$10m Dhaman fund to lower health coverage risks for insurance companies
Updated 19 October 2021
Arab News
Jeddah: A new $10 million healthcare fund has been launched in Saudi Arabia which will step in to cover expenses that exceed a person's insurance coverage.
The fund, called Dhaman, was unveiled on Monday by the Council of Health Insurance (CCHA) in coordination with the Saudi Central Bank.
The size of the fund will be reviewed periodically to meet the demand, Ahmad Abuemara, spokesperson for the CCHA told CNBC Arabia.
“In the first stage, the fund's coverage will be dedicated for emergency cases, with a maximum of SR500,000 per case,” he added.
Dhaman will ensure the protection of insurance companies and enable claiments to receive treatment without interruption.
Pakistan’s factory PMI dips in early sign of global tariff headwinds
New orders slumped while export orders in particular plummeted
Employment fell for a second month as manufacturers cut costs
Updated 03 May 2025
Reuters
KARACHI: Pakistan’s manufacturing sector growth slowed to a seven-month low in April, with the HBL Pakistan Manufacturing Purchasing Managers’ Index (PMI)easing to 51.9 from 52.7 in March, as concerns over global trade weighed, HBL said in a press release.
The latest dip in the index hints at the impact of US President Donald Trump’s trade tariffs, said Humaira Qamar, Head of Equities & Research at HBL.
“We believe that the latest PMI dips are early signs of the headwinds to the global economy from the introduction of US tariffs,” said Humaira Qamar — Head Equities & Research at HBL.
New orders slumped while export orders in particular plummeted. Employment fell for a second month as firms cut costs, said Qamar.
Qamar warned that any US stagflation would hurt Pakistan’s exports, particularly to the US which accounts for 18 percent of its total, potentially prolonging the manufacturing downturn, though lower commodity prices could provide some relief, she added.
Despite the slowdown, the PMI remains above 50, indicating expansion amid a favorable inflation outlook.
Qamar said she expects an interest rate cut on Monday due to strong deflationary pressures. But a Reuters poll suggests Pakistan’s State Bank will hold rates steady at 12 percent, following a surprise pause in its last meeting due to geopolitical tensions and inflation concerns.
Pakistan’s annual inflation rate fell to 0.3 percent in April, well below the Ministry of Finance estimate of 1.5 percent to 2 percent. The central bank forecasts average inflation to be in the range of 5.5 percent to 7.5 percent for the fiscal year ending June.
Pakistan’s largest bank, HBL, and global financial information and analytics firm S&P Global launched the index In February to track the country’s manufacturing sector.
KARACHI: Pakistan’s renewed tensions with archrival India have weighed heavily on the country’s stock market, with key sectors like refineries posting losses of up to 15 percent since a gun attack killed 26 tourists in the disputed Kashmir region on April 22, according to analysts and market data on Friday.
India blamed Pakistan for the attack despite Islamabad’s denial and call for a neutral probe. The escalation, which has seen border closures, tit-for-tat diplomatic expulsions and fears of military confrontation between the nuclear-armed neighbors, has drawn international concern.
The KSE-100 Index, Pakistan’s benchmark stock gauge, fell 6 percent over six trading sessions following the attack, according to Pakistan Stock Exchange (PSX) data.
The market recovered some losses on Friday but remained volatile heading into next week.
“Pakistan’s stock market experienced heightened volatility after the Pahalgam attack,” Sana Tawfik, an economist and head of research at Arif Habib Ltd., told Arab News while referring to the attack in Indian-administered Kashmir.
Between April 22 and April 30, the index dropped 7,104 points or 6 percent, she said.
Key sectors bore the brunt of the sell-off, including refineries (-15.4 percent), transport (-15 percent), pharmaceuticals (-12.9 percent), jute (-11.6 percent) and engineering (-9.2 percent).
“This decline reflects broad investor risk aversion amid geopolitical uncertainty,” she added.
The latest flare-up with India added to pressure on Pakistani equities, which had already been hit by US President Donald Trump’s tariff increases last month. That triggered panic selling and a one-hour trading halt at the PSX.
“Foreigners remained net sellers [in April] as well, taking 10MFY25 net outflow to around $252 million,” JS Global Capital Ltd., the largest broking and investment banking firm in Pakistan, said in a note to clients.
Muhammad Waqas Ghani, its head of research, said investor caution over Pakistan’s escalating tensions with India had driven the recent market volatility.
“The impact of geopolitical concerns is beginning to wear off,” he said.
On Friday, the KSE-100 rebounded 2.5 percent to 114,113 points, trimming overall losses to 3.6 percent. Ghani attributed the recovery to US diplomatic efforts to defuse tensions between the two neighbors.
“The market opened positive today [Friday], gaining 2,900 points or 2.6 percent in the first half,” he said.
Analysts said calls for restraint from the US, United Nations and other members of the International community contributed to Friday’s rally.
US Vice President JD Vance told Fox News in a podcast interview that Washington was working to prevent further escalation and preserve regional peace.
Mohammed Sohail, CEO at Topline Securities Ltd., said stocks bounced back as investors regained confidence amid “signals of easing tensions.”
JS Global said market sentiment could improve further after the International Monetary Fund’s (IMF) expected release of funds for Pakistan following its upcoming executive board meeting this month.
“Materialization of planned foreign inflows, likely after IMF disbursement, along with geopolitical stability, remains crucial for the country and equity markets,” it added.
Saudi Arabia’s flynas Middle East’s fastest-growing airline from 2019-2024: report
Updated 02 May 2025
Nirmal Narayanan
RIYADH: Saudi low-cost carrier flynas’s capacity increased by 63 percent from 2019 to 2024, making it the fastest-growing airline in the Middle East region, according to an analysis.
In its latest report, UK-headquartered global travel data provider OAG said that flynas was closely followed by the UAE’s flydubai, which witnessed a capacity rise of 55 percent from 2019 to 2024.
The analysis revealed that both carriers operated nearly 14.4 million departing seats each during the period, with flynas edging ahead by 25,000 travelers.
The strong capacity growth of flynas aligns with Saudi Arabia’s national goal to establish itself as a global tourist and business destination. The Kingdom aims to attract over 150 million visitors by the end of this decade.
“The Middle East region’s strategic position as a global hub, coupled with the dynamic expansion of both low-cost and network carriers, is driving unprecedented opportunities. This vibrant market is setting the stage for future advancements in aviation technology and passenger experience,” said Filip Filipov, chief operating officer of OAG.
Although flydubai and flynas’ networks are similar, the latter benefits from a large domestic market within Saudi Arabia, allowing it to operate a more diverse route network, OAG added.
The airline aims to operate over 160 aircraft by 2030, with its 280-plane order worth more than SR161 billion ($43 billion), making it the largest holder of single-aisle aircraft purchase orders in the Middle East.
Commenting on the growth of flynas in recent years, Paolo Carlomagno, partner at Arthur D. Little, said that competitive pricing and top-notch quality have played a crucial role in the airlines’ rising popularity among travelers.
“In the past five years, flynas has delivered stellar growth thanks to several factors — endogenous and exogenous. A well-planned and executed network strategy and efficient seat capacity increases, primarily driven by fleet expansion with the Airbus A320Neo, which offers lower operating costs,” said Carlomagno.
He added: “Flynas has also expertly managed the difficult trade-off between pricing and quality of service and delivered strong operational performance over the past five years.”
The Arthur D. Little official added that the growth of flynas as a leading air carrier globally could help Saudi Arabia achieve its national tourism goals as outlined in the Vision 2030 initiative.
He further highlighted that flynas has a significant opportunity to expand, as the market penetration of low-cost carriers in the Kingdom is comparatively low compared to other leading markets.
“LCC market penetration in Saudi Arabia is still significantly lower than some other major aviation markets such as South East Asia and so there is still enormous potential for them to grow further. The ‘democratization’ air travel trend and the connectivity with ‘secondary’ routes will continue to boost demand in the Kingdom,” said Carlomagno.
Middle East aviation market’s outlook
In its latest report, OAG stated that the Middle East’s aviation market has grown by 5 percent since 2019, making it the world’s second-fastest-growing region after South Asia, which saw a 12 percent increase over the same period.
The analysis further said that this increase was fueled by a robust combination of low-cost carrier growth and legacy carrier capacity.
“In recent years, the Middle East has established a leading position in developing new markets and connecting the region to the rest of the world with non-stop services to all continents and key cities,” said OAG.
It added: “The region has a highly competitive environment with best-in-class airlines operating in all segments, alongside ambitious plans for new aircraft and routes. This makes the Middle East a real hot spot in the aviation industry.”
The report highlighted that the Middle East is the sixth-largest region in the world based on available capacity, with 270 million one-way seats in 2024, placing the area ahead of Eastern Europe and behind South Asia.
According to OAG, airlines operating in the Middle East region witnessed an international travel capacity expansion of 8.9 percent by the end of 2024 compared to 2019, the second-strongest pandemic recovery, only next to South Asia, whose capacity grew by 11 percent during the same period.
Affirming the growth of the aviation sector in the region, a recent report by the International Air Transport Association revealed that airlines operating in the Middle East witnessed a 3.3 percent increase in passenger demand growth in February compared to the same month in 2024.
IATA added that the total capacity of Middle Eastern flights also rose by 1.3 percent year on year in February.
In March, another report by Oliver Wyman also highlighted the growth of the aviation sector in the region. It underscored that the fleet of commercial airlines in the Middle East is expected to grow at a compound annual growth rate of 5.1 percent from 2025 to 2035 to reach 2,557 aircraft.
The consultant management firm added that this significant growth in the region is almost double the annual global growth rate, which is projected at 2.8 percent during the same period.
According to the latest OAG report, low-cost carriers accounted for 29 percent of the capacity in the Middle East region in 2024, having more than doubled in the last decade from just 13 percent of capacity in 2014.
Globally, low-cost carriers operated 34 percent of the capacity last year.
Competition intensifies in Middle East market
According to OAG, two Middle Eastern carriers have gained prominence worldwide. Emirates and Qatar Airways are the only regional airlines to feature in 2024’s Top 20 Global Airlines for Capacity and the Top 10 Global Airlines by available seat kilometers — a measure of an airline's passenger carrying capacity.
The report revealed that Emirates is now the 14th largest carrier globally by seat capacity and ranks 4th in terms of available seat kilometers.
On the other hand, Qatar Airways has experienced dramatic growth over the last decade, as it developed Doha into a global connecting point and moved from being the 36th largest airline globally 10 years ago to the 19th in 2024.
A Qatar Airways sign at a check-in area. Shutterstock
Regarding available seat kilometers, Qatar Airways also advanced from 17th in 2019 to the sixth largest globally in 2024.
The capacity of Qatar Airways increased by 18 percent between 2019 and 2024.
The capacity of Emirates dropped by 7 percent in 2024 compared to 2019, while Saudia’s capacity declined by 11 percent during the same period.
“Competition across the region’s leading airlines is increasing, with as much investment in product as network expansion,” said OAG.
The study further stated that the Middle East market is likely to experience significant disruptions in the future as additional airline capacity is added through various airline business models and the creation of new airlines in the region.
“The launch of Riyadh Air is likely to be one of the most interesting disruptions in the Middle East market in the coming years, alongside the planned growth of rival Saudi airline Saudia and its move to a new base at Jeddah,” said OAG.
It added: “Although neither of these airlines is likely to challenge Emirates’ traffic in the short term, they will create a new competitive landscape as Saudi carriers vie for both transfer traffic and inbound tourism.”
Riyadh Air is scheduled to launch passenger flights by the end of 2025. Shutterstock
According to OAG, the key feature of the aviation sector in the Middle East, and particularly the bigger markets of the UAE, Qatar, and Saudi Arabia, is the depth of network that they offer to travelers.
The report added that non-stop flights from the region’s major hub airports reach every continent, with only a handful of international markets remaining unserved directly.
Markets in South America, including Lima and Santiago, fall just outside the operational reach of the Middle East region.
OAG further said that Doha to Auckland is currently the longest non-stop route operated from the Middle East by Qatar Airways, followed by Emirates’ Dubai to Auckland route.
“In time, with ever-increasing aircraft ranges, it is likely these destinations will provide new markets for the network carriers to increase their revenues further,” the report added.
It concluded: “For the traveler, a seemingly ever-expanding choice of destinations to reach, along with increased competition, is likely to result in airfares remaining competitive throughout the region.”
Think local: How startups can successfully expand into Saudi Arabia’s fast-growing market
Updated 02 May 2025
Nour El-Shaeri
RIYADH: Saudi Arabia’s rapidly expanding market presents lucrative opportunities for startups, but successful entry requires careful planning and a deep understanding of the local landscape.
Industry experts told Arab News that companies looking to expand into Saudi Arabia must focus on key factors such as securing regulatory approvals, ensuring financial stability, hiring the right talent, and adapting to the local culture.
By prioritizing these elements, businesses can establish a strong foothold in one of the Middle East’s most lucrative markets.
Regulatory landscape
Regulatory compliance is one of the primary hurdles for startups entering the Saudi market. While the country is actively fostering entrepreneurship and foreign investment, businesses must follow strict licensing and legal requirements.
Mohammed Al-Zubi, managing partner and founder of Nama Ventures, emphasized the need for startups to thoroughly understand and prepare for regulatory processes.
“While Saudi Arabia is opening up to startups, businesses must secure the right MISA (Ministry of Investment) licensing, sector approvals, and legal structures. Many founders underestimate the process and should plan accordingly,” Al-Zubi said in an interview with Arab News.
Failing to navigate these regulatory frameworks can lead to operational delays, legal complications, or financial penalties.
Mohammed Al-Zubi, managing partner and founder of Nama Ventures. Supplied
Paula Tavangar, chief investment officer of Injaz Capital, echoed this, noting that “compliance with Saudi-specific regulations, including licensing, Saudization requirements, and sector-specific rules, is also essential from day one.”
She emphasized that while Gulf Cooperation Council countries may appear similar, “successfully entering the Saudi market has its own very unique economic landscape, regulatory environment, and consumer behavior.”
The Ministry of Investment has streamlined processes to encourage foreign investment, but businesses must still comply with industry-specific guidelines and labor laws, including Saudization policies, which mandate hiring a certain percentage of nationals from the Kingdom.
Beyond legal compliance, establishing local credibility is crucial. Saudi businesses often prefer working with entities that demonstrate a long-term commitment to the market.
Tavangar stressed that “building an on-the-ground presence in Saudi Arabia is not optional — it’s central to gaining traction.”
She added that “Saudi stakeholders generally prefer working with companies that are physically present, engaged locally, and committed to contributing to the Kingdom’s Vision 2030 goals.”
The regulatory framework is evolving to attract foreign startups, with the Saudi government offering multiple incentives to support early-stage businesses.
“The Saudi government actively supports foreign startups through initiatives like the National Transformation and Development Program, which can assist with relocation logistics and business setup,” Tavangar said.
This means startups should not view Saudi Arabia as a short-term expansion play but rather as a core component of their growth strategy.
Paula Tavangar, chief investment officer of Injaz Capital. Supplied
Financial preparedness
Expanding into Saudi Arabia requires significant financial resources. From securing office space to investing in marketing and hiring local employees, the costs can add up quickly.
Startups must assess their financial stability before making the move, ensuring they have the necessary capital to sustain operations during the initial stages of expansion.
Tavangar pointed to the financial realities of entering the Kingdom. “Financial readiness is key. Costs associated with setting up in Saudi — such as obtaining a foreign investment license through MISA, setting the entity, renting office space and hiring local talent — can add up quickly,” she said.
Setting up operations in the Kingdom comes with significant financial obligations that startups must prepare for.
These include licensing, incorporation costs, and office rental, which can be partially offset through available public initiatives. “There are multiple low-cost co-working space options in addition to free spaces through accelerator programs,” Tavangar noted.
She also highlighted the importance of leveraging public-private support schemes.
“Again, NTDP has a program that can sponsor 50 percent of employee salaries for the startups that require the support,” she said, underscoring the need for early-stage companies to budget carefully and align with available national resources.
In an interview with Arab News, Ahmed Mahmoud, CEO of DXwand, a startup that has recently expanded to Saudi Arabia, stressed the importance of financial resilience.
“A startup should have strong financial stability, consistent revenue growth, and a proven market presence. It should be well-funded with enough capital to sustain operations for at least a year after expansion,” he explains.
Mahmoud encourages startups to evaluate their expenses closely and tailor their pricing models to remain competitive within Saudi Arabia’s evolving market landscape.
“To succeed in Saudi Arabia, startups must carefully assess their unit economics and cost structures. A strong balance between customer lifetime value and customer acquisition cost is crucial for long-term profitability,” Mahmoud said.
Other financial considerations include managing operational expenses such as office leases, logistics, and employee salaries.
Localization costs — such as translating marketing materials into Arabic, adapting services to cultural preferences, and ensuring compliance with local regulations — should also be factored into financial planning.
Talent acquisition
One of the challenges of expanding into Saudi Arabia is finding and retaining the right talent.
Al-Zubi advises startups to take a strategic approach to talent acquisition. “While Vision 2030 initiatives are fostering a skilled workforce, specialized tech and startup talent can still be limited. Startups should leverage local hiring programs, university partnerships, and experienced regional hires,” he said.
Hiring Saudi nationals is not only a regulatory requirement in certain sectors but also a competitive advantage.
Local employees bring market insights, cultural understanding, and access to networks that can help businesses establish stronger connections.
“Founders should hire local leadership, engage with stakeholders, and spend time in-market. Remote operations rarely succeed in Saudi Arabia,” he explains.
Market localization
Saudi Arabia is a relationship-driven market where trust and personal connections play a significant role in business success.
Startups that fail to adapt to local consumer behavior and cultural expectations may struggle to gain traction.
Al-Zubi highlights the importance of cultural adaptation. “Startups must localize offerings, marketing, and operations to fit local consumer behavior. Strong local partnerships can accelerate trust and market entry,” he said.
Mahmoud also underscored the importance of branding and culturally relevant marketing strategies.
“Localization isn’t just about language — it includes pricing models, payment preferences, and customer experience. Businesses that invest in culturally adapted services enhance trust and engagement,” he noted.
Tavangar emphasized that “the local context is very important” adding: “While in the UAE we observe very successful implementation of business models that worked in the west, Saudi Arabia has a different business environment, very tailored to the local demand and culture.”
Strategic partnerships
Establishing partnerships with local businesses, distributors, and investors can accelerate market entry and growth.
Saudi companies prefer working with brands that demonstrate commitment and credibility, and forming strategic alliances can help startups gain that trust.
“Building local partnerships with investors and distributors isn’t just helpful — it’s a game-changer. It boosts credibility and makes market entry smoother,” Mahmoud said.
Tavangar added: “A local partner who has ‘skin in the game’ can significantly aid in navigating both the cultural and business landscapes.”
Ahmed Mahmoud, CEO of DXwand. Supplied
Leveraging digital transformation
As Saudi Arabia accelerates its digital transformation, startups leveraging advanced technologies like artificial intelligence, automation, and cloud infrastructure are well-positioned to gain a market advantage.
The Kingdom’s investment in smart cities, fintech, and e-commerce presents opportunities for tech-driven companies to scale quickly.
Mahmoud highlights the importance of embracing technology as part of a long-term strategy.
“With Saudi Arabia going through a rapid digital transformation, there’s a huge opportunity in e-commerce and fintech, both of which align with Vision 2030’s innovation goals,” he said.
Additionally, businesses that set up a regional headquarters in the Kingdom can benefit from government incentives, including potential tax breaks and funding support.
By taking a long-term approach and investing in local partnerships, cultural adaptation, and digital innovation, startups can position themselves for sustainable growth in one of the Middle East’s most dynamic economies.
As Al-Zubi said: “Startups that immerse themselves in the market, build strategic partnerships, and adapt to Saudi dynamics will find the most success.”
LONDON: Oil prices fell on Friday as traders squared positions ahead of an OPEC+ meeting and amid some caution about a potential de-escalation of the trade dispute between China and the US.
Brent crude futures were down 56 cents, or 0.9 percent, to $61.57 a barrel at 3:02 p.m. Saudi time, while US West Texas Intermediate crude futures fell 61 cents, or 1 percent, to $58.63 a barrel.
For the week, Brent and WTI were on track for 7 percent drops, the biggest weekly declines in a month.
China’s Commerce Ministry said on Friday that Beijing was “evaluating” a proposal from Washington to hold talks aimed at addressing US President Donald Trump’s sweeping tariffs, signalling a possible easing of the trade tensions that have rattled global markets.
“There is some optimism when it comes to US-China relations but the signs are only very tentative,” said Harry Tchilinguirian, group head of research at Onyx Capital Group. “It’s still very fluid, a one step forward, two steps back situation when it comes to tariffs.”
Concerns that the broader trade war could push the global economy into a recession and crimp oil demand, just as the OPEC+ group is preparing to raise output, have weighed heavily on oil prices in recent weeks.
Complicating any talks was a threat from Trump to impose secondary sanctions on buyers of Iranian oil. China is the world’s largest importer of Iran’s crude.
Trump’s comments followed a postponement of US talks with Iran over its nuclear program. He had previously restored a “maximum pressure” campaign against Iran, which included efforts to drive the country’s oil exports to zero to help prevent Tehran from developing a nuclear weapon.
Oil prices gained late in Thursday’s session to settle nearly 2 percent higher on Trump’s remarks, erasing some of the losses recorded earlier in the week on expectations of more OPEC+ supply coming to the market.
“With non-OPEC+ supply rising robustly and global demand growth facing structural decline, we see no natural re-entry point for these barrels and, ultimately, the group will likely have to endure some price pain no matter when it unwinds its cuts,” Fitch’s BMI research unit said in a note.
