This occurs as the Kingdom keeps working to improve its ports and link up new marine routes in order to accomplish the objectives specified in the National Transport and Logistics Strategy.

According to Lloyd’s List, processing more than 10.43 million containers at its ports in 2022 will contribute to Saudi Arabia’s increase in international ranking, the Saudi Press Agency claimed.

The Minister of Transport and Logistics Services Saleh Al-Jasser said, “This qualitative progress of the Kingdom’s ports in handling the numbers of containers according to the Lloyd’s List report comes as a result of the continuous support and empowerment of His Highness the Crown Prince – may God protect him.

The Kingdom’s efforts to increase Saudi ports’ ability to handle more than 40 million standard containers yearly by 2030, he continued, are the cause of this.

The strategy also intends to boost the transport and logistics sector’s non-oil revenues to SR45 billion ($12 billion) annually by 2030, from its current contribution of 6% to the national gross domestic product in 2021.

The Kingdom has already made substantial progress toward reaching these goals by establishing six new logistical zones and nine new intercontinental shipping services in partnership with foreign and domestic businesses last year. These generated about SR4 billion in revenue.

Additionally, the Saudi Ports Authority, also known as Mawani, is responsible for programs that have helped Saudi Arabia’s investments in the industry reach almost SR17 billion, according to the SPA.

In a different ranking, the ports of the Kingdom climbed to the 16th spot in the Liner Shipping Connectivity Index of the UN Conference on Trade and Development in June.

Additionally, the Kingdom advanced significantly in the Logistics Performance Index of the World Bank, moving up 17 spots to claim the 38th spot in 2023.

When compared to its rankings of 55 in 2018 and 52 in 2016, this is a significant improvement.

Currently, Saudi Arabia has 97 maritime routes connecting to 348 ports all over the world.

The post Shipping success: Saudi Arabia climbs 8 places in Lloyd’s List global ranking appeared first on International Finance.

Tim Evershed

November 28, 2014: Takaful insurance can have a bright future in Europe due to its parallels with the mutual sector, according to panellists at International Finance Magazine’s EU Islamic Finance and Banking Summit that took place in London on November 18-19.

Non-marine mutual insurance can trace its roots in Europe back almost 1,000 years to Icelandic farmers who pooled their resources to provide protection. More recently, the sector grew exponentially during the Industrial Revolution, driven by the migration of people from rural to urban communities.

And despite a spate of de-mutualisations in the 1990s, the past decade has seen a revival of the model, partly in response to the financial crisis of 2008.

John Gilbert, Consultant, Hogan Lovells International, said: “Mutual insurers are takaful insurers that are already in existence; they are takaful in disguise. Now the Islamic finance industry is stepping away from that disguise.”

Past attempts to launch takaful insurance companies in Europe have foundered. In 2008, Principle Insurance Holdings raised £60mn from investors across the Middle East and Malaysia in order to launch Salaam Halal Insurance.

However, less than a year later, the company stopped accepting new business and was placed into “solvent run-off” after a rights issue failed to raise sufficient funding.

According to Faizal Karbani, Founder and CEO of Simply Sharia Ltd, this has left a gap in the market. “As a financial adviser in the Islamic space, I don’t have the protection products to sell to my clients. There is a great, great opportunity because this is very much needed because every human being has the need for financial protection.”

Historically, many Muslims have been put off the idea of insurance as it can be interpreted as a form of gambling when risk is sold for a fixed term. However, the panellists agreed that mutual insurers, friendly societies and P&I Clubs, with their technique of pooling risk, have the potential to serve the Islamic market.

Clive O’Connell, Partner, Goldberg Segalla Global said: “This is a business with products that can be very international. The problems that stand in the way of takaful can be resolved if one looks at it in a broader way.

“The biggest challenge to Takaful and to the mutual sector is Solvency II. Mutual insurers find it more difficult to comply with Solvency II than other forms of insurance.

“However, mutual insurance is something that everyone wants. After 2008, big anonymous banks and big anonymous insurers are no longer very attractive. The idea of pooling together to mutually insure each other is very positive for Muslims and non-Muslims alike. It is something we all have in common.”

The mutual sector in the UK is 9-10% of the market and growing; in Germany, it is 60% and in France 40%. Bilal Zafar, Senior Business Development Manager, Swiss Re, explained that one of the world’s biggest reinsurer is ready to support takaful insurers with sharia compliant reinsurance products.

He said: “In the takaful space, a lot of the groundwork needs to be done by our clients. So, we rely on our clients. They must have the expertise to run the business in the right way. What we provide is the financial backing and the guarantee that our business model will be sharia compliant. I think it is important for us to work with people bringing this business model to different parts of the world.

“In order to support our model we require a certain volume of business. Unfortunately, it has not taken off in Europe yet, but it is just a matter of time. From out perspective, we are waiting for that time to come. We have spoken to a lot of people in the UK and are looking for ways to support them and provide them with Retakaful backing. That is very important for insurance companies, particularly for start-ups.”

Related report:

Spike in interest rates could hamper Islamic finance

The post Market for takaful in Europe is looking brighter appeared first on International Finance.