UK car maker bets on green revolution

Hugo Spowers, chief engineer and founder of Riversimple, with one of his company’s hydrogen-powered Rasa cars at his factory in Wales in the UK. (AFP)
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Updated 29 November 2020
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UK car maker bets on green revolution

  • South Korea’s Hyundai claims to be the current world leader in hydrogen vehicles, selling 5,000 units of its Nexo model in 2019

ABERGAVENNY: Hydrogen-powered car manufacturer Riversimple is hoping to steal a march on competitors ahead of Britain’s promised “green revolution” that would see petrol-powered cars banned within 10 years.

While conventional battery-powered electric cars may be a few miles ahead in the zero-emission vehicle race, the company is betting that nascent hydrogen technology will fuel the cars of the future.

South Korea’s Hyundai claims to be the current world leader, selling 5,000 units of its Nexo model in 2019, followed by the Toyota Mirai.

Their sales are dwarfed by those of battery powered cars, of which there now around five million on the world’s roads.

Riversimple is only an ambitious upstart compared with the Asian automotive giants, but is currently the only British manufacturer in the sector with its flagship model, the Rasa.

Founder Hugo Spowers is keen to take on the industry’s big boys with his self-designed model, whose name derives from the Latin expression “tabula rasa,” which translates as “clean slate.”

Starting from scratch will give him an advantage, he hopes, over manufacturing giants that are focussed on adapting petrol-driven models to run on hydrogen.

He also believes hydrogen has a clear advantage over electric batteries because it offers a much greater range.

“A short-range car can be brilliant running on batteries, and we need them and there’s a role for them,” he said.

“But if you want the sort of range to which we’ve become accustomed, of 300 miles (482 kilometers) or more, hydrogen is head and shoulders ahead in terms of the overall efficiency,” he added.

Rasa will begin advanced testing over the next few months, with paying customers including Monmouthshire District Council in south Wales, which has approved a hydrogen refueling station in the town of Abergavenny.

It is the only such site in the region, but recharging takes only a few minutes, compared with several hours for an electric battery. 

The cars turn hydrogen and oxygen into electricity and water, offering the advantages of electric cars — sharp acceleration, torque and quiet operation — with no pollutants emitted.

Their environmental footprint is still a problem however, with the hydrogen mainly sourced from CO2-emitting natural gas.

As electricity is increasingly made from renewable sources, there is hope this could be used to create hydrogen from water via electrolysis.

Another problem is the vehicle’s cost.

Riversimple is trying to resolve that via a hire-purchase scheme that includes maintenance and fuel costs.

The vehicle would still belong to Riversimple, giving it a stake in sustainability.

“You pay for it monthly by direct debit and everything’s all under one umbrella, which I think is fantastic,” Jane Pratt, a member of Monmouthshire County Council, told AFP.

“This is a much more sustainable method of having a car,” she added.

Spowers said he expected the total outlay to be competitive with that of a Volkswagen Golf.

“Even though the car costs us more to build, because of these long revenue streams, and because our operating costs will be lower,” the cost should even out, said Spowers, who plans to launch the Rasa in three years.

The company looks set to benefit from the British government’s goal of carbon neutrality by 2050, and specifically the goal announced a few days ago of a ban on the sale of new petrol and diesel vehicles by 2030.

British chemical giant Ineos and market leader Hyundai this week announced a partnership to develop hydrogen-fueled vehicles and capitalize on the expected boom.

Hyundai suggested it could supply its hydrogen fuel cell technology to equip the Ineos all-terrain model Grenadier.


King Khalid International tops Saudi airport rankings with 82% compliance rate: GACA report

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King Khalid International tops Saudi airport rankings with 82% compliance rate: GACA report

RIYADH: Saudi Arabia’s King Khalid International Airport emerges as one of the top three performing terminals in the Kingdom, according to official data. 

The Riyadh-based aviation facility topped the category for international terminals with over 15 million passengers annually, achieving an 82 percent compliance rate with the General Authority of Civil Aviation’s standards. 

In its monthly report for April, GAC outlined the performance of the country’s airports, highlighting King Fahd International Airport and Abha International Airport as premier travel hubs. 

Based on 11 key criteria, the evaluation aims to improve service quality and enhance the passenger experience.  

King Abdulaziz International Airport in Jeddah came second with the same commitment rate but was outperformed by King Khalid International in meeting the criteria. 

King Fahd International Airport led the category for international airports with 5 to 15 million passengers annually, also with a 91 percent commitment rate. Prince Mohammad bin Abdulaziz International Airport in Madinah, which had the same commitment rate, was second. 

In the category of international airports with 2 to 5 million passengers annually, Abha International Airport secured the top spot with a 100 percent commitment rate, outperforming King Abdullah bin Abdulaziz Airport in Jazan, which also had a 100 percent commitment rate but lagged in meeting the criteria. 

Al-Qaisumah International Airport ranked first among international terminals with fewer than 2 million passengers annually, with a 100 percent commitment rate, excelling in average waiting times for departure and arrival flights. 

Arar Airport achieved the highest performance among domestic terminals, with a 100 percent commitment rate, leading in average waiting times for departure and arrival flights. 

GACA’s performance evaluation is based on essential criteria such as passenger waiting times, time spent at baggage claim, and passport and customs areas, alongside standards related to accessibility for persons with disabilities and other global best practices. 

In an additional report released earlier in April, GACA revealed that the volume of air cargo handled by airports in the Kingdom saw an annual rise of 7 percent in 2023 to reach 918,000 tonnes.  

The analysis stated that the Kingdom’s aviation sector strongly rebounded in 2023, with airports witnessing a 26 percent rise in passenger transportation compared to 2022. 

GACA said that flight facilities in Saudi Arabia transported 112 million passengers last year, an 8 percent increase compared to 2019.  

The report revealed that the number of flights through the Kingdom’s airports in 2023 reached about 815,000, an increase of 16 percent compared to 2022. 

In 2023, airports in Saudi Arabia handled 394,000 international and 421,000 domestic journeys, the authority added. 


SME financing in Saudi Arabia surges 20.4% in Q4

Updated 47 min 32 sec ago
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SME financing in Saudi Arabia surges 20.4% in Q4

RIYADH: Financing provided to small and medium enterprises in Saudi Arabia surged by 20.4 percent year on year to $73.5 billion in the fourth quarter of 2023, official data showed. 

In its latest quarterly report, the Kingdom’s Small and Medium Enterprises General Authority said that credit facilities provided to micro and SMEs amounted to $6.7 billion and $24.6 billion, respectively, in the last three months of 2023. 

On the other hand, medium enterprises in the Kingdom secured finance worth $42.2 billion in the last quarter of the previous year. 

The authority, also known as Monsha’at revealed that banks in Saudi Arabia provided credit facilities worth $68.9 billion in the fourth quarter of 2023, representing a rise of 21.1 percent compared to the same period of the previous year. 

On the other hand, finance companies in the Kingdom provided loans amounting to $4.6 billion in the last three months of 2023, marking a year-on-year rise of 9.3 percent. 

Developing the SME sector is crucial for Saudi Arabia as the Kingdom is currently on a path of economic diversification, as it steadily reduces its dependency on oil. 

The report revealed that 9,644 SMEs were benefitted from Monsha’at support centers in the first quarter of this year. 

Moreover, three SMEs had their initial public offering on the parallel market Nomu through the Tomoh program in the first quarter of 2024. 

Monsha’at also revealed that Saudi Arabia led venture capital funding in the Middle East and North Africa region with $240 million deployed across 35 deals in the first quarter of this year. 

“With $240 million deployed across 35 deals to Saudi-based companies, the Kingdom accounted for a remarkable 65 percent of all VC funding in the region,” said the authority. 

The report attributed 54 percent of this VC funding to the $130 million pre-initial public offering secured by Salla in March. 

“While the $240 million invested in the first quarter maintains the Kingdom’s dominance, it did reflect a considerable quarterly drop of 70 percent from the fourth quarter of 2023, along with a 42 percent year-on-year drop. This downturn mirrors the broader trend across the MENA landscape,” said Philip Bahoshy, founder and CEO of venture capital data platform MAGNiTT. 

He added: “Digging deeper, it becomes evident that while the overall funding has diminished, the Kingdom’s entrepreneurial ecosystem continues to attract investors.” 


Oman’s banking sector sees 2.9% rise in credit to $80bn by end of March

Updated 50 min 2 sec ago
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Oman’s banking sector sees 2.9% rise in credit to $80bn by end of March

RIYADH: Oman’s banking sector experienced a 2.9 percent rise in total credit, reaching 30.8 billion Omani rials ($80 billion) by the end of March, official data showed. 

In its monthly review of banking and monetary developments, the Central Bank of Oman disclosed that credit to the private sector rose by 3.6 percent year-on-year, reaching 25.9 billion rials by the end of March. 

Non-financial corporations held the largest share of the total private sector credit, accounting for approximately 45.4 percent by the end of March, followed closely by households at 45 percent. 

Financial corporations constituted 5.8 percent of the total, while the remaining 3.8 percent was allocated to other sectors. 

Total deposits held with other depository corporations witnessed a significant year-on-year growth of 11.7 percent, reaching 30.3 billion rials at the end of March, while total private sector deposits grew by 13.7 percent to 20.2 billion rials. 

The increase in private sector credit and deposits reflects robust economic activity and confidence in the financial system. 

Regarding the sector-wise composition of private sector deposits, household holdings contributed the most at 49.8 percent, followed by non-financial corporations at 30.9 percent, financial corporations at 16.5 percent, and other sectors at 2.8 percent. 

The combined balance sheet of conventional banks showed a year-on-year growth of 0.8 percent in total outstanding credit as of the end of March. 

Credit to the private sector increased by 1.6 percent, reaching 20.3 billion rials, while overall investments in securities surged by 28.0 percent to 5.7 billion rials. 

Investment in government development bonds decreased by 17.1 percent to 1.8 billion rials, while investments in foreign securities saw a dramatic increase of 139.0 percent to 2.3 billion rials. 

Moreover, aggregate deposits in conventional banks experienced significant growth, while government deposits declined. Public enterprise holdings increased substantially, and private sector deposits rose. 

Simultaneously, Islamic banks and windows witnessed notable growth in total assets, financing, and deposits, underscoring their expanding role within the banking system. 

The report further highlighted that the nation’s nominal gross domestic product declined by 2.8 percent at the end of the fourth quarter of 2023, primarily due to a significant drop in the hydrocarbon sector despite growth in the non-hydrocarbon sector. 

However, real GDP increased by 1.3 percent during the same period. Both the average oil price and daily production saw decreases, while inflation remained minimal. 


Saudi fashion industry projected to expand by 48% by 2025

Updated 56 min 21 sec ago
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Saudi fashion industry projected to expand by 48% by 2025

RIYADH: Saudi Arabia’s fashion industry is set to post a cumulative annual growth of 48 percent from 2021 to 2025 as the Kingdom diversifies its economy, a report said. 

In its latest quarterly release, the Small and Medium Enterprises General Authority said that Saudi Arabia’s Fashion Commission is playing a crucial role in building a more robust ecosystem to propel the sector’s growth. 

The authority, also known as Monsha’at, revealed that the fashion industry contributed 1.4 percent of the Kingdom’s gross domestic product in 2022. 

The report added that the total value of the fashion sector in Saudi Arabia, including international brands, stood at $24.6 billion in 2022. 

On the other hand, the domestic fashion industry in the Kingdom was worth $12.5 billion in 2022. 

“Saudi Arabia has embarked on a profound transformation across multiple industries. This renaissance spans architecture, music, film, art, food, and more. Through diverse initiatives at the Fashion Commission, we are revolutionizing the fashion sector and elevating our talents to global stages while adhering to the core pillars that drive growth and sustainability,” said Burak Cakmak, CEO of the Fashion Commission. 

He added: “Due to several strategic initiatives that fostered a dynamic ecosystem of creativity and business acumen, the growth of the fashion industry in Saudi Arabia over the past few years has been unprecedented.” 

Cakmak said that developing local talent in the Kingdom is one of the crucial missions of the Fashion Commission. 

He added that the organization has initiated comprehensive educational programs, workshops, and mentorship opportunities to develop the growth of Saudi nationals in the sector. 

The official also noted that the commission assists small and medium enterprises operating in the sector in growing and expanding their businesses. 

“We also advance the industry by providing essential support to entrepreneurs and SMEs, offering assistance and resources that help businesses scale. Regulatory frameworks are established and enforced to ensure ethical practices and sustainability, while cultural preservation initiatives highlight Saudi heritage, promoting it both locally and globally,” said Cakmark. 

The Monsha’at report added that the fashion industry in Saudi Arabia has employed over 230,000 people as of 2022, and 52 percent of the workforce is female. 

The authority revealed that the women’s apparel market in the Kingdom will witness a 20 percent growth by 2027, while the men’s market is set to expand by 27 percent during the same period. 

Cakmak added that participation in international fashion events by Saudi companies will help affirm the place of the Kingdom in the global arena. 

“Market expansion efforts, including marketing campaigns and participation in international fashion events, further enhance the visibility and competitiveness of Saudi fashion brands. All of these are core strategic pillars that effectively nurture a vibrant, dynamic, and globally competitive fashion industry in the Kingdom,” Cakmak noted. 

He concluded: “We believe that the future of Saudi fashion lies in the hands of our talented designers and visionary entrepreneurs. As we continue to support and nurture these individuals, we are confident that the Kingdom’s fashion industry will continue to flourish.” 


S&P reaffirms Bahrain’s credit rating amid fiscal challenges; outlook stable

Updated 26 May 2024
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S&P reaffirms Bahrain’s credit rating amid fiscal challenges; outlook stable

RIYADH: Bahrain’s commitment to fiscal consolidation has witnessed S&P Global Ratings reaffirm its “B+/B” credit standing with a stable outlook despite challenges in 2023. 

However, the agency added that the transfer and convertibility assessment on the Gulf state remains “BB-.” It also anticipated structural reforms aimed at strengthening the non-oil revenue base, albeit at a slower pace. 

In its report, S&P said that the stable outlook reflects the expectation that Bahrain will persist in implementing measures to reduce its budget deficit, possibly benefiting from additional support from other Gulf Cooperation Council sovereigns if necessary. 

Conversely, the ratings could improve if Bahrain’s fiscal situation exceeds expectations, leading to a reduction in net debt relative to gross domestic product, or if current account surpluses widen, bolstering the country’s external position, according to the study. 

However, potential downside risks include a significant increase in government debt or a sharp decline in foreign currency reserves, which could hinder debt servicing and monetary policy effectiveness. 

“We could lower the ratings if the government’s net debt and debt-servicing burden increased significantly beyond our assumptions, presenting funding challenges. We could also take a negative rating action if foreign currency reserves declined sharply, limiting the government’s ability to service its external debt and weighing on monetary policy effectiveness,” the report said. 

On the other hand, the rating agency outlined an optimistic scenario for Bahrain, stating that it might upgrade the country’s standing if the government surpasses expectations by substantially reducing net debt relative to GDP through improved budgetary performance. 

Additionally, the ratings could increase if the current account surpluses are expanded significantly and consistently enhance the island state’s external position. 

The agency noted that its assessment is based on the anticipation that the Bahraini government will fortify its financial stance up to 2027, notwithstanding the considerable deficit expansion in 2023. 

It added that the shortfall experienced last year was primarily influenced by elevated interest rates, a one-off lump sum social support program, and an upward adjustment in pensioners’ inflationary allowance that will continue into 2024. 

Considering this initial setback, S&P foresees broader fiscal deficits averaging 4.4 percent of GDP from 2024 to 2027, compared to 3.8 percent in its prior evaluation. 

“A decline in oil production due to ongoing maintenance at the Abu Safa oil field also affects our revenue assumptions. However, we believe the government will continue pursuing fiscal and structural reforms to strengthen its non-oil revenue base, allowing for continued, albeit slower, fiscal consolidation over our forecast horizon to 2027,” the agency said in its report. 

Moreover, S&P assumed that Bahrain would receive the remaining $2.8 billion of the $10.2 billion GCC support package pledged by Saudi Arabia, the UAE, and Kuwait in 2018, and there remains potential for additional financial support beyond the program’s expiration at year-end 2024 if needed. 

“These interest-free loans have historically covered about 50 percent of the government’s gross external financing needs, although we note disbursements are not tied to, and do not necessarily align with, Bahrain’s external debt repayments,” the agency said. 

It further highlighted that Bahrain encounters annual external debt redemptions ranging from $2.0 billion to $2.5 billion, equivalent to 5 percent of GDP, stemming from a mix of Eurobond and sukuk issuances. 

In February, S&P explained that Bahrain successfully raised $2 billion by issuing a seven-year, $1 billion sukuk at 6.0 percent and a 12-year, $1 billion conventional bond at 7.5 percent. 

“We understand the issuance was met by strong investor demand, supporting more favorable pricing dynamics. In our base-case, we assume Bahrain will maintain strong access to international capital market funding,” it added. 

It explained that the country’s relatively diverse economy, proximity to Saudi Arabia’s market, robust financial sector oversight, and educated workforce provide a foundation for resilience. However, stagnant GDP per capita levels, adjusted for population growth, suggest underlying challenges in achieving broad-based economic prosperity. 

“However, when GDP performance from 2017-2027 is adjusted for population levels, GDP per capita levels are largely flat, suggesting that labor supply, rather than productivity, remains the key growth spur. We view Bahrain as having a relatively wealthy economy and estimate GDP per capita at $27,58 in 2024,” it said.