Economic

Economic Impact of Dubai Expo 2020

Dubai Expo 2020 will have an impact on the economy through the infrastructure valued at more than USD 12 billion (versus USD 7.5 billion estimate in 2013) that is being spent to successfully build Expo 2020’s establishment. The event was postponed by a year to October 2021 in view of the Covid-19 pandemic. Dubai Expo 2020 will be the first world expo to be held in the Middle East, North Africa, and South Asia region. Expo 2020 will leverage the...

Profits at UAE’s major lenders reached USD 4 billion in H1 2021

Profits at the four largest UAE banks rose during the first half of 2021 after an improvement in the operating environment led to lower loan-loss provisions, rise in non-interest income and improvement in operating efficiency. The combined net profit of four major banks, First Abu Dhabi Bank (FAB), Emirates NBD (ENBD), Abu Dhabi Commercial Bank (ADCB), and Dubai Islamic Bank (DIB) reached USD 4 billion in H1 2021, up 17% from the same period last year. The four big banks...

Could Delta variant play spoilsport for Oil prices?

The Delta variant, which the WHO has called the most transmissible variant of the coronavirus, has caused a surge in covid-19 cases around the world. With a rise in cases, comes a rise in restrictions by the governments to curb the transmission. Travel restrictions in different parts of the world, is set to exert downward pressure on the global jet fuel demand. During the week ending 20th August, Brent crude oil price witnessed its biggest weekly loss this year of...

Oil revenues & private sector growth to speed up GCC economic recovery in 2022

As the world charts its recovery from COVID-19’s impact, businesses and trade around the world begin to hit normalcy, reviving the global demand for oil and consequently the global oil prices. As of August’21, price of IPE Brent is up nearly 41% year to date. OPEC+ is firm on its stance of cutting oil production until mid-2022, this is set to support global oil prices and provide renewed vigour for GCC economies. According to Institute of International Finance (IIF), the...

Revenue squeeze could spur Gulf bond issuance to new highs in 2021

International debt sales by sovereigns and corporates in the Gulf region topped a record USD 100billion issuance in 2020 as governments raised capital to cover their widening deficits and corporates latched upon the opportunity to strengthen their balance sheets amid low interest rates. Central banks opened up the liquidity taps to support the economy and investor frenzy for positive yielding instruments drove international debt issuance from the gulf region to record highs. Exhibit: GCC borrowings topped USD 100billion in 2020...

Who should worry most about VAT in the UAE?

The article originally appeared in The National | Business. By January 1, 2018, it is expected that value added tax (VAT) will be applied at a rate of 5 per cent on most goods and services in the UAE and wider GCC region. The GCC governments will face a combined fiscal deficit of about US$350 billion over the next five years, according to the IMF, which bases its estimate on an oil price of $56 per barrel. This means that...

GCC debt deluge: big-ticket issues, even by international standards

The article originally appeared in The National | Business. The GCC is raining debt issuances. From almost nothing a few years ago, all we hear and read these days is the jumbo-sized bond issuances from Saudi Arabia, Qatar, Kuwait, Bahrain, Abu Dhabi etc. The Saudis just closed a successful US$17.5 billion issue that was oversubscribed by more than four times, while Qatar raised $9bn in May followed by a $5bn sale by Abu Dhabi. Even by international standards, these are...

Bankers can finally look forward to merger activity

The article originally appeared in The National | Business The fee-based investment banking business has four key components – syndicated loans, equity capital markets, debt capital markets and mergers and acquisitions (M&A). While in other markets we can witness activity across these four components, in the GCC investment banking advisers depend on syndicated loans for their survival – 50 per cent of total investment banking fees on average. Equities is dull thanks to poor performing capital markets and the related dull...