BofAML forecasts $10bn gross issuance by Qatar this year - The Peninsula Qatar:
"GCC debt will be a strong play for investors in 2018. Qatar’s gross issuance for the year 2018 is expected to hit $10bn mark. In the GCC, issuance will be the key investment in the near term, particularly as issuers take advantage of low longer-dated US rates with Oman recently mandating banks for a triple-tranche deal, according to Bank of America Merrill Lynch (BofAML).
Given Qatar’s $2bn Eurobond is maturing this month, the country is expected to issue more debt in 2018. “We still see value in Qatar vs. GCC peers, trading almost 60bp wide for its rating,” BofAML’s MENA Economist Jean-Michel Saliba (pictured) said yesterday. BofAML is forecasting $8.5bn gross issuance in Oman this year, he said.
Elsewhere, BofAML is Underweight (UW) on Kuwait and Abu Dhabi; although the balance sheets of both issuers are extremely strong, particularly given sovereign wealth assets, valuations are tight, with the search for yield likely to benefit higher-spread sovereigns."
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Sunday 7 January 2018
Investors upbeat on Qatari economy - The Peninsula Qatar
Investors upbeat on Qatari economy - The Peninsula Qatar:
"The robust and vibrant Qatari economy enjoys the confidence of international investors. Despite the unjust blockade against Qatar, it continued to remain on the spotlight of global and regional investors and businesses who visited the country for boosting and expanding their relations with the tiny Gulf state. In the year 2017 Qatar witnessed the visit of a large number of foreign delegations, including the official visits of several heads of states, Prime Ministers, dozens of Ministers and high level trade missions, which reflect the interests and confidence of major international investors in the fast growing Qatari economy as a result of the business-friendly climate. Qatar Chamber (QC) in a statement yesterday said that some 52 trade delegations from across the world visited the country in 2017. QC signed 13 cooperation agreements with industry representative organisations and business councils from all continents during the year to open new horizons for the private sector of Qatar."
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"The robust and vibrant Qatari economy enjoys the confidence of international investors. Despite the unjust blockade against Qatar, it continued to remain on the spotlight of global and regional investors and businesses who visited the country for boosting and expanding their relations with the tiny Gulf state. In the year 2017 Qatar witnessed the visit of a large number of foreign delegations, including the official visits of several heads of states, Prime Ministers, dozens of Ministers and high level trade missions, which reflect the interests and confidence of major international investors in the fast growing Qatari economy as a result of the business-friendly climate. Qatar Chamber (QC) in a statement yesterday said that some 52 trade delegations from across the world visited the country in 2017. QC signed 13 cooperation agreements with industry representative organisations and business councils from all continents during the year to open new horizons for the private sector of Qatar."
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Qatar budget focuses on stability, support for diversification: SAK
Qatar budget focuses on stability, support for diversification: SAK:
"Qatar’s 2018 budget focuses on strengthening stability, developing prudent financial performance, and providing support for the economic diversification strategy it started earlier on, SAK Real Estate has said in its latest monthly report.
According to the report, the 2018 budget also confirms that Qatar will provide the necessary funds to complete the implementation of significant development projects pledged by the state, especially infrastructure projects in the health, education, transportation sectors and projects related to the country’s hosting of the FIFA World Cup in 2022.
“Total expenditure on these projects is expected to reach QR93bn, which will lead to a boom in the real estate sector as a result of the continued flow of liquidity supporting real estate sector capabilities, and as a response to comprehensive and sustainable development requirements that will achieve the objectives of the Qatar National Vision 2030,” it said."
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"Qatar’s 2018 budget focuses on strengthening stability, developing prudent financial performance, and providing support for the economic diversification strategy it started earlier on, SAK Real Estate has said in its latest monthly report.
According to the report, the 2018 budget also confirms that Qatar will provide the necessary funds to complete the implementation of significant development projects pledged by the state, especially infrastructure projects in the health, education, transportation sectors and projects related to the country’s hosting of the FIFA World Cup in 2022.
“Total expenditure on these projects is expected to reach QR93bn, which will lead to a boom in the real estate sector as a result of the continued flow of liquidity supporting real estate sector capabilities, and as a response to comprehensive and sustainable development requirements that will achieve the objectives of the Qatar National Vision 2030,” it said."
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Aramco Joins Saudi Companies Boosting Pay After Royal Orders - Bloomberg
Aramco Joins Saudi Companies Boosting Pay After Royal Orders - Bloomberg:
"Saudi Arabian Oil Co. and some of the kingdom’s biggest companies said they’ll pay Saudi staff more money, matching a royal order that extended handouts to government workers to ease public discontent over rising prices.
Aramco, preparing for what could be the world’s largest initial public offering, will pay “eligible employees” an extra 1,000 riyals ($267) a month for one year beginning in January, it said in response to questions from Bloomberg. The payments will be for workers inside the kingdom who make 20,000 riyals a month or less, according to two people familiar with the decision.
People who belong to the apprenticeship and college degree program will get an extra 10 percent of their monthly stipend over the same period, the company said."
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"Saudi Arabian Oil Co. and some of the kingdom’s biggest companies said they’ll pay Saudi staff more money, matching a royal order that extended handouts to government workers to ease public discontent over rising prices.
Aramco, preparing for what could be the world’s largest initial public offering, will pay “eligible employees” an extra 1,000 riyals ($267) a month for one year beginning in January, it said in response to questions from Bloomberg. The payments will be for workers inside the kingdom who make 20,000 riyals a month or less, according to two people familiar with the decision.
People who belong to the apprenticeship and college degree program will get an extra 10 percent of their monthly stipend over the same period, the company said."
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MIDEAST STOCKS-Saudi rises on royal handouts, Qatar outperforms
MIDEAST STOCKS-Saudi rises on royal handouts, Qatar outperforms:
"Saudi Arabia’s stock market rose on Sunday after King Salman announced a package of handouts for Saudi citizens to compensate for rising living costs, while Qatar was the strongest market in the region ahead of dividend announcements.
The Saudi index gained 0.6 percent. Shares in most retail sector firms, which could benefit from the package’s boost to consumer spending power, rose with major retailer Jarir up 2.6 percent to its highest since early October.
The information minister was quoted by the Al Sharq Al Awsat newspaper as saying the cost of this year’s handouts, which include bonuses for state employees and the government paying value-added tax (VAT) on some items such as purchases of first homes, would total about 50 billion riyals ($13.3 bln)."
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"Saudi Arabia’s stock market rose on Sunday after King Salman announced a package of handouts for Saudi citizens to compensate for rising living costs, while Qatar was the strongest market in the region ahead of dividend announcements.
The Saudi index gained 0.6 percent. Shares in most retail sector firms, which could benefit from the package’s boost to consumer spending power, rose with major retailer Jarir up 2.6 percent to its highest since early October.
The information minister was quoted by the Al Sharq Al Awsat newspaper as saying the cost of this year’s handouts, which include bonuses for state employees and the government paying value-added tax (VAT) on some items such as purchases of first homes, would total about 50 billion riyals ($13.3 bln)."
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Gosaibi-Saad saga shows that global finance has a long memory | Arab News
Gosaibi-Saad saga shows that global finance has a long memory | Arab News:
"A meeting between senior Saudi Arabian business people and potential investors last autumn had been going very well, the Saudis believed. There was an obvious appetite from foreign financiers to get involved in the momentous economic transformation planned for the Kingdom under the Vision 2030 strategy. But, according to one source familiar with the details of the meeting, which was taking place outside the Kingdom, the accord evaporated when the names Al-Gosaibi and Saad Group came up in conversation. Foreign bankers reminded their Saudi visitors that there were still billions of dollars in loans outstanding from one of the biggest financial collapses ever to hit the Middle East, and that this experience had soured their attitude to the Kingdom, despite the prospect of big business from the economic revolution under way."
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"A meeting between senior Saudi Arabian business people and potential investors last autumn had been going very well, the Saudis believed. There was an obvious appetite from foreign financiers to get involved in the momentous economic transformation planned for the Kingdom under the Vision 2030 strategy. But, according to one source familiar with the details of the meeting, which was taking place outside the Kingdom, the accord evaporated when the names Al-Gosaibi and Saad Group came up in conversation. Foreign bankers reminded their Saudi visitors that there were still billions of dollars in loans outstanding from one of the biggest financial collapses ever to hit the Middle East, and that this experience had soured their attitude to the Kingdom, despite the prospect of big business from the economic revolution under way."
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GDP growth to average 2.2% for 2017: QNB - The Peninsula Qatar
GDP growth to average 2.2% for 2017: QNB - The Peninsula Qatar:
"Qatari economy will continue to be resilient against the blockade and the growth momentum is expected to pick up in the fourth quarter resulting in annual GDP growth of 2.2 percent in 2017, according to QNB.
Citing the Ministry of Development Planning and Statistics’ (MDPS) latest document on Qatar’s Q3 GDP, QNB’s weekly economic commentary noted that real GDP growth accelerated to 1.9 percent year over year in Q3, up from 0.3 percent the previous quarter. The strong upturn was led by the hydrocarbon sector which gained 0.2 percent in Q3 compared to a contraction of 3.1 percent in Q2. The non-hydrocarbon sector remained broadly stable at 3.6 percent in the quarter versus 3.7 percent in Q2.
“Overall, the economy continues to be resilient against the blockade and we expect momentum to pick up in the fourth quarter resulting in annual GDP growth of 2.2 percent in 2017,” QNB analysts noted."
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"Qatari economy will continue to be resilient against the blockade and the growth momentum is expected to pick up in the fourth quarter resulting in annual GDP growth of 2.2 percent in 2017, according to QNB.
Citing the Ministry of Development Planning and Statistics’ (MDPS) latest document on Qatar’s Q3 GDP, QNB’s weekly economic commentary noted that real GDP growth accelerated to 1.9 percent year over year in Q3, up from 0.3 percent the previous quarter. The strong upturn was led by the hydrocarbon sector which gained 0.2 percent in Q3 compared to a contraction of 3.1 percent in Q2. The non-hydrocarbon sector remained broadly stable at 3.6 percent in the quarter versus 3.7 percent in Q2.
“Overall, the economy continues to be resilient against the blockade and we expect momentum to pick up in the fourth quarter resulting in annual GDP growth of 2.2 percent in 2017,” QNB analysts noted."
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Bromance to breakup: 4 ways the Opec deal could end early
Bromance to breakup: 4 ways the Opec deal could end early:
"Opec and Russia have surprised the industry with the success of their grand alliance as oil surges to a three-year high. As the unlikely bond enters a second year, there are challenges ahead. Here are four scenarios that could end their deal earlier than planned. Street fighting Tension is flaring in Opec members Iran and Venezuela, the two countries that RBC Capital Markets says pose the biggest risk of supply disruption. If either nation shuts oil output as a result, fellow producers could just decide the restraints are no longer appropriate, and instead boost supplies to prevent a damaging price shock. Discontent with economic stagnation has sparked the biggest street protests since 2009 in Iran, rekindling memories of the 1979 revolution that paralysed crude production. To top it, US President Donald Trump is threatening to pull out of a nuclear accord that helps Opec’s third-biggest producer trade with other nations. In Venezuela, food shortages and rampant inflation have threatened to trigger a massive social collapse. Even if the country can avoid that, the industry has already been hit so hard that production could slump anyway."
'via Blog this'
"Opec and Russia have surprised the industry with the success of their grand alliance as oil surges to a three-year high. As the unlikely bond enters a second year, there are challenges ahead. Here are four scenarios that could end their deal earlier than planned. Street fighting Tension is flaring in Opec members Iran and Venezuela, the two countries that RBC Capital Markets says pose the biggest risk of supply disruption. If either nation shuts oil output as a result, fellow producers could just decide the restraints are no longer appropriate, and instead boost supplies to prevent a damaging price shock. Discontent with economic stagnation has sparked the biggest street protests since 2009 in Iran, rekindling memories of the 1979 revolution that paralysed crude production. To top it, US President Donald Trump is threatening to pull out of a nuclear accord that helps Opec’s third-biggest producer trade with other nations. In Venezuela, food shortages and rampant inflation have threatened to trigger a massive social collapse. Even if the country can avoid that, the industry has already been hit so hard that production could slump anyway."
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Don't Expect OPEC's Oil Deal To Fall Apart in 2018 - Bloomberg Gadfly
Don't Expect OPEC's Oil Deal To Fall Apart in 2018 - Bloomberg Gadfly:
"Whatever your view on the effectiveness of the deal between OPEC and a group of non-member countries to limit oil supply in order to drain excess inventories and boost prices, there is one thing that everybody seems to agree on -- they stuck to their guns much better than anyone thought possible for the whole of last year. But there is a growing chorus of voices calling the deal's demise this year. Here's why I believe they're wrong.The most common reasons for suggesting that the deal will fall apart in 2018 are: a growing pressure to cheat, capitulation in the face of surging U.S. shale production, or a declaration of success. Each of these is certainly plausible, but I think the risks are low."
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"Whatever your view on the effectiveness of the deal between OPEC and a group of non-member countries to limit oil supply in order to drain excess inventories and boost prices, there is one thing that everybody seems to agree on -- they stuck to their guns much better than anyone thought possible for the whole of last year. But there is a growing chorus of voices calling the deal's demise this year. Here's why I believe they're wrong.The most common reasons for suggesting that the deal will fall apart in 2018 are: a growing pressure to cheat, capitulation in the face of surging U.S. shale production, or a declaration of success. Each of these is certainly plausible, but I think the risks are low."
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Royal Handouts Cheer Saudis But Show Struggle to Revamp Economy - Bloomberg
Royal Handouts Cheer Saudis But Show Struggle to Revamp Economy - Bloomberg:
"Saudi authorities said they’ll spend billions of riyals to help citizens offset the impact of a value-added tax and a surge in gasoline and utility prices, a move that will help ease public discontent while highlighting the kingdom’s struggle to overhaul its economy. King Salman, in a series of royal orders early on Saturday, restored an annual pay raise for Saudi civil servants, suspended as part of attempts to rein in a hefty public-sector wage bill. He ordered a 5,000-riyal ($1,333) bonus for soldiers fighting in Yemen and granted Saudis working for the state an extra 1,000 riyals a month as a “cost of living” allowance for a year. The government will also pay part of the newly introduced VAT. The measures will likely be cheered by Saudis who took to social media and television to criticize surging prices and the implementation of a 5 percent VAT on a wide array of products as of Jan. 1. Yet they also show how the kingdom’s rulers are struggling to find a balance between the need to avoid unrest and take the difficult steps needed to reduce what policy makers and economists see as an unsustainable reliance on oil revenue."
'via Blog this'
"Saudi authorities said they’ll spend billions of riyals to help citizens offset the impact of a value-added tax and a surge in gasoline and utility prices, a move that will help ease public discontent while highlighting the kingdom’s struggle to overhaul its economy. King Salman, in a series of royal orders early on Saturday, restored an annual pay raise for Saudi civil servants, suspended as part of attempts to rein in a hefty public-sector wage bill. He ordered a 5,000-riyal ($1,333) bonus for soldiers fighting in Yemen and granted Saudis working for the state an extra 1,000 riyals a month as a “cost of living” allowance for a year. The government will also pay part of the newly introduced VAT. The measures will likely be cheered by Saudis who took to social media and television to criticize surging prices and the implementation of a 5 percent VAT on a wide array of products as of Jan. 1. Yet they also show how the kingdom’s rulers are struggling to find a balance between the need to avoid unrest and take the difficult steps needed to reduce what policy makers and economists see as an unsustainable reliance on oil revenue."
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Restructuring Saudi power market to generate SR15bn in economic surplus | ZAWYA MENA Edition
Restructuring Saudi power market to generate SR15bn in economic surplus | ZAWYA MENA Edition:
"Restructuring Saudi Arabia’s power generation sector coupled with price reforms can deliver annual aggregate economic gains of more than SR15 billion, according to the recent study published by the King Abdullah Petroleum Studies and Research Center (KAPSARC). With the aim of helping policymakers achieve sufficient supply reliability during peak demand and reduce the inefficient consumption of energy, the study “Restructuring Saudi Arabia’s Power Generation Sector: Model-Based Insights” developed a model to simulate the introduction of private generation companies in the power sector along with reforming fuel prices to an energy equivalent of $3/MMBtu. The paper, authored by KAPSARC’s researchers Bertrand Rioux, Fernando Oliveira, Axel Pierru and Nader Al-Kathiri, in collaboration with the Principal Buyers Department of Saudi Electricity Company, expects the surplus to result from fuel subsidy savings by the Saudi government due to the increased efficiency of consumption and thereby competitive generation."
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"Restructuring Saudi Arabia’s power generation sector coupled with price reforms can deliver annual aggregate economic gains of more than SR15 billion, according to the recent study published by the King Abdullah Petroleum Studies and Research Center (KAPSARC). With the aim of helping policymakers achieve sufficient supply reliability during peak demand and reduce the inefficient consumption of energy, the study “Restructuring Saudi Arabia’s Power Generation Sector: Model-Based Insights” developed a model to simulate the introduction of private generation companies in the power sector along with reforming fuel prices to an energy equivalent of $3/MMBtu. The paper, authored by KAPSARC’s researchers Bertrand Rioux, Fernando Oliveira, Axel Pierru and Nader Al-Kathiri, in collaboration with the Principal Buyers Department of Saudi Electricity Company, expects the surplus to result from fuel subsidy savings by the Saudi government due to the increased efficiency of consumption and thereby competitive generation."
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Market cap of ADX-listed companies up 2.1 percent to AED485 billion in 2017 | ZAWYA MENA Edition
Market cap of ADX-listed companies up 2.1 percent to AED485 billion in 2017 | ZAWYA MENA Edition:
"The market capitalisation of companies listed at Abu Dhabi Securities Exchange (ADX) increased 2.1 percent during 2017, to AED485 billion by the end of the year from AED475 billion by the end of 2016.
In a report issued Saturday, ADX said the market cap of listed domestic firms rose to AED457 billion, an increase of 2.62 percent from AED444 billion in 2016.
The Abu Dhabi Securities Exchange General Index closed at 4398 points by the end of 2017, 3.25 percent down from its 2016 level, with the value of transactions during 2017 amounting to AED48 billion over 28 billion shares, an average of 112 million equities per day."
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"The market capitalisation of companies listed at Abu Dhabi Securities Exchange (ADX) increased 2.1 percent during 2017, to AED485 billion by the end of the year from AED475 billion by the end of 2016.
In a report issued Saturday, ADX said the market cap of listed domestic firms rose to AED457 billion, an increase of 2.62 percent from AED444 billion in 2016.
The Abu Dhabi Securities Exchange General Index closed at 4398 points by the end of 2017, 3.25 percent down from its 2016 level, with the value of transactions during 2017 amounting to AED48 billion over 28 billion shares, an average of 112 million equities per day."
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MIDEAST STOCKS-Saudi rises on royal handouts, blue chips boost Qatar
MIDEAST STOCKS-Saudi rises on royal handouts, blue chips boost Qatar:
"Saudi Arabia’s stock market rose in early trade on Sunday after King Salman announced a package of handouts for Saudi citizens to compensate them for the rising cost of living, while several blue chips boosted Qatar’s market.
The Saudi index gained 0.5 percent in the first hour as real estate developer Dar Al Arkan, the most heavily traded stock, added 2.4 percent. Among the handouts, the government will bear the cost of value-added tax for purchases of first homes by Saudi citizens.
The information minister was quoted by the Saudi-owned Al Sharq Al Awsat newspaper as saying the cost of the handouts would total about 50 billion riyals ($13.3 billion), while an additional 30 billion riyals would be spent on a previously announced aid programme for low- and middle-income Saudis."
'via Blog this'
"Saudi Arabia’s stock market rose in early trade on Sunday after King Salman announced a package of handouts for Saudi citizens to compensate them for the rising cost of living, while several blue chips boosted Qatar’s market.
The Saudi index gained 0.5 percent in the first hour as real estate developer Dar Al Arkan, the most heavily traded stock, added 2.4 percent. Among the handouts, the government will bear the cost of value-added tax for purchases of first homes by Saudi citizens.
The information minister was quoted by the Saudi-owned Al Sharq Al Awsat newspaper as saying the cost of the handouts would total about 50 billion riyals ($13.3 billion), while an additional 30 billion riyals would be spent on a previously announced aid programme for low- and middle-income Saudis."
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