Pakistan posts record inflation for second consecutive month
Inflation of 37.97% in May set national record, adding to problems of balance of payment and risk of sovereign default
In April, the bureau said Pakistan's CPI at 36.5% was the highest recorded as well as the highest in South Asia
Updated 01 June 2023
Reuters
ISLAMABAD: Pakistan's annual inflation rate rose to 37.97% in May, the statistics bureau said on Thursday, setting a national record for the second month in a row, adding to its problems of a balance of payment crisis and the risk of a sovereign default.
Already in April, the bureau said Pakistan's CPI at 36.5% was the highest recorded, as well as the highest in South Asia, ahead of Sri Lanka, which posted annual inflation of 25.2% in May.
Pakistan's month-on-month rise in May was 1.58%, the bureau said in a statement, adding vegetables, pulses, wheat, wheat flour, rice, eggs and chicken in food items and fuel and gas prices caused the increase.
Inflation has been on an upward trend since early this year after the government took painful measures as part of fiscal adjustments demanded by the International Monetary Fund (IMF) to unlock stalled funding.
The IMF demands include the withdrawal of subsidies, a hike in energy prices, a market-based exchange rate and new taxation to generate extra revenue in a supplementary budget.
Islamabad says it has met the demands, but the IMF has yet to release the $1.1 billion funding stalled since November as part of the $6.5 billion Extended Fund Facility agreed in 2019.
The funding is critical for Pakistan to unlock other bilateral and multilateral financing.
Oil Updates — prices climb on crude draw, tight global supply
Updated 6 sec ago
Reuters
RIYADH: US oil futures jumped to their highest in more than a year on Thursday as a drop in crude stocks in the US added to worries over tight global supplies from output cuts by the Organization of the Petroleum Exporting Countries and its allies known as OPEC+, according to Reuters.
US West Texas Intermediate crude futures were up 85 cents at $94.53 a barrel by 9:49 a.m. Saudi time, after rising above $95 earlier in the session for the first time since August 2022.
Brent crude futures climbed 78 cents, or 0.8 percent, to $97.33 a barrel after hitting levels not seen since November.
“The oil market is quickly coming to terms with the fact that the OPEC+ cuts announced in the summer are having a deep effect on crude availability,” said Stefano Grasso, a senior portfolio manager at 8VantEdge in Singapore.
“Stocks are drawing while demand keeps growing. We are still far away from a price level causing demand destruction.”
US crude stocks fell by 2.2 million barrels last week to 416.3 million barrels, government data showed, far exceeding the 320,000-barrel drop analysts expected in a Reuters poll.
Crude stocks at the Cushing, Oklahoma, storage hub, delivery point for US crude futures, fell by 943,000 barrels in the week to less than 22 million barrels, the lowest since July 2022, data showed.
Stockpiles at Cushing have been falling to near historic lows due to strong refining and export demand, prompting concerns about quality of the remaining oil at the hub and whether it will fall below minimum operating levels.
The crude draws follow production cuts of 1.3 million barrels a day to the end of the year by Saudi Arabia, Russia, and other allies that make up the grouping known as OPEC+. The producers’ group will be meeting on Oct. 4 to review markets.
Grasso said: “I think Saudi can accept much higher prices, but not much lower, and if cutting 10 percent production gives them a 30 percent price increase it make sense to do.”
Meanwhile, President Vladimir Putin ordered his government to ensure retail fuel prices stabilize after a jump caused by an increase in exports.
In response, his deputy prime minister cited proposals to restrict exports of oil products purchased for domestic use, adding to market tightness.
“Though oil prices are eyeing the $100 a barrel mark for Brent, the narrative of higher-for-longer interest rates in the US might dampen enthusiasm and could put a lid on prices,” said Sugandha Sachdeva, executive director and chief strategist at Acme Investment Advisers.
Saudi Arabia’s overall unemployment rate drops to 4.9% in Q2
Updated 28 September 2023
ARAB NEWS
RIYADH: Saudi Arabia’s Vision 2030 has started paying dividends, with the Kingdom’s overall unemployment rate declining to 4.9 percent in the second quarter of this year, a dip of 0.2 percentage points compared to the previous three months, official data showed.
The report released by the General Authority for Statistics revealed that the unemployment rate among Saudi nationals reached 8.3 percent in the second quarter, slipping 0.2 pp compared to the first quarter of this year.
The GASTAT data further revealed that Saudi Arabia’s employment-to-population ratio decreased by 0.6 percentage points in the second quarter to hit 47.4 percent compared to the previous quarter.
Uzbekistan announces new charter from Madrid to Samarkand
Updated 27 September 2023
Nada Alturki
RIYADH: Uzbekistan, which is set to host the 25th General Assembly of the UN World Tourism Organization, has announced that it will be chartering a flight directly from Madrid to Samarkand, where the meeting will be held.
More than 100 countries, headed by their respective ministers, have confirmed their attendance for the meeting, which will take place from Oct. 16 - 20.
This was announced by Aziz Abduhakimov, Uzbekistan’s tourism and cultural heritage minister, during his presence at the World Tourism Day 2023 celebrations in Saudi Arabia’s capital, Riyadh.
Abduhakimov said: “Tourism today needs new products and skills, new approaches, and new destinations to drive the sector into a sustainable, prosperous and resilient future.
“Uzbekistan is actively embracing this need for tourism transformation and, as Conde Nast Traveler and Lonely Planet put it, Uzbekistan is one of those hidden tourist gems that await to be explored by visitors from all around the world.”
The General Assembly will host a Tourism Investment Forum, where green tourism investment opportunities will be discussed; an Education Forum, which will gather leading educational institutions in tourism; the Best Tourism Village Award; cultural nights; and the official opening of the UNWTO Tourism Academy.
“The landscape of (the) tourism sector is rapidly shifting, and in the context of the new challenges that the world is facing, from (the) COVID-19 pandemic to climate change, the need for collective action in transforming the sector towards sustainability, inclusion and social economic prosperity is essential,” Abduhakimov added.
In Riyadh, Abduhakimov visited the historic Diriyah, which is home to Turaif, a UNESCO World Heritage Site, along with Saudi Arabia’s Minister of Tourism Ahmed Al-Khateeb and Secretary-General of UNWTO Zurab Pololikashvili. He said he was impressed by the scale and architectural beauty of the project and was pleased to see the buzzing livelihood of the area.
He noted: “I also noticed some similarities in the way Saudi Arabia and Uzbekistan approach tourism development. This thought made me increasingly happy, as it shows that despite cultural, geographical and economic differences, we do share a common vision about tourism development. Some elements of the area reminded me of the Eternal City project located within the New Silk Road touristic center in the ancient city of Samarkand.”
Riyadh Air to use AI for green flight routes in fight against climate change
Updated 27 September 2023
Nadin Hassan
RIYADH: Saudi Arabia’s newest airline will use artificial intelligence to track the least carbon-emitting flight routes, according to its chief operating officer.
Speaking during a panel discussion at the UN World Tourism Day 2023, held from Sept. 27-28 in the Saudi capital, Riyadh Air’s Peter Bellew discussed how the company was putting sustainability concerns at the center of its development.
The airline, announced by Crown Prince Mohammed bin Salman in March, has ordered 72 Boeing 787s, described by the executive as “the most carbon efficient aircraft there is out there.”
He added: “We’re going to track in a unique way every single step and every part of our business (to see how) we can reduce our carbon emissions, how we can improve fuel usage, how we can use artificial intelligence to assist us and the optimal flight paths, flight routings, and all those things together.”
The national carrier acknowledges its advantage as a startup without legacy systems and emphasizes its commitment to sustainability.
The airline will also use IT systems to track each crew member’s carbon index, encouraging eco-friendly practices.
Additionally, they are exploring environmentally conscious systems at airports, including electric and hydrogen-powered ground equipment.
“This is going to be the center of the largest generation of green and blue hydrogen on planet Earth, and we’ll be able to take that through into our maintenance or repair our overhaul, and our engineering facilities,” Bellew said.
He mentioned the airline’s aim to use eco-friendly hydrogen energy by 2030, aligning the carrier with prospective sustainability principles.
“I hope that by 2030, they’ll all be powered by clean green hydrogen energy, and then you’ve got the whole Reduce, Reuse, Recycle (sustainability principles) that we can do with what’s on board the aircraft in terms of the management of the waste, to all our buildings and everything,” he added.
Overall, the airline sees these initiatives as an opportunity to lead by example and foster positive change in the industry.
Bellew stressed the advantages of being a new airline in today’s technology-driven era, considering it a remarkable opportunity to leverage the latest advancements in data utilization and AI.
Moreover, Ahmed Daoud, executive director of innovation at the Royal Commission for AlUla, mentioned that the city has developed a blueprint or a plan for involving entrepreneurs and startups in the region to focus on significant growth through environmentally conscious practices.
This model is “not only sustainable but regenerative and creates wealth and opportunities for local communities,” Daoud said.
He also added: “That also allows us to continue to invest in our local environments as well.”
Saudi Arabia has become the first country to back a call for $1 trillion in annual investment into the global startup ecosystem from G20 countries during the Startup20 engagement group’s summit in India this year.
Daoud outlined a strategic approach to leveraging a global entrepreneurial ecosystem to benefit a young tourist destination.
He said: “We create synergies between a broader global entrepreneurial ecosystem making investments directly now, not from a venture capital or corporate venture capital perspective, that’s not our position, but in terms of creating symbiotic relationships where we can compete as a nascent tourist destination, by leveraging these advanced solutions that are being developed on the S side of the SME spectrum.”
He further explained that this approach is being applied to local startups within Saudi Arabia, and there are plans to expand this model to include businesses from the global entrepreneurial ecosystem.
“We’re investing heavily in expanding that model to a global entrepreneurial ecosystem as well,” Daoud continued.
Riyadh Air's Chief Operating Officer Peter Bellew.
WTO is held under the theme “Tourism and Green Investments” to encourage global collaboration in exploring opportunities to strengthen the tourism industry’s resilience and push the sector toward an investment-led and environmentally conscious future.
During the two-day event, tourism CEOs will deliver keynote comments, while panel discussions will focus on three UNWTO essential themes: people, planet, and prosperity.
Participants will learn about the power of tourism and its role in integrating cultures, preserving the environment, and creating a more peaceful and connected world.
Saudi Arabia will hand over the chair to Georgia, who will host the event next year.
PIF-backed Lucid opens first international EV plant in Saudi Arabia
Updated 27 September 2023
Arab News
JEDDAH: Lucid Group, backed by the Public Investment Fund, on Wednesday opened its first international manufacturing facility in Saudi Arabia’s King Abdullah Economic City.
As Lucid’s second Advanced Manufacturing Plant, AMP-2, and first international plant, the facility will produce Lucid’s groundbreaking electric vehicles for Saudi Arabia and export to other markets.
Through the development of electric transportation, Lucid will support the Saudi Green Initiative’s imperative to ensure that 30 percent of new car sales in the Kingdom are electric by 2030.
“We are delighted to make history today in Saudi Arabia by opening the country’s first car manufacturing facility, which will produce our award-winning electric vehicles and support the country’s vision for a more sustainable and diversified economy,” said Peter Rawlinson, CEO and CTO, Lucid Group.
The AMP-2 facility received significant support from the Ministry of Investment, the Saudi Industrial Development Fund, and KAEC.
“As Saudi Arabia charges toward its Vision 2030, our facility will pave the way for the country’s electric automotive industry and the expansion of the supply chain, and with the support of the Saudi Government, we are proud to drive local talent development in the technology industry. We look forward to delivering Saudi-assembled cars to customers in Saudi Arabia and beyond.”
The AMP-2 facility has begun semi-knocked-down assembly and is expected to have an annual capacity of 5,000 cars. The initial operation re-assembles Lucid Air vehicle “kits” that are pre-manufactured at the company’s US AMP-1 Manufacturing Facility in Casa Grande, Arizona.
Lucid aims to transition AMP-2 to complete build unit production after the middle of the decade, with an additional annual capacity of 150,000 cars.
The plant’s strategic location near Jeddah will also act as a catalyst to further grow and expand the newly established domestic supply chain, creating demand for local suppliers and fostering long-term growth.
“Today is a proud moment for all of us at Lucid as we play a part in Saudi Arabia’s history and create long-term economic value for the country. Earlier this year, we were thrilled to introduce the first and most advanced electric vehicle, the Lucid Air, to the Saudi Arabia market,” said Faisal Sultan, vice president and managing director of Middle East, Lucid Group.
“The opening of our facility today marks the beginning of our production operations to assemble our world-class Lucid Air. AMP-2 in KAEC, in addition to our existing AMP-1 facility in Arizona, gives us the ability to efficiently fulfill the recently signed agreement with the government of Saudi Arabia to purchase up to 100,000 vehicles over a 10-year period, with an initial commitment to purchase 50,000 vehicles and an option to purchase up to an additional 50,000 vehicles over the same period.”
The facility opened at a high-profile event in the presence of PIF Gov. Yasir Al-Rumayyan.
