INTERVIEW: Art Jameel curator Murtaza Vali on the first major exhibition from the Gulf region’s new artistic patrons

Murtaza Vali of the Al Jameel Group of Saudi Arabia. (Illustration by Luis Granena)
Updated 04 November 2018
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INTERVIEW: Art Jameel curator Murtaza Vali on the first major exhibition from the Gulf region’s new artistic patrons

DUBAI: From the patronage of the Medici dynasty in Renaissance Italy, through the artistic philanthropy of the great American magnates of the 19th century, the link between art and business has been a permanent thread.
In the modern Middle East, the tradition was for a while maintained by the Abraaj group and its sponsorship of the annual art fair in Dubai, but with that now in doubt given the group’s financial troubles, the baton has been taken up by the Art Jameel Group of Saudi Arabia.
Next week, reinforcing the link between big business and high art, Art Jameel unveils its first big exhibition at its new art center in Dubai, and the theme, appropriately enough, is the oil industry.
Oil has shaped the economies of the region, but has also been a pervasive factor in its artistic and cultural scene.
“Pervasive, but invisible,” in the words of Murtaza Vali, curator of the exhibition entitled “Crude.”
“Though oil drives all human life, we have limited access to it in an everyday context. ‘Crude’ is an attempt to give viewers a chance to get intimate with it, though it does consciously resist the dark and sticky lure of crude oil itself, which appears only once or twice in the show,” he said.
The exhibition brings together 17 artists from across the region and the world “to explore oil as an agent of social, cultural and economic transformation across the region, as well as a driver of geopolitical upheaval,” according to the Art Jameel website.
There were multiple inspirations for “Crude,” Vali explained. One was the work of Lebanese artist Rayyane Tabet, whose work “The Shortest Distance Between Two Points” was a winner of the Abraaj prize in 2013, the year that Vali curated it. It was based on the TransArabian Pipeline, the post-war venture that got Saudi crude to the Mediterranean without having to pass through the Suez Canal.

In the Middle East, and in the Gulf especially, oil still has the capacity to inspire dreams.

Another inspiration for the exhibition is the huge but little- viewed archive of film produced by the oil companies operating in the Gulf in the mid-20th century. As well as being the heyday of oil discovery in the Gulf, this was also the high point of British documentary film making, and “Crude” digs deep into that reserve.
One highlight of the exhibition is a work by the Saudi artist Manal Al-Dowayan, a self-styled “Aramco brat” whose father worked for Saudi Aramco in Dhahran. Through oral histories and photographs, “If I Forget You, Don’t Forget Me” documents the stories of a generation of pioneering Saudi oilmen and women whose lives straddled the country’s shift from poverty to abundance. The photographs are taken in the home offices of many of these figures and feature mementoes and souvenirs of life lived in the oil industry.
“Living and working in the Aramco ‘camp’ in Dhahran was quite a surreal experience for many — it was like a little bit of mid-20th century suburban America plopped into the middle of the Arabian desert,” said Vali.
Montreal-based Hajjra Waheed captures some of this in her work “Aerial Studies 1-8,” which uses an old map to show some significant sites within the Dhahran compound, including the house she grew up in. Aramco was not involved in the exhibition, but roughly one-third of the works are taken from the Jeddah-based Art Jameel collection.
Oil as an environmental agent is vividly portrayed. “Plume 1-24,” another work by Waheed, consists of photographs of thick black clouds often associated with oil fires. They have been cropped so that the source of the smoke is not visible, opening the images up to multiple interpretations, everything from environmental pollution to the artist’s own memories of the Kuwaiti oil fields burning in 1991 after Saddam’s retreating troops set them alight.
That act of destruction also figures in another work at “Crude.” Monira Al-Qadiri’s “Behind the Sun” features vintage footage of the same fields, ablaze, shot by a Kuwaiti journalist from ground level, but overlaid with recitations of Islamic poetry drawn from Kuwaiti television archives. “These events elicited awe and wonder as much as fear and despair. Al-Qadiri’s use of poetry brings some of this wonder back,” Vali said.
The message from the exhibition is as much corporate as artistic. “I think it is informative to know the early history of the oil industry, to learn how quickly and closely corporations and governments came together around the extraction of petroleum. This link helps us better understand how oil so quickly became the dominant source of energy around the world,” he said.
That history throws up some quirky cultural facts, like the link between oil and golf. The American expats who came to Saudi Arabia, for example, were dedicated golfers, and went to great lengths to play their game in demanding circumstances. “Playing golf in the desert, an environment that does not seem ideal for the game, a landscape that is, in some sense, one big sand trap,” said Vali.
Raja’a Khalid’s “Desert Golf” series uncovers archival images of this practice from the late 1940s on, showing “company men” nonchalantly playing golf in the desert, often in close proximity to pipeline and other infrastructural facilities.
“The images reveal an air of corporate elitism still associated with the industry, and remind us how some of the stranger aspects of contemporary life in the Gulf, like lush green world-class golf courses, can be traced back to imperial and colonial pasts,” Vali said.
In literature, a small but significant sub-genre grew out of the meeting between westerners and Arabs in the oil industry, dubbed “petro-fiction.” The Saudi writer Abdul Rahman Munif’s “Cities of Salt” series was controversial at the time — perhaps, Vali said, because of the legacy of colonialism and imperialism inherent in the “oil encounter.”
He takes this as “another sign of how oil is both magical and insidious. It withholds itself from us while making us entirely dependent on it.”
Vali quoted the famous Polish journalist Ryszard Kapuscinski, who said: “Oil creates the illusion of a completely changed life, life without work, life for free … The concept of oil expresses perfectly the eternal human dream of wealth achieved through lucky accident, through the kiss of fortune and not by sweat, anguish, hard work. In this sense oil is a fairy tale, and like every fairy tale, a bit of a lie.”
Vali agrees with that in principle, but is enough of a pragmatist to understand that the oil business underpins a lot of real life as well, including artistic life.
“In the Gulf, there is quite a direct link between oil and culture. When oil fell to below $40 a barrel a couple of years ago, the culture industry noticeably shrank. Oil permeates art and culture in the region, much as it does our everyday lives,” he said.
As befits a scientist turned artist, he is on top of some of the basic economic problems facing the oil industry. One of the exhibits is a work by a Venezuelan artist entitled “The Last Oil Barrel,” which Vali calls “the key to the exhibition.”
“The idea of ‘peak oil’ is intriguing on many levels. Oil’s growing scarcity produces, what one scholar has called, a kind of “resource anxiety” which is increasingly pervasive in the West. But in the Middle East, and in the Gulf especially, oil still has the capacity to inspire dreams,” he said.


Saudi banks’ funding profile changing on rising mortgage demand: S&P Global

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Saudi banks’ funding profile changing on rising mortgage demand: S&P Global

RIYADH: Saudi banks are expected to pursue alternative funding strategies to deal with the rapid expansion in lending, fueled by the demand for new mortgages, according to S&P Global.
In its latest report, the credit-rating agency stated that the funding profiles of financial institutions in the Kingdom are set to undergo changes, primarily driven by a state-backed initiative to boost home ownership.
According to the analysis, mortgage financing represented 23.5 percent of Saudi banks’ total credit allocation at the end of 2023, compared to 12.8 percent in 2019.
“The ongoing financing needs of the Vision 2030 economic initiative and relatively sluggish deposits growth, is likely to incentivize banks to seek alternative sources of funding, including external funding,” said S&P Global.  
The report also predicted that this pursuit of external funding could potentially impact the credit quality of Saudi Arabia’s banking sector.
According to the US-based rating agency, lending growth among Saudi banks has outpaced deposits, with the loan-to-deposit ratio exceeding 100 percent in 2022, up from 86 percent at the end of 2019.
S&P Global expects this trend to persist, particularly with corporate lending playing a more significant role in growth over the next few years. “We consider Saudi banks are likely to turn to alternative funding strategies to fund that expansion,” the report said.  
It added: “We consider, however, that the risk created by the maturity mismatch is mitigated by the relative stability of Saudi deposits.”   The agency also predicted that Saudi banks’ foreign liabilities will continue to increase, rising from about $19.2 billion at the end of 2023 to meet the funding requirements of strong lending growth, particularly amidst lower deposit expansion.
The report highlighted that Saudi banks have already tapped international capital markets, and the credit rating agency expects this trend to continue for the next three to five years.
According to S&P Global, the Saudi banking system could transition from a net external asset position of SR42.9 billion, or 1.6 percent of lending, at the end of 2023 to a net external debt position within a few years.
In April, S&P Global, in another report, stated that banks in the Kingdom are anticipated to experience robust credit growth ranging between 8 to 9 percent in 2024.
The agency noted that this credit expansion will be propelled by corporate lending, fueled by increased economic activities driven by the Vision 2030 program.
Moreover, the report added that the Saudi government and its related entities are expected to inject deposits into the banking system, thereby supporting the credit growth of financial institutions in the Kingdom.

 


NEOM, Saudi Red Sea Authority sign MoU to develop marine tourism regulations

Updated 03 May 2024
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NEOM, Saudi Red Sea Authority sign MoU to develop marine tourism regulations

  • The MoU’s goal is to enhance research, deliver innovation, and improve the visitor experience for tourists
  • The agreement reflects SRSA’s commitment to attracting investment in coastal tourism activities

NEOM: The Saudi Red Sea Authority and NEOM signed a memorandum of understanding on Friday to cooperate on developing legislation, regulations, and technology in marine tourism, reported the Saudi Press Agency.
The MoU’s goal is to enhance research, deliver innovation, and improve the visitor experience for tourists in Saudi Arabia’s existing, emerging, and future Red Sea coastal destinations.
SRSA Acting CEO Mohammed Al-Nasser and NEOM’s CEO Nadhmi Al-Nasr signed the partnership, which they hope will promote an exchange of expertise and enable the implementation of joint initiatives.
The agreement also reflects SRSA’s commitment to attracting investment in coastal tourism activities.
The partnership will further assist small and medium enterprises in the sector through administrative, technical, and advisory support.
Via this agreement, SRSA aims to integrate with relevant public, private, and third-sector entities to achieve one of the goals of Saudi Vision 2030, which is to develop coastal tourism as a valuable sector of the Kingdom’s economy.


World food prices up in April for second month: UN agency

Updated 03 May 2024
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World food prices up in April for second month: UN agency

PARIS: The UN food agency’s world price index rose for a second consecutive month in April as higher meat prices and small increases in vegetable oils and cereals outweighed declines in sugar and dairy products.

The Food and Agriculture Organization’s price index, which tracks the most globally traded food commodities, averaged 119.1 points in April, up from a revised 118.8 points for March, the agency said on Friday.

The FAO’s April reading was nonetheless 7.4 percent below the level a year earlier.

The indicator hit a three-year low in February as food prices continued to move back from a record peak in March 2022 at the start of Russia’s invasion of Ukraine.

In April, meat showed the strongest gain in prices, rising 1.6 percent from the prior month.

The FAO’s cereal index inched up to end a three-month decline, supported by stronger export prices for maize. Vegetable oil prices also ticked higher, extending previous gains to reach a 13-month high due to strength in sunflower and rapeseed oil.

The sugar index dropped sharply, shedding 4.4 percent from March to stand 14.7 percent below its year-earlier level amid improving global supply prospects.

Dairy prices edged down, ending a run of six consecutive monthly gains.

In separate cereal supply and demand data, the FAO nudged up its estimate of world cereal production in 2023/24 to 2.846 billion metric tonnes from 2.841 billion projected last month, up 1.2 percent from the previous year, notably due to updated figures for Myanmar and Pakistan.

For upcoming crops, the agency lowered its forecast for 2024 global wheat output to 791 million tonnes from 796 million last month, reflecting a larger drop in wheat planting in the EU than previously expected.

The revised 2024 wheat output outlook was nonetheless about 0.5 percent above the previous year’s level.


Material sector dominates TASI trading in first quarter of 2024

Updated 03 May 2024
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Material sector dominates TASI trading in first quarter of 2024

RIYADH: The materials sector led trading on Saudi Arabia’s Tadawul All Share Index, accounting for approximately SR87 billion ($23.2 billion) or 15.11 percent of the market, according to TASI’s 2024 first-quarter report.

SABIC, the largest component of this sector, boasted a market capitalization of SR234.9 billion, with trading value reaching nearly SR7 billion.

The banking sector trailed with transactions valued at SR71.22 billion, comprising 12.37 percent of the market. Al-Rajhi Bank took the lead in market capitalization within the sector and secured the second spot in trade value totaling SR23.62 billion.

In a February report by Bloomberg, Al-Rajhi Bank, seen as an indicator of Saudi Arabia’s growth strategies, exceeded the performance of JPMorgan Chase & Co., exhibiting nearly a 270 percent surge in shares since the initiation of Vision 2030. It has outpaced both local and global competitors, including state-supported banks, emerging as the largest bank in the Middle East and Africa, boasting a market cap of around $95 billion.

According to Morgan Stanley analysts led by Nida Iqbal, as reported by Bloomberg, “We see it as a long-term winner in the Saudi bank sector… While Al-Rajhi is best placed for a rate-cutting cycle, we believe current valuation levels reflect this.” 

Gulf central banks, including Saudi Arabia’s, frequently align their policies with those of the Federal Reserve to maintain their currency pegs to the dollar. According to Bloomberg Intelligence senior analyst Edmond Christou, a reduction in Fed rates could potentially bolster Al-Rajhi Bank’s profitability and expansion, as it will encourage gathering cheap deposits while enabling it to issue debt at more attractive levels.

In this period, the energy sector secured the third position in terms of value traded, reaching SR55.4 billion. Saudi Aramco topped the list with a market capitalization of SR7.47 trillion and registered the highest value among companies traded on the index, totaling SR28.82 billion.

In March of this year, Aramco announced a net income of $121.3 billion for its full-year 2023 financial results, marking the second-highest in its history. Aramco credited these results to its operational flexibility, reliability, and cost-effective production base, underscoring its dedication to delivering value to shareholders.

Tadawul’s quarterly report also indicated that the transportation sector recorded the fourth-highest value traded at SR39.25 billion, equivalent to 6.82 percent of the market. Among the top performers in this sector was cargo firm SAL Saudi Logistics Services, ranking third in value traded on the TASI during this period, following Aramco and Al-Rajhi Bank, with a total value of SR22.74 billion.

SAL debuted on the main market of the Saudi Exchange in November last year. With aspirations to manage 4.5 million tonnes of air cargo by 2030, Saudi Arabia is empowering its logistics sector from a supportive role to a pivotal driver of economic growth.

SAL, in which the Saudi government holds a 49 percent stake through the Saudi Arabian Airlines Corp., experienced a 30 percent surge in its share price during its initial public offering, raising $678 million and becoming Saudi Arabia’s second-largest IPO of the year.

In a January report by Forbes, SAL’s CEO and Managing Director Faisal Al-Beddah emphasized the company’s potential to shape the future of logistics in Saudi Arabia and beyond. He stated: “Logistics is the backbone of any economy. Now we are ready. We have the rotation, we have the infrastructure, we have the regulations, and most importantly, we have the mindset and the technology for Saudi Arabia to be the leading connecting logistics hub in the region.”

The top gainer during this period in terms of price appreciation was MBC Group, with a quarter-to-date percentage change of 127.6 percent, according to Tadawul.

Saudi Arabia’s MBC Group, a media conglomerate, debuted as the first new listing on TASI in 2024. Its trading began on Jan. 8. The company raised SR831 million through its initial public offering.

Saudi Steel Pipes Co. in the materials sector was the second highest gainer, with price appreciating by 88.15 percent.

Etihad Atheeb Telecommunication Co. had a QTD price percentage change of 81.91 percent making it the third-highest gainer on the exchange during this period.

TASI concluded the first quarter of 2024 with a 3.6 percent increase, climbing by 435 points to reach 12,402 points.


Saudi startups raised $3.3bn in last 10 years, says report

Updated 03 May 2024
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Saudi startups raised $3.3bn in last 10 years, says report

  • MAGNiTT report shows fintech emerged as the most funded sector in Kingdom

RIYADH: Startups in Saudi Arabia saw massive growth during the last decade raking in $3.3 billion in venture capital funding, according to a report issued by MAGNiTT.

The data platform, in its “10 Years Saudi Arabia Founders Report” sponsored by Saudi Venture Capital Co., provides an in-depth analysis of the backgrounds, experiences, and expertise of founders. 

“MAGNiTT initially published a report on founders in the MENA VC ecosystem in 2018, focusing on uncovering the DNA of successful entrepreneurs in the region. Today, in partnership with the Saudi Venture Capital Co., we present a comprehensive report on the founders of the top 200 funded startups in the Kingdom over the last ten years,” said Philip Bahoshy, CEO and founder of the platform. 

“By shedding light on founders’ experiences in the Saudi ecosystem, we aim to dispel myths around founders, empower aspiring entrepreneurs looking to establish their ventures in the Kingdom, guide government decision-makers in shaping policies conducive to innovation, and provide invaluable intelligence to investors seeking opportunities in the region,” he added. 

SVC CEO Nabeel Koshak emphasized the remarkable growth and dynamism in the Saudi startup landscape. 

FASTFACTS

Forty-four percent of these startups were launched by teams with two founding members, who together secured 53 percent of the total funds. 

Startups founded by a single individual accounted for 30 percent of the funded startups but only captured 15 percent of the funding in the last decade. 

Thirty-six percent of the 400 founders analyzed had at least 10 years of work experience before launching their respective startups.  

Fifty-nine percent of founders had technical education backgrounds, highlighting science, technology, engineering, and mathematics. 

Thirty-nine percent of founders held degrees in business, contrasting with the global average of 19 percent, according to an Endeavor Insight study. 

“The Kingdom’s strategic initiatives, driven by the Saudi Vision 2030, have laid a solid foundation for innovation, entrepreneurship, and investment. As a result, we have seen a surge in startup activity, with a growing number of ambitious founders seizing opportunities and driving innovation across various sectors,” he said. 

“The goal of the report is to provide policymakers, government officials, and investors with insights and data to inform strategic decisions and policies to further nurture the startup ecosystem for the next 10 years,” Koshak added. 

A decade of funding 

Compiling data from the 200 Saudi-based startups, which collectively raised a total of $3.3 billion from 2014 to 2023, the report highlighted that 44 percent of these startups were launched by teams with two founding members, who together secured 53 percent of the total funds. 

He further stated that with the significant support for innovation, the Kingdom is set to witness the emergence of more unicorns. 

In contrast, startups founded by a single individual accounted for 30 percent of the funded startups but only captured 15 percent of the funding in the last decade. 

Notably, 36 percent of the 400 founders analyzed had at least 10 years of work experience before launching their respective startups.  

The report also indicated a trend toward entrepreneurship among less experienced founders, with 66 percent being first-time startup founders and only 30 percent with previous regional startup experience. 

It revealed a significant gender disparity in the VC landscape within Saudi Arabia, with male founders comprising 94 percent of the total 400 individuals, while female founders accounted for only 6 percent.  

This gender gap is considerably wider than the global norms, where, according to research by Startup Genome conducted between 2016 and 2022, the average proportion of female founders in an ecosystem was 15 percent. 

Additionally, only 7 percent of solo founders were female, and there were no recorded startups with two or more female founders only.  

However, as the number of founders per startup increased, so did gender diversity, albeit slightly. In startups with three founders, 18 percent were of mixed gender, while in startups with four or more founders, the figure was 12 percent. 

Furthermore, 91 percent of male-only founded startups claimed 98 percent of total funding. Conversely, 3 percent of female-only founded startups accounted for 0.4 percent of the total funding. 

Founders' education 

The report further delved into the education qualification of founders revealing that 55 percent in the Kingdom had attained at least a bachelor’s degree.  

In terms of technical development, 59 percent of founders had technical education backgrounds, highlighting science, technology, engineering, and mathematics. 

Thirty-nine percent of founders held degrees in business, contrasting with the global average of 19 percent, according to an Endeavor Insight study. 

Over half of the 400 founders obtained their degrees internationally, while 22 percent held both international and local degrees. 

King Saud University, King Fahd University of Petroleum and Minerals, and King AbdulAziz University were among the most common institutions for startup founders. 

Seven of the top 10 universities of Saudi founders that raised funding were public institutions.

The top international schools of Saudi founders had Stanford and Harvard among the top choices, mirroring global trends. 

Professional experience 

Despite fintech being the most funded sector, only 7 percent of founders had experience in finance, and 18 percent in banking, which is lower compared to the 48 percent with backgrounds in information technology.  

Additionally, even fewer founders, only 12 percent, had experience in e-commerce, despite this industry accounting for the highest share of deals, 20 percent, closed by the top 200 Saudi startups. 

The report also revealed that 36 percent of the founders in Saudi Arabia are skilled professionals with over 10 years of experience before starting their businesses.  

Notably, Saudi Aramco was the most common previous employer among the funded founders, with 7 percent having worked there before launching their startups. 

Furthermore, McKinsey and Microsoft were among the top 10 companies where the 400 founders covered in this report had previously been employed.  

The majority of these founders held significant leadership roles, with 31 percent having served as a founder, co-founder, or board member. Only 4 percent originated from entry-level positions. 

The report also pointed out: “While Saudi Arabia has witnessed several serial entrepreneurs, 66 percent of founders in the last decade were first-time founders,” indicating a vibrant and growing entrepreneurial ecosystem.