3rd March 2019
Global Developments Bottomline: March is going to be a crucial month – need to wait and watch if the latest set of weak economic data released across the globe, dampened by the lack of a China-US deal, will change in the coming weeks; another upcoming deadline this month is Brexit. Reading the US GDP data alongside other macro indicators point towards the unsustainable push from the tax cuts whereas India’s weaker-than-expected GDP number might be used to justify rate cuts ahead of the elections. On the horizon also are policy statements/decisions from key central banks including the ECB and the announcements from China’s National People’s Congress.
- Bahrain approved a draft budget for 2019-2020, and plans to reduce the deficit down to USD 1.63bn by 2020. According to the plan, operational expenditure will be reduced by 17% yoy.
- Bahrain’s cabinet approved hikes in fees imposed on foreign labour licenses under a job nationalisation programme to BHD 500 from BHD 200 currently.
- Bahrain’s central bank has become the first in the region to issue rules on regulating crypto assets. Currently, 8 of the 28 companies in the CBB regulatory sandbox are crypto-related.
- Bahrain is the most cost-effective place to set up and conduct a business in the financial services sector, according to KPMG.
- Fitch affirmed Bahrain’s Long-Term Foreign-Currency Issuer Default Rating at “BB-” with a stable outlook.
- Egypt is finalising an SME draft law (including definitions of SMEs, provision of a single-window system, tax incentives & training programs) and expects to present to the parliament this week.
- According to Egypt’s energy minister, Saudi Aramco agreed to deliver more than 500k barrels of crude oil every month to Egyptian refineries for a 6-month period till Jun.
- Egypt and Lebanon have discussed the possibility of providing the latter with LNG, to fix the electricity sector. This is in line with the current gas exports to Jordan to meet its electricity needs – the amount was increased to 350m cubic feet per day (scf/day) from 100m scf/day in Jan.
- Crude oil exports from Iraq’s southern ports stood at 3.565mn barrels per day (bpd) as of 25 Feb, and compares to 3.556mn bpd in Jan and Dec’s record high of 3.63mn bpd.
- Several commitments were announced to support Jordan’s economy and attract foreign investment (at the London conference) including: UK stated it would underwrite a USD 250mn World Bank loan; France’s would provide funds to the tune of USD 1bn over the period of 2019-2022; a EUR 65mn agreement was signed with the European Investment Bank to fund projects aimed at improving potable water services and sewage.
- CEDRE donors have not imposed a deadline for implementation of reforms in Lebanon, clarified the French envoy tasked with following up on the summit.
- Lebanon’s Beirut international airport saw a 7.37% yoy increase in passenger traffic last year, bringing the total number to 8.8mn passengers.
- Expat population in Oman declined to 2.04mn as of 25 Feb this year – the lowest since Jul 2015 – and accounting for 43.7% of total population in the country.
- Following the implementation of a visa ban in Oman since end-Jan 2018, about 64,386 Omanis were employed in private sector firms and 4,125 more in government agencies.
- Qatar Investment Authority plans to buy a stake of at least 5% in Deutsche Bank from either the open market or Chinese conglomerate HNA, reported the German magazine Der Spiegel.
- Saudi Arabia’s Tadawul expects to receive passive fund inflows of USD 15-20bn this year. The market has already attracted more than $1.5bn from foreign investors since beginning of this year.
- Saudi Arabia plans to finalise by Q2 this year regulations allowing for cross-listing, given the growing requests and appetite from companies in the region.
- A series of structural changes were announced to Saudi Arabia’s parallel market for SMEs Nomu: to be implemented this quarter, changes include (among others) provisions to allow direct listings on Nomu Parallel Market without an IPO as well as streamlining the process for issuers to transition to the Main Market and reducing normal trade threshold.
- Unemployment in Saudi Arabia edged down to 12.8% in Q3 2018, from 12.9% in the two previous quarters.
- The value of oil exports from Saudi Arabia increased by 12.7% yoy to SAR 69.97bn in Dec; non-oil exports picked up by 11.8% to SAR 21.05bn.
- Saudi Arabian exports of crude oil to China are expected to rise to about 1.5mn barrels per day in Q1 2019, driven by growing demand from new and independent Chinese refiners.
- The contribution of Saudi Arabia’s smart cities projects to GDP is expected to reach over USD 2bn annually by 2030, according to the communications minister.
- The entertainment sector in Saudi Arabia has the potential to create 200k+ new jobs by 2030 and could generate revenues worth SAR 30bn (USD 8bn.
- Saudi Arabia announced the creation of a new visa category – one-off “event” visas – to attend sporting and entertainment attractions and can be issued within 24 hours of receiving the request.
- Sovereign borrowing in the MENA region is set to increase by 20% this year, estimates S&P.
- Bank lending in the UAE increased by 5% yoy to AED 1.662trn in Jan 2019: loans to the private sector rose 4% to AED 1.134trn and public sector loans grew 9% to AED 193bn.
- UAE‘s vice-president announced, via Twitter, a AED 32bn (USD 8.7bn) housing plan to build 34k units for citizens within the next 6 years.
- Fuel prices for March were revised upwards, with petrol prices up between 4.35%-4.62% while diesel price was up by 5.7%.
- Dubai announced an ambitious plan to install solar panels in 10% of Emirati homes before end-2019 and connect them to a grid to improve energy efficiency.
- Dubai welcomed around 15.92 million tourists last year, up 0.8% yoy; Indian, Saudi, and UK tourists topped the list of visitors last year recording 2.03mn, 1.6mn, and 1.2mn respectively.
- Abu Dhabi welcomed 10.27mn international visitors into the emirate in 2018 and hotel guests were up by 3.94%.
- A PwC-Dubai Chamber of Commerce and Industry survey revealed that Dubai’s private sector has maintained continuous growth in its innovation score, increasing by 4.7% from 2017 to 2018, following a 1.2% increase the year before.