Issue  No. 205
17 December 2018

This report is designed to give you a snapshot about the MENA region tackling multiple issues:


       60.28 USD         1,238 USD


Economic Outlook
  • The Central Bank of Egypt (CBE) wants the World Bank (WB) and the International Monetary Fund (IMF) to include the country's informal sector in their gross domestic product (GDP) figures and other macro-indicators for Egypt. The CBE aims to quantify the informal sector and recognize it in the overall size of the GDP since it is accounted for about 40% to 50% of GDP.
  • The Central Bank of Egypt (CBE) issued on Sunday 15th of December Treasury bills worth 18 BN EGP in order to finance the budget deficit on behalf of the Ministry of Finance (MOF). The first tranche of the bills will be offered through 91-day notes at 9.5 BN EGP, while the second offering will be through 266-day notes at 8.5 BN EGP. Egypt aims to issue 409.6 BN EGP in T-bills and 101.6 BN EGP T-bonds in 2018/2019.
  • Ukrainian ambassador Hennadii Latii announced that the number of Ukrainian tourists visiting Egypt reached 773,000 from January to August 2018, and is expected to reach one million by the end of 2018 as Egypt is the second destination for the Ukrainian tourists. He added that the trade exchange with Egypt amounted to 2 BN USD, of which 1.9 BN USD was for the benefit of Ukraine, which exports wheat and many agricultural products while importing fruits worth 100 MM USD.
  • Saudi Arabia announced an agreement to create an entity of countries along with the Red Sea and Gulf of Aden. The entity will enhance security, investment and development for countries by the Red Sea. The Red Sea entity is an initiative by the King Salman in order to achieve stability in the region. The entity will include Egypt, Sudan, Djibouti, Yemen, Somalia and Jordan.
  • The Central Bank of the UAE (CBUAE) clarified that it is working with the Saudi Arabian Monetary Authority (SAMA) on a joint project which constitutes a Proof-of-Concept (PoC) for experimenting with Block chain technology to facilitate cross-border payments between the two countries. The PoC is still at an early stage and will help CBUAE gain a deeper understanding of the feasibility of distributed ledger technology in this field and explore the potential opportunities and benefits of a digital currency.
  • In Dubai, The Business Registration and Licensing (BRL) sector in the Department of Economic Development (DED) has issued 1,748 new licenses during November 2018, as Dubai remained a destination of choice for investment in diverse business sectors. Among the new licenses issued, 62.3% were commercial, 35.2% professional, 1.3% related to tourism, and 1.2% industry.
  • The Federal Tax Authority (FTA) announced that all preparations were completed to launch phase 2 of the Tax Refunds for Tourists Scheme. The scheme would cover 12 air, land and sea ports across UAE. The first phase went into effect on 18th November 2018, covering the Abu Dhabi, Dubai and Sharjah international airports. The 2nd phase will cover Al Ain International Airport, Al Maktoum International Airport and Ras Al Khaimah International Airport; as well as 2 sea ports: Zayed Port in Abu Dhabi and Port Rashid in Dubai; and 4 land ports: Al Ghuwaifat Border Post in Abu Dhabi, Hili Border Port and Al Madheef Border Crossing in Al Ain, and Dubai's Hatta Border Exit.
  • In Qatar, the Minister of Finance announced that the state budget for 2019 features a small increase in government spending and the first surplus in three years this was due to higher oil prices and a new tax. He added that Qatar is adopting a conservative approach in its budget amounting 206.7 BN QAR (56.8 BN USD) in 2019, up only 1.7% from the budget plan in 2018.
  • Qatar private sector grew by almost 6% in 2018. Qatar public sector institutions, including its sovereign wealth fund, had injected more 40 BN USD into Qatari banks during the initial months of its rift with Saudi Arabia and its allies to help the banking sector mitigate the impact of fund outflows.
  • Kuwait Credit growth improved in Q3-2018 despite seasonal softness, ending in September 2018 at 2.1%, supported by a rise in business and household lending, while credit to non-financial companies continued to decline. On the other hand, deposit growth eased to 4.9% in Q3-2018. As for interest rates, the Central Bank of Kuwait left its policy rate unchanged after the Fed's September 2018 rate hike but increased the repo rate by 25 bps.
Political Events

  • The Trump administration wants to see an increase in US investment and trade in Africa as part of a new strategy aimed at countering China growing influence on the continent. On the other hand, African countries will benefit from the increased investments by US companies and the projects that will create jobs and bring higher environmental and business standards.
  • Saudi Arabia has guaranteed a financial aid to Tunisia worth 830 MM USD. The Tunisian Prime Minister Youssef Chahed announced that 500 MM USD was expected to finance the budget, 230 MM USD to finance foreign trade and about 100 MM USD to finance projects. Tunisia is struggling to cut its budget deficit, stabilize falling foreign currency reserves and manage expectations of international lenders demanding reforms such as trimming the public wage bill.
  • Lebanese Prime Minister Saad Al-Hariri highlighted the potential for strong commercial and investment ties between Lebanon and Saudi Arabia. Al-Hariri have prepared many agreements that it will be signed with Saudi Arabia as soon as a government is formed. Al-Hariri has been struggling to form a national unity government in Beirut since elections in May 2018 produced an inconclusive result. He wants to prepare Lebanon as a platform for foreign companies to come and invest in and make Lebanon a hub for them to take advantage of reconstruction in Syria, Iraq and even Libya.
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Major Companies Transaction
  • The national Airline of Egypt, EGYPTAIR, and the largest Greek Airline, AEGEAN, both members of Star Alliance, announced the expansion of their code share agreement, offering EGYPTAIR customers more travel destinations in Europe and in return enhanced accessibility for AEGEAN customers to Egypt. Moreover, the two Star Alliance can enjoy the reciprocal frequent flyer benefits, including miles accumulation, redemption, lounge access and baggage check.
  • Egypt Hassan Allam Holding one of Egypt largest private companies specializing in engineering, procurement, construction, building materials and utilities aims to offer 30 to 35% of its shares on the country's stock exchange in H1-2019. The Initial Public Offering (IPO) will involve a capital increase and the sale of some of the company existing investors' shares, adding that it will be the biggest Egyptian IPO since end-2016. An IPO is a type of public offering in which shares of a company are sold to institutional investors and usually also individual investors.
  • Tanzania signed deals with the Egyptian company El Sewedy Electric Co and Arab Contractors to build a 3 BN USD worth hydroelectric plant in a UNESCO world heritage site, the project will more than double Tanzania power generation capacity. The hydro electric plant will have an installed capacity of 2,115 megawatts.
  • Saudi Venture Capital Company signed a Memorandum of Understanding (MoU) with American investor Tim Draper, one of the most important venture capital investors in the world under the sponsorship of the Small & Medium Enterprises General Authority (Monsha'at). The MoU aims to stipulate the establishment of a venture capital investment fund to finance SMEs in the fields of health, education, agriculture, finance, and energy.
  • The Saudi National Water Company (NWC) announced that it is currently setting up wastewater projects worth 72 MM SAR (18.9 MM USD) in investments. These projects are part of the state-run water utility's expansion plans that aim to raise the quality of water and environmental services in Jeddah. Since the beginning of 2018, NWC completed about 11 projects in Jeddah, providing services to 100,000 residents.
  • In Saudi Arabia, Sabic which is a global leader in the chemical industry has signed an MoU with UK-based Plastic Energy, a pioneer in chemical plastics recycling, for the supply of feed stock to support Sabic's petrochemical operations in Europe. Sabic and Plastic Energy intend to build a first commercial plant in the Netherlands to refine and upgrade a valuable feed stock, known as TACOIL, a patented Plastic Energy product, which will be produced from the recycling of low quality, mixed plastic waste otherwise destined for incineration or landfill.
  • In UAE, Emirates Global Aluminum (EGA), the largest industrial company in oil and gas, has announced that 75% of the construction work on its giant mining project in Guinea in West Africa has been completed. The project cost has a total budget of 1.4 BN USD and is being developed by EGA subsidiary Guinea Alumina Corporation (GAC). It is the largest greenfield investment in Guinea in the last four decades.
  • Emirates NBD, a leading bank in the Middle East region, announced the introduction of Traveler HD, an assistive technology designed to enhance the branch experience for customers with low vision. Emirates NBD branches in Dubai Festival City, Hamriya and Al Qusais will be the first to offer the high definition reader, being introduced as part of the bank's flagship advocacy platform #TogetherLimitless that supports financial inclusion of people with disabilities (people of determination) in the UAE.
  • Meraas Development Company and Dubai SME (the agency of the Department of the Economic Development (DED) in Dubai mandated to develop the small and medium enterprise (SME) sector) have signed a partnership to launch 'Al Seef SME District'. This district aims to shape Dubai into a competitive and diversified global startup hub that prioritizes innovation in line with the objectives of the UAE Vision 2021. The hub will showcase a variety of new businesses, from across the design, fashion, F&B and information technology industries.
  • Qatar Petroleum (QP) is looking to invest at least 20 BN USD in the United States over the coming few years, after unexpectedly quitting OPEC in December 2018. QP has decided to self-finance the expansion rather than borrowing which is a great strategic shift from previous practices where QP used to borrow up to 70% of its needs from banks. The company is still in talks with international oil companies for the new expansion project in the US. It currently pumps 4.8 million barrels of oil equivalent per day (boed) and aims to boost its output to 6.5 million boed in the next 8 years by expanding its upstream business abroad.
  • In Kuwait, Equate Petrochemical Co. had amended and extended 2.9 BN USD in bank debt split between a 1.9 BN USD term loan and a 1 BN USD revolving credit facility. The petrochemicals producer extended by two years its term loan to 2023 from the existing 2021 maturity, while the maturity of the revolving loan was extended to June 2022 from June 2020.
Sports and Culture
  • The BBC awarded Egypt footballer and Liverpool star Mohamed Salah the Best Player in Africa award for 2018 for the second year in a row. Salah is the first Arab player who garnered the BBC Best African Player award for two years in a row, and the second African player to garner the award for two consecutive years after Nigerian Jay-Jay Okocha in 2003 and 2004. He is the third Egyptian football player to garner the award after Mohamed Barakat in 2005 and Mohamed Aboutrika in 2008.
  • Sarah Essam, Egypt first female footballer in the English Premier League, was given in 2018 Best Arab Sports Award by the London Arab Foundation. At the age of 15, Essam joined Wadi Degla Club's junior football team before moving to the first club's women's team, becoming the youngest female football player in Egypt. By age 19, she had officially signed with Stoke City Ladies Club as a forward, making history as the first Egyptian to ever compete in the women's Premier League. She had also won three Football League Championships, in addition to winning the Africa Cup of Nations with the national team.
  • For the first time in the Middle East, the race of the formula E-Diriyah in Saudi Arabia will be the first international racing event held in Saudi Arabia. The event was about high-tech electric cars racing round a race track. The driver with the winner's trophy was Antonio Felix da Costa but the real winners were Saudi Arabia itself as more than 1,000 tourists visited the country for the first time. The three-day festival of motor sport, culture and entertainment was Saudi Arabia chance to prove that it can organize any event on the international level.
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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
Dubai Office:
Office No. N 415, North Tower, Emirates Financial Towers, DIFC, P.O Box 506726, Dubai, UAE.
Tel:  +97142820301

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