London: In an exclusive interview with Arab News, Turki Mohammed Al-Shehri explains how an expanding renewables industry will boost employment as well as pave the way for a greener future.
A massive investment drive in green energy projects across Saudi Arabia is about creating jobs as well as diversifying the energy mix away from oil, according to the Kingdom’s renewables chief.
Last week Saudi Arabia revealed ambitious plans to produce 200 gigawatts of solar power by 2030, helping the country become a leading exporter of sustainable energy.
In an exclusive interview with Arab News, Turki Mohammed Al-Shehri, head of Saudi Arabia’s Renewable Energy Project Development Office (Repdo), said jobs and “local content” are guiding principles of the Kingdom’s renewables program. 
“A fundamental cornerstone of these projects will be local content. Local content is key — it is being stipulated in tenders,” said Al-Shehri in an interview in London.
He said: “The idea is that the products and components that are used in these farms (turbines, panels, hoists and other parts) are brought in from local factories, and the idea is to grow the industry organically; we want local factories to also export outside the Kingdom, ensuring the creation of jobs, and this will make sure that everything that is built in the Kingdom will be on a competitive global basis.”
Al-Shehri told Bloomberg in January that eight renewables tenders would be issued this year for 4.125 gigawatts of capacity at a cost of between $5 billion and $7 billion.
Asked by Arab News if the Kingdom would also need foreign investment to develop the sector, Al-Shehri replied: “Due to the size of the projects, we do need foreign investment experience and know-how, yes.”
In terms of the nuts and bolts of how renewable tenders would work, he pointed to the example of Riyadh-based Acwa Power, which recently won the contract to build the Kingdom’s first utility-scale solar photovoltaic plant.
“As long as they meet our local content requirement of 30 percent as well as other stipulations, where and how they source the technology is up to them,” he said. “The objective is to have an economic energy mix, driven by low-cost energy, and to ensure that local competitive industry is created in the Kingdom.”
By building up solar and wind-power generation, KSA will free up oil reserves for export, strengthening the country’s balance sheet.
Last week Crown Prince Mohammed bin Salman unveiled plans to develop the world’s biggest solar power project for $200 billion in partnership with Japan’s SoftBank.
The memorandum of understanding aims to produce up to 200 gigawatts of power by 2030 — about 100 times the capacity of the current biggest projects.
If built on one site, the solar farm would cover an area twice the size of Hong Kong, according to a Bloomberg News calculation.
Acwa Power CEO Paddy Padmanathan, who along with Al-Shehri attended London’s recent Saudi-UK CEO Forum, said: “Personally, I think they (renewables) could make up 40 percent of the (KSA) energy mix in 2030.”
Turning to his company’s success in February of being awarded the 300-megawatt PV solar project in Sakaka, Padmanathan said: “The tender was a rigorous, transparent process at a new world-record tariff and will set the foundation for a robust and competitive market for renewable energy in the Kingdom.”
The 25-year Sakaka power purchase contract was awarded to Acwa at a new world-record tariff of 8.781 halala/kWh (per kilowatt hour) (2.3417 cents/kWh). Middle Eastern oil producers are looking to renewables to meet growing domestic consumption and would rather export as much oil as possible to generate income to meet internationally recognized green energy standards, such as those in the Paris climate accord, while also reducing reliance on fossil fuels.
Saudi Arabia wants to deploy more natural gas, as well as solar and wind, to reduce its dependence on oil-based power generation. Developing a renewable energy industry is a key plank of Saudi Vision 2030.
The Sakaka plant, which Acwa has already started constructing in Al-Jawf province, is backed by a 25-year power purchase agreement with the Saudi Power Procurement Company.
Last year the Kingdom also tendered a 400 megawatt wind project — its first — at Dumat Al-Jandal, for which Repdo prequalified a number of companies in 2017.
In a recent interview with Arab News, Adnan Amin, director-general of the International Renewable Agency, said renewables were incredibly cheap now. “The latest bids for Saudi solar projects are around 2.5 US cents per kWh, which is about a quarter of the cost of oil,” he said.
Victoria Cuming, head of policy covering Europe, Middle East and Africa for Bloomberg New Energy Finance (BNEF), told Arab News: “Looking at the MENA region as a whole, renewables should both replace fossil fuel and add to the mix, as electricity demand will double by 2040, according to BNEF forecasts.”
She expected the region to see a significant shift in the capacity mix, from being 93 percent fossil fuels today to just under half renewables in 2040, according to BNEF’s New Energy Outlook 2017.
Cuming said: “In the near term, this will be mainly driven by incentives such as auctions, but in less than a decade the shift will be driven by the economics. Utility-scale PV plants are already cheaper than combined-cycle gas plants in net importing countries such as Egypt.”
Provided governments continue to phase out fossil-fuel subsidies, “this will be the case across MENA by 2025. Ten years later, onshore wind farms will be cheaper than gas,” said Cuming.
Green energy drive will boost KSA employment: Saudi Arabia’s renewable energy chief
Green energy drive will boost KSA employment: Saudi Arabia’s renewable energy chief
- Turki Mohammed Al-Shehri, head of Saudi Arabia’s Renewable Energy Project Development Office speaks to Arab News
- Crown Prince Mohammed bin Salman unveiled plans to develop the world’s biggest solar power project for $200 billion
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Industrial private sector investments in Saudi Arabia more than double to reach $1.8bn
RIYADH: Private sector investments in Saudi Arabia’s industrial field more than doubled in the first quarter of 2024, surpassing SR7 billion ($1.8 billion), according to official data.
This marks a significant increase from the SR3.34 billion recorded during the first quarter of 2023, according to a report released by the Saudi Authority for Industrial Cities and Technology Zones, also known as MODON.
The report revealed a substantial rise in the number of constructed factories, reaching 6,683 in the first three months of 2024 compared to 5,894 in the same period last year.
Moreover, the total number of logistics contracts surged to 367, up from 223 in the first quarter of 2023.
The report also highlighted a significant growth in industrial contracts, with 276 agreements issued by end of March, nearly doubling the figures from the first three months of 2023.
Jeddah Third Industrial City led in contract issuance with 76 agreements, followed by Al Kharj Industrial City with 47. Sudair Industrial and Business City recorded 20 contracts, while Dammam Third Industrial City and Dammam Second Industrial City had 18 and 16 agreements, respectively.
Furthermore, the total regulatory visits conducted in industrial cities during the first quarter amounted to 1,867, underscoring MODON's rigorous oversight.
In terms of sectoral distribution, food industries secured the highest number of contracts in the first quarter of 2024, constituting 24 percent of the total. They were followed by mining at 12 percent, rubber products industries at 12 percent, chemicals at 8 percent, and electrical equipment at 7 percent.
Additionally, the number of food factories operating in the Kingdom reached 1,300, indicating the country’s expanded capacity in the sector. This underscores its commitment to the “Food Industry Localization” initiative, aimed at enhancing productivity, local production, and quality.
These figures come as MODON prepares to engage as a strategic partner in the inaugural Saudi Food Manufacturing Show.
Scheduled from April 30 to May 2, at Riyadh Front, the event will be under the patronage of the Minister of Industry and Mineral Resources Bandar Al-Khorayef.
MODON plans to showcase its products, services, and comprehensive solutions for the food industry at the show, targeting investors, small and medium enterprises, and entrepreneurs.
This effort is aligned with MODON’s role in the National Industrial Development and Logistics Program, aimed at fostering sustainable growth and enhancing value chains.
The show is expected to host 500 participants from around the globe, including ministers, officials, and industry leaders, as well as CEOs, investors, and experts.
It will feature discussion panels, workshops, and exhibitions, providing a vital platform for displaying the latest in services, products, and solutions for the food industry and its supportive sectors.
Saudi entrepreneurs among beneficiaries of $493m Social Development Bank funding in Q1 2024
RIYADH: Almost 12,000 Saudi entrepreneurs received support and training from the Kingdom’s Social Development Bank in the first quarter of 2024, it was revealed.
Minister of Human Resources and Social Development Ahmed Al-Rajhi announced in a post on X that SDB provided financing worth SR1.85 billion ($493 million) in the first three months of this year.
The financing aims to “support individuals and enterprises to contribute to economic development and sustain efforts toward national sustainable growth.”
During the same period, assistance for small and startup businesses amounted to SR606 million for over 1,700 establishments.
Furthermore, empowerment support for vibrant and productive communities reached SR640 million, benefiting 12,000 citizens through various social developmental products, including marriage, family support, and restoration.
Assistance for freelancers and productive families also surged to SR600 million, benefiting 13,000 individuals.
Additionally, the number of savings accounts increased by 13,000, reaching a total of 245,000, with a balance exceeding SR525 million.
In January, SDB signed 24 deals worth SR1 billion to support entrepreneurs across various sectors in the Kingdom.
Inked during the Entrepreneurship and Modern Work Patterns Forum, the memorandums of cooperation encompassed a broad spectrum of sectors, including health, transportation, and logistics.
This aligns with the objectives of Vision 2030, aiming to reduce the unemployment rate, enhance women’s participation in the workforce, and expand the contribution of small and medium-sized enterprises to 35 percent of the gross domestic product by the end of the decade.
Speaking at the time, CEO of SDB Ibrahim Al-Rashid said those deals would “open new horizons for entrepreneurship and small and emerging enterprises" by developing new systems for financing, training and qualification.
Last year, the bank introduced a range of training programs to assist small businesses across the Kingdom.
The courses covered key areas such as marketing and administration, allowing business owners to meet and discuss their development plans with local and international experts.
Saudi biotechnology sector poised for double-digit growth: report
RIYADH: Saudi Arabia’s biotechnology and genomics sector is likely to record double-digit growth as it plans to invest 2.5 percent of its gross domestic product in research and development by 2040, aiming to add $16 billion to its economy.
This was highlighted in a recent report by US-based consulting firm Arthur D. Little, emphasizing the Kingdom’s substantial growth potential in the sector.
The study highlighted that the global biotech market, valued at $1.5 trillion in 2023, is projected to reach $4 trillion by 2030. This growth is driven by rising demand for improved healthcare and increased investment from both government and private sectors.
“Within this context, Saudi Arabia’s directed R&D investments, amounting to $3.9 billion in 2021 and aims to become a global leader in innovation and R&D, with annual investment equivalent to 2.5 percent of GDP by 2040 which are set to catalyze the expansion of the sector,” the report said.
It added: “This is expected to add $16 billion to the economy and create high-value jobs in science and technology, are set to catalyze the expansion of the sector, reinforcing its commitment to a knowledge-based economy.”
In 2022, Saudi Arabia’s investment in research and development soared to $5.1 billion, marking a 32.7 percent increase from the previous year, according to the General Authority for Statistics.
GASTAT’s report revealed that the government sector infused SR11.1 billion into R&D, constituting 58 percent of the nation’s total R&D budget.
Patrick Linnenbank, a partner in the healthcare and life sciences practice for Middle East & South East Asia at Arthur D. Little, emphasized the synchrony between strategic investments and the burgeoning demand for enhanced healthcare services.
“Our analysis indicates that strategic investments and initiatives are aligning with a growing demand for enhanced healthcare services and personalized medical treatment, which Saudi Arabia is well-positioned to fulfill,” Linnenbank said.
The report underscored the pivotal role of the Kingdom’s biotech and genomics initiatives, exemplified by the Saudi Genome Project 2.0 and collaborative endeavors. These initiatives are instrumental in propelling precision medicine forward, leveraging AI and genomics for personalized healthcare solutions.
Launched in 2018, the Saudi Genome Program utilizes cutting-edge genomic technologies to combat genetic diseases, advancing healthcare through improved diagnosis, treatment, and prevention.
Ankita Gulati highlighted the transformative potential of AI and genomics in healthcare, stating: “The confluence of genomic data and AI in healthcare is at the core of next-generation medical treatment and may revolutionize healthcare. Saudi Arabia’s current trajectory in genomics research and development is a robust indicator of its potential to lead in this domain.”
Integral to Saudi Arabia’s advancement in the biotech sphere are strategic collaborations with global pharmaceutical firms and the integration of research initiatives from key entities such as King Abdullah International Medical Research Center, King Abdullah University of Science and Technology, and King Abdulaziz City for Science and Technology.
The report also applauded the progressive establishment of a regulatory framework, with new guidelines from the Saudi Food and Drug Authority and legislative oversight from the Saudi Research Development and Innovation Authority.
While Saudi Arabia strides confidently toward leadership in the biotech landscape, the report acknowledged the necessity of further developing capabilities across the value chain.
The Kingdom’s accelerator and incubator programs, including KAIMRC’s Medical Biotechnology Park, KAUST’s Taqadam initiative, and the Biotech Startup Program in Dammam Valley, are pivotal in nurturing a thriving biotech and genomics ecosystem.
Saudi, US business ties set to reach new heights after high-level meeting
RIYADH: Trade relations between Saudi Arabia and the US are set to further prosper after a senior official from the Kingdom met with prominent business leaders.
Minister of Commerce Majid bin Abdullah Al-Qasabi held talks with representatives from the US Chamber of Commerce and prominent American companies in Washington, in which the robust economic connections between the two countries were highlighted.
Speaking to participants of the meeting, Al-Qasabi, who also serves as chairman of the board of directors of the National Competitiveness Center, highlighted the progress made so far in the Kingdom’s journey to achieve its ambitious plan for 2030, as reported by the Saudi Press Agency.
Al-Qasabi noted the transformations within the Saudi economy have spurred the emergence of new sectors and promising business opportunities.
Furthermore, discussions during the meeting tackled ways to enhance cooperation between the chambers of commerce of both countries, mainly through the exchange of best practices aimed at improving the Kingdom’s business environment and attracting US companies.
Saudi Ambassador to the US Princess Reema bint Bandar was also present at the meeting, alongside Khush Choksy, senior vice president for Middle East and Turkiye affairs at the US Chamber of Commerce, and Steve Lutes, vice president of Middle East affairs at the US chamber.
Al-Qasabi and his delegation also visited Georgetown University, where they were briefed on the institution’s collaboration programs and the latest research in areas such as entrepreneurship, corporate governance, and compliance.
The Saudi delegation also received briefings on the university’s trade policy analysis, international trade law, and economic development, as well as applications of artificial intelligence and machine learning.
Additionally, the visit provided insight into how to address challenges and leverage emerging opportunities in these fields, according to SPA.
Al-Qasabi also held separate meetings with Stefan Umiastowski, senior vice president of Ecolab, a global leader in water, hygiene, and energy solutions, and Stuart Jones, president for Regions and Corporate Relations at Bechtel, one of the world’s largest engineering, procurement, construction, and project management companies.
Saudi Arabia fastest-growing IT market in region, ICT spending to hit $37.5bn in 2024
RIYADH: Saudi Arabia is the fastest-growing information technology market in the Middle East, Turkey, and the African region, with double-digit growth in technology spending, according to analysts.
Jyoti Lalchandani, regional managing director of research firm IDC, said wider information and communication technology market spending is expected to reach $37.5 billion by the end of 2024.
The comments were made during the ICT Indicators Forum, which was hosted by the Ministry of Communication and Information Technology alongside the Communications, Space, and Technology Commission in Riyadh on April 24.
It was further noted that spending in this area across the Saudi government sector would exceed $752 million by the end of 2024 as innovative technologies become foundational to building an “experience economy.”
“AI, big data analytics, IoT, and cybersecurity spending is poised for tremendous growth and will account for almost one-third of overall IT spending in Saudi Arabia in 2024. Spending on AI in Saudi Arabia will surpass $720 million in 2024, reaching $1.9 billion by 2027 at a CAGR (compound annual growth rate) of 40 percent—half of that will be on interpretative AI,” Lalchandani said.
“We have seen Saudi Arabia emerge as a hub for the cloud,” he added, with spending on public cloud forecasted to surpass $2.4 billion in 2024 and reach $4.7 billion by 2027.
Software-as-a-Service will account for more than 50 percent of the 2024 spending.
IDP further highlighted that spending on cybersecurity alone will surpass the $1 billion mark in 2024 and reach $1.6 billion in 2027.
“I do remember a few years ago, the cybersecurity market was estimated at about $500 million. Today, we’re talking about literally double that. We’re talking about $1 billion in the cybersecurity industry, and to hear it be called the fastest growing market in the region is really a testament to our beloved nation,” Salman Faqeeh, CEO of Cisco Saudi Arabia, said while speaking on a panel during the forum.
