $1.5 trillion to $2 trillion in the eight sectors. 

However, the tracker cautions against the excessive use of AI, which is expected to raise electricity demand. 

The oil and gas sector represents 10 percent of global GHG emissions — the highest among the eight analyzed — and 14 percent of global carbon dioxide equivalent emissions.

Saudi Arabia was the second-most oil-producing country (12 percent) after the US (20 percent) in 2023.

The Kingdom also ranked second, followed by the UAE and Kuwait in third and fourth place, in terms of countries with the lowest CO2 emissions from oil production in 2022.

Methane emissions make up nearly half of all GHG emissions from oil and gas operations, so to achieve net zero in this sector, WEF suggests accelerating reductions in methane emissions, incentivizing these reductions, and increasing investments in electrification to help manage costs.

The report stressed the need for markets outside Europe and the US, which are already advanced, to ramp up efforts in scaling methane abatement policies.

It also spotlighted the importance of international collaborations such as the Oil and Gas Decarbonization Charter, a global industry charter dedicated to accelerating climate action within the industry, and the UAE-US Partnership for Accelerating Clean Energy.


Saudi e-commerce sales using Mada cards hits $5bn milestone

Updated 13 December 2024
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Saudi e-commerce sales using Mada cards hits $5bn milestone

RIYADH: Saudi e-commerce sales using Mada cards reached SR18.34 billion ($4.89 billion) in October – an annual increase of around 37 percent, recent data revealed.

According to the Kingdom’s central bank, also known as SAMA, this figure includes online shopping payments, in-app purchases and e-wallets, and excludes transactions by Visa, MasterCard and other credit cards.

Mada cards are Saudi Arabia’s national payment cards, offering debit and prepaid services within the network. They use Near Field Communication for contactless payments, allowing secure transactions at retailers and online, and play a key role in supporting the country’s cashless economy.

The number of e-commerce transactions also increased by 29.3 percent on a year-on-year basis to reach around 101 million in October.

The prevalence of smartphones, with a 98 percent penetration rate according to the Kingdom’s Fashion Commission, highlights the digital readiness of Saudi consumers compared to advanced markets like the US, which has a  90 percent rate, and the UK with 80 percent.

The Kingdom’s youthful and increasingly affluent population is embracing online shopping, spurred by rising disposable incomes and growing awareness of e-commerce benefits like convenience and cost savings.

Saudi Arabia’s per capita gross domestic product is on a steady rise, with the IMF forecasting a 15.95 percent increase by 2029, reaching $38,124.66.

This growing individual income is enhancing purchasing power, spurring demand for fashion, apparel, and other consumer goods. Combined with government initiatives to promote cashless transactions and local brand development, these trends are creating ripe opportunities for e-commerce players.

Fashion’s role in e-commerce growth

According to a study by Mordor Intelligence the fashion and apparel sector is a major driver of the Saudi online retail sector.

Saudi Arabia’s fashion e-commerce market was valued at nearly $4 billion in 2023 and is expected to reach $7 billion by 2028, according to a 2024 report by the Kingdom’s Fashion Commission.

This growth is driven by increased digital exposure, evolving consumer sophistication, and strong government initiatives aimed at fostering a robust digital economy.

The Kingdom’s Fashion Commission’s 100 Saudi Brands initiative exemplifies this effort, spotlighting local designers and promoting Saudi craftsmanship on a global scale.

By addressing consumer pain points and integrating innovative technologies like virtual try-ons, fashion brands can further capitalize on this thriving market.

With a combination of local and international collaboration, the Kingdom’s fashion e-commerce sector is poised for sustained growth in the coming years.

The report highlighted that 65 percent of the population is under 40, a demographic renowned for their online shopping preferences.

These groups are among the most active online shoppers globally, turning to social media platforms and brand websites for fashion inspiration and purchases.

Adding to the allure of the Saudi market, the Kingdom is home to nearly 130,000 millionaires, a figure projected to rise to 226,000 by 2030. This affluent demographic, known for their financial confidence and affinity for luxury, is poised to increase local spending as high-end international brands expand their Saudi presence.

Notably, these high-income consumers spend significantly more than their global counterparts, with 30 percent planning to boost their expenditures, reflecting a strong appetite for premium clothing and accessories, according to the Fashion Commission.

Social media platforms, particularly Instagram and Snapchat, have emerged as critical sources of inspiration for shoppers in the Kingdom. 

The Saudi Fashion Commission noted that 50 percent to 60 percent of women use these platforms to discover new trends, while men often rely on YouTube for fashion insights.

This underscores the importance of influencer marketing and targeted digital campaigns in driving brand awareness and engagement within the Kingdom.

Transforming digital infrastructure

According to Mordor Intelligence, Saudi Arabia has invested over $24.8 billion into its digital ecosystem over the past six years, significantly enhancing internet quality and coverage.

As a regional leader, it was among the first in MENA to deploy 5G networks, with 77 percent nationwide coverage – well above global averages – and 94 percent coverage in Riyadh, cementing its position as a global frontrunner in connectivity.

Global companies are seizing opportunities in Saudi Arabia’s expanding e-commerce market.

In October, Mastercard introduced local processing for e-commerce transactions, bolstering secure and efficient payment options.

Similarly, TBS Holding announced plans to use artificial intelligence technologies to support digital transformation efforts in Saudi Arabia, reflecting the Kingdom’s broader ambitions for a thriving digital shopping ecosystem.

According to online platform Setup in Saudi, the Kingdom’s e-commerce market is led by six major players, including Noon, backed by the Public Investment Fund, Amazon, which entered via Souq.com, and Jarir Bookstores, a local retail giant with a strong online presence.

Other key companies include Namshi, which caters to regional fashion, while Extra Stores focuses on electronics and home appliances. 

AliExpress has a shrinking share as local platforms expand. These leaders exemplify the sector’s rapid growth and evolving consumer trends.

The Fashion Commission highlighted the seamless integration of digital and physical retail as the rise of e-commerce does not signify the decline of brick-and-mortar stores.

Instead, the Saudi market is embracing an omnichannel approach, where online and offline experiences converge. Approximately 75 percent of fashion-buying behavior in Saudi Arabia is influenced by digital channels.

This includes 38 percent who research online with purchases made offline and 25 percent doing pure online transactions. Challenges like uncertainty about sizing and fit remain key barriers to greater e-commerce adoption, with 40 percent of consumers citing this as a primary concern.

Key challenges for this sector as highlighted by the Fashion Commission include delivery lead times, return processes, and last-mile logistics. While 30 percent of Saudi consumers expect delivery within two to three days, this demand can only be met through local fulfillment centers.

Historically, products were shipped from the UAE or Europe, causing delays and higher costs.

To address this, initiatives like Riyadh’s Special Integrated Logistics Zone support localized operations, helping reduce delivery times. Companies like Chalhoub, Apple, and Amazon have already set up fulfillment centers, enhancing distribution efficiency. For example, Farfetch has notably improved its delivery times.

On payments, the government introduced e-payment regulations in 2018 to increase consumer trust and aims to shift 70 percent of transactions to digital methods.

Solutions like BNPL providers Tabby and Tamara, alongside mobile wallets like Apple Pay, are accelerating this transition.

The market remains fragmented, with the top three e-commerce platforms Shein, Namshi, and Centrepoint holding a combined 22 percent market share.

Luxury fashion remains underrepresented, presenting opportunities for growth as brands like Farfetch and local players like Level Shoes expand their presence.


COP16: Saudi Arabia closes UN conference with bold commitments on environmental sustainability

Updated 13 December 2024
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COP16: Saudi Arabia closes UN conference with bold commitments on environmental sustainability

RIYADH: COP16 witnessed unprecedented financial pledges totaling over $12 billion for land restoration and drought resilience initiatives, with Saudi Arabia leading from the front.

Held in Riyadh from December 2-13 under the theme “Our Land. Our Future,” COP16 brought together over 196 countries and numerous international organizations, marking a crucial milestone in the fight against environmental challenges that threaten billions of people worldwide.

Funding pledges seen at the event included £10 billion from the Arab Coordination Group to finance global projects combating land degradation, desertification, and drought. 

Additional contributions included $1 billion each from the OPEC Fund and the Islamic Development Bank, and $150 million from Saudi Arabia.

A legacy of action and collaboration

Saudi Minister of Environment and COP16 President Abdulrahman Al-Fadhley opened the conference with a call for intensified international collaboration to combat desertification, particularly in regions most affected by climate change.

“The Middle East, among the regions most impacted by these challenges, stands ready to lead through collaboration and innovation,” Al-Fadhley stated.

He emphasized Saudi Arabia’s Vision 2030 as a cornerstone of the Kingdom’s green agenda. 

This vision aims to restore 40 million hectares of degraded land, increase national reserves by 30 percent, and achieve a renewable energy mix of 50 percent by 2030. 

The Saudi Green Initiative, launched in 2021, has already led to the planting of 95 million trees and the restoration of 111,000 hectares of land.

Outgoing COP15 President Alain-Richard Donwahi of Côte d’Ivoire handed over leadership with a message of urgency, while UNCCD Executive Secretary Ibrahim Thiaw underscored that nearly 40 percent of the Earth’s land is degraded, impacting over 3 billion people. 

He warned that failing to address land degradation could lead to intensified food insecurity, conflict, and forced migration.

Saudi Minister of Environment and COP16 President Abdulrahman Al-Fadhley. Screenshot

The Riyadh Policy Declaration

A major outcome of COP16 was the adoption of the Riyadh Policy Declaration, a document drafted by the newly formed Friends of the Chair group. 

This declaration provides a comprehensive framework for global land restoration, drought resilience, and sustainable land management. The initiative showcases Saudi Arabia’s dedication to fostering international cooperation and achieving tangible results in the fight against desertification.

The Kingdom’s Deputy Minister for Environment, Osama Faqeeha, highlighted the significance of this collaborative effort, saying: “The Friends of the Chair group ensures that the outcomes of COP16 are not just promises but actionable steps toward global sustainability”.

Faqeeha also underscored the urgent need for private sector investment to bridge the estimated $355 billion annual funding gap for global land restoration. 

“The restoration economy has the potential to unlock trillions in economic benefits, but it requires the commitment of all sectors,” Faqeeha stated.

Minister of Investment Khalid Al-Falih announced three major renewable energy projects developed in collaboration with French firms, emphasizing the Kingdom’s growing influence in the global green finance market.

“The future of finance is green, and Saudi Arabia is positioning itself as the global hub for sustainable investments,” Al-Falih said.

Innovative projects and sustainability initiatives

Saudi Arabia highlighted several transformative projects aimed at balancing economic growth with environmental preservation. 

The National Red Sea Sustainability Strategy is a flagship initiative to protect 30 percent of the Red Sea’s marine and coastal ecosystems by 2030. This strategy is expected to contribute SR33 billion ($8.78 billion) annually to the economy and create 120,000 jobs.

John Pagano, CEO of Red Sea Global, emphasized the project’s commitment to regenerative tourism and renewable energy. “We are planting 50 million mangrove trees and expanding coral reef protection, aligning with our vision of sustainable development,” Pagano said.

In a landmark announcement, King Abdullah University of Science and Technology launched the International Water Research Center to address global water scarcity and pollution challenges. 

The center will develop innovative water solutions in collaboration with the Ministry of Environment, Water, and Agriculture.

Saudi climate envoy Adel Al-Jubeir highlighted the link between land degradation and forced migration, noting that 100 million hectares of land are lost annually, exacerbating displacement and security crises. 

“When people cannot grow food, they migrate, leading to tension and conflict,” Al-Jubeir warned. The UNCCD’s Thiaw echoed these concerns, emphasizing that land restoration is crucial for global stability and security. 

Thematic days and key dialogues

COP16 featured several thematic days addressing critical issues like sustainable agri-food systems, drought resilience, and rangeland protection. 

Agri-Food System Day coincided with World Soil Day, highlighting that unsustainable farming practices could lead to a 10 percent decline in global crop yields by 2050. 

Faqeeha called for redirecting harmful agricultural subsidies toward sustainable practices to prevent further degradation.

Youth and technology were at the forefront of COP16 discussions. Saudi Arabia’s thriving startup ecosystem, supported by initiatives like The Garage and Vision 2030, showcased how entrepreneurship can drive sustainability. 

Prince Khaled bin Alwaleed, CEO of KBW Ventures, highlighted the synergy between venture capital and sustainable development, while Ma’aden CEO Robert Wilt emphasized the role of responsible mining in enabling the global energy transition.

Global collaboration and regional leadership

The conference featured high-profile attendees, including UN Deputy Secretary-General Amina Mohammed, who called for scaled-up restoration efforts and stronger international cooperation. 

Mayor of Riyadh Faisal bin Abdul Aziz bin Ayyaf underscored Riyadh’s ambition to serve as a model for sustainable urban development.

Hungary’s representative praised COP16 for addressing gender equality, acknowledging the essential role of women in combating desertification. 

Discussions also highlighted the need for international cooperation to address shared challenges, such as sand and dust storms, drought, and land degradation.

A path forward 

Saudi Arabia’s successful hosting of COP16 demonstrated its commitment to shaping global environmental policies and fostering innovation. 

As attention turns to COP17 in Mongolia, the momentum generated in Riyadh is expected to drive sustained action toward land restoration, drought resilience, and a greener future for all.


Oil Updates – crude stabilizes on course for first weekly gain in 3

Updated 13 December 2024
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Oil Updates – crude stabilizes on course for first weekly gain in 3

SINGAPORE: Oil prices stabilized on Friday, heading for their first weekly rise since the end of November, as additional sanctions on Iran and Russia ratcheted up supply worries, while a surplus outlook weighed on markets.

Brent crude futures edged up 7 cents to $73.48 a barrel by 7:34 a.m. Saudi time, while US West Texas Intermediate crude was at $70.11 a barrel, up 9 cents.

Both contracts are on track for a weekly gain of more than 3 percent as concerns about supply disruption from tighter sanctions on Russia and Iran, and hopes that Chinese stimulus measures could lift demand in the world’s No. 2 oil consumer support prices.

Recent stabilizations came after oil defended a key technical level of $71, said Yeap Jun Rong, market strategist at IG.

“But there has not been much conviction to prompt a stronger price recovery just yet,” he added.

Chinese data this week showed crude imports grew annually for the first time in seven months in November, driven by lower prices and stockpiling.

“We have seen a bit of a recovery in refinery margins since the September lows, but don’t think it’s anything to justify the November crude import volumes,” said Warren Patterson, ING’s head of commodities research.

Crude imports by the world’s largest importer are set to stay elevated into early 2025 as refiners opt to lift more supply from top exporter Saudi Arabia, drawn by lower prices, while independent refiners rush to use their quota.

The International Energy Agency increased its forecast for 2025 global oil demand growth to 1.1 million barrels per day from 990,000 bpd last month, thanks to China’s recent stimulus measures, it said in its monthly oil market report.

However, it forecast a surplus for next year, when non-OPEC+ nations are set to boost supply by about 1.5 million barrels per day, driven by Argentina, Brazil, Canada, Guyana and the US.

“I guess with an outlook for a fairly comfortable balance (there is) little reason (for prices) to break out of this range for now,” ING’s Patterson.

Three of Canada’s biggest oil producers forecast higher output in 2025. Building on record US production, Goldman Sachs expects Lower 48 shale oil production to grow by 600,000 bpd in 2025, although growth could slow if Brent falls below $70 a barrel.

Investors are also betting that the Fed will cut borrowing costs next week and follow up next year with further reductions, after economic data showed weekly claims for unemployment insurance unexpectedly rose.


PIF acquires 15% stake in Heathrow Airport

Updated 12 December 2024
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PIF acquires 15% stake in Heathrow Airport

  • Statement says move underscores commitment to impactful global investments

RIYADH/LONDON: Saudi Arabia’s Public Investment Fund announced on Thursday it had finalized the acquisition of a 15 percent stake in FGP TopCo, the holding company of Heathrow Airport Holdings.

The stake was purchased from Ferrovial SE and other shareholders of FGP TopCo.

Simultaneously, Ardian, a private investment firm, acquired a 22.6 percent stake in FGP TopCo through a separate transaction.

A PIF statement said the strategic investment underscored its commitment to impactful global investments that bolstered key sectors, and its broader strategy of supporting sustainable and long-term growth in major international markets.

Turqi Al-Nowaiser, deputy governor and head of international investments at PIF, said the fund was pleased to be investing in Heathrow, calling it a “vital UK asset and a world-class airport.”

He added: “We believe in the importance of infrastructure as a key sector in supporting the transition to net zero.

“Heathrow acts as a crucial gateway to the world, and we look forward to supporting Heathrow’s management in its efforts to secure the sustainable growth of the airport and to continue to maintain its position as a global aviation hub.”