Business

Saudi business confidence hits two-year high as boom in non-oil sector continues

Confidence among businesses in Saudi Arabia’s non-oil sector rose to a two-year high in January, as firms reported strong new order growth and started to see improvements in supply chains and softening inflation.

New order growth rose compared to December and was the sec-ond highest level in the past 16 months, according to a survey of purchasing managers compiled by S&P Global. Foreign demand also increased rapidly and to a greater degree than at the end of 2022.

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The Riyad Bank Saudi PMI rose to 58.2 from 56.9 in December, well above the 50-mark separating growth from contraction. Last month’s figure was the second-highest recorded since September 2021 after November’s more than seven-year high.

It’s the latest sign that last year’s economic boom is continuing even as oil prices fall from recent highs. Overall growth was an es-timated 8.7 percent last year, Saudi official projections showed, making it the fastest growing major economy.

The positive sentiment was “driven by the ongoing improvement in the business environment, private-sector employment, and in-creased foreign investment with governance and labor market re-form,” said Naif al-Ghaith, chief economist at Riyad Bank.

The Kingdom’s non-oil economy, the engine of job creation, grew an annual 6.2 percent during the fourth quarter of last year, the highest level in more than a year.

“Saudi Arabia is continuing its strong performance and outper-formed the global economic trends for activity and demand,” al-Ghaith said.

The world’s largest oil exporter has so far been mostly shielded from global economic woes as high crude prices are putting the government on track to record a second year of budget surplus.

That’s helping the government accelerate investments in new in-dustries intended to wean it off a reliance on oil sales.

The rise in output prices was the softest in nearly a year, despite the growth in new orders, the report showed. Job creation slowed from December’s near five-year high.

Business

Credit Suisse managers could face disciplinary action, Swiss regulator says

Swiss financial regulator FINMA said it was considering whether to take disciplinary action against Credit Suisse managers after Switzerland’s second largest bank had to be rescued last week by UBS.
FINMA President Marlene Amstad told Swiss newspaper NZZ am Sonntag it was “still open” whether new proceedings would be started, but the regulator’s main focus was on “the transitional phase of integration” and “preserving financial stability.”

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UBS agreed to buy Credit Suisse for 3 billion Swiss francs ($3.26 billion) in stock a week ago and to assume up to 5 billion francs in losses in a merger engineered by Swiss authorities during a period of market turmoil in global banking.
Credit Suisse on Sunday declined to comment on the FINMA President’s comments when asked by Reuters for a response.
Asked whether FINMA is looking into holding current Credit Suisse managers accountable for the collapse of Switzerland’s second-largest bank, Amstad said it is “exploring the options”.
“CS had a cultural problem that translated into a lack of responsi-bilities,” Amstad was quoted as saying by NZZ, adding: “Numerous mistakes were made over several years”.
FINMA had conducted six public “enforcement proceedings” against Credit Suisse in recent years, Amstad said.
“We have intervened and used our strongest instruments,” she said of its previous moves.
Amstad also defended Switzerland’s decision to write down 16 billion Swiss francs of Credit Suisse Additional Tier 1 (AT1) debt, to zero as part of the forced rescue merger.
“The AT1 instruments contractually provide that they will be fully written off in the event of a trigger event, in particular the granting of extraordinary government support,” Amstad said.
“The bonds were created precisely for such situations.”

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Business

Aramco affirms support for China’s energy security

Saudi Arabian oil giant Aramco affirmed on Sunday its support for China’s long-term energy security and development, the company’s CEO Amin Nasser said in remarks made before a forum in Beijing.

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Nasser said that the company has partnerships and emission-reducing technologies with China to make lower carbon products.

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Business

Kuwait Oil Co dealing with ‘limited fire’ at well where oil leak occurred last week

Kuwait Oil Company said on Sunday it is dealing with a “limited fire” that erupted at a well where oil leaked last week.
The company said in a statement that no injuries had been reported at the scene.
“The company’s operations in the area have not been affected,” the statement read.
Kuwait Oil Company declared a state of emergency last Monday due to an oil leak in the west of the country.

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