Riyadh’s Cloud Computing Economic Zone a ‘game-changer for all sectors’

The Cloud Computing Special Economic Zone in Riyadh will gradually be expanded to cover the technologies that will shape the future. (SPA)
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Updated 25 August 2024
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Riyadh’s Cloud Computing Economic Zone a ‘game-changer for all sectors’

  • CCSEZ is set to account for 30 percent of total information communications technology spend in the Kingdom by 2030

RIYADH: A special economic zone being rolled out in Riyadh is turning Saudi Arabia into a cloud computing hub that will boost jobs and attract foreign investment, experts have told Arab News.

The Cloud Computing Special Economic Zone was launched in April 2023, and is located in the Innovation Tower at King Abdulaziz City for Science and Technology in Riyadh.

It provides access to the latest technologies, world-class infrastructure, and a pool of skilled talent, for companies providing cloud computing services.

The zone is set to account for 30 percent of total information communications technology spend in the Kingdom by 2030 and offers investors the opportunity to take advantage of a growing market for emerging and disruptive digital technologies.

Backed by the Kingdom’s Cloud First Policy, the CCSEZ will gradually be expanded to cover the technologies that will shape the future. With an initial focus on cloud computing, a vital hub for innovation and collaboration is being created to drive the next wave of tech advancement.

Experts have told Arab News that some 15 months on from its launch, the zone is providing investors with significant access to untapped prospects.

According to statistics released by market research firm Mordor Intelligence, the Saudi cloud computing market reached approximately $4.8 billion in 2023, with expectations to soar to $8.8 billion by 2029. This reflects a forecasted compound annual growth rate of 16.85 percent from 2024 to 2029. 

The market is anticipated to grow due to rising demands for lower capital expenditure, increased acceptance of digital business strategies, a greater need for the Internet of Things, and quicker and simpler cloud service implementation.

That said, the CCSEZ offers a distinctive and adaptable model that enables providers to deliver a wide range of cloud computing services within the zone. This includes the flexibility to construct and operate data centers across different regions of the Kingdom – with 400 already online in Saudi Arabia.

Sectors benefiting from the most from the CCSEZ

Aamer Mushtaq, regional solutions engineering manager at US-based cloud computing company Snowflake Aamer Mushtaq told Arab News that the CCSEZ will be a “game-changer for all sectors” but he highlighted three in particular – starting with financial and banking services.

“The secure and compliant cloud environment will be a boom for startups especially in the fintech domain and established institutions alike. Local cloud native solutions will enable innovative mobile payment solutions to enhance consumer experience, improve financial security and prevent fraudulent activity through cloud based analytics,” Mushtaq said.

The expert flagged up government services as another sector to benefit, particularly in the areas of efficiency, transparency, and service delivery. 

“Under the CCSEZ regulation and compliance, government departments will be able to host data securely in the cloud, facilitating digital transformation initiatives such as e-government services, and supporting smart city developments across Saudi Arabia,” he said.

The third sector that Mushtaq shed light on is health care, saying: “Cloud computing in health care can help revolutionize telemedicine and remote patient monitoring by facilitating remote consultations with specialists, improving access to health care in remote areas and reducing wait times.”

He added that medical research and innovation will be accelerated by enabling researchers to share data and findings efficiently. 

Rajat Chowdhary, technology consultant partner at PwC Middle East, also affirmed that health care will benefit from the CCSEZ, but flagged other areas also set to gain.

“The education sector will benefit from e-learning platforms, online resources, and collaborative tools, making learning more accessible,” Chowdhary told Arab News.

“Furthermore, the finance sector will see improved data security, faster transaction processing, and better decision-making through big data and analytics. Government agencies can use cloud services to improve e-government services and achieve greater efficiency,” the PwC partner added.

Additionally, Chowdhary shed light on smart mobility and how it is set to utilize the advantages offered by the CCSEZ.

“Smart mobility will benefit from the collection and analysis of data from connected vehicles, traffic management systems, and public transportation networks, leading to improved traffic flow, real-time route optimization, and predictive maintenance,” the partner explained.

Chowdhary said that as these sectors adopt cloud computing, there will be a significant transformation in their operations driven by enhanced efficiency and data-driven decision-making. 

“The CCEZ will provide the necessary infrastructure, support, and regulatory framework to facilitate this transformation, positioning Saudi Arabia as a leading technology hub in the region,” he added.

CCSEZ impact on ICT sector growth and development

According to business management consultant Kearney, three years ago the Kingdom set itself the ambitious target to have 1,300 megawatts of data center capacity by 2030.
Lukas de Sonnaville, partner at digital and analytics practice Kearney Middle East and Africa, believes the roll out of the zone – together with Amazon Web Services investing more than $5.3 billion in developing data centers in Saudi Arabia – means it is merely a “matter of time” before that “ambitious” goal will be reached.

“This transformation will help the Kingdom become a regional hub for advanced computing technologies, aligning with Saudi Vision 2030’s goal to expand and strengthen technology and innovation infrastructure,” de Sonnaville said.

*CCSEZ role in enhancing cloud offering and boosting cloud utilization locally*

The objective of the CCSEZ in Saudi Arabia is to expedite the adoption of cloud technology within the region.

This is achieved by establishing an environment that is attractive to investors, with simplified regulations and enticing incentives designed to draw renowned cloud service providers to the Kingdom.

“Through increased diversification of local cloud services with reduced latency and improved security and compliance, Saudi businesses will accelerate their digital transformation journeys and drive sustainable growth in the digital economy,” Mushtaq explained.

De Sonnaville echoed this, saying: “By providing a Safe Harbor regulatory regime, the CCSEZ offers significant regulatory incentives to tech companies, fostering a competitive environment that drives innovation and technological advancements within and beyond the tech sector.”

CCSEZ benefits to businesses and organizations within Saudi Arabia

The economic benefits of the CCEZ for businesses and organizations in Saudi Arabia are substantial, with the robust cloud infrastructure attractive to foreign investments and local tech start-ups. 

“Businesses will gain agility and flexibility, allowing them to quickly adapt to market changes. Enhanced customer experiences will result from faster and more reliable applications, leading to higher customer satisfaction. Advanced data analytics capabilities will enable personalized customer experiences,” PwC’s Chowdhary said.

“Finally, the CCEZ will support small and medium-sized enterprises by leveling the playing field. SMEs will have access to advanced cloud services similar to larger corporations, enabling effective competition. Cloud services will provide SMEs with the tools to innovate, scale, and expand their market reach,” he added.

The CCSEZ provides an array of incentives, such as favorable tax treatments and regulatory assistance, establishing an attractive investment landscape for both domestic and global cloud computing firms.

“These incentives are designed to stimulate substantial investment in the sector. In summary: services will be offered at lower cost as incentives are provided – e.g. very low electricity cost at $0.05 per kWh only – allowing a competitive, local KSA cloud market,” Sonnaville said. 

The Kearney partner went on to underline that this flexibility is expected to attract significant FDI, thereby enhancing the global competitiveness of Saudi Arabia’s information and communications technology sector in the process as well as promoting sustained economic growth.

CCSEZ and job creation

The CCSEZ will have a significant impact on job generation by providing unique employment prospects in cutting-edge computing technologies and associated fields.

“The reason why KSA is doubling down on these cloud incentives, is not only to capture the cloud market and related GDP and employment, but that this is the flywheel to localization of many more tech companies, requiring significant (cloud) computing power, such as AI companies,” Sonnaville said.

Undoubtedly, the CCSEZ embraces Saudi Vision 2030’s objectives toward expanding and strengthening the ICT and innovation infrastructure in the Kingdom while turning the country into a regional tech hub.

“The CCSEZ in Saudi Arabia aims to accelerate cloud adoption in the region by creating an investor-friendly environment, with streamlined regulations and incentives, attracting leading cloud service providers into the Kingdom,” Mushtaq said.

“Through increased diversification of local cloud services with reduced latency and improved security and compliance, Saudi businesses will accelerate their digital transformation journeys and drive sustainable growth in the digital economy,” he added. 

From PwC’s perspective, Chowdhary clarified that the CCSEZ is fundamental in positioning Saudi Arabia as a regional tech hub and aligns with Saudi Vision 2030.

“By creating a competitive environment for cloud service providers and encouraging foreign direct investment, the CCEZ supports the Kingdom’s goal of becoming a leader in advanced computing technologies, contributing to economic diversification, and developing a knowledge-based economy,” the partner said.


Pakistan regulator unveils new measures to strengthen Shariah-compliant market intermediaries

Updated 6 sec ago
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Pakistan regulator unveils new measures to strengthen Shariah-compliant market intermediaries

  • SECP has outlined phased approach encouraging institutional investors to engage with Shariah-compliant brokers
  • Islamic financial institutions being urged to channel takaful, investment activities through specialized intermediaries

KARACHI: The Securities and Exchange Commission of Pakistan (SECP) is proposing new measures aimed at strengthening the presence and operations of Shariah-compliant intermediaries within the capital market, the regulator said in a statement this week.

Pakistan’s Federal Shariat Court (FSC) directed the government in April 2022 to eliminate interest and align the country’s entire banking system with Islamic principles by 2027. Following the order, the government and the State Bank have taken several measures ranging from changing laws to issuing sukuk bonds to replace interest-based treasury bills and investment bonds.

However, documents seen by Arab News earlier this year showed Pakistan’s government had failed to achieve a target set by the central bank to increase the share of Islamic banking deposits in the country by 50 percent by January this year.

“The paper proposes a phase-wise approach for Shariah-compliant institutional investors to route their business through Shariah-compliant brokers based on a plan to be prepared by their respective boards of directors,” the SECP said about the latest proposal. 

“The paper encourages Islamic financial institutions, including providers of Islamic window services, to utilize Shariah-compliant intermediaries for takaful and investment purposes in situations where they are not obligated to do so.”
 
Other proposed measures include creating a specific category for Shariah-compliant intermediaries for greater visibility on the Centralized Gateway Portal and a dedicated list of Shariah-compliant asset management companies on EMLAAK Financials, Pakistan’s first digital mutual fund aggregator. The platform brings together multiple Asset Management Companies (AMCs) and their mutual funds under one roof. It is a venture of ITMinds Limited, a wholly owned subsidiary of the Central Depository Company of Pakistan (CDC).

In order to facilitate Roshan Digital Account (RDA) clients, creating a separate category of Shariah-compliant intermediaries on the websites and mobile apps of Islamic banks would also be explored in coordination with relevant stakeholders, the SECP said.


Saudi Arabia opens three sports facilities to private investment

Updated 19 May 2025
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Saudi Arabia opens three sports facilities to private investment

RIYADH: Saudi Arabia has unveiled a major initiative to open up key sports venues to private sector investment, signaling a significant step forward in the Kingdom’s efforts to transform the industry.

Announced by the Ministry of Sport, the Sports Facilities Investment Project offers private investors access to three of the nation’s premier sports complexes: King Abdullah Sports City and Prince Abdullah Al-Faisal Sports City in Jeddah, and King Abdulaziz Sports City in Makkah.

Under the initiative, a range of five-year renewable contracts will be made available, the Saudi Press Agency reported. These include naming rights, leasing arrangements for non-match day use, and contracts to manage, operate, and maintain the venues.

The move supports Vision 2030, Saudi Arabia’s national strategy to diversify its economy and position the country as a global destination for sports, tourism, and entertainment.

With the 2034 FIFA World Cup on the horizon, the government is stepping up efforts to attract private capital into its burgeoning sports sector.

According to SPA, the initiative is part of “modern operational models that aim to raise facility efficiency, improve service quality, broaden commercial opportunities, and enhance the fan experience.”

Saudi Arabia’s sports industry is currently valued at $8 billion and is projected to grow to $22.4 billion by 2030, fueled by investments in sports clubs, academies, facilities, and equipment.

The government has already identified 20 high-priority investment opportunities within the sector, with a combined potential value of up to $20 billion.

Hosting the 2034 World Cup is expected to further accelerate this growth, with forecasts indicating over 10 million international visitors, 1.5 million new jobs, and an economic boost of $9 billion to $14 billion to the national GDP. The tournament will be staged across 15 stadiums in cities including Riyadh, Jeddah, Alkhobar, Abha, and the futuristic city of NEOM.

Interested investors are encouraged to submit proposals via the government’s “Furas” investment portal during the designated application period.

Officials described the project as a strategic gateway into one of the Kingdom’s most dynamic and fast-growing industries.


PIF convenes 1,000 global executives in Riyadh to shape next phase of governance

Updated 19 May 2025
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PIF convenes 1,000 global executives in Riyadh to shape next phase of governance

  • Discussions centered around redefining board impact in the national transformation
  • The Directors’ Gathering, launched in 2023, is a key pillar of PIF’s corporate excellence agenda

JEDDAH: Saudi Arabia’s Public Investment Fund gathered over 1,000 top executives in Riyadh for its second Directors’ Gathering, unveiling new governance priorities amid rapid portfolio expansion. 

The event, which brought together representatives from approximately 220 portfolio firms — including over 100 established by PIF itself — focused on enhancing board performance, aligning strategic priorities, and promoting cross-sector synergies to deepen collaboration across the fund’s growing portfolio. 

Discussions were centered around redefining board impact in the context of national transformation, strengthening oversight in a changing risk landscape, and navigating new governance challenges posed by artificial intelligence and emerging technologies, according to a press release. 

The event comes as PIF accelerates its dual mandate of advancing Saudi Arabia’s economic diversification and generating long-term global returns. Since its 2015 transformation, the fund has grown into a globally influential investor, managing $941.3 billion in assets in 2024 and playing a key role in Vision 2030. 

Speaking to the delegates, PIF Governor Yasir Al-Rumayyan, highlighted PIF’s vision and that the roles of boards include three main priorities: brainstorming and setting strategy, ensuring the right governance frameworks are in place for management, and monitoring performance, with a view to the ever-changing macro-economic context and evolving innovations. 

“He stressed that this could transform challenges into opportunities to lead, grow and innovate,” the release added. 

Al-Rumayyan also urged directors to view PIF and its 220 companies as a unified ecosystem, emphasizing the importance of leveraging the group’s collective capabilities. He added that collaboration should be considered the primary measure of success. 

The Directors’ Gathering, launched in 2023, is a key pillar of PIF’s corporate excellence agenda and serves as a platform for knowledge exchange and governance development not only within its portfolio but across Saudi Arabia’s business ecosystem. 

PIF was ranked as the world’s second most active sovereign investor by deal value in February, committing $3 billion in global transactions, according to Global SWF, a data platform tracking sovereign wealth fund activity. 

In a fireside chat titled “Aligning the Economic Vision,” Minister of Economy and Planning Faisal Al-Ibrahim, who also sits on the the sovereign wealth fund’s board, said the existence of PIF portfolio companies and the related ecosystem is in itself a form of resilience, according to a post on the fund’s official X account. 

Al-Ibrahim added: “We are transforming our economy and restructuring the Saudi economy to create more engines of growth, more drivers of progress, and a diversified set of growth sources.”   

In another fireside chat titled “Evolving Investment Strategy,” Head of the Global Capital Finance Division and Head of the Investment Strategy and Economic Insights Division at PIF, Fahad Al-Saif, said the fund is responsible for investing in assets that generate maximum economic impact for Saudi Arabia while also maximizing financial returns for the fund. 

“This is done within a robust framework, across duration for us to become a generational fund in the future,” he said in another X post by PIF. 


Closing Bell: Saudi indices close in red at 11,405 

Updated 19 May 2025
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Closing Bell: Saudi indices close in red at 11,405 

  • Parallel market Nomu dropped 155.91 points to close at 27,499.65
  • MSCI Tadawul Index decreased by 1.62 points to end at 1,454.93

RIYADH: Saudi Arabia’s Tadawul All Share Index decreased on Monday, losing 33.66 points, or 0.29 percent, to close at 11,405.28.     

The total trading turnover of the benchmark index was SR4.8 billion ($1.2 billion), as 50 stocks advanced and 191 retreated.     

The Kingdom’s parallel market, Nomu, dropped 155.91 points, or 0.56 percent, to close at 27,499.65. This comes as 27 of the listed stocks advanced while 47 retreated.     

The MSCI Tadawul Index also decreased by 1.62 points, or 0.11 percent, to close at 1,454.93.      

TASI’s top performer was Al-Baha Investment and Development Co., which surged by 6.74 percent to reach SR3.96.    

Other top performers included Saudi Printing and Packaging Co., which gained 5.14 percent to close at SR11.86, and the National Co. for Learning and Education, which rose 4.82 percent to SR156.60.  

Fawaz Abdulaziz Alhokair Co. was also among the top performers, increasing 4.40 percent to SR17.54.     

Middle East Specialized Cables Co. saw the steepest decline, with its share price easing 5.83 percent to SR31.50. 

National Gas and Industrialization Co. also saw its stock prices decline 4.71 percent to SR76.80. United Electronics Co. also dropped to SR85.90, a 4.66 percent decrease.    

Alinma Bank announced plans to issue US dollar-denominated sustainable additional Tier 1 capital certificates, following a board resolution passed on May 5, 2025, authorizing the CEO to execute the process. 

The issuance, conducted through a special purpose vehicle, will target eligible investors in Saudi Arabia and abroad. It aims to bolster the bank’s Tier 1 capital and support general banking activities.  

The final size and terms will depend on market conditions, with the transaction subject to regulatory approvals and applicable legal requirements. 

Abu Dhabi Islamic Bank PJSC, Alinma Capital, and Emirates NBD Bank PJSC have been appointed as joint lead managers for the offer. Goldman Sachs International, J.P. Morgan Securities plc, and Standard Chartered Bank will also serve in the same capacity. 

Alinma’s share price dropped 1.97 percent to settle at SR27.40.  

Separately, Saudi Ground Services Co. signed a Shariah-compliant banking facility agreement with Banque Saudi Fransi for up to SR300 million. 

Dated May 15, the flexible credit line allows the company to draw funds as needed to meet working capital requirements. 

The facility is valid through April 30, 2026, with an option to renew for one year, and is secured by a promissory note. 

Saudi Ground Services said the facility aims to boost liquidity, support working capital needs, and back its strategic growth plans. 

SGS saw a 1.03 percent drop in its share price to settle at SR48.20.  


Saudi Arabia’s PIF expands global footprint with new Paris office 

Updated 19 May 2025
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Saudi Arabia’s PIF expands global footprint with new Paris office 

  • PIF invested $84.7 billion across Europe between 2017 and 2024
  • French President Emmanuel Macron and PIF Gov. Yasir Al-Rumayyan will headline the opening ceremony

RIYADH: Saudi Arabia’s sovereign wealth fund is expanding its global presence with a new subsidiary company office in Paris.  

The Paris office marks the Public Investment Fund’s latest effort to deepen ties in Europe, following previous openings in New York, London, Hong Kong, and Beijing, underscoring the fund’s commitment to strengthening its presence in key international markets. 

This comes as PIF invested $84.7 billion across Europe between 2017 and 2024, contributing $52 billion to the continent’s gross domestic product and generating over 254,000 direct and indirect jobs. In France alone, its investments totaled $8.6 billion, adding $4.8 billion to GDP and creating 29,000 jobs. 

“PIF is an active, long-term investor in the world’s most innovative and transformational industries, businesses, and markets. This new office will enable PIF to further strengthen its partnerships in the region,” the fund said in a release. 

French President Emmanuel Macron and PIF Gov. Yasir Al-Rumayyan will headline the opening ceremony of the fund’s Paris office, coinciding with the “Choose France” summit that began on May 19 in the capital. 

The event will also draw senior officials and leading business figures, underscoring the strategic significance of PIF’s investment in France.

The 8th edition of the “Choose France” summit, held at the Palace of Versailles, is expected to secure €20 billion ($22.47 billion) in commitments across key sectors such as defense, energy, and industry, surpassing last year’s €15 billion, according to Reuters.

Ahead of the 2025 summit, €17 billion in projects were already pledged, including a €6.4 billion data center investment by US logistics firm Prologis and €1 billion from fintech Revolut for expansion.  

Other major announcements are expected from Amazon, UAE’s MGX, and rare earth firm Less Common Metals, alongside a €100 million drone factory by Portugal’s Tekever, Reuters reported. 

The PIF Tower in the King Abdullah Financial District in Riyadh stands as the tallest building. International High-Rise Award 2022/23

According to UN Trade and Development, France retained its top spot in 2024 for the sixth consecutive year, attracting 1,025 projects despite a 14 percent decline. It remained ahead of the UK with 853 projects and Germany with 608. France captured 19 percent of all foreign investment into Europe, slightly above its 18.7 percent share in 2019 — highlighting its continued appeal to investors despite global economic uncertainty.

“The addition of Paris also aligns with PIF’s strategy to drive global economies and lead the economic transformation of Saudi Arabia,” the fund added in the release. 

Since 2017, PIF has backed around 220 portfolio companies and supported the creation of 103 new firms, contributing to global economic activity and employment. The fund has generated over 1.1 million jobs worldwide and maintains a focus on forming strategic partnerships with innovative players across sectors.  

In February, the PIF ranked as the world’s second most active sovereign investor by deal value, committing $3 billion in global transactions.  

Global SWF, a data platform tracking activity in the sector, reported that the Kingdom’s PIF emerged as the most active sovereign wealth fund, completing three overseas deals through its portfolio companies.