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IMF cuts Pakistan’s growth outlook to 0.5% in 2023

A Pakistani vendor (R) waits for customers as he sells cheap clocks on a footpath in Saddar bazaar, a neighbourhood of Karachi, on March 15, 2010. (AFP /FILE)
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Updated 12 April 2023
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IMF cuts Pakistan’s growth outlook to 0.5% in 2023

  • Last year, IMF predicted Pakistan's growth rate to be 3.5% in the ongoing fiscal year
  • World Economic Outlook also predicts 27.1% inflation and 7% unemployment in Pakistan
Updated 12 April 2023
Arab News Pakistan

ISLAMABAD: Pakistan’s economic woes are expected to continue in the ongoing year, making the International Monetary Fund (IMF) revise the country’s growth forecast to 0.5 percent along with high inflation and unemployment rates.

The international lending agency made the forecast in its latest World Economic Outlook report at a time when the Pakistani government is striving to secure external financing to shore up its dwindling foreign exchange reserves.

The country was forced to limit its imports in recent months due to a massive dollar liquidity crunch amid its negotiations with the IMF for about a $1 billion tranche under a $7 billion loan program.

Despite protracted negotiations, the two sides failed to reach a staff-level agreement over the issue that has remained pending since last September.

The IMF shared Pakistan’s economic outlook in tabulated form, along with its other member states, showing a projected growth rate of 0.5 percent in 2023 along with 27.1 percent inflation and seven percent unemployment for the same period.

“Tentative signs in early 2023 that the world economy could achieve a soft landing — with inflation coming down and growth steady — have receded amid stubbornly high inflation and recent financial sector turmoil,” the report said at the outset while presenting the overall global economic outlook.

It added that debt levels remained high in much of the world, “limiting the ability of fiscal policymakers to respond to new challenges.”

Last October, the IMF estimated that Pakistan’s economic growth would be 3.5 percent for the current fiscal year, though it has now downgraded its own estimate in the new report.

Pakistan’s gross domestic product (GDP) stood at six percent in 2022, and the IMF expects it to grow once again in 2024 to 3.5 percent.

As the country’s economic crisis lingers on, its finance minister Ishaq Dar decided to cancel its trip to the United States last week to attend the spring meetings of the IMF and World Bank.

However, he announced he would attend important bilateral and multilateral meetings virtually and send a Pakistani delegation to Washington as well.

Topics: Pakistan economy inflation in Pakistan IMF Pakistan's growth forecast

Saudi Arabia on track to lead global hydrogen market

Updated 30 min 39 sec ago
MOHAMMED AL-KINANI
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Saudi Arabia on track to lead global hydrogen market

  • Kingdom aiming to be responsible for 15 percent of world’s blue hydrogen production
Updated 30 min 39 sec ago
MOHAMMED AL-KINANI

JEDDAH: Saudi Arabia is positioning itself as a leader in the hydrogen economy, with significant investments in both green and blue versions of the fuel with the aim to generate half of the Kingdom’s electricity from renewable sources by 2030.

With its commitment to achieving net-zero emissions by 2060, strategic partnerships, and projects like NEOM’s hydrogen initiative, Saudi Arabia is paving the way for a sustainable, hydrogen-powered future.

Saudi energy giants, including Aramco and ACWA Power, are leading major projects in this area aligned with the country’s sustainability goals.

ACWA Power’s Sudair solar plant, with a 1,500 megawatt capacity, will offset 2.9 million tonnes of carbon emissions annually. Aramco is also involved in $30 billion renewable energy projects with the Public Investment Fund and other partners.

Yaseen Ghulam, associate professor of economics and director of research at the Riyadh-based Al-Yamamah University, told Arab News that Saudi Arabia plans to invest up to $10 billion in green hydrogen manufacturing firms, aiming to be responsible for 15 percent of the world’s blue hydrogen production. “Aramco aims to generate 11 million tonnes of blue ammonia annually by 2030. In a well-established plan, Saudi Arabia is aggressively investigating the application of hydrogen in many fields. More specifically, the country is also exploring hydrogen applications in industrial, power generation, and transportation, and car fuel for fuel cell-powered vehicles,” Ghulam said.

He added that the country’s Vision 2030, smart trade relationships with Europe and Asia, technological advancements, and government support are driving these plans and progress in the hydrogen energy sector.

The expert noted that integrating hydrogen into Saudi Arabia’s blue economy is a key strategy for sustainable growth, with green hydrogen set to transform industries like transportation, steel production, and heavy-duty vehicles.

“The global green hydrogen market is expected to see annual growth of more than 40 percent by 2030, reaching $72 billion. By 2050, the demand for green hydrogen could replace 37 percent of the world’s oil production. Saudi Arabia, with its focus on the blue economy since the start of Vision 2030, is making efforts to transition to this next stage by producing and using green hydrogen,” he said.

The academic emphasized that Saudi Arabia’s natural environment — specifically its sunny, windy desert landscapes — creates favorable conditions for green hydrogen production. Youssef Saidi, a research fellow at the Economic Research Forum and a member of the Saudi Economic Association, agreed with Ghulam, adding that the abundant renewable energy resources, including solar, wind, and geothermal, make the Kingdom an ideal location for green hydrogen production. 

The global green hydrogen market is expected to see annual growth of more than 40 percent by 2030, reaching $72 billion. By 2050, the demand for green hydrogen could replace 37 percent of the world’s oil production. Saudi Arabia, with its focus on the blue economy since the start of Vision 2030, is making efforts to transition to this next stage by producing and using green hydrogen.

Yaseen Ghulam, Associate professor of economics and director of research at Al-Yamamah University

Ghulam noted that green hydrogen has potential applications in numerous industries that are expected to play a prominent role in the success of Vision 2030, including transportation, steel production, ammonia manufacturing, and heavy-duty vehicles.

“It can also be used for energy storage, powering transportation, and stabilizing the electrical grid. Currently, many industries that are vital for the blue economy are ready to accept hydrogen, and some industries, such as shipping, transportation, and heavy industry, are preparing for it in the near future,” he said.

Discussing the cost of hydrogen energy production, Ghulam stated that global prices are expected to range between $2 and $7 per kilogram, while Saudi Arabia’s cost is projected to be just $2.16 per kilo.

He noted, however, that if domestic natural gas prices remain stable, the cost of producing blue hydrogen could drop to $1.13 per kilogram. “This will, of course, help the Kingdom’s blue economy progress steadily in the next few decades and beyond,” he said.

According to the International Energy Agency, global hydrogen investments have surged, with the NEOM Hydrogen Project leading the way as the largest to reach a final investment decision, boasting 2.2 gigawatts of electrolyzer capacity.

Ghulam pointed out that Saudi Arabia’s success in the hydrogen sector is also driven by strong international collaborations, such as joining the International Partnership for Hydrogen and Fuel Cells in the Economy, a global initiative aimed at advancing hydrogen and fuel cell technologies.

He added that NEOM, ACWA Power, and Air Products have also formed a $500 billion renewable energy-powered NEOM Green Hydrogen Co.

“The facility is expected to produce 650 tonnes of green hydrogen daily by 2026,” he said, adding that Aramco, MIG, and IE have partnered to establish new green hydrogen and ammonia production facilities.

“Germany and the Kingdom are collaborating to develop clean hydrogen technology. King Abdullah University of Science and Technology, NEOM’s Education, Research, and Innovation Foundation along with Enowa, NEOM’s sustainable energy and water systems subsidiary, have recently made agreements to promote the hydrogen economy,” he said.

According to Saidi, the King Salman Energy Park, the Blue Ammonia Supply Chain project, Hydrogen City within the NEOM megaproject, and the NEOM Green Hydrogen Co. are all ambitious renewable power initiatives.

He added that these are not the only developments, as the Kingdom has all the resources needed to position itself as a global leader in the renewable energy market and play a key role in achieving long-term global carbon neutrality goals.

Ghulam noted that the demand and supply of hydrogen energy are expected to grow exponentially due to the growing focus on clean energy, as Saudi Arabia is distinguishing itself compared to major global hydrogen producers. 

He noted that 10 percent of the world’s energy may come from hydrogen by 2050, resulting in a market value of up to $700 billion. “The clean hydrogen market is expected to increase to $640 billion in 2030, compared to the $160 billion in 2022,” the associate professor said.

He explained that while the EU aims to produce 10 million tonnes of green hydrogen and import an additional 10 million tonnes, Saudi Arabia is aiming to become the world’s largest exporter of the fuel by 2030, producing 1.2 million tonnes of green hydrogen.

“The Kingdom’s location along trade routes allows for fast shipping of hydrogen to markets in Northern Europe, South Korea, Japan, and Singapore,” he said.

He said that the Kingdom’s expertise as a major international oil producer — and the existing related infrastructure — offer a strong basis for developing and expanding green hydrogen export capabilities.

“King Abdullah Petroleum Studies and Research Center estimates that financing costs in the Kingdom are at least 200 basis points less than those in Germany, with green hydrogen costing between $1- $2/kg, making it the cheapest producer with clear comparative advantage in international trade of this vital product,” the associate professor said.

More importantly, he concluded, the Kingdom’s ambition to retain its dominance in the international energy trade remains strong, driven by substantial investments and advancements in the hydrogen energy sector.

Meanwhile, Saidi told Arab News that Saudi Arabia is set to play a key role in the global energy transition, leveraging its expertise to develop and scale hydrogen production.

He added that the Kingdom’s abundant hydrocarbon resources can support blue hydrogen production through Steam Methane Reforming with carbon capture and storage.

Saidi explained that international partnerships and private investment are driving Saudi Arabia’s hydrogen sector growth. He noted that the Kingdom aims to become a global hydrogen supplier and has established several joint ventures to develop the necessary infrastructure. “These include partnerships between Air Products and ACWA Power, SABIC and ExxonMobil, and Air Liquide and Tasnee,” he said.

He emphasized that international partnerships enable Saudi Arabia to access cutting-edge technologies and expertise in hydrogen production, storage, and transportation.

Saidi added that these deals also provide market access, which is crucial for scaling up hydrogen production and positioning the Kingdom as a global leader in clean energy.

Topics: Saudi Arabia hydrogen economy

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How Saudi Arabia is reshaping the global talent landscape

Updated 03 May 2025
Reem Walid
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How Saudi Arabia is reshaping the global talent landscape

  • The influx of international talent is vital for advancing key sectors such as healthcare, tourism, and renewable energy
Updated 03 May 2025
Reem Walid

RIYADH: In the field of attracting global talent, Saudi Arabia stands out as a hub of innovation and opportunity, recruiting skilled professionals from all over the world to drive growth in key sectors including technology, finance, and manufacturing.

With a strong focus on talent development and labor market improvements, initiatives such as the Premium Residency program represent an important step in transforming the Kingdom’s workforce.

More than 2,600 healthcare workers became beneficiaries of this scheme, dubbed the Saudi Green Card, in October – a clear sign that the Kingdom is proactively working to secure international talent within the country’s borders

How Saudi Green Card is reshaping landscape for global talent attraction in Saudi Arabia

Launched in 2021, the Premium Residency program offers long-term residency to skilled workers, entrepreneurs, and investors to create a more competitive environment for top professionals.

It offers expats access to benefits available to Saudi nationals, including the ability to own property, start businesses, and make use of public services. 

Raymond Khoury, partner and public sector practice lead, at Arthur D. Little, Middle East, believes the program will positively impact key sectors by attracting the talent  needed to service the growing population — set to rise from 34.4 million today to 55 million by 2030.

“Such incentives allow skilled professionals to have a more stable personal life environment with their families and the facility to make long-term investments in their careers – a better work-life balance in general,” Khoury told Arab News.

The Arthur D. Little partner went on to note that attracting skilled professionals in sectors like healthcare, technology, tourism, and renewable energy will help diversify Saudi Arabia’s economy, reduce oil dependency, and boost gross domestic product through innovation and strategic partnerships in non-oil industries.

“The program also facilitates international professionals in academia and research, allowing for stronger collaborations between universities and private institutions in Saudi Arabia and their international counterparts,” he said.

Khoury added that while the initiative does face challenges, such as the time it takes for international talent to adapt to local cultural and legal norms, these can be mitigated by providing clear integration pathways and support for newcomers. 

The international talent infusion not only accelerates progress within key sectors but also drives cultural and intellectual exchange, fostering long-term growth and innovation.

Raymond Khoury, Partner and public sector practice lead at Arthur D. Little, Middle East

While Saudi Arabia has this program, its Gulf Cooperation Council neighbors, such as UAE and Qatar, have their own talent attraction schemes in place, meaning there is competition for skilled professionals, Khoury explained. Abhishek Sharma, partner at Oliver Wyman’s Government and Public Institutions practice for India, Middle East and Africa, said the Kingdom’s Premium Residency program is transforming the expatriate model by attracting highly skilled professionals.

“Given the Kingdom’s large-scale economic ambitions and the significant opportunities emerging across various sectors, these factors collectively position Saudi Arabia as an increasingly attractive destination for global talent,” Sharma told Arab News.

The Saudi Green Card is improving talent mobility especially in technology, by allowing professionals to work and live without a sponsor, he added. 

This supports Vision 2030’s goal of making Saudi Arabia an innovation hub, and boosts technological growth in sectors like artificial intelligence and digital transformation, according to Mamdouh Al-Doubayan, managing director of Middle East and North Africa at Globant.

“However, while attracting global talent is crucial, sustainable growth depends on balancing international expertise with local knowledge development. The real opportunity lies not just in recruitment but in fostering a dynamic, homegrown workforce capable of driving long-term digital adoption,” Al-Doubayan told Arab News.

International talent influx 

The influx of international talent is vital for advancing key sectors in Saudi Arabia, such as technology, healthcare, tourism, and renewable energy — all of which support Vision 2030’s goal of reducing oil dependence and fostering a sustainable, knowledge-based economy.

Khoury believes innovation and technology advancement across core and adjacent sectors is critical in creating innovation hubs and driving the digital transformation of industries.

“This also covers supporting technology research, development and innovation startups and an encompassing ecosystem that fosters knowledge transfer and international collaboration,” he said.

Healthcare was raised as an area where attracting skilled medical professionals — doctors, nurses, and researchers — can effectively and efficiently improve patient outcomes, introduce advanced medical practices, and lead groundbreaking research. 

By incentivizing industries that rely on highly skilled professionals, Saudi Arabia can accelerate sectoral growth and enhance its overall economic contribution.

Abhishek Sharma, Partner at Oliver Wyman’s Government and Public Institutions practice

“Establishing the Kingdom as an attractive medical tourist destination is part and parcel of some mega-projects — for example the Red Sea project — today under Vision 2030,” Khoury said.

The Arthur D. Little partner also highlighted that improving the education sector in Saudi Arabia is essential for building a knowledge-based economy, particularly in STEM fields.

Attracting international talent in tourism, hospitality management, event planning and arts development is key for Saudi Arabia, particularly for destinations such as Qiddiya and the Red Sea project, where the target is to attract and service between 60 million and 70 million visitors per year by 2030.

“Such a large target requires domain knowledge of global trends and international best practices, which international talent can bring in a timely manner,” Khoury said.

He also flagged the need for international expertise in green technologies as being crucial for Saudi Arabia’s Vision 2030, especially in renewable energy. Global partnerships and innovative solutions will aid in achieving net-zero emissions, optimizing energy efficiency, and creating sustainable business models.

“The international talent infusion therefore not only accelerates progress within key sectors but also drives cultural and intellectual exchange, fostering long-term growth and innovation for the Kingdom,” Khoury said.

Knowledge economy

From Oliver Wyman’s side, Sharma explained that human capital is a key driver of economic growth, with skilled professionals fostering expansion, which in turn attracts more talent. Saudi Arabia is set to experience this positive cycle over the next seven to 10 years.

“As the Kingdom advances toward its Vision 2030 goals, transitioning to a knowledge-based economy, improving the overall quality, skill level, and productivity of the workforce will be critical. By incentivizing industries that rely on highly skilled professionals — such as professional services, technology, and advanced manufacturing — Saudi Arabia can accelerate sectoral growth and enhance its overall economic contribution,” he said. 

While attracting global talent is crucial, sustainable growth depends on balancing international expertise with local knowledge development.

Mamdouh Al-Doubayan, Managing director of Middle East and North Africa at Globant

According to Al-Doubayan from Globant, international talent is crucial to the Kingdom’s shift toward a knowledge-based economy, bringing specialized skills and innovative approaches, particularly in technology. 

Collaborating with local professionals drives progress, supports Vision 2030’s goals of economic diversification, and enhances competitiveness in a digital, AI-driven world.

“By integrating global expertise with local capabilities, Saudi Arabia is not only strengthening its workforce but also creating an environment where homegrown talent can thrive. The impact goes beyond immediate job creation — it builds a long-term, self-sustaining innovation ecosystem that reduces reliance on traditional industries and positions the Kingdom as a leader in digital transformation,” he said.

Future strategies 

As Saudi Arabia aims to become a global hub for business, technology, and culture through Vision 2030, the ongoing influx of international talent will play a crucial role in driving economic growth and fostering innovation.

Arthur D. Little’s Khoury believes that enhancing immigration policies, including expanding programs like the Saudi Green Card, could see tailored benefits being offered to professionals in sectors such as renewable energy, AI, and biotech, as well as healthcare and fintech, providing long-term opportunities.

He explained that availing and advancing innovation hubs and ecosystems in support of attracting and retaining tech entrepreneurs, researchers, and innovators, is vital, as is offering them not only business opportunities but also a platform to collaborate with global experts in their fields. 

“This is a key focus of the Saudi Research Development and Innovation Authority in its aim to bolster RDI capabilities and create a compelling environment for leading scientists, engineers, and researchers,” Khoury said.

He added that the government is boosting investments in incubators, accelerators, and venture capital to support local and international startups, aiming to create a diverse innovation ecosystem and foster new tech-driven industries.

Additionally, the partner explained how the Kingdom’s investment in education and upskilling initiatives to build a knowledge-based economy, focusing on attracting international students and researchers while pairing global talent with local professionals, will enhance expertise.

“Having a skilled and diverse workforce will better enable Saudi Arabia to effectively compete on the international stage and attract more high-value investments that will spur further economic development and prosperity,” Khoury said.

Oliver Wyman’s Sharma highlighted attracting top talent is key to the Kingdom’s goal of becoming a global leader in AI.

He said that a parallel strategy of aggressively upskilling the local workforce will be “equally critical” in sustaining long-term economic and innovation-driven growth.

Al-Doubayan from Globant explained with growing demand for skilled professionals in technology, entertainment, and sustainability, organizations must offer not just jobs but upskilling, career development, and innovation-driven environments to position the Kingdom as a long-term career destination.

He said: “The increasing integration of AI across industries is intensifying competition for top talent. Organizations now face a paradigm shift: moving from simply retaining talent to empowering professionals to grow, innovate, and remain engaged within the Kingdom’s evolving workforce. The key challenge is no longer just recruitment — it is creating an environment where individuals choose to stay despite global demand for elite professionals.”

Topics: Saudi Arabia

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MENA firms raise $180m in 7-day funding blitz

Updated 04 May 2025
Nour El-Shaeri
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MENA firms raise $180m in 7-day funding blitz

  • Activity reflects continued investor confidence in multiple sectors
Updated 04 May 2025
Nour El-Shaeri

RIYADH: Startups across the Middle East and North Africa kicked off the second quarter of 2025 with a wave of funding rounds, acquisitions, and strategic mergers.

The activity reflects continued investor confidence in sectors ranging from fintech and food tech to health tech and Software-as-a-Service. 

Saudi Arabia and the UAE led the charge, underscoring their growing prominence as hubs for regional startup innovation. 

Fintech startup Erad, based in the Kingdom, has raised $16 million in a pre-series A funding round with participation from Y Combinator, Nuwa Capital, and Khwarizmi Ventures, as well as Aljazira Capital, VentureSouq, Oraseya Capital, and Joa Capital. 

The round follows its $2.4 million pre-seed raise three years ago, backed by several of the same investors. 

Founded in 2022 by Salem Abu-Hammour, Faris Yaghmour, Abdulmalik Al-Meheini, and Youssef Said, Erad provides Shariah-compliant, data-driven financing to micro, small and medium-sized enterprises in Saudi Arabia and the UAE. 

UAE-based fintech Fuze has raised $12.2 million in a series A round led by Galaxy and e& capital, with participation from Further Ventures. (Supplied)

“While SMEs continue to power the GCC (Gulf Cooperation Council) economy, entrepreneurs in retail, F&B (food and beverage), healthcare, and beyond struggle to secure the capital they need to scale up. Over 60 percent of our customers are first-time credit takers, and we are proud to be partners in their growth while fostering financial inclusion,” Abu-Hammour said. 

The company claims its platform enables access to funding in as little as 48 hours. The new capital will support Erad’s geographic expansion, local hiring, and product development, aligning with Saudi Vision 2030’s goals to increase SME economic contribution.

Techrar secures $1.6m to scale recurring billing platform 

Techrar, a Saudi subscription and billing management platform, has raised $1.6 million in funding led by Wa’ed Ventures, the venture capital arm of Aramco. 

Founded in 2022 by Safwan Saigh, Fawzan Al-Khlawi, and Rania Shaker, Techrar focuses on managing subscriptions, memberships, and recurring billing. 

The investment will be used to expand the team, develop new products, and support customer acquisition.

iMENA Group secures $135m  pre-IPO investment 

Saudi-based iMENA Group has raised $135 million in a pre-initial public offering funding round through a combination of private placement and in-kind contributions. 

The round included participation from Sanabil Investments, FJ Labs, and SellAnyCar founder Saygin Yalcin, among other Saudi investors. 

Co-founded in 2012 by Nasir Al-Sharif, Khaldoon Tabaza, and Adey Salamin, iMENA is the parent company of platforms including OpenSooq, SellAnyCar, and Jeeny. 

The company will use the funds to increase its stake in these core businesses, pursue vertical and geographic expansion, and improve operational synergies across its portfolio. 

Healthtech startup Tuba raises $8m pre-seed round 

Saudi Arabia-based health tech startup Tuba has secured $8 million in a pre-seed funding round led by Al-Waalan Investment with participation from angel investors.  

Founded in 2025 by Fayez Al-Anazi, Tuba leverages artificial intelligence to enhance healthcare management by improving operational efficiency and creating more transparent, patient-centric experiences. 

The funds will be used to build technical infrastructure, grow the team, and scale operations in line with its vision of digitally transforming the healthcare sector. 

STV launches $100m Shariah-compliant fund

STV has announced the final close of its $100 million STV NICE Fund I, a non-dilutive capital vehicle aimed at supporting the growth of tech startups in Saudi Arabia through Shariah-compliant financing solutions.

Backed by SAB Invest’s Alternative Financing Fund, a CMA-licensed private fund, and several regional family offices, the initiative is supported by the National Technology Development Program.

The fund seeks to fill a key financing gap by offering non-dilutive capital to early- and growth-stage technology ventures.

Fuze raises $12.2m to expand infrastructure 

UAE-based fintech Fuze has raised $12.2 million in a series A round led by Galaxy and e& capital, with participation from Further Ventures. 

Founded in 2023 by Mo Ali Yusuf, Arpit Mehta, and Srijan Shetty, Fuze provides Digital-assets-as-a-Service, over-the-counter trading, and stablecoin infrastructure. 

The company says it has processed over $2 billion in digital asset volume to date. The funds will be used to accelerate regional and global expansion, enhance product offerings, and grow the team. 

Calo enters UK market through dual acquisition 

Saudi-headquartered food tech startup Calo has expanded into the UK with the acquisition of Fresh Fitness Food and Detox Kitchen, two established brands in the health-focused food delivery sector. 

Founded in Bahrain in 2019 by Ahmed Al-Rawi and Moayed Al-Moayed, Calo offers personalized meal subscriptions for health-conscious consumers. 

The company raised $25 million in a series B round in December 2023, led by Nuwa Capital, with participation from STV, Khwarizmi Ventures, and regional family offices. 

Calo currently operates in Saudi Arabia, the UAE, and Bahrain, as well as Qatar and Kuwait, and plans to go public in Saudi Arabia by 2027. 

Miran and Welnes merge to form holistic health platform 

AI-driven health and fitness app Miran has merged with Welnes, a fitness community platform, in a strategic move to combine personalized technology with a community-based approach. 

Miran offers tailored meal plans, workout routines, and health insights through AI. Welnes, backed by Flat6Labs, Samurai Incubate, UI Investments, and angel investors, connects users with coaches and wellness programs. 

The merged entity aims to deliver a comprehensive health platform targeting the growing wellness market in Saudi Arabia. 

Zest Equity raises $4.3m to scale secondary shares platform 

Zest Equity, a UAE-based fintech enabling secondary share transactions, has raised $4.3 million in pre-series A funding. 

The round was led by Prosus Ventures and included participation from Morgan Stanley Inclusive and Sustainable Ventures. 

Founded in 2021 by Rawan Baddour and Zuhair Shamma, Zest Equity facilitates secondary share sales for ecosystem participants such as founders and venture capitalists. 

The company will use the capital to grow in Saudi Arabia and the UAE, hire specialized talent, and develop its technology infrastructure. Zest previously raised $3.8 million in a seed round in October 2023. 

BloomPath raises $1.3m pre-seed to enhance workflow analytics 

US-based SaaS startup BloomPath has raised $1.3 million in a pre-seed round led by RAED Ventures, with participation from Ulu Ventures, Wamda Capital, +VC, and angel investors. 

Founded in 2024 by Mohammad Kotb and Ahmed Gad, BloomPath offers AI-powered workflow tools designed to track progress, analyze patterns, and monitor team performance. 

The funding will support product development, team expansion, and customer acquisition. 

Hushday raises $550k to launch premium retail platform 

UAE-based e-commerce startup Hushday has raised $550,000 in a pre-seed round from undisclosed regional investors. 

Founded earlier this year by Jennifer Cohen Solal and Riad Djabri, Hushday offers an invitation-only platform for consumers to access premium and luxury brands’ excess inventory while preserving brand positioning and pricing. 

The company plans to launch in the UAE and expand into Saudi Arabia, Qatar, and Kuwait. 

iQ Cars raises 7-figure seed round to expand automotive platform in Iraq 

Iraq-based automotive platform iQ Cars has raised a seven-figure seed round led by Euphrates Ventures. 

Founded in 2020 by Amer Salih, iQ Cars operates an online marketplace featuring more than 34,000 car listings and over 1,000 dealerships. 

The company, now registered as Iraq’s first private joint stock company, plans to expand across the country while enhancing transparency and innovation in the sector, according to a press release.

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Saudi Arabia’s flynas Middle East’s fastest-growing airline from 2019-2024: report

Updated 02 May 2025
Nirmal Narayanan
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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.

In February, flynas announced that it expects to receive more than 100 Airbus aircraft over the next five years, part of its broader deal for 280 Airbus jets.

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.”

Topics: Flynas aviation

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Think local: How startups can successfully expand into Saudi Arabia’s fast-growing market

Updated 02 May 2025
Nour El-Shaeri
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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.”

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