Global Developments Bottomline: The IMF issued its latest World Economic Outlook, lowering global growth forecast (for the 3rd time in 6 months) to 3.3% this year – the weakest annual growth since 2009 – before improving to 3.6% in 2020. Dragged down by uncertainties surrounding Brexit and the US-China (and global) trade wars, the IMF also highlighted downside risks from tightening financing conditions, given a backdrop of large private and public sector debt. If US’s Mnuchin is to be believed, the China-US trade deal is nearing “final round” with US expressing its willingness to face repercussions from China in case it fails to comply. Concerns are rising from US trade tensions with Europe (EU is targeting USD 12bn of US goods in the Boeing subsidies dispute) while Japan hopes to wrap up a trade agreement with the US “very quickly” as negotiations begin Monday (Apr 15).
- Bahrainis in Bahrain’s financial sector account for 65.6% of the total workforce (14,148 jobs); Bahraini women in the sector increased by 2.2% yoy to 3621 in 2018, accounting for 39% of the Bahraini workforce.
- Egypt’s PMI edged up to 49.9 in Mar (above 2018’s average of 49.5 and Feb’s 48.2) thanks to an improvement in output and new domestic orders. Overall input prices hit a record low at 50.8 in Mar from 53.6 the month before.
- Budget deficit in Egypt declined to EGP 259.7bn or 4.9% of GDP in Jul 2018-Feb 2019, after revenues increased by 23% and expenditures by 14.8%.
- Egypt’s inflation eased to 14.2% in Mar (Feb: 14.4%), after food supply issues were sorted and food & beverage prices were down to 1.5% mom from 3.5% mom in Feb.
- Egypt plans to launch three investment areas and five free zones this year.
- Egypt’s government purchased electricity worth EGP 400mn (USD 23mn) from the private sector until Mar 2019.
- The Ministry of Housing in Egypt plans to establish over 1.1mn residential units over the next 5 years.
- Iraq plans to increase output from its Baiji oil refinery to 140k barrels per day (bpd) by end of this year, up from the current 45k bpd output.
- According to Jordan’s prime minister, though the country accounts for only 3% of the region’s population, it is home to 23% of entrepreneurs in the region.
- Kuwait’s Customs revenues increased by 12% yoy to KWD 367mn (USD 1.2bn) during the fiscal year 2018-2019, largely due to the recent plans like automated customs systems and facilitating clearance of customs data
- Fitch affirmed Kuwait’s long-term foreign-currency Issuer Default Rating (IDR) at ‘AA’ with a stable outlook, citing key strengths of exceptionally strong fiscal and external metrics and one of the lowest fiscal breakeven Brent oil prices among Fitch-rated oil exporters.
- Kuwait’s higher committee focusing on the demographic structure has recommended the implementation of a five-year cap on the stay of expatriates.
- Lebanon’s PM disclosed that preemptive measures were being taken to deal with the chronic budget deficit, reassuring that the country’s financial and monetary situation was stable. Reducing the deficit-to-GDP ratio, which reached 11% in 2018, by 1 ppt every year over five years was one of the key pledges made at the CEDRE conference.
- Lebanon’s central bank governor unveiled a USD 1bn package of new subsidized loans – with USD 500mn allocated for the productive sectors in dollars, USD 100mn in loans for non-Lebanese residents, and USD 220mn for housing loans in Lebanese pounds.
- Lebanon’s cabinet endorsed the new electricity plan aiming to reform the sector. However, a yet-to-be-resolved issue is the formation of the National Electricity Regulatory Authority.
- Qatar’s plan to increase its stake in Deutsche Bank has stalled, reported Reuters.
- Saudi Arabia’s PMI increased to 56.8 in Mar (Feb: 56.6), supported by a rise in new business (highest since Apr 2015), new orders (a near 4-year high of 65.5) and output (7-month high of 59.6). The employment sub-index however fell to 49.8, contracting for the first time in 5 years.
- The IMF maintained Saudi Arabia’s growth forecast for this year at 1.8%, forecasting a pickup to 2.1% next year.
- Saudi Aramco disclosed that it had raised USD 12bn from its debut international bond issue. The offering is expected to close on Apr 16.
- Saudi Arabia’s energy minister stated that there would be no change to the long-standing policy of trading oil in dollars. Separately, he also stated that there were no plans to deepen oil production cuts and that the OPEC+ meeting in May would be a “key” gathering.
- About SAR 430mn (USD 111.8mn) was deposited into the bank accounts of close to 284k job hunters in Saudi Arabia by the Human Resources Development fund.
- Saudi Arabia’s internal tourism spending touched SAR 121.5bn (USD 32.39bn) in 2018, with spending on domestic tourism trips at SAR 46.3bn. Inbound tourism spending grew 13.6% to SAR 12.5bn in Jan-Feb 2019.
- The double taxation avoidance agreement between Saudi Arabia and UAE came into force in the beginning of this month. The agreement aims to strengthen the cooperation in tax matters and consolidate the financial, economic and investment partnership between the two countries.
- The GCC capital market issuance is likely to recover after a slow Q1 2019, led by Saudi Aramco and Saudi Telecom, according to S&P.
- The IMF, in its latest World Economic Outlook, expects GDP growth in the MENA to edge down to 1.3% in 2019 before posting a strong recovery to 3.2% in 2020.
- PMI in the UAE increased to 55.7 in Mar, from the 28-month low of 53.4 in Feb, with both the output (63 from 59.3) and new orders (59 from 55) sub-indices rising. The employment sub-index rose to 50.3 (from Feb’s dismal 47.5 reading).
- The IMF expects UAE to grow by 2.8% this year, and by 3.3% next year while inflation is expected to drop to 2.1% this year and next due to declines in rentals and property prices.
- Inflation in the UAE fell for the 3rd consecutive month, posting -2.53% yoy and -0.3% mom reading in Feb, as both food and transport costs plunged.
- Dubai’s non-oil economy expanded in Mar: the Dubai Economy Tracker increased to 57.6 – the highest since May 2018 – and up from Feb’s 55.8, led by the travel and tourism sector (posted a record high of 59.8).
- The UAE attracted USD 10.35bn in foreign direct investments in 2017, accounting for 36% of the total FDI inflows to the Arab countries, according to the Ministry of Economy. FDI into Dubai surged by 41% yoy to AED 38.5bn (USD 10.5bn) in 2018; US, India, Spain, China and the UK together accounted for 70% of the total.
- South Korea and UAE have renewed the USD 5.4bn currency swap deal for three years (till Apr 2022). First signed in 2013, the deal had expired in Oct 2016.
- Dubai moved into 9th position globally in a list of maritime capitals (moving up from 10th in 2017), according to the Leading Maritime Capitals report for 2019.