Our first look at next year’s budget

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WHAT WE’RE TRACKING TODAY

THIS MORNING: CMA approves two Tadawul IPOs + two Nomu debuts

Good morning, friends, and welcome to a busy and macro-heavy news day. Leading our news well this morning is the government’s pre-budget statement for 2025, which sees the budget deficit narrowing next year while GDP growth is expected to rebound.

HAPPENING TODAY-

#1- Opec+’s joint ministerial monitoring committee is expected to leave its oil output policy unchanged when it meets at 3pm KSA today, Reuters reports, citing five unnamed sources from the group. The expectation that the group is likely to stick to its current output policy, which includes plans to phase out the voluntary production cuts starting December, comes despite oil prices falling below USD 70 / bbl for the first time in three years.

#2- The Sirha Arabia Food Trade Exhibition is on its second day today and will wrap tomorrow at Riyadh Front Expo. The event will showcase 300 exhibitors from the food products and equipment, bakery, pastry, and coffee industries. Sirha Arabia will also be hosting selection contests for the Bocuse d’Or and the Pastry World Cup, which start in 2025.

#3- Intersec Saudi Arabia is also on its second and penultimate day, with experts in the security, safety and fire protection industries convening to address the role of AI and VR in the sector.

WEATHER- Sun’s out: Riyadh is looking at a daytime high of 41°C and a nighttime low of 28°C today. Over in Makkah, the temperature will peak at 42°C before dropping to 27°C. Meanwhile, Jeddah — the coolest of three — will see a high of 36°C and a low of 28°C.

PSA-

Property owners in six Medina neighborhoods will have until tomorrow to register their units, the Real Estate General Authority said in a statement. The areas include parts of King Fahd, Al Aqoul, Jama Umm Khalid, Sikkat Al Hadid, Al Khadra, and Abyar Al Mashi. Property owners must register through the real estate registry platform before the deadline to avoid fines.

WATCH THIS SPACE-

#1- CMA gives the all-clear for two Tadawul IPOs: Saudi healthcare provider Almoosa Health has lined up approval from the Capital Market Authority (CMA) to proceed with an IPO that will see the firm offer 13.3 mn shares representing a 30% stake, according to a CMA statement. A prospectus for the offering is yet to be published. The regulator also gave Arabian Company Agriculture and Industrial Investments (Entaj) the green light to offer a 30% stake (9 mn share) in an IPO, according to another statement.

…and two Nomu debuts: The capital market regulator approved Hedab Alkhaleej Trading’s offering of a 10.7% stake (800k shares) on parallel market Nomu, according to a statement. The CMA also approved a request by Lamasat to offer a 7.4% stake (6 mn shares) on Nomu, it said in a separate statement.

REMEMBER- The regulator’s approval for an IPO offering is valid for six months, with additional information to be provided pending the publication of each offering’s prospectus.

#3- Carbon trading market to launch next month: Saudi is planning to launch a voluntary carbon market exchange in November, CEO of PIF’s Regional Voluntary Carbon Market Company (RVCMC) Riham ElGizy told Asharq Business on the sidelines of the Portfolio Egypt conference earlier this week. The launch will feature the company’s largest auction to date, with carbon credits ranging between USD 2.5-3 mn tons.

Who will participate? Regional and Saudi companies, including Aramco and Sabic, will participate in the auction, said ElGizy.

REMEMBER- RVCMC has long been preparing for the Saudi carbon market: RVCMC hired global ESG commodities exchange platform Xpansiv in April to provide a tech base for the carbon credit exchange. The company also signed two MoUs with Kenya’s main dry cell battery maker Eveready East Africa and Carbon Vista Nigeria to set up high-quality and impactful carbon projects in the two countries last year.

#3- InterContinental Hotel Group (IHG) plans to expand its Saudi team by adding 6k new employees as part of its regional expansion strategy, the group’s Regional Managing Director Haitham Mattar was quoted as saying by Gulf News. The group currently employs 30k people across the Middle East, Africa, and India.

The group expects to have 22 new hotels open by the end of this year, bringing IHG’s hotel portfolio in the region to around 220. Meanwhile next year, the group plans to open 19 new hotels, with 2026 expected to “be the biggest in terms of new hotel openings,” Mattar said.

#4- Azerbaijan is looking to establish a joint sovereign investment fund with Saudi Arabia to boost investment in priority sectors in both countries, Azerbaijani Economy Minister Mikail Jabbarov told Federation of Saudi Chambers (FSC) Chairman Hassan bin Moajab Al Huwaizi, state news agency SPA reports. Jabbarov discussed the idea with Al Huwaizi during his visit to Azerbaijan at the head of an FSC trade mission.

The potential investment areas: Officials discussed channeling Saudi investments towards Azerbaijan’s energy, renewables, manufacturing, tourism, infrastructure, livestock, agriculture, and mining sectors, while also facilitating Azerbaijani companies’ involvement in infrastructure projects in Saudi Arabia and exports of foodstuffs to the Kingdom. Incentives for Saudi investors at Azerbaijan’s freezones were also on the agenda.

DATA POINTS-

#1- The Tadawul All Share Index (TASI) rose 2.4% week-on-week, with turnover of SAR 27.4 bn by the end of last week, according to a weekly report from the exchange.

Al Rajhi was the most traded in terms of value at SAR 1.162 bn despite falling 0.3% WTD, followed closely by Red Sea International (SAR 1.16 bn in trades), which saw its shares increase 19.9%. Saudi Fisheries edged out Aramco for third spot at SAR 1.1 bn, with its shares rising 21.9% — the largest increase seen during the week.

Deep dive: Saudi individual investors traded on turnover of 32.7 bn, while turnover for Saudi institutional investors came in at SAR 6.3 bn. Meanwhile, qualified foreign investors traded on turnover of 13.2 bn , and GCC institutional investors traded on turnover of 799.8 mn, according to Tadawul’s weekly stock market ownership and trading activity report (pdf).

#2- The Saudi Central Bank’s (Sama) net foreign assets rose 9.6% y-o-y in August to SAR 1.67 tn, according to Sama’s monthly bulletin (pdf). Meanwhile, net foreign assets at commercial banks fell to negative SAR 19.70 bn from SAR 66.63 bn.

#3- Consumer spending in Saudi Arabia rose 5% y-o-y to SAR 120.9 bn in August 2024, Argaam reports.

#3- Ejar logs over 10 mn rental contracts since launch: Ejar, a rental platform developed by the General Authority for Real Estate, has registered over 10 mn rental contracts across the Kingdom since its launch in 2018, with a daily rate of 19k contracts, the authority said in a statement. Residential contracts accounted for 82.3%, or 8.3 mn, of the total contracts, while commercial contracts made up the remaining 17.6%, or 1.7 mn.

The platform registered over 1.5 mn contracts in the year-to-date, 1.2 mn of which were residential rental contracts.

#5- Marine fisheries recorded a total catch of 74.7k tons in 2023, up 16.2% y-o-y, while aquaculture production reached 139.9k tons, a 56.3% increase since 2021, according to the Marine Fishery and Aquaculture report (pdf).

Saltwater farms produced 92.5k tons of fish, while inland water farms produced 47.5k tons. Geographically, the Arabian Gulf accounted for 47k tons of the marine fishing total, and the Red Sea contributed 27.7k of the marine catch. Shrimp production led with over 66.5k tons, followed by Nile tilapia (45.2k tons), and sea bass (13.1k tons).

OIL WATCH-

The oil market is stable, and we have OPEC+ policy to thank for it: Despite growing regional tensions and macro headwinds, the global oil market has remained stable, “with fluctuations within expected bounds,” due to OPEC’s decision to pump below full capacity, Russian Deputy Prime Minister Alexander Novak tells Alarabiya in an interview (watch: runtime: 22:30).

In his words: “We don’t see extreme volatility. The market is generally stable now,” Novak said, adding that any market change would still align with the group’s policy. “This agreement allows us to manage the volatility.”

Long-term demand is in the cards, with no peak in sight: Novak sees global demand for oil on the up through to 2050. “We expect oil demand to increase by 20 mn bbl / d over the next 25 years,” he stated, adding that the boom will be driven by increased energy consumption from emerging technologies and the ongoing global push for electrification.

IN CONTEXT- OPEC’s crude production took a major hit in September, dropping by 480 bbl / d to 26.62 mn bbl, as political turmoil in Libya cut the member country’s output by 38%, according to a Bloomberg survey. Libya’s disruptions provided unintended support for the broader bloc, which has been working to limit production to prop up oil prices. The cartel is due to convene today to decide on its oil strategy moving forward.

SPORTS-

#1- Brazilian forward Neymar has returned to full training after nearly a year of recovery from injuries which he sustained in October 2023, just two months after his joining Al Hilal, according to the Saudi Gazette. While Neymar resumed individual training in July, he has not yet been registered for the local league but is included in the AFC Champions League squad.

#2- Cristiano Ronaldo and Sadio Mane scored two goals for Al Nassr in the AFC Champions League Elite group stage, defeating Qatar’s Al Rayyan 2-1 victory and taking his club to 4th place in the group standings with 11 points, AP reports.

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THE BIG STORY ABROAD-

Iran fired some 200 missiles at Israel last night in a massive escalation of regional violence, with the Israeli army saying it has intercepted most missiles and reporting one dead in the West Bank. Israeli Prime Minister Benjamin Netanyahu said the attack was a “big mistake” and vowed retaliation during the opening meeting of his security cabinet yesterday, with the US promising to support Israel in its retaliation, Bloomberg reports.

Iranian Foreign Minister Sayed Abbas Araqchi said Iran’s attacks were “finished,” unless Israel retaliates, in which case their response will be “stronger and more powerful” on X a few hours ago.

Market reax: Oil prices surged 5% following the attacks, with Brent settling at USD 73.56 per barrel, and several indices on Wall Street and in the region ending lower.

The Iranian attack is getting plenty of play: Reuters | AP | CNN | BBC.

US elections are also back on front pages as the country gears up for the first and only vice presidential debate between Kamala Harris’ VP Tim Walz and Donald Trump’s pick, JD Vance, later today.

IN OTHER US NEWS- East Coast and Gulf Coast dockworkers’ kicked off their biggest strike in 50 years after negotiations for a new labor contract broke down, halting nearly half of the country’s shipping and potentially costing bns of USD in damages. (CNBC | Reuters)

Also causing plenty of damage: Hurricane Helene, which has killed at least 130 people across six states, with analysts estimating more than USD 30 bn in damages so far. (Semafor)

AND IN TECH NEWS-

OpenAI launched a slew of new tools, including one that will make it easier for developers to build AI voice applications, and another that will improve responses generated using images and text, as the company shifts its focus to agent systems, (Reuters | FT)
Apple is preparing to unveil a new version of its budget iPhone, iPhone SE, alongside new iPad Air models and new keyboards. (Bloomberg)

CIRCLE YOUR CALENDAR-

The 2024 Saudi Games are coming back tomorrow at Riyadh’s Boulevard City, with musical performances from The Saudi Arwa and Abdulwahab kicking off the annual sporting competition, according to a post on X. The event will see upwards of 9k male and female athletes compete in 52 sports. The two-week event runs from until 17 October. You can grab tickets here.

The three-day 6 Kings Slam event at Riyadh’s Venue kicks off on Wednesday, 16 October, featuring all-star players competing for the largest purse in tennis history. The matches will see face offs between tennis champs Novak Djokovic, Rafael Nadal, Jannik Sinner, Carlos Alcaraz, Daniil Medvedev, and Holger Rune (watch, runtime: 5:15). The final and third-place match will be held on Saturday, 19 October. Book your tickets here.

The Professional Fighters League’s (PFL) Battle of the Giants is coming to Riyadh on Saturday, 19 October. Headlining the card, MMA superstar Francis Ngannou will face PFL heavyweight champion Renan Ferreira for the title of inaugural PFL Super Champion. Meanwhile, women’s featherweight champion Cris Cyborg will square off against Larissa Pachecho for the World Title Fight in the co-main event. Expect fireworks with additional matchups featuring Johnny Eblen vs. Fabian Edwards and A.J. McKee vs. Paul Hughes.

The two-day Multilateral Industrial Policy Forum will kick off in Riyadh on Wednesday, 23 October. The forum will address global industrial challenges, focusing on topics like industrial policy, clean energy, and advanced manufacturing tech. The forum is organized by The Industry and Mineral Resources Ministry in partnership with UNIDO. The Kingdom will also host the UNIDO General Conference in 2025.

FinMin expects growth to jump to 4.6% in 2025 + deficit to narrow

The government expects Saudi’s GDP to register 4.6% growth in 2025, the Finance Ministry said in its pre-budget statement for FY 2025 (pdf).

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The statement expects the budget deficit to come in at 2.3% of GDP, narrowing 0.6 percentage points from the government’s expectation of a 2.9% deficit in 2024. The budget deficit is expected to come in at SAR 101 bn in 2025, the ministry said, as a faster decline in expenditures offsets some of the fall in revenues.

Money in, money out: Total revenues are expected to come in at SAR 1.18 tn in 2025, as the government maintains a reserved outlook on oil and non-oil revenues. That’s a notch above the SAR 1.17 tn the ministry had initially budgeted for 2024, but is below the estimated actual revenue of SAR 1.24 tn this year. Expenditures are expected to come in at SAR 1.29 tn in 2025, which again is above the initial budget figures but below the estimated actual figures for 2024.

IN CONTEXT- The government continues to double down on diversification plans and gigaprojects while staying clear of “overheating” the national economy. Officials have also said that they’re willing to accept modest fiscal deficits as the price of pursuing long-term diversification.

FinMin’s budget scenarios for 2025:

Baseline scenario: A budget deficit of SAR 101 bn — with revenues at SAR 1.18 tn and expenditures at SAR 1.29 tn;
Low scenario: A budget deficit of SAR 164 bn — with revenues at SAR 1.12 tn and expenditures at SAR 1.29 tn;
High scenario: A budget deficit of SAR 44 bn — with revenues at SAR 1.24 tn and expenditures at SAR 1.29 tn.

Plugging the gap: The Kingdom will continue to draw on debt markets to meet its financing needs, as its strong fiscal position allows it to maintain its reserves and draw on an “additional fiscal space” to fill funding gaps.

A new annual borrowing plan? FinMin is set to introduce an annual medium-term borrowing plan through the National Debt Management Center as it looks to shore up debt sustainability and diversify funding by accessing global debt markets, it said in the statement.

What the pundits are saying: “On the expenditure side, the Saudis are forecasting a cut in spending, but persistent past spending overshoots make this doubtful,” Bloomberg cites Goldman Sachs MENA economist Farouk Soussa as saying. Soussa also raises “big questions around production targets and global oil prices” and how those will affect revenue targets.

HOW 2024 IS LOOKING-

Real GDP is forecasted to grow at a 0.8% clip in 2024, on the back of a 3.7% increase in non-oil activities, as well as growth in private consumption and investment, according to the pre-budget statement. The latest estimate represents a downgrade from the 4.4% GDP growth forecast Finance Minister Mohamed Al Jadaan had outlined for 2024 last December.

REMEMBER: Saudi’s GDP shrank 0.4% in 2Q 2024, marking the fourth consecutive quarter of contraction.

Economic growth forecasts have trended downward all year: Saudi’s GDP was initially pegged by Saudi officials in January to grow at around 4.5-5.0% this year, with the World Bank expecting 4.1% growth. The World Bank later slashed its estimate to 2.5% — a number it later maintained in June. Meanwhile, the IMF cut back an earlier 4% forecast to 2.7% in January, before slashing it again 2.6% in April, and finally to 1.7% in July. More recently, a Reuters poll and a Riyad Capital forecast penciled in growth clips of 1.3% and 1.5%.

The government expects to record a budget deficit of SAR 118 bn (2.9% of GDP) in 2024, compared to a SAR 79 bn deficit in its approved budget for the year, and marking a 45.7% y-o-y increase from 2023’s SAR 81 bn deficit.

Expenditures rose faster than revenues, with both categories up: Total expenditures for 2024 are forecasted at SAR 1.4 tn, SAR 104 bn more than budgeted, while total revenues are estimated at SAR 1.2 tn, SAR 65 bn than the figure penciled in for the year’s budget. Despite revenues being higher than expected, “spending is where the increase happened,” Reuters cited Riyad Bank’s Chief Economist Naif al Ghaith as saying.

Inflation is set to cool to 1.7% in 2024, down from 2023’s 2.3%, on the back of “proactive measures and policies to control rising prices,” the ministry said in its report. Inflation will then accelerate to 1.9% the following year and stabilize there until 2027.

AUM in Saudi top USD 250 bn in 1H 2024, up 13.5% y-o-y -Fitch Ratings

Saudi Arabia’s assets under management (AUM) grew 13.5% y-o-y to top USD 250 bn in 1H 2024, according to Fitch Ratings. The agency sees the Kingdom’s asset management industry expanding into the second half of 2024 and next year supported by regulatory reforms, a booming capital market and heightened demand for Saudi’s asset management services from high-net-worth individuals.

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And the outlook is positive: “Saudi AUM could cross USD 300 bn within a couple of years, driven by Vision 2030’s Financial Sector Development Program,” Global Head of Islamic Finance at Fitch Ratings Bashar Al Natoor said. Demand for islamic funds is solid, with nearly 95% of mutual funds in the Kingdom being shariah-compliant, Al Natoor added.

Market breakdown: AUM accounted for 22% of GDP last year, with private funds holding three times more assets than public funds, according to Al Natoor. AUM by private funds are concentrated in equities (43%) and real estate (40.5%), while public funds favor money markets (28%) ahead of equities (25.6%), with REITs and debt trailing at 18.7% and 16%.

FOR REFERENCE- Saudi is home to the largest AMI in the GCC and the second-largest market for public Islamic finds globally, while Tadawul is the largest stock exchange in the Gulf and the world’s tenth largest.

Logging strong returns: Capital market institutions booked USD 1.1 bn in net income in 1H 2024, up 29% y-o-y. Return on equity hit 15% in 2023, while the industry’s capital adequacy ratio stood at 28.1% at the end of 1H 2024, comfortably above the 8% minimum requirement. Nevertheless, fluctuations in oil prices and interest rates present risks to Saudi’s asset management industry, Fitch Ratings said.

Red Sea Global to borrow at least SAR 14 bn to finance tourism developments

PIF-owned developer Red Sea Global is planning to borrow “at least” SAR 14 bn (USD 3.7 bn) over the next 12 months, Group Head of Investments and Legal Gregory Djererjjan tells Bloomberg. The debt will be used to finance Red Sea Global’s development of several projects, including the construction of Amaala, which will include 29 hotels, Djerejjan told the business information service.

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Past financing: The developer — which is also mulling a potential IPO in 2026 — had previously borrowed SAR 14.1 bn in 2021 to finance the construction of the first phase of the Red Sea project, Bloomberg notes.

Red Sea Global expects that six hotels will be operational before the year is out, with another 20 slated to open their doors next year. The plan for next year’s hotel operations include eight hotels at Amaala, according to Djerejjan.

SPEAKING OF WHICH- The developer also inked an agreement with Marriott International to open the Ritz-Carlton Amaala in 2025, according to a press release. The development will feature 391 luxury rooms with sea views. Amaala, one of the Kingdom’s flagship regenerative tourism projects along the Red Sea coast in northwestern Saudi Arabia, is fast becoming a global luxury destination.

IN OTHER DEBT NEWS-

#1- PIF-owned real estate developer Roshn Group signed a SAR 9 bn (USD 2.4 bn) syndicated credit facility to finance the company’s “growth and expansion plans,” according to a statement. The unsecured revolving facility carries a five-year tenor.

ADVISORS- Saudi National Bank, Arab National Bank, and Riyad Bank were bookrunners and mandated lead arrangers, while Bank Al Bilad and Alinma Bank participated were lead arrangers. Saudi Awwal Bank was an arranger. Riyad Bank acted as the documentation & agent bank. AS&H Clifford Chance provided counsel for the banks and White & Case was counsel for Roshn.

#2- Aldrees Petroleum bought into Riyad Bank’s USD-denominated sukuk issuance, purchasing USD 59.7 mn of the instruments, according to a filing to the exchange. The sukuks have an annual return of 5.5% over a five-and-a-half-year period, with semi-annual dividend distributions. Aldrees made the purchase to diversify its investments via secure holdings of sukuks.

ICYMI- Riyad Bank closed a USD 750 mn additional tier 1 sustainable sukuk issuance on Monday, with settlement set for tomorrow. The 3,750 sukuk, priced at USD 200k each, will be listed on the London Stock Exchange’s International Securities Market.

Cabinet signs off on new regs for temporary visas

Cabinet OKs temporary work visa regs + key international agreements: The Council of Ministers, led by Crown Prince Mohammed bin Salman, approved yesterday nine decisions, including new rules for temporary work visas, specifically for Hajj and Umrah services, aiming to streamline labor support in the religious tourism sector, state news agency SPA reports.

Here’s what you need to know about the new work visa rules: The amendments are set to offer increased flexibility to the private sector, aligning visa provisions with market demands that peak during Hajj and Umrah seasons, the Human Resources and Social Development Ministry said in a statement.

The provisions in a nutshell:

The “seasonal work visa” is now called the “temporary work visa for Hajj and Umrah services;”
The grace period has been extended from mid-Shaaban until the end of Muharram;
Medical ins. is now mandatory;
To curb misuse, the regulations include penalties;
Temporary work visas can be extended for up to 90 days;
The amendments will come into effect 180 days following their approval.

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The Cabinet also authorized the Investment Ministry to sign a draft agreement with the Egyptian government on promoting and protecting mutual investments, along with a handful of international agreements with Romania, Kuwait, Kosovo and the Maldives focusing on fisheries, customs, and geological cooperation.

Saudi Re + Swisport name new CEOs

Saudi Re has tapped Ahmed Ali Al Jabr (LinkedIn) as CEO, the company said in a filing to Tadawul. Al Jabr comes with 25 years of experience in the ins. sector and has held several leadership positions before joining Saudi Re in 2011. He holds an MBA degree from Bradford University in the UK.

Swissport has appointed Hamad Alhemede (LinkedIn) as its new CEO for Saudi Arabia, according to a press release (pdf). Alhemede has 17 years of experience in the aviation industry, having most recently served as Saudi Ground Services’ Vice President of Commercial.

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Canada is not off-limits to Saudi mining ambitions, Al Khorayef says

There are no barriers to Saudi investments in Canada’s mining sector, despite the country outlining new rules in 2022 that take a tougher stance on foreign state-owned investments, Industry and Mineral Resources Minister Bandar Al Khorayef told Bloomberg in an interview. Al Khorayef, who is currently in Toronto meeting with Canadian mining firms, underscored the government’s confidence in state-backed funds’ ability to nab stakes in Canadian metal companies.

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Al Baha gets board sign-off for Elegant Centers acquisition

M&A WATCH-

#1- Al Baha Investment Development’s board of directors signed off on the company’s planned acquisition of the remaining 13% of Elegant Centers, according to a disclosure to Tadawul. Al Baha already holds 87% of Elegant Centers and the remaining acquisition will make Al Baha its sole owner. The two companies had signed an MoU for the agreement in August, valuing the transaction at SAR 19.6 mn.

#2- SPM exits Moroccan Paper Manufacturing: Saudi Paper Manufacturing (SPM) has sold its entire stake in Moroccan Paper Manufacturing to an individual buyer in a SAR 7.3 mn (MAD 19 mn) transaction, according to a filing to Tadawul. The sale was made through SPM’s investment arm Saudi Investment and Industrial Development, which owned 100% of Moroccan Paper Manufacturing. The sale is pending approval from Moroccan authorities. Proceeds from the sale boost the company’s liquidity and will be funneled towards covering high-cost loans.

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MANUFACTURING-

Obeikan Glass’ board signed off on establishing a second float glass production line at its plant in the Royal Commission for Yanbu, according to a disclosure to Tadawul. The new line is expected to cost SAR 520 mn and will have a production capacity of 650 tons per day , contributing to the manufacturing of new types of float and tinted glass for automotives, construction, and mirrors.

Financing will primarily be sourced from government funding institutions, bank loans, and the company’s internal resources. The project’s completion and start to commercial production are slated for 2027.

CONSTRUCTION-

Retal Urban Development inked a SAR 142.4 mn agreement with subsidiary Building Construction to develop 263 residential units in Riyadh, it said in a disclosure to Tadawul. The contract runs for a 30-month period.

EDUCATION-

Gov’t launches the Kingdom’s first public middle schools for students gifted in sports: Sports Minister Abdulaziz bin Turki Alfaisal and Education Minister Yousef bin Abdullah Al-Benyan inaugurated the first public middle school for athletically gifted students at the Prince Faisal bin Fahad Olympic Complex in Riyadh, state news agency SPA reports. The school has already registered 354 students who are talented in football, athletics, and martial arts in the first phase.

DIGITIZATION-

Saudi Fransi Capital will invest SAR 82.6 mn to increase the capacity of the six data centers that are being built by Al Moammar Information Systems (MIS), MIS said in a disclosure to Tadawul. The facilities were originally valued at SAR 1.2 bn under the contract signed in 2021 between Saudi Fransi Capital, which will own the centers through a Shariah-compliant private investment fund, and MIS.

More are on the way: The new investment is part of Saudi Fransi Capital’s plan to increase the capacity of the 24-MW data centers by 64 MW at a cost of SAR 1.95-2.5 bn. A letter of intent was signed last month between Saudi Fransi Capital and MIS.

HEALTHCARE

Healthtrip sets up shop in the Kingdom: International medical travel outfit Healthtrip opened a regional headquarters in Riyadh, according to a press release. The company will offer its medical services in key cities like Makkah and Medina, in addition to wellness retreats in Amala and Abha.

GCC sovereign wealth funds accounted for 40% of global sovereign investments in 9M 2024

Sovereign wealth funds (SWFs) in the GCC invested USD 55 bn across 126 transactions in 9M 2024, accounting for around 40% of all investments from state-backed investors, consultancy firm Global SWF said in its 2024 GCC playbook report. The lion’s share of investments from the GCC’s sovereign wealth funds — some USD 52 bn — were deployed during the first half of the year, Bloomberg reported previously. In 1H 2024, GCC SWFs accounted for 56% of all the capital deployed by global SWFs.

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Leading the pack: The Public Investment Fund (PIF), the Abu Dhabi Investment Authority (ADIA), ADQ, Mubadala, and the Qatar Investment Authority, which are collectively known as the Oil Five.

AUM is heading towards the USD 5 tn mark: Sovereign wealth funds and other sovereign investors in the gulf — including Saudi’s General Organization for Social Ins. and Aramco PF, as well as the Investment Corporation of Dubai — have some USD 4.9 tn in collective assets under management (AUM), the report says. That figure is expected to grow to USD 5 tn early next year and hit USD 7.3 tn by 2030. Although the forecast for the end of the decade is “a shade lower than the USD 7.6 tn the consultancy forecast in its December report, it still represents a 49% increase from 2024,” Bloomberg notes.

The breakdown: Sovereign wealth funds in the UAE have the largest share of AUM within the GCC, with the report forecasting USD 2.2 tn of AUM by the end of 2024, according to Zawya. In Saudi, some USD 1.1 tn are held by the country’s sovereign investors, the report shows. The PIF’s AUM reached USD 900 bn (SAR 3.47 tn) by the end of August, a 21% increase from SAR 2.87 tn at the end of 2023, making the fund the world’s sixth-largest sovereign wealth fund, according to the Finance Ministry’s FY2025 Pre-Budget Statement (pdf).

Where’s the money going? China appears to be emerging as the darling destination for GCC SWF capital, drawing in USD 9.5 bn in investments from the region, the report says. The increased focus on China comes as Western investors have been withdrawing from Chinese investments amid increased pressure and regulatory restrictions. In 2023, sovereign wealth funds from the Middle East had invested USD 2.3 bn in Chinese companies, marking a 2.2k% y-o-y increase from the year prior. the Hong Kong Monetary Authority previously said. Meanwhile, traditional investment destinations the US and UK still attracted a “significant” portion of investments from GCC SWFs.

The tides are changing: “Sovereign investors such as ADIA have traditionally invested over 50% of their portfolio in the US just because there were more opportunities on the rise. However, they have been trying for years to diversify into the East,” Zawya quotes Global SWF founder and Managing Director Diego Lopez as saying. “We have seen increased activity in both China and India.”

REMEMBER- The EU and US hiked tariffs on Chinese imports in recent years in a bid to contain the country’s rise in sectors that much of the developed world sees as a threat to their own economies.

MARKETS THIS MORNING-

It’s a mixed picture in the markets, with Japan’s Nikkei down in early trading, while the Hang Seng is trading in the green. Mainland Chinese markets are closed for the entire week.

Meanwhile, Wall Street futures are just barely in the green, although Dow futures are down 0.1% in pre-market trading.

TASI	12,254	+0.2% (YTD: +2.4%)
MSCI Tadawul 30	1,534	+0.4% (YTD: -1.1%)
NomuC	25,309	-0.5% (YTD: +3.2%)
USD : SAR (SAMA)	USD 3.75 Sell	USD 3.75 Buy
Interest rates	5.5% repo	5.0% reverse repo
EGX30	31,866	+0.9% (YTD: +28.0%)
ADX	9,406	-0.2% (YTD: -1.8%)
DFM	4,477	-0.6% (YTD: +10.3%)
S&P 500	5,709	-0.9% (YTD: +19.7%)
FTSE 100	8,277	+0.5% (YTD: +7.0%)
Euro Stoxx 50	4,954	-0.9% (YTD: +9.6%)
Brent crude	USD 74.40	+3.8%
Natural gas (Nymex)	USD 2.90	-0.8%
Gold	USD 2,690	+1.2%
BTC	USD 60,803	-4.7% (YTD: +44.0%)

THE CLOSING BELL: TADAWUL-

The TASI rose 0.2% yesterday on turnover of SAR 6.4 bn. The index is up 2.4% YTD.

In the green: Al Baha (+9.1%), MESC (+7.8%) and Chubb (+7.6%).

In the red: Salama (-3.6%), Astra Industrial (-3.1%) and Budget Saudi (-3.0%).

THE CLOSING BELL: NOMU-

The NomuC fell 0.5% yesterday on turnover of SAR 29.8 mn. The index is up 3.2% YTD.

In the green: Al Mohafaza for Education (+11.2%), Ghida Al Sultan (+10.0%) and NBM (+8.6%).

In the red: Osool and Bakheet (-7.2%), Knowledge Tower (-6.3%) and iOud (-5.8%)

CORPORATE ACTIONS-

#1- Academy of Learning’s board recommended a buyback of a maximum of 800k shares, to be retained as treasury shares for the firm’s long-term employee incentive program, it said in a disclosure to Tadawul. The Nomu-listed company did not specify a share price for the transaction which will be financed via its internal resources.

#3- Albilad Capital is distributing SAR 258 mn in dividends at SAR 0.026 per unit to unitholders of Albilad Saudi Sovereign Sukuk ETF for September 2024, it said in a filing to Tadawul.

Saudi and the Maldives ink trade agreement to boost bilateral trade

The Kingdom and the Maldives eye more trade: Commerce Minister Majed Al Kassabi inked an MoU with his Maldivian counterpart Mohamed Saeed to boost bilateral trade in goods and services, according to a statement from the General Authority of Foreign Trade.

(** Tap or click the headline above to read this story with all of the links to our background and outside sources.)

CALENDAR

OCTOBER

1-3 October (Tuesday-Thursday): Intersec Saudi Arabia 2024, Riyadh.

1-3 October (Tuesday-Thursday): Sirha Arabia Food Trade Exhibition, Riyadh Front Expo, Riyadh.

5-7 October (Saturday-Monday): Middle East Education & Training Exhibition 2024, Jeddah.

12 October (Saturday): Riyadh Season.

12 October (Saturday): Shakur Stevenson x Joe Cordina, Riyadh.

12-14 October (Saturday-Monday): Global Logistics Forum, Riyadh.

15-16 October (Tuesday-Wednesday): Solar & Storage Live KSA, Riyadh.

16-17 October (Monday-Tuesday): Global Airport & Aviation Forum, Jeddah.

19 October (Saturday): Battle of the Giants, Mayadeen Hall, Riyadh.

21-22 October (Monday-Tuesday): Smart Ports & Logistics Transformation Summit, Riyadh.

21-22 October (Monday-Tuesday): Aussie Expo, King Abdullah Financial District Conference Center, Riyadh.

21-23 October (Monday-Wednesday): Global Health Exhibition 2024, Riyadh.

23-24 October (Wednesday-Thursday): UNIDO’s Multilateral Industrial Policy Forum (MIPF), Riyadh.

26 October (Saturday): Donor Conference to Support Refugees in Sahel and Lake Chad Regions, TBD.

27-28 (Sunday-Monday): The Global PropTech Summit, Movenpick Hotels & Resorts, Riyadh.

29-31 October (Tuesday-Thursday): Future Investment Initiative Conference, Riyadh.

30 October-3 November (Wednesday-Sunday): Hia Hub 4.0, Riyadh.

31 October (Thursday): No-visa travel for Saudis to Montenegro on charter flights expires.

NOVEMBER

2-9 November (Saturday- Saturday): WTA Finals, Riyadh.

3-23 November (Sunday-Sunday): NEOM Beach Games, Neom.

4-7 November (Monday-Thursday): Saudi Build, Riyadh.

26-28 November (Tuesday-Thursday): Saudi Electricity Expo, Riyadh.

11-12 November (Monday-Tuesday): World Advanced Manufacturing Logistics Summit & Expo, Riyadh.

11-12 November (Monday-Tuesday): Saudi Airport Exhibition, Riyadh.

11-12 November (Monday-Tuesday): Expenditure Efficiency Forum, The Hilton, Riyadh.

11-14 November (Monday-Thursday): Cityscape Global, Riyadh.

16 November (Saturday): Latino Night at Riyadh Season, Riyadh.

18-20 November (Monday-Wednesday): The Heavy Equipment and Truck Show, Dammam.

19-20 November (Tuesday-Wednesday): The Women’s Economic Forum 2024, Dammam.

19-21 November (Tuesday-Thursday): Saudi International Maritime Forum, Dammam.

23 November (Saturday): Red Sea 600, Jeddah Yacht Club and Marina.

25-27 November (Monday-Wednesday): World Investment Conference, Riyadh.

26-28 November (Tuesday-Thursday): Future Power Expo, Riyadh.

28 November-14 December (Thursday-Saturday): Noor Riyadh, Riyadh.

29 November-2 December 2024 (Sunday-Wednesday): World Sailing Youth Match Racing World Championship, Jeddah Yacht Club and Marina.

DECEMBER

1 December (Sunday): Opec+ to meet.

2-3 December (Monday-Tuesday) Wings of Change Middle East, Riyadh.

3-5 December (Tuesday-Thursday): The International Business Exchange – IBEX EVENTS, Riyadh.

11 December (Wednesday): Billboard Arabia Music Awards (BBAMAs), King Abdullah Financial District, Riyadh.

2-13 December (Monday-Friday): Conference of the Parties (COP16) to the United Nations Convention to Combat Desertification, Riyadh.

5-8 December (Thursday-Sunday): World Sailing Women’s Match Racing World Championship, Jeddah Yacht Club and Marina.

11 December (Wednesday): FIFA Congress, which will decide the hosting countries for the FIFA World Cup 2030 and 2034

15-19 December (Sunday-Thursday): Internet Governance Forum, King Abdulaziz International Conference Center, Riyadh.

23-26 December (Monday-Thursday): Aqarat Expo, Riyadh.

Signposted to happen sometime in 2024:

The AFC Champions League Elite

2025

JANUARY 2025

14-16 January (Tuesday-Thursday): Future Minerals Forum, King Abdulaziz International Conference Center, Riyadh.

27-29 January (Monday-Wednesday): Real Estate Future Forum, Four Seasons Hotel, Riyadh.

28-29 January (Tuesday-Wednesday): Sustainability Forum Middle East, Riyadh.

29-30 January (Wednesday-Thursday): Global Labor Market Conference, Riyadh.

FEBRUARY 2025

6-8 February (Thursday-Saturday): Liv Golf season opener, Riyadh Golf Club, Riyadh.

10-13 February (Monday-Thursday): Leap 2025, the Kingdom’s premier tech investment conference.

14-15 February (Friday-Saturday): Formula E, Diriyah.

JUNE 2025

26 June (Thursday): 2024-2025 academic year ends.

2026

UN Trade and Development Global Supply Chain Forum to take place in Saudi Arabia.

2027

The World Water Forum takes place in Riyadh.

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