Saudi Arabia-hosted finance event to outline Arab post-pandemic recovery
The event, which kicked off on Monday, takes place digitally this year, with the first day focusing on the role of environmental, social and corporate governance practices in achieving economic growth and financial prosperity
Updated 30 March 2021
JEDDAH: The 11th annual conference of the Arab Federation of Exchanges is being hosted by Saudi Arabia this year and features keynote speakers discussing the importance of finance in supporting the Arab region’s post-pandemic recovery.
Supported by the Saudi Stock Exchange Company (Tadawul), the two-day conference is the largest gathering of regional financial institutions in the region this year. The event, which kicked off on Monday, takes place digitally this year, with the first day focusing on the role of environmental, social and corporate governance practices in achieving economic growth and financial prosperity.
Chairman of Saudi Arabia’s Capital Market Authority, Mohammed El-Kuwaiz, told delegates the event is an important dialogue platform for the exchange of expertise and experiences, especially at a time when the region is still dealing with the negative impact of the pandemic on financial markets.
“Our conference today comes at an important time, as financial markets have witnessed during the past year exceptional challenges due to the pandemic and precautionary measures that have been imposed to combat it,” he said.
“Despite the obvious impact on the economy, the role of financial markets was also clear in supporting the economic recovery and the financing needs of market participants during the pandemic, which made us more aware of the importance of financial markets in such exceptional circumstances,” he added.
Using the global financial crisis of the 2000s as an example, El-Kuwaiz said the decade “highlighted the importance of supervision and tightening control over financial markets, which led to a number of reforms and precautions.”
CEO of Saudi Stock Exchange (Tadawul), Khalid Al-Hussan, said the conference this year comes amid exceptional circumstances and coincides with several developments in the Arab and global financial markets as a result of the pandemic.
“This edition of the conference also represents a unique event that is distinguished from its previous annual conferences, as it is the first virtual conference of the Arab Federation of Exchanges, and in the period of global economic recovery,” he said.
Chairman of Mubasher Financial Group, Mohammed Al-Ballaa, highlighted the need to support financial technology initiatives to help the development of the Arab market.
“I would like to say that the use of financial technology in the field of trading and investment has had the greatest impact on the success of the business and services of direct companies.”
Mubasher Financial Group has used artificial intelligence to research and provide investment recommendations to clients.
Kingdom is moving toward Vision 2030 by developing the trade sector and ensuring its sustainability
Updated 13 August 2022
CAIRO: Saudi Arabia’s bank loan portfolio rose by SR289 billion ($77.1 billion) in the second quarter of this year from the same quarter a year ago, according to a recent statistical bulletin released by the Saudi Central Bank, also known as SAMA.
Bank loans totaled SR2.42 trillion at the end of the second quarter of 2022, up from SR1.95 trillion in the second quarter of 2021, showed the SAMA report.
The SR289 billion increase was led by an SR191.1 billion growth in miscellaneous activities. Its share increased by 2 percentage points to 52 percent in the second quarter of 2022.
The data showed that the value of Saudi banks’ aggregate loan portfolio totaled SR2.24 trillion at the end of the second quarter of 2022, up 14.8 percent from the year before and up 4 percent from the previous quarter.
The annual growth in bank loans dropped to a negative in 2017 and remained below zero until the third quarter of 2018. However, bank loans have been seeing an upward trend ever since, according to the SAMA report.
From the third quarter of 2018 until the end of 2019, the value of Saudi bank loans grew at an average rate of 3.7 percent year on year; between 2020 and the second quarter of this year, it grew at an average rate of 14.8 percent year on year.
The dominating segment in the Kingdom’s loans was miscellaneous economic activity, which acquired 52 percent of the total loans this quarter.
Commerce came in second, holding 17.2 percent of total loans in the country, recording SR385.7 billion in the second quarter, showed the data.
The Ministry of Commerce in the Kingdom has been moving toward the Saudi Vision 2030 by developing the trade sector and ensuring its sustainability, according to the Kingdom’s Unified National Platform.
The platform stated: “The Ministry of Commerce’s mission focuses on improving the business environment in Saudi Arabia through enacting, developing and supervising the implementation of flexible and fair trade policies and regulations.”
Even though total bank loans expanded this quarter, two economic activities saw a quarterly decline in bank credit in the second quarter of this year: manufacturing and processing and transport and communication.
Bank loans to transport and communication fell by SR6.2 billion in the second quarter of 2022 from the same quarter the previous year.
Compared to the previous quarter, the sector dropped from 2.1 percent of total loans in the first quarter to 1.9 percent, showed the SAMA bulletin.
Bank loans given to manufacturing and processing fell by SR4 billion in the second quarter of 2022 from the same quarter the previous year.
The data showed that the sector dropped from 7.2 percent of total loans in the first quarter to 6.9 percent compared to the previous quarter.
Platform currently operates in 72 countries: Managing director Burak Karapinar
Updated 13 August 2022
RIYADH: UAE-based global food trade startup QS Monitor has created a platform for food traders to ship their goods risk-free.
Established in 2020, the company mitigates the risk for exporters as they streamline their shipments to avoid food loss by providing traders with the requirements for their goods to pass security measures.
Burak Karapinar, the managing director and founder of QS Monitor, told Arab News that the platform currently operates in 72 countries, which amounts to almost 90 percent of the global food trade industry.
“We are in 72 countries and growing, but this represents almost 90 percent of the global food trade. So, the ones we don’t have on the platform right now are either small countries or ones that are not big in the food trade,” Karapinar said.
Calling it the “Google for food trade,” Karapinar explained that traders input the product along with the destination, and QS Monitor will provide a complete list of requirements.
But that is not at all. Joe Hawayek, the board member of QS Monitor, told Arab News that the platform also links users to testing laboratories in their country.
“We are linking them with a testing laboratory in their country that can conduct these tests, issue them with the relevant certification that says they have passed, and they take it and travel with it for their product from the start,” he added.
By linking these players, Karapinar is trying to mitigate the food loss in the supply chain caused due to contamination.
• As the Ukraine-Russia war affected the global food trade sector, the company plays a huge role in ensuring importers are still connected with exporters.
• Saudi Arabia and the UAE import most of their eggs from Ukraine, and because of the platform, importers could find alternative sources for their products.
“To give you an idea, 72 percent of global food loss happens in the supply chain, not at home or on the consumer’s plate,” he pointed out.
As the Ukraine-Russia war affected the global food trade sector, the company plays a huge role in ensuring importers are still connected with exporters.
“That’s another beauty that we can provide to this platform. The onboarding of a supplier takes months. You need to be able to verify all the information and make sure the supplier meets your criteria and standards.
“Through our platform, you don’t need to do that. You can gather this information. And you can make your decision. So, we also add the trust element between the buyer and the seller,” Karapinar said.
Hawayek also added that Saudi Arabia and the UAE import most of their eggs from Ukraine, and because of the platform, importers could find alternative sources for their products. With a network of over 400 laboratories, the company provides several services through its platform and certification for Halal requirements for certain foods.
“We did more than 10,000 transactions last year; this includes certification testing, inspection, product registration, and supplier audits,” Karapinar added.
With 6,000 traders on the platform, Karapinar stated that the company currently has 1,000 traders on QS Monitor from the Kingdom and is planning to grow that number by a minimum of five times.
In addition, the company is currently in series A funding stage and is on its way to raising $8 million and expanding its staff from 18 to 60 people in the next five months.
QS Monitor also won UAE’s FoodTech Challenge provided by the Ministry of Climate Change and Environment, which features almost 600 companies.
Gazprom ramps up gas flow to Hungary via Turkstream pipeline, official says
The agreement with Gazprom is for 15 years, with an option to modify purchased quantities after 10 years
Updated 13 August 2022
BUDAPEST: Russia’s Gazprom has ramped up flows to Hungary via the Turkstream pipeline that brings gas to Hungary via Serbia, a Hungarian Foreign Ministry official said on Saturday.
EU member Hungary has maintained what it calls pragmatic relations with Moscow since Russia’s invasion of Ukraine, creating tensions with some EU allies keen to take a tougher line.
Hungary, which is about 85 percent dependent on Russian gas, firmly opposes the idea of any EU sanctions on Russian gas imports and Prime Minister Viktor Orban has also lobbied hard to secure an exemption from EU sanctions on Russian crude oil imports.
Foreign Minister Peter Szijjarto met his Russian counterpart Sergei Lavrov in Moscow last month, seeking a further 700 million cubic meters of gas on top of an existing long-term supply deal with Russia.
Under a subsequent agreement, Gazprom started ramping up gas flows to Hungary on Friday, Hungarian Foreign Ministry State Secretary Tamas Menczer said in a statement.
Menczer said Gazprom would add 2.6 million cubic meters of additional gas per day to previously-agreed deliveries via Turkstream through August, with the amount of September deliveries being negotiated.
Hungary’s reserves stored 2.84 billion cubic meters of gas by the middle of July, the lowest level for that period over the past five years based on data by the national energy regulator.
Under a deal signed last year, before the start of the war in neighboring Ukraine, Hungary receives 3.5 billion cubic meters of gas per year via Bulgaria and Serbia under its long-term deal with Russia and a further 1 bcm via a pipeline from Austria.
The agreement with Gazprom is for 15 years, with an option to modify purchased quantities after 10 years.
KARACHI: Pakistan’s national currency on Thursday continued its bullish trend and appreciated 1.38 percent against the United States dollar amid easing balance of payment pressure and expected inflows from the International Monetary Fund, traders and analysts said.
The Pakistani rupee gained Rs3.03 to close at Rs218.88 against the greenback in the interbank market following eight consecutive appreciation trading sessions. The rupee has recouped its value by 9.3% or Rs21 against the greenback in the continued uptrend, according to State Bank of Pakistan data.
“There are couple of reasons for the current appreciation of the Pak rupee against dollar including easing off balance of payment pressure and declining demand at home after government’s administrative measures to curtail imports,” Tahir Abbas, Director Research at Arif Habib Limited, told Arab News.
“Declining current account deficit and price cut of oil and other commodities also eased off pressure on the rupee. The expected inflows from the IMF by the end of this month and undervalued currency are also the key reasons of rupee appreciation.”
Following austerity measures by the government and a restriction on imports, the import bill has declined from $7.8 billion in June 2022 to $4.8 billion in July 2022, which has not only reduced the trade deficit but also eased pressure on the national currency.
The rupee in the open market also appreciated from Rs218 to Rs216 for selling during trading on Thursday. The currency in the open market has appreciated by over 11% or Rs28 since July 29, 2022, according to the Exchange Companies Association of Pakistan (ECAP).
“There are only sellers in the market after the sentiments have changed following the measures taken by government and the central bank,” Zafar Paracha, General Secretary of ECAP told Arab News.
“The central bank has taken action against the banks’ treasuries departments which were involved in maneuvering of dollar in interbank market. In addition, the expected reduction in the import bill of August has also played appreciation role.”
The pressure on the Pakistani rupee eased off after the government took steps to curtail imports and meet preconditions of the IMF for the revival of a $6 billion program signed in 2019 to stave off a balance of payment crisis.
The IMF said last month it had reached a staff level agreement with Pakistan that would pave the way for the disbursement of $1.17 billion after its board approval later this month. Islamabad also has to convince the fund about the availability of funds for a $4 billion financing gap.
Last week, the UAE’s state news agency had reported that the country intended to invest $1 billion in Pakistani companies across various sectors, which include gas, energy infrastructure, renewable energy and healthcare.
Following the current bullish trend in the currency market, Pakistani analysts said the currency was likely to appreciate further to around Rs200 against the greenback in the near future.
Stocks, however, on Thursday, remained bearish mainly due to profit taking that kicked off during the midsession. The benchmark KSE-100 index closed at 42,243 points, down by 251 points.
“Stocks fell sharply lower on political noise and hike in power tariff. Mid session support remained on strong rupee and falling Pakistan dollar bond yields,” Ahsan Mehanti, CEO of Arif Habib Corporation, told Arab News. “Investor concerns for weak earnings outlook played a catalyst role in bearish close.”