Partial curfew lift will revive business activity, say experts
Kingdom’s stock exchange reacted positively to the decree to climb 3.54 percent
FASTFACT
Experts have welcomed a royal decree to partially lift the coronavirus curfew across Saudi Arabia, saying it will revive business activity and increase consumption.
The decree means the curfew is off from 9 a.m to 5 p.m. from April 26 to May 13.
Saudi Arabia’s main stock exchange reacted positively to the decree to climb 3.54 percent, the most since March 10. Seven companies reached the daily limit of 10 percent, 194 companies closed up and only one company closed down.
Bandar Alkhorayef, of industry and minister mineral resources, thanked in a tweet the country’s leadership for taking the decision.
“We ask all entities in the industry sector to comply with the preventive measures mentioned in the royal decree,” he added. Construction companies and factories are allowed to resume their activities without restrictions on time, according to the nature of their business, the state news agency, SPA reported.
Wholesale and retail trade stores, as well as commercial centers and malls, are also reopening. Places that will stay shut are those that do not achieve physical distance, including beauty salons, sports and health clubs, cinemas, restaurants and cafes.
Mazen Alsudairi, the head of research at Al Rajhi Capital, said the decision would increase the scale of economic consumption and that this uptick would benefit sectors that had been hit hard by the curfew.
“Consumption will improve, grocery retailers will continue maintaining the lead (with revenue). Other companies will also be relieved from (having) low or zero revenues such as mall retailers and retailers that were forced to switch to e-commerce,” he told Arab News.
Alsudairi said that other sectors such as construction would already be under pressure with Ramadan, which usually witnesses a slowdown of construction activities, such industries were unlikely to benefit from the decision, he added.
He said he expected only a slight improvement in revenues for the manufacturing sector, especially those producing constructionrelated goods.
“In general, this is a period for the government to assess the impact of the decision to partially lift the curfew and the capability to move further, to release or loosen the restrictions further or maintain them.”
Jamal Banoon, economist and journalist writer, said the measures would speed up the country’s recovery.
“These measures will speed up the recovery of the Saudi economy and compensate the Kingdom for the losses incurred during the last two months, especially the SMEs and MSMEs that were really hit by the pandemic,” he told Arab News. “Most of the shops are going to give offers and discounts to shoppers to encourage them to come back to the malls and to whet the customers’ appetite for buying.”
He said the weeks leading up to May 13 would be a test to see if the market dealt with the partial curfew lift well by forcing people to take the appropriate preventive measure and apply the rules of social distancing. “This will facilitate our return to normal life in the period after,” he added.
Most of the shops are going to give offers and discounts to shoppers to encourage them to come back to the malls.