The Saudi company “Aqua” is working to develop projects in renewable energy, electricity storage, and water desalination, at a time when the expansion of artificial intelligence and data centers is raising the demand for electricity, and increasing the importance of the reliability of supplies, operating efficiency, and its cost.
The CEO of Aqua in Saudi Arabia, Omar Al-Hassan, told Asharq Al-Awsat that the rapid growth in artificial intelligence and data centers is changing the requirements of the energy sector, as the challenge is no longer limited to providing larger quantities of electricity, but also includes ensuring the continuity of supplies, their efficiency, and their competitive cost.
He added that the company is working to develop projects that combine renewable energy, storage and solutions that enhance the reliability of supplies, benefiting from its experience in large-scale energy and water projects. Its total electricity generation capacity is 98.2 gigawatts, while the capacity of its water desalination portfolio reaches 9.7 million cubic meters per day.
Al-Hassan pointed out that Aqua is also working to take advantage of digital technologies and artificial intelligence to improve the performance of its assets, going beyond meeting the growing demand for electricity to developing more efficient and reliable solutions.
Electricity storage supports the expansion of renewable energy
With the expansion of solar and wind energy projects in Saudi Arabia, the importance of storing electricity increases to take advantage of the energy produced in times of abundance and provide it when demand rises, according to Al-Hassan, who expected that storage will play a growing role in the energy system, alongside generation sources and transportation networks.
In this context, in August 2026, ACWA signed three agreements with the Saudi Energy Procurement Company, as the main buyer, to develop projects to store electricity with batteries in “Hudn,” “Al-Muwayh,” and “Al-Kahfah,” with a total capacity of 1,500 megawatts, and a storage capacity of up to 6,000 megawatt hours, under 15-year agreements.
Al-Hassan said that these projects reflect the opportunities available in the Saudi market, and the importance of storage in supporting the expansion of renewable energy, expecting storage to become a more important part of planning new projects, according to the needs of the network, the requirements of each project, and its economic feasibility.
The Red Sea project combines generation and storage
In the Red Sea project, which combines solar energy and battery storage, the most prominent results, according to Al-Hassan, are proving the possibility of operating an integrated facilities system that relies on renewable energy and storage without connecting to the national electrical grid.
The project reached commercial operation in September 2026, and includes a solar power plant with a capacity of 340 megawatts and a battery storage system with a capacity of 1,227 megawatt hours.
Al-Hassan explained that the project highlights the importance of integrated planning from the beginning, so that generation and storage capabilities are designed to meet actual demand and ensure continuity of supplies. He added that the success of renewable energy projects does not depend on the generation capacity alone, but also on the integration of the system’s components and the efficiency of its operation, taking into account the different site needs, costs, and operating requirements.
Partnerships to develop water desalination technologies
In the water sector, Aqua sees opportunities to develop desalination by expanding the use of renewable energy and adopting more efficient technologies, which contributes to reducing energy consumption and production costs and meeting increasing demand.
The capacity of the company's water desalination portfolio is 9.7 million cubic meters per day, according to Al-Hassan, who pointed out the company's focus on improving the efficiency of plants, developing desalination technologies, and benefiting from renewable energy to reduce dependence on traditional energy sources, wherever technical and economic conditions allow for this.
In August 2026, Aqua signed a memorandum of understanding with Veolia to cooperate in developing desalination plant designs and equipment and improving their operational performance. It also signed a joint development agreement with PT Garam in Indonesia to establish a project that combines seawater desalination and industrial salt production, allowing the project’s infrastructure to be utilized to meet water needs and support industrial activities.
According to Al-Hassan, growth opportunities in the sector include increasing water production, improving the efficiency of existing plants, developing new technologies, and expanding partnerships that help provide water reliably and at a competitive cost.
The International Monetary Fund said that inflation expectations in sub-Saharan Africa have deteriorated since April, despite better-than-expected economic growth, warning that the region's hard-won economic gains remain fragile.
The Fund raised its growth forecast for the region in 2026 to 4.5 percent, compared to 4.3 percent in the April forecast, attributing this to adjustments in global supply chains and local reforms. However, this flexibility hides a deterioration in inflation prospects. The median inflation rate is expected to rise from 3.4 percent in 2025 to 4.3 percent in 2026, then to 5 percent in 2027. This represents a shift from April expectations, when the Fund expected price pressures to peak at 5 percent in 2026, before they begin to recede, according to Reuters.
“Monetary policy must remain data-driven, with a primary focus on ensuring that inflation is reduced to the target level,” Zine Zidane, Director of the International Monetary Fund’s African Department, told Reuters.
The IMF's report on the region, updated this week, noted that tightening monetary policy "may be necessary" in most countries, a tougher warning than when it described the situation in April as a "difficult budget process."
Interest payments currently account for about 12 percent of government revenues in the region as a whole. The yield on 10-year US Treasury bonds also rose from 4 percent in late February to 5.2 percent by the end of September, which led to an increase in borrowing costs, despite the narrowing of yield spreads on sovereign bonds.
Zidane added: “Despite the narrowing of yield spreads, the cost of borrowing may continue to rise.”
The Fund warned that delay in debt restructuring may hinder countries' access to financing from the Fund, exacerbate debt crises, and make the economic adjustment process more difficult. Although Ethiopia, Ghana, and Zambia have made progress in restructuring their debts, these processes have taken years. Zidane said that preparing a new restructuring guide and models for memorandums of understanding would speed up the processing of future cases, noting that the International Monetary Fund is also offering its “good offices” to improve the exchange of information between creditors and debtors.
The pressures are exacerbated by the widening gap between countries that export basic goods and those that import them. The current account surpluses of oil-exporting countries are expected to rise from 1.6 percent to 4.4 percent of GDP, while the deficit of economies that do not depend on natural resources will widen from 3.4 percent to 5.8 percent, in a sharper contrast than expected in April. Bilateral aid is also expected to decline by an additional 12 percent in 2026, after falling by about a quarter in 2025.
The El Niño phenomenon, which was not a major factor in the Fund's forecasts issued in April, emerged as one of the main risks. A simulation conducted by the Fund indicates that this climate phenomenon, which could disrupt the agricultural sector and exacerbate the risks of food insecurity, could reduce the growth rate by half a percentage point and raise inflation by 2.6 percentage points by 2027.
Zidane said: “The situation may deteriorate to a greater degree than our current expectations indicate,” stressing that the Fund is “ready” to provide emergency financing through its programs currently in place in 18 countries.
Japan intends to invest up to $21 billion to establish two semiconductor factories in the US state of New York, as part of a partnership with the US government, under which Global Foundries will operate the two facilities, in a move aimed at strengthening industrial cooperation between Tokyo and Washington, and securing electronic chip supply chains.
The project comes as part of a trade agreement concluded by the administration of US President Donald Trump with Japan last year, under which Tokyo pledged to invest $550 billion in the United States, in exchange for reducing US customs duties on Japanese cars and other imports from levels of no less than 25 percent to 15 percent.
Global Foundries announced the details of the project on Wednesday, while Japanese Trade Minister Ryusei Akazawa stressed on Thursday the importance of cooperation with the United States to expand semiconductor production and enhance the economic security of the two countries.
Construction of the first factory is scheduled to begin during the current year, with production starting in 2029, while the partners will decide before the end of 2028 whether to proceed with the construction of the second factory.
Upon completion of its operation, the first factory is expected to add a production capacity equivalent to about 900,000 silicon wafers with a diameter of 300 millimeters annually, becoming one of the largest facilities for the semiconductor industry in the United States, while providing more than a thousand industrial jobs in New York.
Japan will provide the entire investment capital for the project, while the US government and Japanese interests will share ownership, and Global Foundries will manage and operate.
The company's CEO, Tim Breen, said that the US government's share will rise from 3 percent to about 7 percent. Trump had announced that the value of this stake exceeds two billion dollars, after Washington provided the company with grants worth $1.63 billion.
The US President promised that converting government support into ownership in companies represents a way to achieve financial returns for the state from its industrial investments.
Global Foundries, which is headquartered in Malta, New York, is one of the prominent chip manufacturing companies, and the Emirati company Mubadala Investment Company owns a majority stake in it.
The company's shares rose by more than 4 percent during Wednesday's trading following the announcement, bringing its gains since the beginning of the year to more than 39 percent.
Brin revealed that the first expected customers for the manufacturers include the Japanese “Renesas Electronics” and the American “Apple”, which reflects the importance of the project in meeting the needs of the automotive, electronics and industrial systems sectors.
The company's management explained that the agreement would provide revenues from fees for a period of no less than 20 years, with the expectation of collecting about $50 million next year, in exchange for managing the construction work of the first factory.
In a parallel move, Global Foundries will redirect $955 million in US government funding previously allocated to it, to accelerate investment in silicon photonics technologies, silicon materials, germanium, and advanced chip packaging, within its existing facilities in New York and Vermont.
As for Japan, the potential gains extend to semiconductor equipment manufacturing companies, as Brin expected that part of Japanese investments would return to equipment suppliers, including Tokyo Electron, stressing the company’s interest in benefiting from Japanese technologies.
Tokyo had announced two batches of projects with a total value exceeding $100 billion, as part of the $550 billion investment program.
Under the agreement, Trump selects the projects that Japan finances, and the available free cash flows are divided equally between the two countries until a specific allocation level is reached, before the US share rises to 90 percent.
Akazawa rejected criticism that the initiative is considered economic submission to Washington, stressing that the projects are subject to careful bilateral reviews to ensure their financial feasibility and their ability to recover investments and achieve benefits for Japanese companies.
The project reflects the escalation of global competition to localize the chip industry and reduce dependence on limited production centers, especially in sectors related to advanced technology and economic security.
While the United States seeks to expand its manufacturing capabilities, Japan is betting on turning its foreign investments into opportunities for domestic equipment and technology companies.
Commitment to construction dates, controlling costs, and securing future demand for chips will be decisive factors in determining the economic returns of the project and the success of the industrial partnership between the two countries.
