Saudi Arabia establishes logistics zone in Djibouti to expand economic presence in Africa

Saudi Arabia establishes logistics zone in Djibouti to expand economic presence in Africa
During a delegation visit of Saudi investors to the capital city of the East African country, the contract was signed by Hassan Al-Huwaizi, president of the Federation of Saudi Chambers, and Aboubaker Omar Hadi, chairman of Djibouti Ports and Free Zones Authority. Supplied
Short Url
Updated 05 June 2024
Follow

Saudi Arabia establishes logistics zone in Djibouti to expand economic presence in Africa

Saudi Arabia establishes logistics zone in Djibouti to expand economic presence in Africa

RIYADH: Saudi Arabia has signed a deal to establish a logistics zone in the port of Djibouti, leveraging Africa’s gateway to propel the Kingdom’s products and exports, fostering economic interplay. 

During a delegation visit of Saudi investors to the capital city of the East African country, the contract was signed by Hassan Al-Huwaizi, president of the Federation of Saudi Chambers, and Aboubaker Omar Hadi, chairman of Djibouti Ports and Free Zones Authority. 

Under the leadership of Al-Huwaizi, the delegation, including over 100 entrepreneurs and government representatives, came together to advance this transformative initiative. 

The 92-year contract for the logistics zone, spanning an expansive area of 120,000 sq. m. in its inaugural phase, underscores a pivotal milestone in Saudi-Djibouti economic relations. 

The Saudi logistics city, serving as a nexus for commerce and innovation, is positioned to strengthen the Kingdom’s economic presence across the African continent, as reported by the Saudi Press Agency. 

Djibouti’s port, strategically located as Africa’s gateway, facilitates the expansion of Saudi products and exports into new markets, promoting robust economic interplay. 

Simultaneously, the Saudi-Djibouti Business Forum, attended by over 300 stakeholders, unveiled a range of investment opportunities, highlighting Djibouti’s appeal as a free zone. 

In return, Djibouti authorities have promised equal treatment for Saudi investors, guaranteeing fair opportunities across sectors, from renewable energy to technology. 

This collaborative effort emphasizes a steadfast commitment to fostering lasting economic cooperation between the two nations. 

In February, Djibouti’s president reaffirmed his country’s dedication to promoting maritime security in the Red Sea. 

Ismail Omar Guelleh noted that the East African nation was collaborating with major powers, including Saudi Arabia, to ensure safe passage for international shipping in the Bab El-Mandeb and the Gulf of Aden. 

He emphasized that Djibouti’s strategic position made it a key player in facilitating global trade, mentioning cooperation with nations such as the US, France, the UK, and Red Sea coastal states, especially Saudi Arabia, in counterterrorism efforts and maritime security. 

Guelleh had underscored Djibouti’s longstanding ties with Saudi Arabia, dating back to 1977 when his country gained independence. 

The president added that Djibouti aimed to further enhance collaboration with Saudi Arabia, especially in maritime transport, logistics, and port services, building on significant progress in port development. 

Dya-Eddine Saïd Bamakhrama, Djibouti's ambassador to Saudi Arabia, told Arab News: “This contract, signed between the Ports and Free Zones Authority of Djibouti and the Saudi Investors Alliance, will make it possible to create the largest logistics city outside the Kingdom.

“This Free Zone will facilitate access for Saudi products and exports to a large number of African countries.”


Closing Bell: Saudi main index closes higher, gains 76 points  

Closing Bell: Saudi main index closes higher, gains 76 points  
Updated 26 May 2025
Follow

Closing Bell: Saudi main index closes higher, gains 76 points  

Closing Bell: Saudi main index closes higher, gains 76 points  
  • MSCI Tadawul 30 Index climbed 14.22 points, or 1.01%, to 1,416.62
  • Parallel market Nomu fell 237.23 points, or 0.88%, to 26,780.54

RIYADH: Saudi Arabia’s Tadawul All Share Index closed higher on Monday, rising 76.18 points, or 0.69 percent, to finish at 11,075.96.

The total trading value on the main market reached SR4.32 billion ($1.1 billion).  

Despite the benchmark’s gain, market breadth leaned negative, with 70 stocks advancing while 171 declined.  

The MSCI Tadawul 30 Index climbed 14.22 points, or 1.01 percent, to 1,416.62.  

The parallel market, Nomu, however, ended in the red, falling 237.23 points, or 0.88 percent, to 26,780.54, with 36 stocks advancing and 59 declining.  

ACWA Power Co. led the session’s gainers on the main index, surging 9.96 percent to close at SR276.00, supported by trading turnover of SR192.89 million.  

Astra Industrial Group advanced 4.38 percent to SR157.20, followed by Saudi Industrial Investment Group, which gained 3.64 percent to SR15.38.  

Other notable risers included Dar Alarkan Real Estate Development Co., up 3.55 percent to SR20.44, and Jamjoom Pharmaceuticals Factory Co., which closed 3.13 percent higher at SR171.40.   

On the downside, Raoom Trading Co. recorded the steepest drop, falling 4.31 percent to SR68.90.  

Jabal Omar Development Co. declined 4.14 percent to SR22.70, while The National Co. for Glass Industries ended 4.03 percent lower at SR44.10.  

SHL Finance Co. dropped 4.03 percent to SR18.56, and National Metal Manufacturing and Casting Co. slipped 3.90 percent to SR13.32.  

On the announcement front, Arabian Pipes Co. signed a contract with Saudi Aramco valued at approximately SR104 million for the manufacturing and supply of steel pipes.   

The agreement, signed on May 26, will span nine months and is expected to impact financial results in the fourth quarter of 2025 and the first quarter of 2026.   

Despite the news, shares of Arabian Pipes closed 1.03 percent lower at SR8.62.   

Meanwhile, United Carton Industries Co. is set to debut on the main market on May 27 following the completion of its SR600 million IPO.   

The final offer price was set at SR50 per share, giving the packaging firm an implied market capitalization of SR2 billion at listing. It marks the sixth listing on Tadawul so far this year. 


Saudi Arabia increases wage support to 50% for tourism sector jobs


Saudi Arabia increases wage support to 50% for tourism sector jobs

Updated 26 May 2025
Follow

Saudi Arabia increases wage support to 50% for tourism sector jobs


Saudi Arabia increases wage support to 50% for tourism sector jobs

  • Move aims to bolster Saudization across 43 professions
  • It is designed to enhance the appeal and sustainability of careers in the sector

RIYADH: Saudi Arabia has raised wage subsidies for local workers in the tourism sector from 30 percent to 50 percent, in a strategic push to expand employment opportunities for Saudi nationals and reduce reliance on foreign labor.

The initiative, part of the Employment Support Program by the Human Resources Development Fund, was unveiled by the Ministry of Tourism in coordination with other government agencies.

It extends financial support to 43 tourism-related professions and is designed to enhance the appeal and sustainability of careers in the sector.

According to the Saudi Press Agency, the program aligns with the Ahlaha initiative — the ministry’s national workforce empowerment plan — which seeks to train and integrate Saudi citizens into the tourism industry.

The updated wage support is expected to encourage more private sector involvement in national workforce development and marks a significant step toward achieving the goals outlined in the Kingdom’s National Tourism Strategy, which aims to create 1.6 million jobs by 2030 as part of the broader Vision 2030 economic diversification agenda.

“The step aims to raise the percentage of national employment in the tourism sector, while ensuring job sustainability and stability for Saudi workers,” the SPA report stated.

The decision underscores ongoing efforts by the Ministry of Tourism and its partners to empower Saudi men and women in tourism-related roles and increase Saudization rates across the industry.

Latest figures from the General Authority for Statistics show that by the fourth quarter of 2024, employment in the tourism sector grew by 4 percent year on year. Saudi nationals comprised 25 percent of the workforce — or 242,073 employees — while expatriates accounted for 75 percent, totaling 724,458 workers. The Riyadh and Makkah regions led the sector in employment numbers.

In a related move, authorities announced in April that 41 key tourism roles, including hotel managers, travel agency directors, and tour guides, will be exclusively reserved for Saudi nationals starting April 2026. The decision is part of continued efforts to localize critical job functions and strengthen the domestic workforce.


Saudi Arabia launches joint venture to produce high-voltage insulators

Saudi Arabia launches joint venture to produce high-voltage insulators
Updated 26 May 2025
Follow

Saudi Arabia launches joint venture to produce high-voltage insulators

Saudi Arabia launches joint venture to produce high-voltage insulators
  • Consortium will establish a new facility within the Kingdom to produce the insulators
  • Deal expected to reinforce local energy supply chains, reduce operational costs, and generate employment opportunities

JEDDAH: Saudi Arabia’s power sector is set to receive a significant boost following the launch of a new joint venture aimed at localizing the production of high-voltage porcelain insulators, a key component in the Kingdom’s push to strengthen domestic manufacturing and reduce reliance on imports.

The agreement, signed under the patronage of the Ministry of Energy, brings together China’s Dalian Insulators Group, Power Union Co. — a subsidiary of Al-Ojaimi Industrial Group — and the Saudi firm Greengrid.

The consortium will establish a new facility within the Kingdom to produce high-voltage and extra-high-voltage suspension porcelain insulators used in electricity transmission and distribution networks.

The deal was formalized by Salem Mohammed Al-Ojaimi, CEO of Al-Ojaimi Industrial Group, and Chen Junrong, chairman and general manager of Dalian Insulators Group.

The initiative aligns closely with Saudi Arabia’s economic diversification plan that emphasizes local industry development, reduced import dependency, and private sector engagement. The venture is expected to reinforce local energy supply chains, reduce operational costs, and generate employment opportunities within the power sector.

In a statement on X, the Ministry of Energy said the agreement seeks to “enhance local manufacturing capabilities in the conventional power sector to achieve the goal of localizing energy sector components by 2030.”

The initiative is part of Nuwatin — Arabic for “We Localize” — a flagship program under the Energy Localization initiative, unveiled at the Energy Localization Forum in Riyadh last October. It aims to guide energy companies toward national localization targets, including expanding industrial capacity, increasing GDP contribution, boosting exports, and improving the trade balance.

Porcelain insulators are vital to the reliability and safety of high-voltage transmission lines, providing both mechanical and electrical stability. Local production is expected to enhance grid resilience, reduce long-term infrastructure costs, and accelerate the development of a self-reliant domestic energy industry.

Established in 1915, Dalian Insulators Group is a leading Chinese manufacturer of high-voltage insulators and has been publicly listed on the Shenzhen Stock Exchange since 2011. The company has supplied more than eight million porcelain insulators to major transmission projects globally, including China’s 1,000kV UHV AC and 800kV DC lines.

As Saudi Arabia continues its transition to a more diversified and resilient energy economy, this joint venture represents a strategic step forward in strengthening industrial cooperation and advancing energy sector localization.


Six Saudi-listed companies join FTSE Russell indices amid index review 

Six Saudi-listed companies join FTSE Russell indices amid index review 
Updated 26 May 2025
Follow

Six Saudi-listed companies join FTSE Russell indices amid index review 

Six Saudi-listed companies join FTSE Russell indices amid index review 
  • Changes will take effect on June 23 and be reflected on the Saudi Exchange
  • All six companies recently completed initial public offerings on the Tadawul

RIYADH: Six recently listed Saudi companies are set to join FTSE Russell’s global equity benchmarks, following the index provider’s latest quarterly review.

As part of the FTSE Saudi Arabia Inclusion in the Global Equity Index Series, these changes will take effect on June 23 and be reflected on the Saudi Exchange at the close of trading on Wednesday, June 19. The adjustment is being made early due to the market closure on Friday, June 21.

The newly included companies are Al Majed Oud Co., Arabian Mills for Food Products Co., Fourth Milling Co., Nice One Beauty Digital Marketing Co., Tamkeen Human Resource Co., and United International Holding Co. All six companies recently completed initial public offerings on the Tadawul.

FTSE Russell, a subsidiary of the London Stock Exchange Group, is a globally recognized index provider. Its indices, including the FTSE Global Equity Index Series, are widely followed by institutional and passive investors. Inclusion in these benchmarks is a notable milestone for any listed company, often resulting in increased passive fund inflows, improved liquidity, greater visibility, and enhanced credibility.

According to the index update, Al Majed Oud Co. will be included in the Mid Cap segment of the FTSE Global Equity Index. The other five companies — Arabian Mills, Fourth Milling, Nice One, Tamkeen, and United International Holding — will be added to the Micro Cap segment.

This move supports Saudi Arabia’s Vision 2030, a national strategy aimed at diversifying the economy, liberalizing capital markets, and boosting non-oil revenues. Reforms spearheaded by Tadawul and the Capital Market Authority — including the easing of foreign ownership restrictions and the modernization of trading systems — have helped make the Kingdom’s markets more accessible to global investors.

The momentum in Saudi Arabia’s IPO market continues to grow. In 2024, the main market witnessed 14 IPOs that raised approximately $3.8 billion, while the Nomu parallel market hosted 28 listings. Currently, more than 30 companies are in the IPO pipeline, and Tadawul is expecting a record year, with over 50 applications under review.

Despite the positive signal from index inclusion, all six companies experienced declines in share price as of 14:00 Saudi time on the day of the announcement. Al Majed Oud Co. dropped by 2.09 percent, Arabian Mills for Food Products Co. declined 1.87 percent, and Fourth Milling Co. fell 1.06 percent. Nice One Beauty Digital Marketing Co. slipped 1.96 percent, Tamkeen Human Resource Co. was down 2.89 percent, and United International Holding Co. edged lower by 0.71 percent.

While short-term price fluctuations are common, research suggests that being added to major global indices tends to enhance a company's visibility and appeal to institutional investors over time. The long-term impact, however, often depends on broader market conditions, investor behavior, and post-inclusion trading patterns.


Kuwaiti lenders Warba, Gulf Bank explore merger to boost competitiveness

Kuwaiti lenders Warba, Gulf Bank explore merger to boost competitiveness
Updated 26 May 2025
Follow

Kuwaiti lenders Warba, Gulf Bank explore merger to boost competitiveness

Kuwaiti lenders Warba, Gulf Bank explore merger to boost competitiveness
  • Move comes in light of current internal and external challenges posed by local and global economic conditions
  • Aim is to form a single banking entity compliant with Islamic Shariah principles

RIYADH: Kuwait’s Warba Bank and Gulf Bank have entered discussions to explore a potential merger as part of a strategy to enhance long-term growth and competitiveness in the local Islamic banking sector. 

The two lenders announced the move in separate disclosures to Boursa Kuwait on May 26, prompting a temporary one-hour suspension of trading in both banks’ shares in line with capital markets regulations.  

A tie-up between the two would mark one of the most significant consolidations in Kuwait’s banking industry in recent years, as lenders in the region increasingly pursue mergers to achieve scale, drive efficiency, and adapt to evolving regulatory and economic conditions.  

In a statement to Boursa Kuwait, Warba Bank said: “The potential merger provides a promising strategic opportunity for growth and expansion for the two banks, leveraging their synergies and capabilities, as well as enhancing competitiveness in the local Islamic banking sector.”  

Kuwait-listed Gulf Bank and Warba Bank have agreed to undertake a feasibility study and due diligence on a proposed merger. Wikimedia Commons

It added that the move comes in light of current internal and external challenges posed by local and global economic conditions, to maximize value for shareholders and investors. 

As part of the merger process, both institutions will undertake a preliminary feasibility study and begin due diligence to assess the integration. The aim is to form a single banking entity compliant with Islamic Shariah principles. 

The banks noted that the Central Bank of Kuwait had been informed of the discussions on May 25. 

In its own bourse filing, Gulf Bank stated that its chairman received a letter from Warba Bank — one of its major shareholders — requesting the bank to consider the feasibility of a potential merger between the two institutions to create a unified entity. 

“Hence, the proposal was discussed taking into consideration the bank’s efforts to explore new approaches and prospects to achieve growth and prosperity, which includes the analysis of all opportunities and means of collaboration that would lead to the realization of our goals in terms of sustainable growth and added value for the bank, customers, and investors alike,” the Gulf Bank stated in the statement. 

The merger talks come amid a challenging global economic landscape marked by rising trade tensions and market volatility. In April, S&P Global Ratings said that banks across the Gulf Cooperation Council remain well-positioned to weather external shocks. 

In its report titled “GCC banks can cope with the fallout from intensifying trade tensions,” the agency pointed to the region’s robust financial buffers as protection against evolving global risks. 

“GCC banks appear to be in a good position to withstand these threats,” the report stated at that time, citing “robust liquidity levels, solid profitability, and healthy capitalization” as the sector’s core strengths.  

While the direct impact of trade tensions on GCC economies is expected to remain limited due to minimal export exposure to the US, S&P warned of potential indirect effects. A prolonged downturn in oil prices, for instance, could dampen fiscal spending and sentiment. 

The ratings agency has revised its average Brent oil price assumption for 2025 to $65 per barrel.