Latest news with #HinaShoeb
Zawya
24-04-2025
- Business
- Zawya
Saudi Arabia doubles down on mining, says report
Saudi Arabia's long-term economic growth will increasingly rely on the metals and mining sector, says an S&P Global report. This development is in line with the Vision 2030 programme, which aims to reduce the country's oil dependency, it says. "Saudi Arabia's proactive measures and substantial resources may help offset continued cost pressures and support the resilience of metals and mining companies' credit profiles," S&P Global Ratings credit analyst Hina Shoeb says. Unlike some global peers, Saudi metals and mining companies benefit from strong government support, new regulatory frameworks--such as the Mining Investment Law--and significant government-led capital investments in mega projects and domestic infrastructure, the report says. "We expect these initiatives will spur domestic demand for metals, reduce import dependency, and over time improve the sector's operational efficiency. They will also support the domestic metals and mining sector's capacity to meet rising global demand, notably for base metals and minerals," the report continues. Yet the sector suffers from strict regulations, harsh operating and environmental conditions, insufficient infrastructure, global commodity price fluctuations, and stiff competition, it notes. The mining sector currently accounts for about 1.5% of Saudi Arabia's GDP. The Saudi government aims to increase mining companies' GDP contribution to $75 billion by 2030, from approximately $17 billion in 2024, it says. The country boasts large reserves of metals and minerals that the world needs in large quantity in the future. Base metals--including copper, nickel, and lithium--are critical for the energy transition, while minerals, for example phosphate fertilisers, are essential for food safety. Saudi Arabia's internal industrial growth is central to this transformation. "We expect that sustained momentum in Vision 2030 investments and associated activity in construction, logistics, domestic manufacturing, and mining will lead to an average headline GDP growth of about 4% over 2025-2028," the report says. The Saudi government aims to invest $40 billion annually in local giga and mega projects via the Public Investment Fund (PIF). As investments in infrastructure and manufacturing rise, local demand for metals will increase substantially, it says. Government initiatives, such as the investment of close to SAR29 billion ($7.7 billion) in the Wa'ad Al-Shamal project, with a focus on phosphates and a $100 billion funding plan targeting critical minerals by 2035, intend to reduce import dependency and stimulate domestic production. These funding measures are critical to support Saudi Arabia's internal growth and, with that, its economic diversification. Industrial growth could fuel domestic demand Domestic industrial expansion is key to increase the local demand for metals. Giga projects--such as Neom, Red Sea, Qiddiya, Roshn, and Diriyah, among others--can transform Saudi Arabia's urban landscapes and boost the demand for construction materials and high-value metals. For example, Neom's integrated industrial clusters and Qiddiya's focus on sectors such as entertainment, travel and tourism, utilities, hospitality, and transportation are projected to ramp up the local consumption of steel, aluminum, and copper. These projects, which benefit from funding and infrastructure investments, aim to reduce the country's import costs for metals (including iron, steel, precious and semi-stones), by creating a solid domestic market for metals and minerals. Import costs stood at about $20 billion- $24 billion for 2024 as per the General Authority for Statistics (GASTAT). Saudi Arabia's metals and mining sector also benefits from the country's geographic position, with access to important markets in Europe, Asia, and Africa representing a competitive advantage. Still, the large scale development of the sector hinges on the implementation of clear and predictable regulations, notably on openness in international contracts, or ease for foreign investors to partner with local companies and government entities to gain access to resources, expertise, and market knowledge. Untapped reserves spell opportunity Saudi Arabia possesses vast, yet underexploited, mining and mineral resources. Current estimates value these reserves at approximately SAR9.375 trillion ($2.5 trillion), marking a 90% increase from the valuation of SAR5 trillion ($1.3 trillion) in 2016. This upward revision incorporates newly discovered rare earth elements and transitional metals, along with significant increases in phosphate ore, copper, zinc, and gold reserves. Saudi Arabia's Western Region--dominated by the Arabian Shield, the Red Sea coastal plain, and volcanic fields--hosts most of the country's mines, while the northern area is rich in phosphate deposits. These geological advantages provide a solid foundation for future exploration and production activities. - Copyright 2024 Al Hilal Publishing and Marketing Group Provided by SyndiGate Media Inc. (
Arab News
24-04-2025
- Business
- Arab News
Saudi Arabia ramps up mining investment as sector outpaces global peers
RIYADH: Saudi Arabia's mining sector is emerging as a global standout, supported by regulatory reforms, major investment, and a strong pipeline of domestic projects, a new analysis said. In a report titled 'Saudi Arabia Doubles Down on Mining,' S&P Global Ratings said the sector is poised for rapid expansion, with its contribution to gross domestic product expected to surge from $17 billion in 2024 to $75 billion by 2030, under the government's Vision 2030 strategy. Saudi Arabia's mining ambitions are anchored in its substantial natural endowments and reinforced by robust government support. The country holds an estimated SR9.37 trillion ($2.5 trillion) in mineral reserves — a 90 percent increase on a 2016 forecast — thanks to new discoveries of rare earth elements, base metals, and expanded phosphate and gold deposits. Hina Shoeb, credit analyst at S&P Global Ratings, said: 'Saudi Arabia's proactive measures and substantial resources may help offset continued cost pressures and support the resilience of metals and mining companies' credit profiles.' The agency noted that unlike many global peers, Saudi Arabia's metals and mining companies benefit from strong government support, a modern regulatory framework — including the Mining Investment Law — and substantial state-led investment in mega projects and infrastructure. The number of exploitation licenses has increased by 138 percent since 2021, and exploration permits rose from 58 to 259, driven by the law's transparency and investor-friendly policies. Flagship state-owned enterprise Ma'aden reported SR32 billion in 2024 revenues, with a diversified portfolio spanning gold, phosphate, aluminum, and base metals. Its gold output alone reached 450,000 ounces, while phosphate production surpassed 6.5 million tonnes. The number of exploration firms has grown from just six in 2020 to 133 in 2023. 'As budgets continue to increase, the likelihood of discovering additional resources and expanding existing operations supports our view of sustainable, long-term growth of Saudi Arabia's metals and mining industry,' the report said. The Vision 2030 framework has driven a shift away from oil dependency, focusing instead on sectors like mining, tourism, and manufacturing. The mining sector alone contributed about $400 million in revenues as of 2023 and is now backed by a $100 billion investment plan targeting critical minerals by 2035. Government funding also includes a SR29 billion commitment to the Wa'ad Al-Shamal phosphate project. Saudi Arabia's geography offers logistical advantages with access to European, Asian, and African markets, while mega projects such as NEOM and Qiddiya are expected to drive up local demand for construction materials and high-value metals. These projects, the report stated, 'which benefit from funding and infrastructure investments, aim to reduce the country's import costs for metals, including iron, steel, precious and semi-stones, by creating a solid domestic market for metals and minerals.' However, the report also notes infrastructure and labor as potential bottlenecks. Many deposits are in remote desert regions lacking adequate transportation and water infrastructure. Additionally, the sector's expansion will require substantial investments in workforce training to avoid high labor costs from foreign recruitment. S&P states that Saudi Arabia's commitment to financial discipline, low debt levels in the sector, and targeted policy support position the Kingdom's mining industry to grow sustainably — even amid volatile commodity markets. 'We expect these initiatives will spur domestic demand for metals, reduce import dependency, and over time improve the sector's operational efficiency,' S&P added.
Trade Arabia
24-04-2025
- Business
- Trade Arabia
Saudi Arabia doubles down on mining, says report
Saudi Arabia's long-term economic growth will increasingly rely on the metals and mining sector, says an S&P Global report. This development is in line with the Vision 2030 programme, which aims to reduce the country's oil dependency, it says. "Saudi Arabia's proactive measures and substantial resources may help offset continued cost pressures and support the resilience of metals and mining companies' credit profiles," S&P Global Ratings credit analyst Hina Shoeb says. Unlike some global peers, Saudi metals and mining companies benefit from strong government support, new regulatory frameworks--such as the Mining Investment Law--and significant government-led capital investments in mega projects and domestic infrastructure, the report says. "We expect these initiatives will spur domestic demand for metals, reduce import dependency, and over time improve the sector's operational efficiency. They will also support the domestic metals and mining sector's capacity to meet rising global demand, notably for base metals and minerals," the report continues. Yet the sector suffers from strict regulations, harsh operating and environmental conditions, insufficient infrastructure, global commodity price fluctuations, and stiff competition, it notes. The mining sector currently accounts for about 1.5% of Saudi Arabia's GDP. The Saudi government aims to increase mining companies' GDP contribution to $75 billion by 2030, from approximately $17 billion in 2024, it says. The country boasts large reserves of metals and minerals that the world needs in large quantity in the future. Base metals--including copper, nickel, and lithium--are critical for the energy transition, while minerals, for example phosphate fertilisers, are essential for food safety. Saudi Arabia's internal industrial growth is central to this transformation. "We expect that sustained momentum in Vision 2030 investments and associated activity in construction, logistics, domestic manufacturing, and mining will lead to an average headline GDP growth of about 4% over 2025-2028," the report says. The Saudi government aims to invest $40 billion annually in local giga and mega projects via the Public Investment Fund (PIF). As investments in infrastructure and manufacturing rise, local demand for metals will increase substantially, it says. Government initiatives, such as the investment of close to SAR29 billion ($7.7 billion) in the Wa'ad Al-Shamal project, with a focus on phosphates and a $100 billion funding plan targeting critical minerals by 2035, intend to reduce import dependency and stimulate domestic production. These funding measures are critical to support Saudi Arabia's internal growth and, with that, its economic diversification. Industrial growth could fuel domestic demand Domestic industrial expansion is key to increase the local demand for metals. Giga projects--such as Neom, Red Sea, Qiddiya, Roshn, and Diriyah, among others--can transform Saudi Arabia's urban landscapes and boost the demand for construction materials and high-value metals. For example, Neom's integrated industrial clusters and Qiddiya's focus on sectors such as entertainment, travel and tourism, utilities, hospitality, and transportation are projected to ramp up the local consumption of steel, aluminum, and copper. These projects, which benefit from funding and infrastructure investments, aim to reduce the country's import costs for metals (including iron, steel, precious and semi-stones), by creating a solid domestic market for metals and minerals. Import costs stood at about $20 billion- $24 billion for 2024 as per the General Authority for Statistics (GASTAT). Saudi Arabia's metals and mining sector also benefits from the country's geographic position, with access to important markets in Europe, Asia, and Africa representing a competitive advantage. Still, the large scale development of the sector hinges on the implementation of clear and predictable regulations, notably on openness in international contracts, or ease for foreign investors to partner with local companies and government entities to gain access to resources, expertise, and market knowledge. Untapped reserves spell opportunity Saudi Arabia possesses vast, yet underexploited, mining and mineral resources. Current estimates value these reserves at approximately SAR9.375 trillion ($2.5 trillion), marking a 90% increase from the valuation of SAR5 trillion ($1.3 trillion) in 2016. This upward revision incorporates newly discovered rare earth elements and transitional metals, along with significant increases in phosphate ore, copper, zinc, and gold reserves. Saudi Arabia's Western Region--dominated by the Arabian Shield, the Red Sea coastal plain, and volcanic fields--hosts most of the country's mines, while the northern area is rich in phosphate deposits. These geological advantages provide a solid foundation for future exploration and production activities.
