#SaudiArabia lays down #Dubai challenge by luring multinationals | Financial Times

Saudi Arabia lays down Dubai challenge by luring multinationals | Financial Times

Saudi Arabia has lured a coterie of 24 multinationals to set up regional headquarters in Riyadh as the Gulf kingdom seeks to turn its capital into a business hub to rival Dubai’s dominance. 

US engineering group Bechtel and Indian hotelier Oyo are among the companies that will establish regional headquarters, according to Fahd al-Rasheed, president of the Royal Commission for Riyadh City. 

The announcement from the multinationals, which came during a Future Investment Initiative conference held in Riyadh last week, marks another step towards a rehabilitation of Crown Prince Mohammed bin Salman’s ambitious economic reforms, which were thrown into turmoil by the gruesome murder of journalist Jamal Khashoggi in 2018. 

Multinationals now appear more comfortable with the reputational risk attached to the kingdom, which is also mired in a bloody war in Yemen, as they eye potential profits from Prince Mohammed’s plan to cut the country’s dependence on oil and overhaul the economy.

KSA Labor Market, 2017-2020 – The Bitter Lake tks @AndrewMLeber

KSA Labor Market, 2017-2020 – The Bitter Lake

For my dissertation I look at a fair amount of Saudi labor statistics, which have attracted a bit of media coverage of late – the General Authority for Statistics delayed the release of the Q3 2020 labor market report several times “to ensure that the data collected… are up to the standards GASTAT is committed to.”

Now that the data has been released (showing a slight drop in the unemployment rate, from 15.4% to 14.9%), I’ve compiled a quick overview of the last few years of statistics. Jobs creation has been a key metric of success for Saudi Arabia’s economic reforms (“SAUDI CROWN PRINCE’S LEGACY RESTS ON RISKY JOB REFORMS,” FT, England and Omran 2020) so it’s worth seeing what the numbers tell us.

That said, even at their best these statistics can be a bit… opaque. Saudi government agencies did not regularly publish a measure of unemployment rates until the 21st century, and changes in methodology make it hard to compared numbers over time. Most recently, in 2016, GASTAT transitioned from estimating the size of the labor force through surveys to measuring employment through the registration of employees with the General Organization for Social Insurance (private sector) and the Civil Service (mostly public sector, some state-owned enterprises. This means that current numbers are only comparable as far back as late 2016; other measures start appearing more recently.

Thoughts? There is certainly more I could go into here (wages by age, unemployment rates by age cohort, public vs private-sector employment by region) and maybe I’ll come back to this in the days ahead. 

#Oman Wealth Fund’s Latest Revamp Focuses on Tourism, Real Estate - Bloomberg

Oman Wealth Fund’s Latest Revamp Focuses on Tourism, Real Estate - Bloomberg

Oman’s wealth fund plans to restructure its tourism and real estate investments in the latest shift by the $17 billion sovereign investor.

The Oman Investment Authority will transfer a shareholding company, a tourism development project and resorts to the Omran Tourism Development Co., also known as Omran Group, the wealth fund said in a statement Sunday.

This move aims to “drive growth for Omran Group and strengthen its role in supporting economic diversification,” the statement added. Omran Group was established by the government in 2005 to focus on developing sources of economic diversification and attracting foreign direct investment to the Gulf nation, according to its website.

Last June, Oman combined its two wealth funds -- the State General Reserve Fund and the Oman Investment Fund -- into one entity.

The sultanate -- one of the Gulf’s weakest sovereigns --- is aiming to add greater variety to its economy as it struggles to improve its finances. Its budget deficit has swollen to become the widest in the region, due to lower oil prices and the coronavirus pandemic.

#Saudi Chemical Giant Sabic Sees Vaccinations Boosting Income - Bloomberg

Saudi Chemical Giant Sabic Sees Vaccinations Boosting Income - Bloomberg

Chemicals maker Saudi Basic Industries Corp. expects sales and earnings to increase this year after it beat analysts’ estimates by making a profit in 2020.

The Riyadh-based firm, controlled by Saudi Aramco, said it sees the global rollout of coronavirus vaccines leading to a 2% to 5% gain in revenue this year. Pretax income will be “moderately higher” than in 2020, while capital expenditure will be similar, Sabic said in a results statement.

Sabic earned net income of 40 million riyals ($10.7 million) in 2020, down sharply from 5.2 billion riyals in 2019. Still, analysts expected a loss of almost 300 million riyals, according to the median estimate in a Bloomberg survey, after the pandemic caused demand for chemicals products to sink.

Sabic’s net income between October and December was 2.2 billion riyals, more than double the figure for the third quarter.

“The fourth quarter benefited from sustained economic recovery,” said Chief Executive Officer Yousef Al-Benyan. “Distributing competitive dividends to our shareholders continues to be paramount and this is supported by our firm commitment to maintaining capital discipline, as well as our ability to uphold a strong balance sheet and credit rating.”

Gulf markets lower as #SaudiArabia says vaccines delayed | Reuters

Gulf markets lower as Saudi Arabia says vaccines delayed | Reuters

Major Middle East stock markets ended lower on Sunday, tracking a slide in global markets at the end of last week and after Saudi Arabia extended measures to fight the coronavirus crisis.

Saudi Arabia’s benchmark index fell 1.2%, after the government said COVID-19 vaccines were being delayed. The kingdom extended its travel ban for citizens and port closures to May 17 from March 31.

Shares in Al Rajhi Bank dropped 1%, while National Commercial Bank slipped 2.4% lower.

Saudi Basic Industries Corp (SABIC), the Gulf’s largest petrochemical maker, slid 1.8% despite posting a net profit of 2.22 billion riyals ($592 million) in the fourth quarter of 2020 compared with a net loss a year earlier.

Dubai’s main share index retreated 1.6%, extending the previous session’s losses, as Dubai Islamic Bank fell 1.8% and Emirates NBD Bank dropped 1.7%.

Dubai suspended non-essential surgeries in hospitals for a month and halted live music at restaurants indefinitely after daily coronavirus infections surged in the United Arab Emirates.

In Abu Dhabi, the index slipped 0.9%, hit by a 1.6% fall in the country’s largest lender First Abu Dhabi Bank and a 0.6% decrease in telecoms giant Etisalat.

The Qatari index lost 0.7%, with Qatar Fuel shedding 2.2% to be the worst performer on the benchmark.

ADCB 2020 net profit down 27% as provisions for hospital group NMC build | Reuters

ADCB 2020 net profit down 27% as provisions for hospital group NMC build | Reuters

Abu Dhabi Commercial Bank said on Sunday it posted a 27% drop in net profit for 2020, as it booked significantly higher provisions including new ones for troubled hospital operator NMC, for which it had nearly $1 billion in lending exposure.

The bank posted a net profit of 3.81 billion dirhams ($1.04 billion) for the year ending Dec. 31, down from a net profit of 5.24 billion dirhams a year earlier.

It beat analysts’ mean net profit estimate of 3.46 billion dirhams, according to Refinitiv data.

Its fourth quarter net profit fell 4% year-on-year to 1.01 billion dirhams. It was down 26% compared to the third quarter.

#Dubai house prices to drop at slower pace: Reuters poll | Reuters

Dubai house prices to drop at slower pace: Reuters poll | Reuters

Dubai’s house prices are expected to fall at a slower pace this year and next than previously thought as hopes for a successful vaccine rollout and an economic recovery boost confidence in the sector, a Reuters poll showed.

After declining 3.5% in the first quarter of 2020, Dubai property prices have shown signs of stabilising. They fell by a much slower 0.9% year-on-year in the third quarter after barely changing in Q2, United Arab Emirates central bank data found.

The Jan. 13-28 poll of 11 property market analysts predicted Dubai house prices would decline 2.0% this year, a significant improvement from a September survey that forecast a decline of 5.1%. It was expected to fall the same next year.

“While multiple factors are at play, an economic recovery and a successful vaccine rollout stand out as key drivers for the real estate sector, both of which will boost confidence in the market,” said Aditi Gouri, head of strategic consulting and research at Cavendish Maxwell in Dubai.

European, Middle Eastern & African Stocks - Bloomberg #UAE #Kuwait #Israel #SaudiArabia #Qatar close

European, Middle Eastern & African Stocks - Bloomberg #UAE #Kuwait #Israel #SaudiArabia #Qatar close

Mashreq Capital's Kettlewell on Turkish Sovereign Debt, #Dubai's Economy, and #Oman's Fiscal Reforms - Bloomberg

Mashreq Capital's Kettlewell on Turkish Sovereign Debt, Dubai's Economy, and Oman's Fiscal Reforms - Bloomberg

Oliver Kettlewell, Head of Fixed Income & Global Portfolios at Mashreq Capital, discusses the purchase of Turkish sovereign debt, how Dubai travel and tourism-sensitive bonds will benefit from the economy's reopening, and how Oman's fiscal reforms are amongst the slowest-paced reforms in the GCC. He speaks with Manus Cranny and Yousef Gamal El-Din on "Bloomberg Daybreak: Middle East." (Source: Bloomberg)

#UAE Central Bank Fines 11 Banks for Compliance Failure - Bloomberg

UAE Central Bank Fines 11 Banks for Compliance Failure - Bloomberg

The United Arab Emirates’ central bank imposed financial sanctions on 11 banks operating in the country for their failure to reach appropriate levels of compliance on anti-money laundering and sanctions.

The sanctions imposed on Jan. 24 amounted to a total of 45.76 million dirhams ($12.5 million), the regulator said in a statement. It didn’t identify the banks.

All banks operating in the UAE have been allowed “ample time” by the central bank to remedy any shortcomings and were instructed in the middle of 2019 to ensure compliance by the end of that year, it said.

Arqaam Capital's Meijer on the #UAE's Citizenship Plan for Foreigners, 2020 Bank Earnings - Bloomberg

Arqaam Capital's Meijer on the UAE's Citizenship Plan for Foreigners, 2020 Bank Earnings - Bloomberg

Jaap Meijer, Head of Equity Research at Arqaam Capital, discusses the United Arab Emirates' plans to open citizenship to select foreigners to boost growth and UAE 2020 bank earnings. He speaks with Manus Cranny and Yousef Gamal El-Din on "Bloomberg Daybreak: Middle East." (Source: Bloomberg)

#Dubai Stocks Lead Mideast Selloff Amid Travel Curbs: Inside EM - Bloomberg

Dubai Stocks Lead Mideast Selloff Amid Travel Curbs: Inside EM - Bloomberg

Most Middle East stocks fell, with shares in Dubai leading losses, as increased travel restrictions added to pessimism over vaccine rollouts sweeping global equity markets.

Dubai and Abu Dhabi’s gauges dropped 1.3% and 0.6%, respectively, as of noon local time. Saudi Arabia’s main index retreated 0.6% as Saudi Basic Industries Corporation fell as much as 1% even after 2020 profit beat estimates. Qatari stocks declined 0.5%.

The U.K. announced on the weekend it was banning direct passenger flights from the United Arab Emirates to stop the spread of a new virus strain originally identified in South Africa. Meanwhile, Saudi Arabian authorities delayed the reopening of the country’s borders.

Global stocks slumped last week, with the S&P 500 tumbling 1.9% on Friday, as bidding by retail traders for heavily-shorted U.S. stocks fanned speculation hedge funds would have to reduce their market exposure, while concern over the deployment of coronavirus vaccines sapped risk appetite. A gauge tracking emerging-market shares posted the biggest weekly drop since March.

Shares in Dubai had been recovering from a virus-triggered selloff amid prospects of a pick-up in tourism, one of the main pillars of the emirate’s economy. Sunday’s declines came even as the UAE announced plans to offer citizenship to select foreigners, the first Gulf nation to formalize a process aimed at giving expatriates a bigger stake in the economy.

Though the decision is a positive one for markets, more details are needed, Arqaam Capital’s head of equity research Jaap Meijer said in an interview with Bloomberg Television.

SABIC sees positive Q1 though cautious over COVID-19 | Reuters

SABIC sees positive Q1 though cautious over COVID-19 | Reuters

Saudi Basic Industries Corp, the world’s fourth-biggest petrochemicals firm, expects business performance to be positive in the first quarter of 2021 after an uptick in chemical prices but remains cautious given COVID-19 uncertainty, its CEO said on Sunday.

Saudi Aramco’s acquisition of a 70% stake in SABIC will have a financial benefit worth $3 billion to $4 billion, Yousef al-Benyan told reporters on a virtual news conference.

“There is an enhancement of cooperation between SABIC and Aramco. As mentioned, God willing, the benefits between the two companies is expected in the range of $3-4 billion. SABIC’s share of that is from $1.5-1.8 billion,” the chief executive said.

SABIC posted a net profit of 2.22 billion riyals ($592 million) in the fourth quarter, reversing a net loss of 890 million riyals a year earlier as the impairment charges it took on certain capital assets were reversed.

“Our outlook is that Q1 is going to be more or less equal to Q4 given the improvement we have experienced. We have seen an average 13% improvement in chemical prices,” Benyan said, adding, however, that prices remain lower than 2019 levels.

SABIC-Aramco tie-up to have benefit worth $3-4 billion - SABIC CEO | Reuters

SABIC-Aramco tie-up to have benefit worth $3-4 billion - SABIC CEO | Reuters

Saudi Aramco’s acquisition of a 70% stake in Saudi Basic Industries Corp (SABIC), the world’s fourth-biggest petrochemicals firm, will have a financial benefit worth $3 billion to $4 billion, SABIC’s CEO said on Sunday.

SABIC’s share of that benefit will be worth between $1.5 billion and $1.8 billion, its chief executive Yousef al-Benyan said on an earnings call.

Most Gulf markets fall in early trade | Reuters

Most Gulf markets fall in early trade | Reuters

Major stock markets in the Gulf traded lower on Sunday following Friday’s fall in global equities amid a growing battle on Wall Street between hedge funds and retail investors.

Saudi Arabia’s benchmark index fell 0.4%, with National Commercial Bank and Saudi Telecom Company both losing 0.9%.

The kingdom has postponed the end of a ban on travel for its citizens and the reopening of its ports from March 31 to May 17, the Saudi state news agency SPA said on Friday, citing an interior ministry official.

The health minister has said that deliveries of COVID-19 vaccines are being delayed.

Dubai’s main share index dropped 0.7%, weighed down by a 1.1% fall in blue-chip developer Emaar Properties and a 2.4% slide in Dubai Investments.

Dubai will roll out China’s Sinopharm vaccine to the general public from Sunday as coronavirus infections surged to record levels in the Middle East tourism hub, the government said on Saturday.

Last week, Dubai suspended non-essential surgeries in hospitals for a month and live music at restaurants indefinitely after daily infections of the coronavirus in the United Arab Emirates rose to their highest levels in January.

On Saturday, authorities reported 3,647 new cases and 12 deaths bringing the total number of cases and deaths from COVID-19 to 300,661 and 674 respectively.

In Abu Dhabi, the index eased 0.3%, with the country’s largest lender First Abu Dhabi Bank losing 0.5%.

Elsewhere, telecom giant Etisalat was down 0.4%.

The Qatari index lost 0.5%, as most of the stocks on the index were in negative territory including Qatar National Bank, the Gulf’s largest lender, which fell 0.8%.

Back in Saudi Arabia, Saudi Basic Industries Corp (SABIC), the Gulf’s largest petrochemical maker, slipped 0.1%, despite posting a net profit of 2.22 billion riyals ($591.87 million) in the fourth quarter.

SABIC had reported a net loss of 890 million riyals in the same quarter in 2019.

#SaudiArabia to Start Tracking Tourism’s Contribution to Economy - Bloomberg

Saudi Arabia to Start Tracking Tourism’s Contribution to Economy - Bloomberg

Saudi Arabia’s statistics authority will begin tracking tourism’s contribution to its economic output, according to a statement on Saturday.

The Tourism Establishment Survey will provide data on the industry, including the size of the workforce, pay and revenue and expenditure. This will help calculate tourism’s share of gross domestic product and establish growth rates for activities within the sector, the General Authority for Statistics said.

On Thursday, Saudi Arabia’s sovereign fund announced it had formed a company, called Cruise Saudi, to develop a local cruise industry as Crown Prince Mohammed Bin Salman tries to turn the kingdom into a global tourism destination.

The 35-year-old heir to the throne introduced measures to boost tourism in Saudi Arabia, including allowing visiting unmarried couples to stay together in hotel rooms, removing the ban on female drivers and dropping a strict dress code for foreign women.

#Dubai Demands Joint Stock Firms List on Local Exchanges - Bloomberg

Dubai Demands Joint Stock Firms List on Local Exchanges - Bloomberg

Public joint stock companies established in Dubai, including those set up in special economic zones or free zones like the Dubai International Financial Centre, must list their stocks on local exchanges, the city’s media office said, citing a royal decree.

Private companies can go public in local markets, like the Dubai Financial Market PJSC and Nasdaq Dubai, after ensuring compliance with listing requirements and regulations, the office said on Saturday, citing a decision by the emirate’s ruler, Sheikh Mohammed Bin Rashid. Companies listed in local markets may have secondary listings in other markets.

According to the decree, foreign companies should list their stocks in local markets when their annual profit or revenue generated from activities in Dubai make up at least 50% of the total, or when their total assets owned in Dubai amount to 50% or more of their entire assets. The listing should be completed within one year of the date of reaching this percentage.

Why Oil Companies’ Fall From Favor Could Cause Next Price Spike - Bloomberg

Why Oil Companies’ Fall From Favor Could Cause Next Price Spike - Bloomberg

Nobody loves oil companies. Tesla Inc., the emblem of an emissions-free future, is worth more today than the top five Western supermajors combined.

Yet the world’s disdain for its petroleum giants could carry a sting in the tail -- a jarring price spike.

Oil may be on the way out, but it will be a long goodbye. Even if demand peaks, companies like Exxon Mobil Corp. and Royal Dutch Shell Plc need to keep investing tens of billions of dollars every year into fossil fuels just to stand still. Right now, many investors would prefer to take that cash in dividends, or see it channeled into renewables.

“We have concerns about investment, particularly in light of the pandemic,” OPEC Secretary-General Mohammad Barkindo said at a virtual conference in Iran on Jan. 26. Starving the industry of capital today “could sow the seeds for extreme volatility down the road.”

#Dubai, #Israel trade reaches 1 billion dirham since normalisation - Dubai media office | Reuters

Dubai, Israel trade reaches 1 billion dirham since normalisation - Dubai media office | Reuters

The trade between Dubai and Israel has reached 1 billion dirham ($272 million) over the last five months, the Dubai media office said on Saturday.

Israel and the United Arab Emirates agreed in August to normalise diplomatic relations.

The amount includes around 325 million dirham of imports and 607 million dirham of exports, the media office said in a statement.

#UAE Plans to Offer Citizenship to Select Group of Foreigners - Bloomberg

UAE Plans to Offer Citizenship to Select Group of Foreigners - Bloomberg

The United Arab Emirates plans to offer citizenship to a select group of people, the first Gulf nation to do so in a major policy shift designed to give expatriates a bigger stake in the economy and foster growth.

“We adopted law amendments that allow granting the UAE citizenship to investors, specialized talents & professionals including scientists, doctors, engineers, artists, authors and their families. The new directives aim to attract talents that contribute to our development journey,” Prime Minister Sheikh Mohammed Bin Rashid Al Maktoum said in a tweet.

“The UAE cabinet, local Emiri courts & executive councils will nominate those eligible for the citizenship under clear criteria set for each category. The law allows receivers of the UAE passport to keep their existing citizenship.”

Foreign residents make up more than 80% of the U.A.E.’s population and have for decades been a mainstay of its economy. The UAE comprises seven sheikhdoms, including Dubai and Abu Dhabi.

Commodities - Bloomberg Oil close

Commodities - Bloomberg Oil close

Oil set for slow recovery as vaccines rolled out: Reuters poll | Reuters

Oil set for slow recovery as vaccines rolled out: Reuters poll | Reuters

Oil prices will hover around current levels for much of the year before a recovery gains traction into end-2021 as vaccines help demand gradually emerge from the depths of the coronavirus pandemic, a Reuters poll showed on Friday.

The survey of 50 participants forecast Brent crude would average $54.47 per barrel this year, a jump from last month’s $50.67 forecast. Brent has averaged around $54 so far in January.

Oil prices rangebound as supply cuts offset virus worries | Reuters

Oil prices rangebound as supply cuts offset virus worries | Reuters

Oil prices edged up on Friday but traded in a tight range as demand concerns caused by new coronavirus variants and slow vaccine rollouts offset a cut in Saudi Arabian oil supply and falling U.S. oil inventories.

Brent crude futures for March rose 24 cents, or 0.4%, to $55.77 a barrel by 1126 GMT.

The Brent March contract expires on Friday. The more active April contract was up 26 cents, or 0.5%, at $55.36.

U.S. West Texas Intermediate (WTI) crude futures rose 3 cents, or 0.1%, to $52.37.

A Reuters poll showed that oil prices will hover around current levels for much of 2021 before a recovery gains traction towards the end of the year.

RDIF says completes joint investment of 7.85% in AliExpress Russia alongside partners | Reuters

RDIF says completes joint investment of 7.85% in AliExpress Russia alongside partners | Reuters

The Russian Direct Investment Fund (RDIF) on Friday said it had completed a joint investment to acquire 7.85% of AliExpress Russia, alongside the UAE’s Mubadala Investment Company and other Middle East sovereign wealth funds.

AliExpress Russia is an e-commerce venture between Chinese online shopping giant Alibaba and Russian partners.

The acquisition of shares was completed on Jan. 28, the RDIF said in a statement.

Oil steady as supply cuts offset demand worries on stalled vaccine rollouts | Reuters

Oil steady as supply cuts offset demand worries on stalled vaccine rollouts | Reuters

Oil prices were slightly lower in subdued trade on Friday, sticking to ranges seen over the past three weeks, as investors looked for signs of changing supply and demand fundamentals.

A cut in Saudi Arabia’s oil supply and lower U.S. oil stocks helped offset price pressures from fuel demand, which is slowing due to stalled vaccine rollouts and contagious new coronavirus strains.

“We’re waiting for the next shoe to drop in the oil market. We really don’t have much to move us around,” said Michael McCarthy, chief strategist at CMC Markets.

Brent crude futures for March slipped 2 cents to $55.51 a barrel at 0743 GMT, standing broadly flat on the day after falling 0.5% in the previous session.

The Brent March contract expires on Friday. The more active April contract was 3 cents, or 0.1%, lower at $55.17.

U.S. West Texas Intermediate (WTI) crude futures fell 23 cents to $52.10 a barrel, after easing 1% on Thursday.

Another IPO Record Beckons for #Saudi Stock Exchange This Year - Bloomberg

Another IPO Record Beckons for Saudi Stock Exchange This Year - Bloomberg

The Saudi stock exchange expects to host more initial public offerings than ever in 2021, seizing on strong demand from local investors that supported several deals last year.

After 22 issuances across different platforms in 2020, “I think we will break that record this year,” Khalid Abdullah Al-Hussan, the chief executive officer of the Tadawul exchange, said in an interview on the sidelines of the Future Investment Initiative conference in Riyadh.

Four companies went public last year on the main market of the Saudi exchange, raising a combined $1.5 billion, according to data compiled by Bloomberg. That was more than the $1.3 billion worth of IPOs in Germany, though far behind the listing of oil giant Saudi Aramco in 2019.

“We have a very very healthy pipeline in all our platforms, and there is a good focus on Nomu and the main market,” Al-Hussan said, referring to the parallel market for smaller listings in Riyadh. “So we see a good pipeline -- even better than 2020.”

Oil eases as demand worries offset weaker dollar, big storage draw | Reuters

Oil eases as demand worries offset weaker dollar, big storage draw | Reuters

Oil eased on Thursday as the market focused more on concerns that delays to vaccine rollouts and fresh travel curbs could depress demand than the impact of a weaker dollar and a big U.S. crude inventory drawdown.

Brent futures for March delivery fell 28 cents, or 0.5%, to settle at $55.53 a barrel, while U.S. West Texas Intermediate (WTI) crude ended 51 cents, or 1.0%, lower at $52.34.

With the Brent March contract expiring on Friday, the premium of the Brent front-month over the second month rose to its highest level since February 2020 for a fourth day in a row.

“We ... view the strong curve as indicative of tightening balances in which upcoming Saudi production cuts are more than offsetting increased demand concerns related to the coronavirus,” said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois.

UPDATE 1- #Saudi bourse could go public within two years, says CEO | Reuters

UPDATE 1-Saudi bourse could go public within two years, says CEO | Reuters

Saudi Arabia’s bourse, Tadawul, will announce plans to go public this year, its chief executive said on Thursday.

A timeline for an initial public offering (IPO) will be provided this year, Tadawul CEO Khalid Alhussan told Reuters on the sidelines of the Future Investment Initiative conference, adding that the listing could take place within a two-year time frame.

Tadawul hired HSBC in 2016 to manage an IPO initially planned for 2018 but put on hold due to oil giant Saudi Aramco’s record $29.4 billion listing at the end of 2019.

“Our commitment for listing continues the same. What we have delayed is just the time because Vision 2030 came in place, transformational commitment came into place,” Alhussan said, referring to Saudi Crown Prince Mohammed bin Salman’s plan to diversify the economy and wean it off crude revenues.

He said he anticipated that the total number of IPOs this year may exceed last year’s 22, and would be across the main index and other platforms, adding that it would give a strong indication of Saudi corporates’ views about listing.

MIDEAST STOCKS-Major Gulf markets track global stocks lower; #Saudi gains | Nasdaq

MIDEAST STOCKS-Major Gulf markets track global stocks lower; Saudi gains | Nasdaq

Major Gulf markets weakened on Thursday, tracking global shares, as a sudden sell-off on Wall Street and lingering COVID-19-induced restrictions soured investor sentiment worldwide.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 2%, while pan-European STOXX .STOXX benchmark shed 1.8%.

Oil, a key catalyst for financial markets in the Gulf region, steadied after earlier declines fuelled by fresh travel curbs to prevent new coronavirus outbreaks and delays to vaccine rollouts. O/R

Among Gulf markets, the Dubai benchmark .DFMGI led the declines, falling 1.1%. The index also posted its first weekly loss in four, shedding 1.4% over the five sessions to Thursday.

Blue-chip developer Emaar Properties EMAR.DU was the worst performer on the Dubai index, with just two constituents in the benchmark finishing in the positive territory.

In Abu Dhabi, the index .ADI closed 0.4% lower, dragged mainly by a 0.6% decline in telecom giant Etisalat ETISALAT.AD and an about 2% fall in real estate stock Aldar Properties ALDAR.AD. Abu Dhabi had gained 1.4% in the previous session.

The index also managed a fourth successive weekly gain, firming 0.5% during the week.

The Qatari index .QSI lost nearly 1%, with Qatar Islamic Bank QISB.QA shedding 2.4% to be the worst performer on the benchmark.

The index also logged a weekly loss of 1.8%, declining in four of the last five trading days.

Qatar's Commercial Bank COMB.QA Chief Executive Officer Joseph Abraham said the firm plans to raise at least $1 billion through bond issues in the coming months, as the bank looks to take advantage of positive market conditions. The bank's shares followed the broader market, slipping 1.2%.

Saudi Arabia's benchmark index .TASI bucked the trend to end 0.3% higher, with Saudi Basic Industries Corp (SABIC) 2010.SE, the world's fourth-biggest petrochemicals firm gaining about 1%.

The index, however, posted a weekly loss of 0.8%, its second straight decline for the period.

Oil steadies as COVID-19-induced demand worries persist | Reuters

Oil steadies as COVID-19-induced demand worries persist | Reuters

Oil steadied on Thursday after early declines fuelled by delays to vaccine rollouts and fresh travel curbs to prevent new coronavirus outbreaks.

Brent crude futures were up 8 cents, or 0.1%, at $55.89 a barrel by 1331 GMT, having hit a session low of $55.31.

U.S. West Texas Intermediate (WTI) crude futures were down 8 cents, or 0.2%, at $52.77 after dropping as low as $52.22.

Oil prices were supported by data on Wednesday showing a huge 10 million barrel decline in U.S. crude inventories last week, which analysts said was because of a pick-up in U.S. crude exports and a drop in imports.

Aramco will launch further share sales - #Saudi crown prince | Reuters

Aramco will launch further share sales -Saudi crown prince | Reuters

Saudi Arabia’s Crown Prince Mohammed bin Salman, the kingdom’s de facto ruler, on Thursday said that oil giant Saudi Aramco will hold further share sales.

He was speaking at the kingdom’s Future Investment Initiative conference.

Aramco, the world’s biggest oil company completed the world’s largest initial public offering in late 2019.

European, Middle Eastern & African Stocks - Bloomberg #UAE #Kuwait #Israel #SaudiArabia #Qatar close

European, Middle Eastern & African Stocks - Bloomberg #UAE #Kuwait #Israel #SaudiArabia #Qatar close

UK court allows Abraaj founder's extradition to U.S | Reuters

UK court allows Abraaj founder's extradition to U.S | Reuters

The founder of collapsed Dubai-based private equity company Abraaj Group will be extradited to the United States, where he is wanted on fraud charges, a London court ruled on Thursday.

U.S. prosecutors allege Arif Naqvi, a Pakistani businessman, is the architect of a plot to defraud investors including the Bill & Melinda Gates Foundation. Naqvi’s lawyers have said he could face 291 years in jail if convicted in the U.S..

Dubai-based Abraaj was the largest buyout fund in the Middle East and North Africa until its collapse in 2018, after investors raised concerns about the management of its $1 billion healthcare fund.

Mubadala's four main business units prepare it for next phase of growth | The National

Mubadala's four main business units prepare it for next phase of growth | The National

Mubadala Investment Company's new organisational structure along four lines of business will gear the investment company for its next phase of growth.

The strategic investment fund with $232 billion of assets across six continents is being organised around four new entities: UAE investments, disruptive investments, direct investments and real estate and infrastructure.

The organisation is currently structured around key areas of investment: petroleum and petrochemicals; technology, mining and minerals; alternative investments and infrastructure; and aerospace, renewables and ICT, but a review of this structure has been under way since 2019.

"This new structure aligns with our aspirations to grow significantly in the coming years, in key asset classes and important geographies, and to continue building on our job creation and economic growth engines here in the United Arab Emirates," Ahmed Al Calily, Mubadala's chief strategy and risk offer, told The National.

#SaudiArabia Won’t Erase Budget Deficit by 2024, Says Goldman - Bloomberg

Saudi Arabia Won’t Erase Budget Deficit by 2024, Says Goldman - Bloomberg

Saudi Arabia’s budget deficit will narrow into 2024 but the kingdom is unlikely to balance its books by then as the government forecasts, according to Goldman Sachs Group Inc.

“In the medium term, we are cautious regarding the prospects for significant cuts to public spending, and see a gradual narrowing of the budget deficit to around 4.1% of gross domestic product in 2024,” Farouk Soussa, a London-based economist at Goldman, wrote in a report. “The government, meanwhile, projects a balanced budget in this time frame, suggesting upside risks to our more conservative forecasts.”

The double shock of lower oil prices and the economic fallout of the Covid-19 pandemic sent the kingdom’s deficit into double digits in 2020. Goldman sees this year’s shortfall narrowing significantly to 6.4% of GDP but remaining wider than the government’s 4.9% target.

#Qatar’s Third-Biggest Bank Says It’s in Turkey for ‘Long Haul’ - Bloomberg

Qatar’s Third-Biggest Bank Says It’s in Turkey for ‘Long Haul’ - Bloomberg

Commercial Bank of Qatar is committed to its business in Turkey for “the long haul” and will focus on building its operations there, according to the top executive at the lender.

“We are focusing on building it and improving the return on equity,” Group Chief Executive Officer Joseph Abraham said in a Bloomberg TV interview Thursday. CBQ has spent the last few years turning the business around, with its non-performing loans better than the market’s average, he said.

CBQ is currently Qatar’s third-largest lender by assets, though a combination between Masraf Al Rayan QSC and Al Khalij Commercial Bank PQSC could knock it down a notch. It took full ownership of Alternatifbank AS in 2016 and has had to undertake several rounds of capital increases since then to support the Turkish unit’s growth plans.

Turkish banks are at risk of an increase in NPLs after being pressured into extending more credit to keep the economy afloat through a currency crisis and lockdown restrictions aimed at slowing the spread of Covid-19. The outlook for the industry is shifting, however, following a dramatic change in policy making last November, after the central bank governor was fired by President Recep Tayyip Erdogan, and the resignation of his son-in-law as finance minister.

#Qatar's Commercial Bank plans to raise at least $1 bln via bond sales - CEO | Reuters

Qatar's Commercial Bank plans to raise at least $1 bln via bond sales - CEO | Reuters

Qatar’s Commercial Bank is planning to raise at least $1 billion through bond issues in the coming months, Chief Executive Joseph Abraham said, as the bank looks to take advantage of positive market conditions to boost its capital.

It plans to issue its debut international additional tier 1 bonds in the first quarter, aiming to raise between $500 million and $650 million, depending on market appetite.

On top of that, probably at the end of the quarter, it plans to issue senior bonds worth $500-$600 million, Abraham said.

“We’re seeing if we can diversify the investor base in our bonds, and also the tenor ... because I think this is a good time to look at maybe extending the tenor for some portions of the bonds,” he said in an interview.

This week the bank reported a 35.6% annual drop in net profit for 2020 but expects business conditions to improve this year amid the vaccines roll out and a rebound in energy prices.

Oil falls on COVID-19-induced demand worries, stronger dollar | Reuters

Oil falls on COVID-19-induced demand worries, stronger dollar | Reuters

Oil fell on Thursday on fresh fuel demand worries because of travel curbs to prevent new coronavirus outbreaks and delays with vaccines and a stronger U.S. dollar weighed on prices.

U.S. West Texas Intermediate (WTI) crude futures fell 36 cents, or 0.7%, to $52.49 a barrel at 0738 GMT, erasing Wednesday’s gain.

Brent crude futures fell 46 cents, or 0.8%, to $55.35 a barrel, after losing 10 cents on Wednesday.

The U.S. dollar index, which measures the greenback against other major currencies, rose to 90.753 from a January low of 89.206. Buyers using other currencies must pay more for dollar-denominated oil when the greenback rises.

The oil market had been supported earlier this week by a surprisingly large decline in U.S. crude stockpiles in the week to Jan. 22, which analysts said was due to a pick up in U.S. crude exports and a drop in imports.

Most Gulf markets in red mirroring Asian stocks | Reuters

Most Gulf markets in red mirroring Asian stocks | Reuters

Most stock markets in the Gulf retreated on Thursday, in line with Asian shares, as a sudden sell-off on Wall Street and delays with coronavirus vaccines weighed on sentiment.

Oil prices, a key catalyst for the Gulf region’s financial markets, also slipped despite a huge drop in U.S. crude stock.

Brent crude futures fell 36 cents, or 0.65%, to $55.45 a barrel, after losing 10 cents on Wednesday.

Saudi Arabia’s benchmark index fell 0.4%, with the kingdom’s largest lender National Commercial Bank losing 1.1%, while Al Rajhi Bank slipped 0.4%.

Dubai’s main share index dropped 0.8%, dragged down by a 1.3% fall in blue-chip developer Emaar Properties and a 0.8% decrease in Emirates NBD Bank.

In Abu Dhabi, the index slipped 0.4%, hit by a 0.4% fall in the country’s largest lender First Abu Dhabi Bank and a 0.5% ease in telecom giant Etisalat.

The Qatari index lost 0.6%, as most of the stocks on the index were in negative territory including Qatar Islamic Bank, which traded 1.1% lower.

Drake and Scull: Jordan court files indictment against Khaldoun Tabari | ZAWYA MENA Edition

Drake and Scull: Jordan court files indictment against Khaldoun Tabari | ZAWYA MENA Edition

The Public Prosecutor in Amman, Jordan, has filed an indictment against the former CEO of Dubai-based contractor Drake and Scull International, his daughter and a former executive director at the firm on several charges, including fraud.

In a statement issued on Wednesday, the DSI said the indictment made against Khaldoun Saeed Al Tabari, Zeina Khaldoun Al Tabari, and Saleh Mustafa Muradweij, a former executive director at the firm, includes the felony of fraud in buying, selling, or managing movable and immovable state or public authority funds, as per Article (175) of the Penal Code and Articles (2, 3 and 4) of the Jordanian Economic Crimes Law.

Tabari was the CEO of DSI from 1998 to 2016 and has been accused by the UAE’s Public Funds Prosecution of several transgressions valued at more than AED 4 billion in addition to other financial crimes.

He left the UAE with his family in 2018 and has not returned since. In January 2020, Tabari was arrested at Jordan's Queen Alia International Airport in Amman on January 7 as he was catching a flight to the UK, after Interpol issued a Red Notice for his arrest.

Fortunes Diverge for #Dubai, Turkey Firms Bidding on Israeli Port - Bloomberg

Fortunes Diverge for Dubai, Turkey Firms Bidding on Israeli Port - Bloomberg

Israeli officials have cleared United Arab Emirates port operator DP World to move forward in the privatization of Israel’s largest seaport but kept Turkey’s Yildirim Holding AS under further scrutiny.

DP World received security clearance to move forward in the bidding process for the port in the northern city of Haifa, according to two people familiar with the matter. Local representatives for Yildirim lodged a complaint about unfair treatment in the process, according to a letter it sent to Israeli officials that was seen by Bloomberg.

The Government Companies Authority, which is running the privatization, said Israel is making necessary regulatory checks as part of confirming investors’ participation in the Port of Haifa privatization and that it expects the sale to be completed in a few months. Representatives for Yildirim and DP World declined to comment.

DP World’s progress is an important indicator for Israel’s new normalization agreement with the UAE, which the countries announced last summer. It marks a key nod of approval from Israel when it comes to Emirati involvement in strategic assets. Israel hopes to sell the facility for as much as 2 billion shekels ($612 million).

#SaudiArabia Says 7 Businessmen Arrested for $3.1 Billion Scheme - Bloomberg

Saudi Arabia Says 7 Businessmen Arrested for $3.1 Billion Scheme - Bloomberg

Saudi authorities said they had arrested seven businessmen and 12 bank employees for a scheme that involved transferring 11.6 billion riyals ($3.1 billion) of unknown origin abroad.

A statement from the kingdom’s anti-corruption authority published by the official Saudi Press Agency said officials had foiled a “gang” of foreign residents, bank employees and businessmen that worked together “to deposit cash amounts of an unknown source and transfer them outside of the kingdom.” In addition to the businessmen and bank employees, authorities detained a police officer and several other citizens and foreign residents.

The men arrested were accused of bribery, forgery, exploiting their jobs for illegal financial gain, money laundering and other crimes, according to the statement. The statement did not provide their names.

The announcement came the same day the kingdom held its annual global investment summit, the Future Investment Initiative. The inaugural conference in 2017 was followed by a controversial anti-corruption campaign led by Crown Prince Mohammed bin Salman, who has pledged to root out graft in the country whatever its source. Saudi dissidents have accused him of using corruption allegations to undermine potential opponents and critics, a charge that officials have denied.

Oil prices end mixed, despite big U.S. crude stock drawdown | Reuters

Oil prices end mixed, despite big U.S. crude stock drawdown | Reuters

Oil prices were little changed on Wednesday, despite a massive drawdown in U.S. crude inventories, as ongoing concerns about the coronavirus pandemic tempered buying interest.

U.S. crude oil stocks dropped by nearly 10 million barrels last week to their lowest levels since March, surprising the market, which was looking for a modest increase in stocks. [EIA/S]

“The market was led up by a significant draw in crude oil as the refining industry continues to turn the crude oil surplus into refined products,” said Andrew Lipow, president Lipow Oil Associates in Houston.

U.S. West Texas Intermediate (WTI) crude futures settled at $52.85 a barrel, rising 24 cents, while global benchmark Brent crude futures fell 10cents to end at $55.81 a barrel.

Also helping oil was the U.S. Federal Reserve’s decision to stick to its dovish tone and leave its key overnight interest rate near zero to maintain monetary support until there is a stronger rebound from the pandemic-triggered recession.

#SaudiArabia Aims to Become Next Germany of Renewable Energy - Bloomberg

Saudi Arabia Aims to Become Next Germany of Renewable Energy - Bloomberg

Saudi Arabia wants to emulate Germany’s success with renewable energy and be a pioneer in hydrogen production, as the world’s biggest exporter of oil seeks to diversify its economy.

“We will be another Germany when it comes to renewables,” Energy Minister Prince Abdulaziz bin Salman said Wednesday on a panel at the Future Investment Initiative conference in Riyadh. “We will be pioneering.”

The kingdom is working with many countries on green and blue hydrogen projects and those to capture carbon emissions, he said.

The green version of the fuel, which produces only water vapor when burned, is made with renewable energy, typically solar and wind power. The blue type is produced from natural gas, with the greenhouse gas emissions being captured so they can’t escape into the atmosphere.

While hydrogen is seen as crucial for the switch from oil and gas to cleaner fuels, the technology to make it is still comparatively expensive.

Stable outlook for GCC banks; but profits under pressure again: Fitch | ZAWYA MENA Edition

Stable outlook for GCC banks; but profits under pressure again: Fitch | ZAWYA MENA Edition

Fitch Ratings expects to see positive real GDP growth in most GCC countries which should bring revenue opportunities for the region’s beleaguered banking sector currently reeling from the twin shocks of low oil prices and COVID-19 related economic slowdown.

“Overall, we have a stable outlook on the banking sector despite the challenging environment,” said Raymond Ramsdale, Head of Middle East Banks & Islamic Banking at a Fitch webinar titled “2021 Outlook: ME Islamic & Conventional Banks Wading Through the Coronavirus and Low Oil Prices” on Wednesday.

The ratings agency expects loan growth in the GCC to be soft, averaging between 2 and 3 percent, driven by a mix of government and government-related entities (GRE’s) and non-oil sector. However, for banks in Saudi Arabia, the average loan growth could be about 7 percent, higher than the Middle East average, on the back of growth in retail mortgages.

Banks’ profitability, which last year was impacted by lower interest rates, higher impairment charges and lower business volumes will continue to be under pressure in 2021. “In fact, loan impairment charges may be even higher this year as we expect to see loan impairment charges over gross loans to average between 1-1.5 percent; two or three times what they have historically been,” said Ramsdale.

MIDEAST STOCKS- #UAE markets strengthen, #SaudiArabia edges down | Nasdaq

MIDEAST STOCKS-UAE markets strengthen, Saudi Arabia edges down | Nasdaq

Markets in the United Arab Emirates (UAE) finished higher on Wednesday, with Abu Dhabi index .ADI leading the advancements, buoyed by gains in the country's largest lender First Abu Dhabi Bank FAB.AD.

The Abu Dhabi benchmark closed 1.4% higher, bouncing back from losses in the previous session.

FAB was the best performer on the Abu Dhabi index, putting on 2.5%, while real estate firm Aldar Properties ALDAR.AD added 3.5%.

The bank on Tuesday after-market hours said its underlying operating performance is expected to improve in 2021, driven mainly by a healthy pipeline of business from government and state-linked companies, and by its latest acquisition in Egypt.

The lender posted a 16% drop in 2020 net profit on higher impairment charges, but that came in better than analysts' average forecast of 9.36 billion dirhams, according to Refinitiv data.

Dubai's main share index .DFMGI gained about 1.1%, with its biggest bank Emirates NBD ENBD.DUadding 2.6% as the lender posted a better-than-expected annual net profit.

Sharia-compliant lender Dubai Islamic Bank DISB.DU tacked on 2%.

Saudi Arabia's benchmark index .TASI, however, edged down 0.1%, dragged by Samba Financial Group 1090.SE, which fell 0.8% and was the worst performer on the index.

Saudi Arabia raised $5 billion in a dual-tranche bond sale with tenors of 12 and 40 years, a document showed, as it seeks to plug a large fiscal deficit.

The world's top oil exporter has taken a severe blow from the pandemic, which, along with a price war between Saudi Arabia and Russia last year, sent crude prices tumbling.

In Qatar, the index .QSI eked out a narrow 0.1% gain, breaking a four-session losing run.

Qatar Industries IQCD.QA was the best performer, adding 0.8%, while Qatar National Bank QNBK.QA, the Gulf's biggest lender by assets, rose 0.6%.

The index's gains, however, were capped by a 1.8% decline in Qatar International Islamic Bank QIIB.QA.

European, Middle Eastern & African Stocks - Bloomberg #UAE #Kuwait #Israel #SaudiArabia #Qatar close

European, Middle Eastern & African Stocks - Bloomberg #UAE #Kuwait #Israel #SaudiArabia #Qatar close

#SaudiArabia Gets Its Timing Right For the Davos of the Desert - Bloomberg

Saudi Arabia Gets Its Timing Right For the Davos of the Desert - Bloomberg

The “Davos in the Desert,” as the annual Future Investment Initiative in Riyadh has come to be known, has often been associated with controversy and crisis. As Saudi Crown Prince Mohammed bin Salman’s showcase event for investors, this year's event may be a chance for a rebound. Investors are anxious to see clear skies and signs of recovery after a difficult 2020.

The inaugural gathering in 2017 was quickly overshadowed by what the government claimed was a crackdown on corruption, in which the venue of the event, Riyadh’s Ritz-Carlton hotel, was turned into a prison for hundreds of rich and powerful Saudis. The detentions of many prominent businesspeople inevitably had a chilling effect on foreign direct investment, which fell to a 14-year low in 2017. The following year, the event was haunted by the recent murder of journalist Jamal Khashoggi: Spooked by the international outcry, global business leaders stayed away.

The 2019 FII was scaled down (along with the size of the initial public offering of the country’s biggest company, Saudi Aramco) as the government tried to refocus efforts on concrete economic reforms. Though foreign direct investment showed a slight pick-up that year, it hasn’t accelerated. And the 2020 edition had to be postponed as the coronavirus pandemic killed off investor interest and stalled progress on major infrastructure and tourism initiatives.

MBS, as the crown prince is commonly known, will be hoping for better as the fourth FII kicks off today. For all the controversies of previous years, his own position as the kingdom’s de facto ruler is unchallenged: He wields complete political authority as well as command of the driving force behind the economy and the country's economic development model, the Public Investment Fund. If there are investment opportunities to be had in Saudi Arabia, they will go through him.

#Dubai's Emirates NBD full year profit plunges 52%; board recommends dividend | ZAWYA MENA Edition

Dubai's Emirates NBD full year profit plunges 52%; board recommends dividend | ZAWYA MENA Edition

Dubai's biggest bank Emirates NBD reported a 52 percent plunge in full-year net profit due to a rise in provisions for bad loans and no repeat of the gain on disposal of Network International shares in 2019.

Net profit for the year fell to 6.97 billion dirhams ($1.9 billion) from 14.5 billion dirhams in 2019 when Emirates NBD sold a stake in payments processor Network International. The board of Emirates NBD has recommended a dividend of 40 fils per share.

The bank's impairment allowances increased to 7.9 billion dirhams reflecting weaker credit environment impact of COVID-19 with net cost of risk at 163 bps. Net interest margin declined 24 bps y-o-y to 2.65 percent following cuts in base interest rates in the first half of 2020.

Sheikh Ahmed Bin Saeed Al Maktoum, Chairman, Emirates NBD said: “Emirates NBD delivered a net profit of 7 billion dirhams in 2020 despite the global pandemic that caused major disruption to individuals, communities and businesses. As the official banking partner of Expo 2020 Dubai, we look forward to helping showcase the UAE’s innovative, tolerant and proud culture as we welcome the world to the UAE. In light of the Bank’s performance, we are proposing a cash dividend at 40 fils per share.”

ADX plans new listings, derivatives trading in drive to double market cap | ZAWYA MENA Edition

ADX plans new listings, derivatives trading in drive to double market cap | ZAWYA MENA Edition

The Abu Dhabi Securities Exchange (ADX) plans to double market capitalisation over the next three years by increasing liquidity and improving market efficiency, the exchange said in a statement Wednesday.

A new strategy called “ADX One”, which includes new listings, launch of derivatives trading and research coverage, aims to adopt best international practices and make the exchange more attractive for foreign investors, the exchange said in a statement Wednesday.

The new strategy comes as the market capitalisation of companies listed on the ADX rose 40 percent in 2020 to a record 750 billion dirhams. The market value of foreign-owned shares in ADX-listed companies topped 60 billion dirhams at the end of December last year.

The ADX is the second-largest exchange in the region, behind Saudi Arabia’s Tadawul. Among its heavyweight listings are First Abu Dhabi Bank and Etisalat.

Top #AbuDhabi Lender Names Al Rostamani as First Female CEO - Bloomberg

Top Abu Dhabi Lender Names Al Rostamani as First Female CEO - Bloomberg

Hana Al Rostamani Source: First Abu Dhabi Bank PJSC

First Abu Dhabi Bank PJSC appointed Hana Al Rostamani as group chief executive officer, promoting a woman to the top leadership position in a male-dominated sector.

Al Rostamani will be the first female CEO of the biggest lender in the United Arab Emirates, taking over from Andre Sayegh, who spent less than a year in the role. She is currently deputy group CEO and head of personal banking.

“FAB has always been an organization that champions diversity and the appointment of our first female Group CEO to lead our company into the future is truly something to value,” Chairman Sheikh Tahnoon Bin Zayed Al Nahyan said.

#Saudi Sovereign Fund Sets Sky-High Targets for Tough Next Act - Bloomberg

Saudi Sovereign Fund Sets Sky-High Targets for Tough Next Act - Bloomberg

Saudi Arabia’s $400 billion sovereign wealth fund will find it tough to repeat its success of recent years when it made its mark globally as a source of cash for asset managers, tech entrepreneurs and tycoons.

Ahead of the kingdom’s flagship investment conference this week, Saudi Crown Prince Mohammed bin Salman laid out the fund’s strategy through 2025. It’ll spend at least $40 billion a year at home, creating new cities and industries, along with 1.8 million jobs. It plans to more than double assets it controls to over 4 trillion riyals ($1.1 trillion), putting it on par with the current size of Norway’s sovereign fund, the world’s biggest.

But as investors tune in Wednesday to the annual meeting dubbed “Davos in the Desert” by participants -- held as a hybrid virtual-physical event due to Covid-19 -- many will recall that Saudi Arabia’s track record on ambitious projects is patchy.

Top #UAE Banks Fare Better Than Expected With Payouts Intact - Bloomberg

Top UAE Banks Fare Better Than Expected With Payouts Intact - Bloomberg

The two biggest banks in the United Arab Emirates reported a decline in annual profit that was less severe than expected as the lenders brace for the full brunt of the economic fallout from the coronavirus pandemic and lower oil prices.

Emirates NBD PJSC, Dubai’s biggest lender, and First Abu Dhabi Bank PJSC, its counterpart in the UAE capital, both maintained their dividend payouts for 2020 despite a surge in impairment losses as their buffers to protect depositors against shocks remained strong. Shares of both banks rose.

While an acceleration in the pace of vaccine distribution and a normalization in travel is helping to partly offset the drop in crude prices and output due to the Covid-19 outbreak, the economy is struggling to gain traction. The profitability of UAE lenders is expected to remain under pressure this year as the central bank phases out support measures introduced to shield the economy from the damage caused by the Covid-19 outbreak and bad debts climb, according to S&P Global Ratings.

Oil up above $56 on lower U.S. stockpiles, drop in new Chinese COVID-19 cases | Reuters

Oil up above $56 on lower U.S. stockpiles, drop in new Chinese COVID-19 cases | Reuters

Oil rose above $56 a barrel on Wednesday after industry data showed U.S. crude inventories fell unexpectedly and as concerns eased about a resurgence in coronavirus cases in China, the world’s second-biggest oil user.

Industry group the American Petroleum Institute (API) said U.S. crude inventories fell by 5.3 million barrels. Analysts had expected them to rise. Official inventory figures are due at 1530 GMT from the Energy Information Administration. [EIA/S]

Brent crude climbed 51 cents, or 0.9%, to $56.42 a barrel at 0920 GMT. U.S. West Texas Intermediate (WTI) crude rose 41 cents, or 0.8%, to $53.02.

“Oil prices are inching higher this morning amid data pointing to an unexpected drop in US crude stocks,” said Stephen Brennock of broker PVM.

Brent is near an 11-month high of $57.42 reached on Jan. 13, having recovered from a 21-year low below $16 in April due to a demand recovery particularly in China and huge supply cuts by OPEC and its allies, known as OPEC+.

MIDEAST STOCKS-Lender FAB buoys #AbuDhabi as major Gulf markets rise | Nasdaq

MIDEAST STOCKS-Lender FAB buoys Abu Dhabi as major Gulf markets rise | Nasdaq

Major stock markets in the Gulf traded higher on Wednesday, with the Abu Dhabi index leading the gains, boosted by top lender First Abu Dhabi Bank.

In Abu Dhabi, the index .ADI advanced 1.1%, buoyed by a 1.5% gain in First Abu Dhabi Bank (FAB) FAB.AD and a 3.5% jump in Aldar Properties ALDAR.AD.

FAB, the United Arab Emirates' largest lender, posted a net profit of 10.6 billion dirhams ($2.89 billion) in the year ended Dec. 31, down from 12.5 billion dirhams in the same period a year earlier.

The net profit, however, came in better than analysts' average forecast of 9.36 billion dirhams, according to Refinitiv data.

Dubai's main share index .DFMGI gained 1.1%, with sharia-compliant lender Dubai Islamic Bank DISB.DU rising 2.2%, while Emirates NBD ENBD.DU traded 1.7% higher after the lender posted its full-year numbers.

Saudi Arabia's benchmark index .TASI added 0.1%, bolstered by a 0.6% increase in Al Rajhi Bank 1120.SE.

The kingdom's economy will grow 2.6% this year, the International Monetary Fund said on Tuesday, after the economy of the world's top oil exporter shrank last year due to low oil prices and the coronavirus crisis.

Saudi Arabia itself has estimated its economy could swing back to growth of 3.2% this year after a 3.7% contraction in 2020.

In Qatar, the index .QSI edged up 0.1%, helped by a 1.4%gain in Qatar National Bank <QNBK.QA, the Gulf's biggest lender by assets.

The index's gains, however, were capped by a 1.6% decline in Commercial Bank COMB.QA, which is scheduled to report its 2020 results.

Oil prices steady as virus deaths rise, demand worries persist | Reuters

Oil prices steady as virus deaths rise, demand worries persist | Reuters

Oil prices were little changed on Tuesday as coronavirus deaths globally continued to rise and weighed on the demand outlook, but losses were capped by reports of a blast in Saudi Arabia.

Brent crude ended the session up 3 cents, or 0.05%, at $55.91 while U.S. crude fell 16 cents, or 0.3%, to settle at $52.61.

Indonesia, the world’s fourth-most-populous country, surpassed a million confirmed coronavirus cases on Tuesday while the death toll in Britain passed 100,000 people as the government battled to speed up vaccination delivery and keep variants of the virus at bay.

The number of cases in the United States crossed 25 million on Sunday, a Reuters tally showed.

Further dampening bullish sentiment, U.S. Democrats are still trying to convince Republican lawmakers of the need for more stimulus, raising questions over when and in what form a package will be approved.

#Israel's Airobotics eyes Tel Aviv IPO, drone deal in #Dubai | Reuters

Israel's Airobotics eyes Tel Aviv IPO, drone deal in Dubai | Reuters

Israeli drone technology firm Airobotics is preparing for an initial public offering (IPO) in Tel Aviv this year and is also close to clinching deals in the United Arab Emirates (UAE), chief executive officer Ran Krauss said on Tuesday.

He declined to give specifics, citing regulatory issues.

“We are starting the process and we’re about to submit the (prospectus) to Tel Aviv Stock Exchange in the coming months,” he told Reuters.

A source close to the matter said Airobotics -- which has raised $120 million in private funding -- plans to raise $50 million through the IPO, based on a pre-float valuation of around $240 million. The source said the company was planning for an April listing after the prospectus is published in two weeks time.

Krauss, speaking virtually from Dubai, said Airobotics was engaged with a number of entities in the city and would “shortly” sign a first contract there for its smart city and other drone technology.

#Saudi Aramco may sell more shares if market is right - PIF | Reuters

Saudi Aramco may sell more shares if market is right - PIF | Reuters

Saudi Aramco may consider selling more shares if market conditions are right, the head of Saudi Arabia’s sovereign wealth fund told a news briefing on Tuesday.

The Saudi government sold more than 1.7% of Aramco in a 2019 initial public offering that raised a record $29.4 billion, triggering more IPOs in the kingdom, which is also seeking to deepen its capital markets to reduce its reliance on oil.

Yasir al-Rumayyan, who is governor of Saudi Arabia’s Public Investment Fund (PIF), made the comments during a media briefing to give details on the PIF’s five-year plan.

The PIF, whose holdings include a stake in Uber, plans to double its assets to 4 trillion riyals ($1.07 trillion) by 2025, Prince Mohammed bin Salman said on Sunday, making it one of the world’s biggest sovereign wealth funds.

Initially the government had wanted to list Aramco on the Saudi bourse and an international stock exchange, but an overseas listing plan was shelved.

MIDEAST STOCKS-Most Gulf markets ease in line with Asian stocks | Nasdaq

MIDEAST STOCKS-Most Gulf markets ease in line with Asian stocks | Nasdaq

Most Gulf markets ended lower on Tuesday, mirroring Asian shares, as concerns about potential roadblocks to new U.S. President Joe Biden's planned $1.9 trillion stimulus weighed on investor sentiment.

Saudi Arabia's benchmark index .TASI lost 0.7%, weighed down by a 1% fall in Al Rajhi Bank 1120.SE and a 2.2% decline in the country's largest lender National Commercial Bank 1180.SE.

The Dubai index .DFMGI declined 0.9%, its third loss in four sessions, hit by a 1.8% fall in the blue-chip developer Emaar Properties EMAR.DU and a 1.3% retreat in Emirates NBD Bank ENBD.DU.

Abu Dhabi's benchmark .ADI slipped 0.6%, pressured by a 1.7% drop in the United Arab Emirates' largest lender First Abu Dhabi FAB.AD.

The number of daily coronavirus cases in the UAE, a federation of seven emirates, has tripled in the past month. On Monday authorities registered 3,579 new infections and nine deaths. They do not provide a breakdown per emirate.

Forecasts for economic recoveries in the six-member Gulf Cooperation Council in 2021 have been trimmed while expectations for gross domestic product declines last year were mixed in a quarterly Reuters survey of analysts released on Tuesday.

Elsewhere, the Qatari benchmark .QSI, closed 0.3% down, extending losses for a fourth straight session.

The top decliners included Qatar National Bank QNBK.QA and Qatar Gas Transport Co QGTS.QA, which fell 1% and 1.8%, respectively.

#SaudiArabia Targets Deals to Expand Local Manufacturing to Diversify From Oil - Bloomberg

Saudi Arabia Targets Deals to Expand Local Manufacturing to Diversify From Oil - Bloomberg

Yasir Al-Rumayyan said the PIF is in a “very advanced stage” of negotiating joint ventures as part of a partnership that could ease the path for foreign companies.

 
Photographer: Mohammed Al-Nemer/Bloomberg

Saudi Arabia aims to agree on deals this year or next to expand local manufacturing, the head of the kingdom’s wealth fund, Yasir Al-Rumayyan, told a briefing in Riyadh.

“Now we’re in the process of looking at electric appliances,” he said Tuesday. “In relation to cars, there is more than one project that we’re now looking at, and they will be executed this year or next year at the latest.”

Saudi Arabia is trying to become a Middle Eastern hub for manufacturing electric vehicles as it diversifies its economy from oil. Bloomberg reported earlier this month that Lucid Motors Inc. is in talks with the $400 billion Public Investment Fund to build a factory, potentially near the Red Sea city of Jeddah. The PIF, as the fund is known, is already a shareholder in Lucid.

Al-Rumayyan said the PIF is in a “very advanced stage” of negotiating joint ventures as part of a partnership that could ease the path for foreign companies.

“We would open and pave the way for them in dealing with regulations, laws, tax holidays or even off-takes -- either from us or from the government,” he said. “We negotiate a lot of things for them. So it makes perfect sense of those companies to come and really be with us in Saudi Arabia.”