Four new projects to focus on environment, culture, and wellness in Riyadh

As part of ongoing efforts to improve the lives of Saudi citizens and transform the city of Riyadh in KSA into one of the world’s most livable cities, the Custodian of the Two Holy Mosques King Salman launched on 19 March 2019 four projects worth SR86 billion.

HRH Crown Prince Mohammed bin Salman will head the committee overseeing the projects: King Salman Park, Riyadh Green, Sports Boulevard, and Riyadh Art.

The projects will complement Saudi Vision 2030’s Quality of Life Program, and are aligned with the UN Sustainable Development Goals, to create sustainable cities and communities, while driving urgent action against climate change.

The projects are expected to generate 70,000 new jobs for citizens in various sectors, and offer investment opportunities worth SR50 billion to local and foreign investors. Implementation will begin during 2H19.

King Salman Park

Source: King Salman Park website. The plan includes green areas and open spaces of more than 9.3 million sq m.

King Salman Park aims to contribute to changing and improving the lifestyle of all Riyadh residents. The park will be located at a strategic location in the heart of Riyadh, linked to six main roads and highways. It will include buildings and facilities such as: The Royal Art Complex, a national theatre, an opera house, art academies, museums and galleries, extensive green areas, open squares, sports compounds, and a golf course.

Sports Boulevard

Sports Boulevard aims to encourage citizens to follow a healthy lifestyle, exercise, and participate in different sports, particularly, walking, cycling, and horse riding. The boulevard will include 48 green and open space sites, event venues, show squares, outdoor museums, movie theatres, cycling and horseback riding tracks, jogging tracks, and sports and cultural centres.

Green Riyadh

Green Riyadh will lead to improved air quality, and reduced temperatures in Riyadh by increasing green space availability to 28 sq m per capita from the current 1.7 s m per capita. It aims to raise total green spaces by planting 7.5 million trees across the capital. All of the greening will be watered by recycled water from an irrigation network.

Riyadh Art

Riyadh Art will be the world’s largest government investment in public art. The project aims to engage artists and citizens from all around the world, as well as strengthen social values, improve civilised interaction, knowledge transfer, and creative cooperation. It will deliver more than 1,000 installation artworks and landmarks to be created by local and international artists, distributed in public spaces across the city of Riyadh. It will include cultural and art institutions such as museums and theatres.

Islamic Development Bank approves US$715 million in funding

Source: Islamic Development Bank Board Members at the 318th meeting convened in Madinah Al Munawarah, KSA.

Members of the Board of Executive Directors of the Islamic Development Bank, have approved the allocation of US$714.7 million in financing for new development projects in member countries.

Approved financing included:
US$328.5 million for the reconstruction of the Atyrau – Border of Russian Federation (Astrakhan) project in Kazakhstan; 
US$300 million for phase two of the Construction of Rural Housing project in Uzbekistan; and 
US$86 million for the Expansion and Development of the Port of Tripoli project in Lebanon. 

The Board Members were also informed of a US$270,000 technical assistance grant approved by the IsDB Group President, Dr Bandar Hajjar, for Oman aimed at increasing the export value of luban (Editor's note: frankincense) and dates.

Public-private partnerships are the way to go in socioeconomic development

Source: Islamic Development Bank. Participants at the event.

The Islamic Development Bank’s first Public-Private Partnership Forum has called for more public-private partnerships (PPP) to handle the challenges of socioeconomic development in the bank’s member countries.

Dr Bandar Hajjar, President of the Islamic Development Bank Group, said that the group is putting every resource available at the disposal of its 57 member countries so they can gain experience in building successful partnerships between the public and private sectors in every field, especially with the gap between the two in the funding they provide for these partnerships.

“We all know that laws and regulations alone are no guarantee for a successful partnership,” said Dr Hajjar. “Both parties must work hard to create successful, ties that actually work. Each one of the two sectors have multifaceted administrative, economic, judicial, legal, and social aspects that need to intertwine and hook up at just the right points, and all stakeholders must share a common understanding of the principles of transparency, disclosure, accountability, and equal rights, as well
as a clear determination of responsibilities for the efficient use of resources, boosting competitiveness, finding new sources of funding, expanding projects, creating new job opportunities, and solidifying economic stability in our member countries.”

At the forum, water desalination and housing came up as the two sectors set to see the strongest interest from PPPs, particularly in KSA's Kingdom Vision 2030. Challenges for PPPs that were identified included inadequate funding. Participants also stressed that these partnerships need support at the highest levels of government to succeed, as well as teams of specialists in place that are dedicated only to this model. Also, universally recognised procedures and contracts need to be adopted, so as to encourage funding and attract the global talent which will ultimately build capabilities and expertise in the private sectors of respective member states.

More than 300 government figures and private-sector business leaders from the member countries participated in the forum, set to be the first of many that are scheduled to be held successively in member states.

The IsDB launched the forums after the major changes witnessed in the economies of many of the bank’s member states, mostly due to weak oil prices, at a time of immense pressure for infrastructure projects to continue in member countries especially now that the traditional model of the government-funded infrastructure projects has proven to be inadequate, with the huge disparities between national budgets and the funds actually needed to keep projects on track.

Islamic Development Bank finalises funding for new development projects in Middle East

The Board of Executive Directors of the Jeddah-based Islamic Development Bank (IsDB), in its 316th meeting, has approved funding of US$863 million for new financing development projects in a number of member countries, including the UAE, Bahrain, and Jordan. 

Financing approvals for the Middle East included: 

- US$170 million for the “non-sovereign project financing participation in the Dewa 800 MW Photo-voltaic Solar Power Plant – Phase III” in Dubai, UAE

- US$105 million for the “aluminum Bahrain BSC (Alba) 1,350 MW Power Plant (PS5) under Line 6 expansion project” in Bahrain 

- US$5 million for the “solar power plant – King Hussein Cancer Center expansion project” in Jordan 

The meeting also approved to a number of programmes, including a proposed three-year action plan (from 2017 to 2019) totalling US$16 billion. It further approved a US$5.2 billion budget for the new fiscal year 2017 and reviewed the major components of the IsDB President’s programme for the next five years. 

Ministry of Hajj reveals long-term initiatives to accommodate more pilgrims

Source: Ministry of Hajj, KSA.

Saudi Arabia expects to host many more pilgrims than over the next five years and is preparing to make the umrah and Hajj experiences as smooth as possible, revealed His Highness Dr Bandar ibn Muhammad Hajjar, the Minister of Hajj of Saudi Arabia. According to Dr Bandar, an estimated 8 million umrah pilgrims and 3 million Hajj pilgrims will visit this year, and the numbers will grow over the next five years.

Dr Bandar reported that the umrah and Hajj experiences are being enhanced on many fronts, including e-tracking for foreign pilgrims, crowd control (tafwij) during all stages of the Hajj journey, accommodation, health services, transportation, communications services, and project management. Other initiatives include the welcome and farewell ceremonies for umrah pilgrims, development of a Pilgrim City in Yanbu, and operating rest-houses along the Makkah-Madinah road.

The Ministry of Hajj is conducting studies on accommodating more pilgrims, including estimating water and electricity requirements, health, and transportation services, Dr Bandar said. The studies also cover the housing capacities in Makkah and Madinah, estimating local movement, and the accommodation of large numbers at the Mataf* (tawaf area), Mas`a** (sa`y area) and Al-Haramain Al-Sharifain***.

His Highness Dr Bandar further noted that the state has made the development of Al-Haramayn Al-Sharifayn and care of its visitors a top priority. Recent achievements to this purpose include the expansions of Al-Haramain Al-Sharifain, the Mas`a and the Mataf areas have all been expanded; established a Jamaraat**** facility, railway services in Mashair and Al-Haramain Al-Sharifain; built the King Abdul Aziz International Airport in Jeddah and the Prince Mohammad bin Abdul Aziz International Airport in Madinah, and also opened a Pilgrims Rest Hall with a 2,400-man capacity. 

*The mataf is the area where pilgrims circumambulate the Ka'abah as part of the ritual called the tawaf

**The Sa'y area is where pilgrims go seven times between the hills of As-Safa and Al Marwah

***Referring to the two holy cities of Makkah and Madinah

****A ritual where pebbles are thrown at pillars called jamaraat occurs as part of the pilgrimage

Islamic Development Bank launches private equity infrastructure fund

The Islamic Development Bank's Board of Directors led by His Excellency Dr Ahmad Mohamed Ali, President of the Islamic Development Bank (IDB) Group, announcing the launch of the US$2 billion Islamic Development Bank Infrastructure Fund II (the IDB Fund II), on the occasion of the 40th anniversary of the IDB on 26 June.

The US$2 billion Islamic Development Bank Infrastructure Fund II (the IDB Fund II), the largest private equity infrastructure fund dedicated to the 57 member countries of the IDB, has been launched in conjunction with the 40th anniversary of the IDB.

The IDB Fund II is the successor to the US$730 million IDB Infrastructure Fund I (the IDB Fund I), also supported by the founding investors, which achieved an IRR of 18% and an investment multiple of 1.7 times across signature projects such as AirAsia in Malaysia, Saudi International Petrochemical Company (SIPCHEM) in Saudi Arabia and AES Oasis with power assets in Pakistan, Oman and Jordan.

The new fund is supported by the Public Pension Agency of the Kingdom of Saudi Arabia, the Public Investment Fund of the Kingdom of Saudi Arabia, the Ministry of Finance of the Kingdom of Bahrain and the Ministry of Finance of the Sultanate of Brunei Darussalam as founding investors, with aggregate commitments totalling US$750 million for the first closing.

His Excellency Dr Ahmad Mohamed Ali, President of the Islamic Development Bank (IDB) Group, said: "Building on the successful track record of IDB Fund I, the IDB and founding investors are nearly tripling the size of the IDB Fund II to US$2 billion. The fund will mobilise up to US$24 billion of aggregate financing to support the development of key infrastructure projects in IDB member countries."

IDB and the founding investors have established ASMA Capital Partners, based in the Kingdom of Bahrain, as a multi-fund asset management platform to manage the IDB Fund II. The Chairman of ASMA Capital is the President of the IDB Group, and the Vice Chairman is H.E. Mohammed Al-Kharashi, the Governor of the Public Pension Agency of the Kingdom of Saudi Arabia, H.E. Dato Paduka Haji Bahrin bin Abdullah, Deputy Minister of Finance of the Sultanate of Brunei Darussalam.

The other Board Members are Abdulla Ebrahim Al Ayadhi, Assistant Secretary General of the Public Investment Fund of the Kingdom of Saudi Arabia and Sami Mohammed Humaid, Director of Foreign Economic Relations of the Ministry of Finance of the Kingdom of Bahrain. The management team is led by the CEO of ASMA Capital, Mumtaz Khan, who previously managed the IDB Fund I.

H.E. Mohammed Al-Kharashi said, "ASMA Capital is expected to play a significant role in assisting pension funds and other global investors seeking to deploy capital into infrastructure projects in select emerging markets for portfolio diversification and stable return."

The IDB Fund II will have a broad sectorial focus beyond the core infrastructure sectors of power, telecommunications, and transportation. It will include investments in oil and gas, refinery and petrochemicals, steel and aluminum, mining, logistics and an allocation for healthcare, education, and financial services.

Mumtaz Khan said, "The IDB Fund II is a unique platform combining the strength of IDB and other founding investors with an experienced management team to identify and develop investment opportunities across multiple regions."

A final closing with additional investors is targeted for early 2015.