This report is designed to give you a snapshot about the MENA region tackling multiple issues:
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/USD
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/EUR
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EGP
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17.93
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21.05
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AED
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3.67
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4.31
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QAR
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3.64
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4.28
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SAR
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3.75
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4.41
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BHD
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0.38
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0.44
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OMR
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0.39
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0.45
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Economic Outlook
- The total foreign currency assets held by the Central Bank of the UAE (CBUAE) surged to 329.5 BN AED (89.7 BN USD) in August 2018 compared to 326.4 BN AED in April 2018. Current account balances increased and deposits with foreign banks strengthened to 260.8 BN AED in August 2018 compared to 255 BN AED in April 2018.
- Dubai attracted 21.66 BN USD worth of foreign direct investment in high-end technology transfers in three years to emerge as the top global destination for FDI in technology transfers like artificial intelligence and robotics.
- Expats remittances from the UAE amounted to 88 BN AED (24 BN USD) in H1-2018, a growth of 13.1% compared to 77.8 BN AED (24 BN USD) in H1-2017. Money sent by expats to home countries in Q1-2018 reached 43.5 BN AED, a growth of 17.3% compared to Q1-2017.
- Egypt Suez Canal revenues increased to 502.2 MM USD in August 2018 up 6.7% compared to August 2017. The canal is the fastest shipping route between Europe and Asia and one of the government main sources of foreign currency.
- Egypt exports of chemicals and fertilizers are expected to hit 6 BN USD by the end of 2018, with an anticipated growth exceeding 23%.The exports of the first five months of 2018 marked positive indicators, as they increased 26%, recording 2.1 BN USD from January to May 2018, compared to 1.7 BN USD during the same period of 2017.
- Egypt is likely to issue sukuk worth 1 BN USD within the next 18 months. Moreover, Egypt plans to sell around 5 BN USD in foreign currency bonds in October 2018.
- Egypt is planning to develop 208 hospitals with around 6.37 BN EGP in 2018/2019. Almost 31 projects will be completed prior to June 2019. The projects will include hospitals in Port Said and Baltim, in addition to El Odaisat Central Hospital in Luxor.
- State-controlled Saudi Electricity Co is set to issue 2 BN USD in sukuk, or Islamic bonds in order to partly refinance a 2.6 BN USD bridge the company raised in January 2018 for general corporate purposes and to back its capital expenditure program. The firm is considered as the main electricity producer in the kingdom with an 81.2% indirect government ownership.
- Saudi Arabia Shura Council, a top advisory council to the government, discusses the possibility of increasing Saudization in the private healthcare sector during the coming period. The implementation of nationalization in Saudi Arabia is expected to contribute to reducing the GCC nation unemployment rate.
- The GDP growth of Middle East countries is set to rebound in 2018 on the back of increased spending by governments and higher oil revenues. It is expected that the combined growth rate for countries across the Middle East (excluding North Africa) will reach 2.4% in 2018, up from 0.7% in 2017.
- China has maintained its position as Dubai largest trade partner in H1-2018 with a trade volume valued at 69 BN AED (18.8 BN USD). India was the emirate's second largest trade partner with a trade volume valued at 56 BN AED (15 BN USD), followed by the US with trade worth 39 BN AED. Meanwhile, Saudi Arabia was Dubai biggest trade partner in the Arab world and the GCC and it is the fourth largest global trade partner with trades worth 29 BN AED (7.9 BN USD).
- Qatar GDP growth is expected to reach 2.6% in 2018 compared to 1.6% in 2017, with non-hydrocarbon GDP growth forecasted at 5% in 2018 and 5.3% in 2019 compared to 3.8% in 2017.
- Kuwait Fund for Arab Economic Development (Kuwait Fund) has signed an agreement with the Jordanian government to schedule debts valued at 300.7 MM USD. This agreement aims at scheduling Jordan debts that have accumulated as a result of 17 loans. The debts will be paid off during a 40-year period with a grace period of 15 years at a 1% interest.
- In Kuwait, the Ministry of Commerce and Industry has asked the Central Bank of Kuwait (CBK) to inform local banks about the new conditions for holding raffle draws starting from Jan 1, 2019. They have agreed on several decisions, including the requirement for banks to provide the ministry with copies of contracts signed with external auditors responsible for the financial statements of customers, commitment to review accounts participating in the raffle, and affirm compliance with conditions for participation.
- Bahrain economy relies on oil for about 75% of revenues. Bahrain economy grew by 3.8% in 2017 but is set to slow to 2.6% in 2018 as the pace of investment in the country slows, before recovering to a forecasted 2.8% for both 2019 and 2020.
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Political Events
- To mark the country's 88th National Day, the Royal Embassy of Saudi Arabia in Seoul held a reception in the Shilla Hotel, in South Korea. Riyad Almubaraky, the Saudi ambassador, stated that ties with South Korea represented one of the most successful models of Saudi Arabia bilateral relations with nations around the globe. Riyadh and Seoul are working closely on nuclear safety and security, as the Kingdom has sent 41 nuclear experts to South Korea for training in the development nuclear plants based on System-integrated Modular Advanced Reactor (SMART) technology.
- Islamabad has invited Saudi Arabia to become the third partner in the Beijing-funded Belt and Road corridor of major infrastructure projects inside Pakistan. Beijing has pledged 60 BN USD to build power stations, major highways, new and upgraded railways and higher capacity ports, to help turn Pakistan into a major overland route linking western China to the world.
- Emirates National Oil Company (ENOC) has chartered at least one vessel to store jet fuel to ensure supply to airlines in Dubai as pending U.S. sanctions on Iran have cut off its access to feedstocks for producing the aviation fuel. ENOC has chartered the Suezmax-sized tankers Portman Square and NS Africa for 30 to 60 days with an option to store oil products. The company will store jet fuel on board at least one of the vessels, which can store about 100,000 tons of jet fuel.
- The UAE welcomed Imran Khan, the Prime Minister of the Islamic Republic of Pakistan. The visit came to strengthen the bonds of friendship between the two countries and to reflect the depth of the historical relationship since its establishment to the present day, a relationship that flourished to various partnerships, defined by the economic relations and trade exchanges over half a century.
- The UAE Cabinet announced that upon retirement, expatriates over the age of 55 will be granted a five-year retirement visa if they meet a set of clauses which include either having properties worth at least 2 MM AED, a minimum of 1 MM AED in savings or an active income of more than 20,000 AED per month. The law is said to come into effect starting next year.
- The ambassador of Japan in Egypt, Masaki Noke stated that the Japanese schools are a unique and successful project, enhancing cooperation between the two countries. Noke added that the Japanese International Cooperation Agency (JICA) dispatched Japanese teachers to Egypt to give Egyptian teachers courses on the Japanese education system. The Japanese system would develop the ability to think out of box and resolve problems.
- Egyptian President Abdel Fattah al-Sisi arrived in New York to participate in the 73rd session of the United Nations General Assembly. He will deliver Egypt statement to the General Assembly, which addresses the country's vision to enhance the United Nations as well as Egypt roles on regional and international developments, maintaining international peace and security and Egypt efforts in supporting the fight against international terrorism. Sisi will chair the high-level meeting for the Group of 77, which Egypt presides over this year for the third time in the group's history.
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Major Companies Transaction
- The European Bank for Reconstruction and Development (EBRD) aims to boost investments in Arab countries to 2.5 BN EUR (2.92 BN USD) at the end of 2018 from 2.2 BN EUR in 2017 invested in Morocco, Tunisia, Egypt and Jordan. Now they have Lebanon and Palestine added to their areas of operation last year. EBRD invests in public infrastructure and to help the private sector, especially small and medium-sized enterprises.
- Jeddah-based Islamic Development Bank (IsDB) has raised 1.3 BN USD in senior, unsecured sukuk. IsDB, a triple-A rated institution, is a regular issuer of international sukuk, or Islamic bonds, which it raises to fund its business activities and to promote the international sukuk market by building a liquid yield curve. The new transaction has a five-year maturity and a profit rate of 3.389%, corresponding to a spread of 32 basis points over mid-swaps.
- Deutsche Bank has appointed Mohammed Alajmi as general manager of Deutsche Bank Riyadh Branch in Saudi Arabia. The group expects to boost regional hiring this year, driven by expected corporate bond sales and initial public offerings.
- Dubai Land Department (DLD) has announced that its service centers across Dubai have served more than 39,000 investors, after helping them complete their investments with a total value of 131 BN AED during the period from January to 31st August 2018. The number of transactions provided in service centers during the period mentioned amounted to 42,000, distributed between 24,000 transactions for the transfer of ownership, and 18,000 that provided excellent services to investors.
- du, from Emirates Integrated Telecommunications Company (EITC), won the Smart Cities Award at the Telecoms World Middle East 2018 for its role in developing Dubai Pulse which is considered as the digital backbone of the city that offers the means of sharing data in order to be utilized by decision makers encouraging innovation.
- Qatar Islamic Bank (QIB), Qatar leading Islamic Bank, received two awards from New Age Banking & Finance Awards 2018, as part of the 7th edition New Age Banking Summit Qatar which was supported by Qatar Central Bank, and Qatar Financial Center Regulatory Authority (QFCRA). QIB was recognized through two awards, "Best Islamic Bank in Qatar" and "Excellence in Mobile Banking".
- In Qatar, Careem, one of the region leading ride-hailing app, has signed an agreement with Rehlat, one of the Middle East leading online travel apps. The partnership gives Rehlat customers access to Careem service directly from their app which will allow users to book rides from the airport in all the cities where Careem operates. It also offers special coupon codes to save up to 50% off on the next two rides to or from the airport.
- The success of Kuwait Oil Company (KOC) to produce 500 million cubic feet of Jurassic free natural gas and 175,000 barrels of light oil per day is considered a historic achievement of the company. This achievement was made through the completion of operating the three new plants for Jurassic production that locate at oil wells of East Raudhatain, West Raudhatain and Sabriya, north of the country.
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Sports and Culture
- Forbes Middle East has included 20 Egyptians in its 2018 ranking of the region's 100 most influential women, including 18 women in business, and another 2 heading government departments. Its shortlist, titled "Top 10 Women Heading Government Departments in 2018", featured Lobna Helal, Deputy Governor of Egypt Central Bank, in 3rd place, and Nevein Gamea, CEO of the Micro, Small & Medium Enterprise Development Agency (MSME), in 8th. Meanwhile, Egyptians in the 100 most influential businesswomen were led by Elham Mahfouz, CEO of the Commercial Bank of Kuwait in Egypt, who ranked 16th.
- Weam Al-Dakheel has become the first woman to anchor the main evening news bulletin on Saudi Arabia main national TV station. Al-Dakheel presented the news alongside Omar Al-Nashwan on Saudia TV channel. Saudis grabbed the chance to celebrate on Twitter with her achievement and the new milestone for Saudi women.
- Egypt Gouna Film Festival founder Naguib Sawiris announced that he will be naming a street in Gouna after Mohamed Salah, to show appreciation for the national football treasure and because successful achievements of Egyptian icons needed to be appreciated.
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Cairo Office:
Z
epter Office Building
S5-6 ,
Area 5, District 1, 5th Settlement,
New Cairo, Egypt.
P.O. Box:
1147
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Dubai Office:
Office No. N 415, North Tower, Emirates Financial Towers, DIFC, P.O Box 506726, Dubai, UAE.
Tel:
+97142820301
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