Non-oil exports up 8.2% in 4Q 2024

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WHAT WE’RE TRACKING TODAY

THIS MORNING: Middle East will need more aircrafts in the next 20 years -Airbus President

Good morning, wonderful readers. The week is almost over, and the holy month is almost here. We have a packed issue for you today, with the latest international trade data out from Gastat, and Saudi Arabia launching its first EUR-denominated green sukuk issuance. Let’s dive in.

HAPPENING TODAY-

The Qasr Al Hokm Metro Station in central Riyadh goes live today, according to a statement from the Royal Commission for Riyadh. The station will connect the blue and orange lines, and will provide access to various government institutions, historical squares and commercial centers, read the statement.

WEATHER- Riyadh is set for a 17°C high and a 7°C low today, while Jeddah’s mercury is set to peak at 30°C and hit a low of 21°C. Meanwhile, Dammam will see a high of 16°C, and a low of 6°C.

PSAs-

#1- Ramadan working schedule from Sama: The Saudi Central Bank announced that banks will be open from 10am to 4pm during the holy month, while financial transfer centers and payment service providers will open for six hours between 9:30am to 5:30pm, it said in a X post. Sama also declared celebrations for Eid Al Fitr to run from 30 March to 2 April, and Eid Al Adha from 5 June to 10 June.

#2- Property owners in Riyadh, Madinah and 3 cities in the Eastern Province have until tomorrow to register their properties online through the Real Estate Registry website, according to a post on X from the Real Estate General Authority. The Riyadh districts include Al Yamamah, Atifa, Sabah, Al Mafrooqah Al Jadida, Al Suwaidi, Al Rawda, Al Badia, Al Olaya, Sakina, Al Wasita, Salam, Al Arousia, Al Morouj, and Al Hara, among others.

WATCH THIS SPACE-

#1- Middle East aircraft demand is projected to reach 3.7k over the next 20 years, including 42% wide-bodied jets — double than the global average, Airbus President Wouter Van Wersch told Al Eqtisadiah on the sidelines of the Aerospace Connect Forum (watch, runtime 00:58). The region’s aviation market, with a particular emphasis on Saudi Arabia, is “undergoing tremendous change,” Wersch said, highlighting the Kingdom’s target to increase its passenger numbers to 330 mn by 2030.

REMEMBER- Air traffic across Saudi airports increased 15% y-o-y to 128 mn passengers in 2024. The Kingdom’s airports also saw 11% y-o-y growth in flight numbers to 905k during the same period, with a 16% y-o-y rise in air connectivity to 170 global destinations.

#2- The Gulf Petrochemicals and Chemicals Association (GPCA) is set to move its headquarters to Riyadh from Dubai, after a headquarters agreement was approved by the council of ministers during their meeting yesterday, state news agency SPA reports.

DATA POINTS-

Consumer spending via point-of-sale (PoS) transactions in the Kingdom dropped 2.1% w-o-w for the week ending February 22 to just over SAR 13 bn, according to the Saudi Central Bank’s report (pdf). The number of weekly transactions also declined by 3.0% to 210k.

The details: Food and beverages once again made up the biggest chunk of spending in terms of value during the week, falling 3.7% w-o-w to some SAR 1.9 bn. The figure nearly matched restaurants and cafes, which saw a 1.7% w-o-w drop. Riyadh had the highest value of PoS transactions at SAR 4.6 bn, followed by Jeddah at SAR 1.9 bn.

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THE BIG STORY ABROAD-

Ukraine has reportedly agreed to a framework for an economic agreement that will see the US tap its revenues from rare minerals. US President Trump — who pushed hard for the agreement with personal attacks on his counterpart Volodymyr Zelensky — had earlier hinted the Ukrainian President could arrive in Washington as soon as Friday to sign the agreement.

Trump is active as usual: The US president also signed an order yesterday to examine tariffs on copper, and said he will introduce a “gold card” visa program that provides a route to US citizenship for the low price of USD 5 mn. Meanwhile, his controversial USD 4.5 tn tax cut plan narrowly passed the House.

ALSO WORTH NOTING-

Israel and Hamas will exchange the bodies of four Israelis for hundreds of Palestinian prisoners, temporarily saving the ceasefire. (Associated Press)
Tesla shares dropped 8% with market cap falling below USD 1 tn, wiping most gains since Trump’s election. (CNBC)

Non-oil exports up 8.2% in 4Q 2024

Saudi Arabia’s non-oil exports were up 8.2% y-o-y in 4Q 2024, according to the latest data from the General Authority for Statistics (Gastat) (pdf ). Total non-oil exports — including re-exports — were up 17.3% y-o-y, pushed by an 47.3% increase in the value of re-exports over the same period. Meanwhile, imports increased 15.5% y-o-y in 4Q, and the surplus of the merchandise trade balance declined 52.4% y-o-y.

EXPORTS BREAKDOWN-

Non-oil exports maintained their lead over imports: The ratio of non-oil exports to imports rose to 35.2% in 4Q 2024, compared to 34.7% in 4Q 2023.

Chemical products accounted for 25.8% of non-oil exports, increasing 3.9% y-o-y. Plastics, rubbers, and their derivatives followed, making up 22.4% of non-oil exports, with an 8.9% y-o-y rise.

Machinery, electrical equipment and parts made up 26.1% of total imports, up 26.3% y-o-y. Transportation equipment and parts followed, accounting for 15.1% of total imports, recording a 5.5% increase.

China remains #1 on the trade list: The Kingdom’s merchandise exports to China made up 14.7% of our total exports in 4Q 2024, followed by Japan (9.8%) and India (9.6%). Meanwhile, Chinese goods accounted for a quarter (25.6%) of total Saudi imports in the same period, followed by the U.S. (9.0%), and the UAE (5.4%).

ON THE OIL FRONT- Oil exports continue to decline: Oil’s share of total exports dropped by 5.9 percentage points y-o-y to 70.5% in 4Q 2024. Total oil exports fell 13.3% y-o-y during the same period, leading to a 6.1% drop in merchandise exports.

Saudi Arabia issues EUR 2.25 dual-tranche international sukuk

Saudi Arabia’s first green sukuk issuance: The Kingdom raked in EUR 1.5 bn from its (and MENA’s) first sovereign EUR-denominated green international sukuk issuance, Bloomberg reported, citing an unnamed source. The seven-year green note — which was 4.9x oversubscribed — drew in some EUR 7.3 bn in orders. The issuance was priced at a spread of 115 basis points (bps) above its benchmark, after the pricing was tightened from an original 155 bps spread.

The green tranche was sold alongside a EUR 750 mn conventional sukuk that saw orders topping EUR 2.7 bn, priced at 145 basis points above mid-swaps, according to the source.

The proceeds will be used to cover projects that align with the Kingdom’s greenfinancing framework(pdf), in which it identifies eight types of green projects to be funded through the sale of the bonds. The Kingdom’s first push into green sukuk also comes as part of efforts to boost its clean energy transition away from fossil fuels, which remains the cornerstone of the economy.

The Kingdom is set to have a busy year in the debt market: Saudi Arabia's debt capital market could top USD 500 bn by the year-end, up from the USD 430 bn registered at the end of 2024, as the government turns to debt markets to fund diversification efforts.

“Their appetite to borrow is big, and the market is currently happy to fund them at decent spreads,” Mashreq Managing Director Mohamed Ahsan told Bloomberg.

ADVISORS- HSBC, JP Morgan, and Société Générale were tapped as global coordinators and joint active bookrunners for the issuance, while Crédit Agricole CIB and SNB Capital will work passively. HSBC and JP Morgan also acted as joint green structuring agents.

Salic upgraded to FTSE large-cap index

Agribusiness Salic steps up to the FTSE large-cap index: The latest FTSE Russell semi-annual review (pdf) classifies the Saudi Agricultural and Livestock Investment Company (Salic) and the UAE’s Adnoc Supply to large-cap status up from mid-cap in a move that reflects their growing market capitalization and strategic weight in the GCC economy. The review also saw upgrades for Parkin and Space42 to the mid-cap index and additions to the FTSE All-World Index.

The upgrade comes as Salic continues to expand its global agribusiness footprint, reinforcing its role as a key player in the government’s food security strategy. Large-cap inclusion means Salic is now positioned alongside the Kingdom’s financial heavyweights, making it a prime target for institutional and fund flows that track FTSE indices.

The changes take effect after trading closes on Friday, 21 March, with the changes applying from Monday, 24 March. However, FTSE Russell will finalize adjustments by Monday, 10 March.

HKC Ceramics wraps up IPO ahead of listing on Nomu

HKC Ceramics, better known as Hedab Al Khaleej, priced its IPO at SAR 52 per share — the top of the range it was guiding on — after its Nomu offering closed 1.7x covered, according to a filing to Tadawul. The final price saw the local marble and porcelain supplier raise some SAR 41.6 mn in IPO proceeds, giving it a market cap of SAR 390 mn at listing.

REFRESHER- The company took a 10.67% stake to market in a primary offering limited to qualified institutional investors, in a bid to finance its expansion plans and reduce its existing liabilities.

Post-IPO ownership: The company’s three substantial shareholders will see their ownership diluted to a combined 68.57% stake, down from 76.76%.

ADVISORS- Yaqeen Capital is quarterbacking the transaction as financial advisor and lead manager, while PKF Al Bassam & Co. serves as legal accountant. Receiving agents include Derayah Financial, Al Rajhi Capital, SNB Capital, Alinma Investment, Albilad Capital, ANB Capital, BSF Capital, Riyad Capital, SAB invest, AlJazira Capital, Alistithmar Capital, AlKhabeer Capital, GIB Capital, and Sahm Capital.

Coffee chain operator Ratio wraps Nomu IPO

Al Ahsa-based Ratio Specialty wrapped up its SAR 50 mn IPO of a 25% stake on Tadawul’s parallel market Nomu, according to a filing to the exchange. The secondary offering was priced at SAR 10 apiece, and was 8.6x oversubscribed. The final price implies a market cap of SAR 200 mn at listing.

Use of proceeds: The brand operator of homegrown coffee chain Ratio will disburse net proceeds from the sale to the selling shareholders, after deducting some SAR 2.6 mn to cover IPO-related expenses.

REMEMBER- The IPO was primarily driven by the Derayah private equity fund divesting a large portion of its stake.

ADVISORS- Derayah Financial is quarterbacking the transaction as the lead manager, while Amwal Capital is acting as financial advisor with RSM and Moore providing legal counsel. Receiving agents included Alinma Investment, Al Rajhi Capital, SNB Capital, Saudi Fransi Capital, Riyad Capital, ANB Capital, Alistithmar Capital, Albilad Capital, AlJazira Capital, GIB Capital, Alkhabeer Capital, SAB Invest, Sahm Capital, and Yaqeen Financial.

Jeddah gets a new 1.2 sqm MRO hub to support the Kingdom’s aviation sector

An aviation infrastructure spree: The General Authority for Industrial Cities and Technology Zones (Modon) launched a new 1.2 mn sqm aviation industrial city at Jeddah’s Modon Oasis, according to a statement during the Aerospace Connect Forum. No investment ticket or timeline for the project have been disclosed.

The details: The city, Aero Park I, will include a wide array of ready-built factories equipped to accommodate several firms in the aviation sector, the statement says. The cluster is set to be situated next to King Abdulaziz International Airport and Jeddah Islamic Port.

The first players: The Kingdom granted the first industrial licenses for aircraft maintenance and repair operations (MRO) to Middle East Aircraft Engines Company and Saudia Technic, according to a statement. The services will include jet and drone maintenance and repair, navigational and electric systems servicing, and all-around aircraft overhaul services, SPA reports.

SOUND FAMILIAR? PIF invested an undisclosed sum into Saudia Group subsidiary Saudia Technic to build a Jeddah MRO village back in December 2023. The new cluster was set to include a state-of-the-art jet propulsion center and an engine test cell to support the operationalization of next-generation wide-body and narrow-body aircraft engines.

THERE’S MORE NEWS FROM THE FORUM-

A slew of agreements from NIDC: The National Industrial Development Center (NIDC) inked several MoUs during the Aerospace Connect Forum in an aim to boost national industrial capabilities and develop in line with Saudi’s 2030 Vision, Ashraq Business reports.

The agreements include:

An MoU with local manufacturer AIC Steel and Japan’s Toho to localize the sponge titanium metal melting and pipe industry used in the MRO process, according to a statement.
An agreement to cooperate with airport operator Cluster2 to develop specialized aircraft maintenance centers in the Kingdom, according to a statement.
An agreement with Jabben and Portugal-based Jetbase to offer the necessary support to localize aircraft maintenance and overhaul for military aircraft at Jubail Naval Airport, according to a statement.
An MoU with International Airport Solutions to advance the level of connectivity with technical partners to localize aircraft recycling services and facilitate the necessary licenses for such operations, according to a statement.
An MoU with Kingdom Aero Industries and US-based Doroni Aerospace for the localization of the vertical take-off and landing sports light aircraft sector, according to a statement.
An MoU with Germany’s Autogyro and local firm Life Shield Aerospace to localize and transfer the manufacturing technology of taxi and helicopter aircrafts, according to a statement.
An agreement to work with Italy’s Leonardo to develop the local helicopter industry and vertical aviation sector, according to a statement.

IN OTHER AVIATION NEWS-

IBM agreed to set up an AI-powered enterprise for PIF-backed Riyadh Air to improve the airline’s guest and employee experiences, according to a statement. Riyadh Air will integrate IBM’s portfolio of AI services — including watsonx and IBM Consulting solutions — to streamline operational efficiency. The new AI-driven platform will be developed with a focus on regulatory compliance, privacy, and data security to optimize flight services and boost intelligence customer interactions.

REMEMBER- The airline is slated to launch its operations in 3Q 2025. It is rumored to be in talks with Boeing and Airbus for an order of up to 50 additional widebody jets as it looks to expand its fleet.

Saudi Arabia captures 14% of GCC real estate market, up 47% y-o-y

Saudi Arabia snapped up 14% of the GCC’s real estate transactions, up 47% y-o-y to USD 75.7 bn, according to Sakan’s Gulf Residential Market Report (pdf). Despite the growth, the Kingdom still trails behind the UAE, which drew in 79% of the GCC’s USD 391 bn real estate market in 2024.

Population growth and government-backed infrastructure projects drove the region’s housing sector expansion, according to the report. There’s high demand, with Saudi Arabia, Kuwait, and Oman needing over 800k housing units by 2030 to meet it. Additionally, urban populations across the GCC are expected to grow by 30% between 2020 and 2030, with 84.3% to be living in cities. Riyadh's population is projected to grow by 4.1% annually, reaching 9.6 mn by 2030, with 5.5 mn expats and 4.1 mn Saudis, though Gigaprojects may reduce rural-to-urban migration.

Rents, to no one’s surprise, are on the rise: Saudi apartment rental prices rose 10.6% in 2024, spurred by increasing expat demand, particularly in Riyadh. Villa rents also grew 4-7%, slower than the UAE with Dubai up 18% and Abu Dhabi 10% but faster than the GCC’s most affordable villa markets in Oman (up 1-2%) and Bahrain (up 2-3%).

Property prices are also climbing: Saudi apartment prices are rising, with Riyadh up 8% in 2024, compared to Dubai’s 19.5% increase, while Oman’s apartment prices fell 13%. For villas, Bahrain, Oman, and Saudi lean on the affordable side, while the UAE, Qatar, and Kuwait are pricier. North Riyadh and Dubai are the most dynamic villa markets, with y-o-y price increases of 14-17% and 9-47%, respectively. High-end villas in Bahrain dropped 4.5% in early 2024.

Despite rising prices, the Saudi property market is more affordable than most: Saudi Arabia has the lowest price-to-income ratio in the GCC, with Riyadh at 3.1 in 2024, making homes more affordable compared to cities like Kuwait City (10.1).

Saudi Arabia recorded one of the highest apartment yields in the region at 7.8% slightly behind Kuwait and Bahrain (both 7.9%), and above the GCC average of 6.8% thanks to a strong leasing market and high price-to-income ratios, which make renting more favorable than homeownership.

Expats’ changing role in GCC housing demand: Expats, who make up 52% of the GCC population, have traditionally dominated the residential leasing market. However, they are increasingly transitioning to homeownership, becoming investors and business owners. Additionally, many expats are bringing their families to the region, which boosts population growth and consumer demand, although remittance outflows have decreased.

The luxury real estate race: Saudi Arabia, alongside the UAE and Qatar, is vying for dominance in the Gulf's luxury residential market. While Dubai leads in super-prime transactions (properties exceeding USD 10 mn), Saudi Arabia is advancing with projects like The Red Sea. Branded residences are also gaining popularity in the Middle East which now accounts for 12% of the global supply.

Acwa Power net income up 5.7% in 2024 + Jamjoom, Care, Wataniya ins. full-year earnings

ACWA POWER-

Acwa Power’s net income increased 5.7% y-o-y to SAR 1.8 bn in 2024, on the back of better financial management and the reversal of impairment on its Oman-based Barka plant, it said in an earnings release (pdf). The increase was partially offset by a SAR 191 mn impairment on its Morocco-based CSP plant Noor 3, higher legal provisions, and lower one-time financial gains. The renewables giant reported a 13.4% drop in net income to SAR 502 mn in 4Q.

MEANWHILE- Revenues were up 3.3% y-o-y to SAR 6.3 bn in 2024, driven by higher operation and maintenance revenue, as well as higher electricity sales. However, this was partially offset by lower services income from projects.

It has been a busy year for Acwa Power: The company reached financial closure on nine fully and partially-owned projects in 2024, with SAR 34.6 bn in total investments. These include Egypt’s SAR 4.1 bn Suez Wind project closed in December, the SAR 1.1 bn Azerbaijan wind IPP in November, and the Nukuk Wind IPP in Uzbekistan, closed in October with SAR 400 mn in investments. All three projects were fully owned by Acwa at the time.

JAMJOOM PHARMA-

Jamjoom Pharma saw its net income grow 21.9% y-o-y in 2024 to SAR 356.5 mn, according to an earnings release (pdf). Meanwhile, the company recorded a 19.8% y-o-y growth in revenues to SAR 1.32 bn. The growth was driven by market and portfolio expansion, enhanced manufacturing in Saudi and Egypt, as well as cost optimization and contributions from its Algeria joint venture.

In 4Q 2024, net income grew 16% y-o-y to SAR 51.6 mn, while revenues grew 24% y-o-y to SAR 259.7 mn.

ALSO- The company’s board greenlit a SAR 102 mn dividend distribution for 2H 2024 at SAR 1.46 per share, set to be disbursed on 11 March, it said in a disclosure to Tadawul.

NATIONAL CARE-

National Medical Care (Care) reported a 23.8% y-o-y increase in net income to SR 298.2 mn in 2024, driven by improved cost absorption, favorable Zakat expenses, and full year operations at Chronic Care Hospital after acquisition, according to an earnings release (pdf). This helped offset higher expenses and interest costs, as well as losses at Al Salam Hospital, the company said.

MEANWHILE- Revenues were up 19.6% y-o-y to SAR 1.3 bn in 2024, fueled by a higher business volume and a 14% y-o-y growth in total patient count, as well as the positive impact of Chronic Care Hospital’s acquisition.

REMEMBER- Care received last November the green light from regulators to go ahead with the full acquisition of Chronic Care Specialized Medical Hospital Co. for SAR 193 mn.

WATANIYA INS-

Wataniya Ins. reported a 21.8% y-o-y increase in net income to SAR 103.1 mn in 2024, driven by an 11.4% rise in net insurance service results and a 58.5% increase in investment returns, according to a disclosure to Tadawul. The increase was partially offset by an 85% drop in surplus from insurance pools and a 7.5% rise in operating expenses. Revenues saw a 30.3% y-o-y growth during the year to SAR 1.8 bn.

Sedco Capital appoints Abdulwahhab Abed as CEO

Jeddah-based advisory firm Sedco Capital appointed Abdulwahhab Abed (LinkedIn) as CEO, after serving as Acting CEO, according to a press release. Abed has been with the company for 17 years, serving as Chief Business Development Officer since 2021.

NWC launches 9 projects worth SAR 300 mn in Tabuk

INFRASTRUCTURE-

#1- National Water Company (NWC) launched 9 projects worth a combined SAR 300 mn in Tabuk, it said in a statement. The projects included:

Three drinking water projects involving 60 km of water networks, worth SAR 62.2 mn;
Two sanitation projects including a lift station expansion and 46.7 km of sewer lines, worth SAR 65 mn;
Two water projects featuring a 21.9 km transmission line and a 5k cubic meter reservoir, as well as a 1k cubic meter purification plant, at a combined ticket of SAR 39.4 mn;
Two projects covering 75.8 km of sewage networks and a 9.6k cubic meter lift station, worth SAR 78.1 mn.

#2- Shalfa Facilities Management Company secured a SAR 162 mn contract to run operation and maintenance works, cleaning services, and pest control at the Presidency of State Security’s offices in Riyadh, it said in a disclosure to Tadawul. The Nomu-listed facilities service provider has agreed to fully manage architectural installations, equipment, electrical, and mechanical services as well as landscape and irrigation works for administrative buildings.

REAL ESTATE-

Shurfah Real Estate in Riyadh’s Al-Malqa neighborhood sold a 27.7k sqm plot toThimaryah Real Estate Company for SAR 987 mn, marking one of the largest real estate transactions in Riyadh this year, Al Eqtisadiah reports. The land’s price more than doubled in three years, rising to SAR 34k per sqm from SAR 16k.

STARTUP WATCH-

#1-UAE-based Fintech startup Flow48 closed a USD 69 mn series A funding round to expand into Saudi Arabia, in addition to scale further in the UAE and South Africa and expanding its platform and features, according to a statement (pdf). Flow48, co-founded in 2022 by Idriss Al Rifai (LinkedIn) and Karim Khattar (LinkedIn), offers alternative financing solutions for SMEs, using payment data, operational behaviors, and sector insights to convert future revenues into immediate working capital — without requiring equity dilution or traditional collateral.

#2- Madinah gets a new investor network for early-stage startups: VMS, Al Madinah Chamber, and Numu Angels have launched the Al Madinah Angels investor network to support early-stage startups in the city by providing capital, strategic partnerships, and mentorship, according to a press release. The network was launched under the Al Madinah Ventures Initiatives at the Al Madinah Chamber event.

AVIATION-

#1-Mawani adds Syria service: The Saudi Ports Authority (Mawani) launched Caerus EXS6, a new shipping service to Syria to facilitate the expansion of trade between the two countries, according to a statement. The new service, with a capacity of 858 standard containers, will call at Jeddah Islamic Port, Turkey’s Iskenderun Port, and Syria’s Latakia Port.

#2- The King Abdulaziz International Airport in Jeddah now has 70 e-gates, as part of an initiative between the General Directorate of Passports, Matarat Holding, and the Saudi Data and Artificial Intelligence Authority, state news agency SPA reports. The e-gates are intended to allow passengers to complete their travel procedures independently without human intervention.

REGULATION WATCH-

Capital market institutions will soon be able to enforce close-out netting agreements with greater legal certainty, under fresh rules (pdf) by the Capital Market Authority (CMA). Close-out netting is important because it allows financial institutions to offset mutual obligations in the event of default, reducing systemic risk and ensuring financial stability, particularly during bankruptcy proceedings.

The details: The draft ensures that qualified financial contracts involved in netting agreements remain enforceable during bankruptcy proceedings. It also introduces provisions for cross-border transactions involving capital market institutions in Saudi Arabia, clarifying how financial obligations should be handled. Additionally, the framework strengthens collateral rules by confirming that cash, securities, guarantees, and other credit support remain enforceable, even if a counterparty becomes insolvent.

M&A WATCH-

Saudi Enaya and Salama signed a non-binding MoU to consider a potential merger, according to a disclosure to Tadawul. Under the agreement, both companies will conduct operational, technical, financial, legal, and actuarial due diligence. If the transaction goes through, one of the companies would fully take over the other in a transaction that would see the buyer issue new shares for the shareholders of the seller. The MoU runs for 12 months, and could be terminated during that period based on specific conditions, read the disclosure.

EDUCATION-

The Education Ministry is offering up 5k investment projects worth a combined SAR 50 bn, it said in a post on X. The investment offerings come as the government looks to boost private sector participation in the education sector from to 30% up from the current 17%, Aleqtisadiah quotes Education Minister Yousef Al Benyan as saying at the Invest in Education Forum held in Al Ahsa.

JPMorgan reclassifies Qatar and Kuwait as developed markets

Qatar, Kuwait reclassified as developed markets: JPMorgan Chase has reclassified Qatar and Kuwait as developed markets, with the bank set to remove the two countries from its Emerging-Markets Bond Index (EMBI) over a six month period starting with the month-end rebalancing on March 31, JPMorgan’s Global Index Research team said in a statement seen by Bloomberg.

What this means: New bond issuances from Qatar and Kuwait won’t be included in JP Morgan’s EM index, including the two benchmark-sized sovereign USD-denominated bonds Qatar will sell on Thursday. For Qatar, “the reclassification may potentially spark flows into the country from developed-market bond investors,” according to Bloomberg.

The UAE could be next: The United Arab Emirates’ cost of living ratio has exceeded the EM index threshold for two years in a row — and, if it does so for a third consecutive year, the country would no longer be eligible for the EMBI series, and will be reviewed for a removal from the index.

Investors would also be looking for a higher yield to invest in EM sovereign bonds, with the extra yield investors demand to own EM sovereign bonds set to widen by 11 bps. The bank’s index is tracked widely by those investing in treasures across the world, and the loss of both countries could potentially “increase the average risk in the asset class,” according to Bloomberg. In the EMBI Global Diversified grouping, Qatar and Kuwait hold a weight of 3.2% and 0.6%, respectively. With the potential exit of the UAE — which accounts for 4.1% — the collective exit of the three countries would lead to capital outflows from EMs, and would “narrow the opportunities for bond traders.”

“As investors we were waiting for this to happen,” Anders Faergemann, co-head of EM global fixed income at Pinebridge Investments told Bloomberg. “On paper, the investor base for Qatar and Kuwait will narrow by taking them out of the EM indices but we can still invest in both countries off benchmark.”

ALSO FROM THE REGION-

Adnoc Gas raises USD 2.8 bn in MENA’s largest equity offering year-to-date: Emirati state-owned energy giant Abu Dhabi National Oil (Adnoc) completed the sale of a 4% stake in subsidiary Adnoc Gas to institutional investors, raising USD 2.8 bn, according to a statement. The follow-on offering, which was priced at AED 3.40 per share, was 4.4x oversubscribed. This is the largest equity offering in the MENA region since Saudi Aramco’s USD 12.3 bn secondary share sale last June.

REMEMBER- Adnoc Gas raked in USD 2.5 bn in one of the region’s biggest IPOs in 2023.

ADVISORS- Our friends at EFG Hermes acted as (pdf) joint coordinator and bookrunner alongside BofA Securities, Citi, First Abu Dhabi Bank, HSBC, and International Securities.

MARKETS THIS MORNING-

Asian markets are mixed in early trading this morning — Japan’s Nikkei is down 1.2%, the Shanghai Composite is looking at gains of 0.5% and the Hang Seng is up 2.2%. Meanwhile, South Korea's Kospi is flat.

TASI	12,301	-0.2% (YTD: +2.2%)
MSCI Tadawul 30	1,543	-0.1% (YTD: +2.2%)
NomuC	31,273	-0.4% (YTD: -0.6%)
USD : SAR (SAMA)	USD 3.75 Sell	USD 3.75 Buy
Interest rates	5.0% repo	4.5% reverse repo
EGX30	30,655	-0.9% (YTD: +3.1%)
ADX	9,612	+0.2% (YTD: +2%)
DFM	5,342	+0.1% (YTD: +3.6%)
S&P 500	5,955	-0.5% (YTD: +1.3%)
FTSE 100	8,669	+0.1% (YTD: +6.1%)
Euro Stoxx 50	5,448	-0.1% (YTD: +11.3%)
Brent crude	USD 73.02	-2.4%
Natural gas (Nymex)	USD 4.15	-0.5%
Gold	USD 2,931	+0.4%
BTC	USD 89,021	-2.7% (YTD: -4.8%)

THE CLOSING BELL: TADAWUL-

The TASI fell 0.2% yesterday on turnover of SAR 5.3 bn. The index is up 2.2% YTD.

In the green: Miahona (+5.9%), Al Babtain (+4.2%) and SIDC (+4.2%).

In the red: Saudi Ceramics (-10%), Chubb (-9.5%) and Malath Ins. (-8.5%).

THE CLOSING BELL: NOMU-

The NomuC fell 0.4% yesterday on turnover of SAR 36.4 mn. The index is down 0.6% YTD.

In the green: Amwaj International (+8.3%), Fadeco (+7.6%) and Paper Home (+6.7%).

In the red: Leaf (-7%), Leen Alkhair (-6.5%) and Enma Alrawabi (-6.4%).

Defense Minister meets US counterpart in Washington

Defense Minister Prince Khalid Bin Salman landed in Washington on Monday to meet with his US counterpart, Secretary of Defense Pete Hegseth, state news agency SPA reports. The ministers discussed the deep-rooted alliance between the US and the Kingdom and their shared commitment for regional and global stability.

ALSO- Economy and Planning Minister Faisal Alibrahim met with Switzerland’s Head of the Federal Department of Economic Affairs Guy Parmelin in Bern, where the two discussed cooperation in boosting entrepreneurship and SMEs, SPA reports.

CALENDAR

EVENTS WITH NO SET DATE

1Q: BinDawood Holding expected to close 100% acquisition of Zahrat Al Rawdah Pharma.

FEBRUARY

23-27 February (Sunday-Thursday): Riyadh International Disputes Week, Hilton Riyadh Hotel Granada.

24-27 February (Monday-Thursday): Week two of Big 5 Construct Saudi, Riyadh Front Exhibition & Conference Center.

MARCH

1-30 March: Ramadan (TBC).

18-19 March (Tuesday-Wednesday): Federal Open Market Committee meeting and Summary of Economic Projections.

31 March- 3 April (Monday-Thursday): Eid Al Fitr (TBC).

31 March (Monday): Deadline for applying to theReal Estate General Authority’s Regulatory Sandbox Program.

31 March (Monday): Deadline for applying to the World Intellectual Property Organization (WIPO) Global Awards 2025

APRIL

7-9 April (Monday-Wednesday): Sports Investment Forum (SIF), Riyadh.

3-20 April (Thursday-Sunday): AFC Asian U17 Cup.

13-14 April (Sunday-Monday): Human Capability Initiative (HCI) Conference, King Abdulaziz International Conference Center, Riyadh.

13-16 April (Sunday-Wednesday): EdgeX HCI, The Ritz Carlton, Riyadh.

14-16 April (Monday-Wednesday): Future Hospitality Summit, Mandarin Oriental Al Faisaliah, Riyadh.

18-20 April (Friday-Sunday): Saudi Arabian Grand Prix, Jeddah,

21-24 April (Monday-Thursday): Saudi Food Exhibition and Conference, Riyadh.

22-23 April (Tuesday-Wednesday): AAM Middle East, Riyadh.

23-25 April (Wednesday-Friday): Construction and Real Estate Development Exhibition, Jazan.

25 April- 4 May (Friday-Sunday): AFC Champions League Elite Finals

MAY

May: The World Intellectual Property Organization (WIPO) Global Awards 2025 announces its results.

6-7 May (Tuesday-Wednesday): Federal Open Market Committee meeting.

12-15 May (Monday-Thursday): Saudi Smart Manufacturing, Riyadh International Convention & Exhibition Center.

13-14 May (Tuesday-Wednesday): Global EV & Mobility Technology Forum, The Arena, Riyadh.

19-20 May (Monday-Tuesday): Tech-ecO-System Summit (ToSS), Riyadh.

23 May (Friday): Guns N’ Roses Show, Riyadh.

31 May-5 June (Saturday-Thursday): Hajj.

JUNE

6-9 June ( Friday-Monday): Eid Al Adha.

17-18 June (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

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

30 June (Monday): Deadline for Cancellation of Fines and Exemption of Financial Penalties Initiative by the Zakat, Tax and Customs Authority (Zatca).

JULY

July: The World Intellectual Property Organization (WIPO) Global Awards 2025 awards ceremony, Geneva.

31 July (Thursday): Deadline for companies with SAR 2.5 mn or more in 2022/2023 revenues to integrate e-invoicing solutions with Fatoora.

29-30 July (Tuesday-Wednesday): Federal Open Market Committee meeting.

AUGUST

5-17 August (Tuesday-Sunday): Fiba Asian Cup.

SEPTEMBER

15-17 September (Sunday-Tuesday): Money 20/20 Middle East, Riyadh.

17-18 September (Tuesday-Wednesday): Federal Open Market Committee meeting and Summary of Economic Projections.

23 September (Tuesday): Saudi National Day.

OCTOBER

28-29 October (Tuesday-Wednesday): Federal Open Market Committee meeting.

NOVEMBER

3-9 November (Monday- Sunday): WTA Tour Finals.

24-26 November (Monday-Wednesday) The World Advanced Manufacturing & Logistics Saudi Expo, Riyadh Front Convention & Exhibition Centre, Riyadh.

27-30 November (Thursday-Sunday): The World Rally Championship (WRC), Jeddah.

DECEMBER

1-4 December (Monday-Thursday): International Conference on Nuclear Emergencies, Riyadh.

4-13 December (Thursday-Saturday): Red Sea International Film Festval, Jeddah.

December: The Fortune Global Forum 2025, Riyadh.

9-10 December (Tuesday-Wednesday): Federal Open Market Committee meeting and Summary of Economic Projections.

2026

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

8-12 February (Sunday-Thursday): World Defense Show, Riyadh.

26-29 October (Monday-Thursday): World Energy Congress, Riyadh.

2027

The World Water Forum takes place in Riyadh.

The Ocean Race finishes in Amaala on the Red Sea.

Riyadh-Kudmi transmission line to be completed.

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