Transcript Zero Episode 34: UAE Oil Boss Sultan Al Jaber Has a Plan for COP28 - Bloomberg
Sultan Al Jaber is the president of COP28. He is also the head of Abu Dhabi National Oil Co., the state-owned oil company that's the source of wealth in the United Arab Emirates. That juxtaposition has been met with criticism from green groups, but also with an embrace from those looking to reform the United Nations-backed annual climate summits.
That’s in part because Al Jaber isn’t an oil boss cut from the prototypical mold — he spent a decade as a renewables executive. This week on Zero, Bloomberg Green executive editor Aaron Rutkoff talks to senior reporter Akshat Rathi about his new in-depth profile of Al Jaber, and what it means when a kingdom built on oil controls the world’s climate progress.
Listen to the full episode below, learn more about the podcast here, and subscribe on Apple, Spotify, and Google to stay on top of new episodes.
Moscow approves sale of Inditex's Russian business to UAE-based buyer | Reuters
The Russian government on Wednesday said it had approved a deal for Spain's Inditex (ITX.MC) to sell its Russian business to a UAE-based buyer, with some of its former stores to reopen under new branding in April and May.
Inditex shuttered its more than 500 Russian stores after Moscow sent troops into Ukraine, and agreed to sell them in October, although small-scale imports and online sellers are helping to keep Inditex's brands alive in Russia.
Inditex did not immediately respond to a request for comment.
The company previously said it had agreed to transfer 245 of its 514 shops to UAE-based Daher Group, while others would close. It has said that the new brands opening in Russia would be totally different from Inditex brands.
Russian exits by Western companies have been complicated as deals involving firms from so-called unfriendly countries - those that imposed sanctions against Russia - need approval from a government commission. Companies often insert buyback clauses that could one day see them return.
Dubai Luxury Housing Market Sets Record With Baccarat, Bulgari Penthouse Sales - Bloomberg
For the world’s rich looking for places to stash their wealth, one segment of Dubai’s real estate market is increasingly the destination of choice: apartments and townhouses with a brand name, like Four Seasons, Bulgari and Cavalli.
Sales of those properties are booming in Dubai, which has become the world capital of so-called branded residences as foreign buyers continue to purchase ultra-luxury homes. This week, a buyer agreed to pay 203.1 million dirhams ($55.3 million) for a five-bedroom, Baccarat-branded apartment in a project that hasn’t even broken ground yet. At 14,000 dirhams per square foot, it’s the highest price per square foot paid for a pre-construction apartment, according to Luxhabitat Sotheby’s International Realty, the broker on the property.
It breaks a record set in just February, when a five-bedroom apartment sold for 160.3 million dirhams, or 13,751 dirhams per square foot, in the Bulgari Lighthouse, according to Dubai land records. The tower will be built on a seahorse-shaped, manmade island near the jewelry brand’s hotel and resort.
Luxury real estate boomed in Dubai as the rich got richer during the Covid-19 pandemic and as Russians looked for safe havens for money after their country’s invasion of Ukraine. Prime real estate soared 89% in October from the previous year—a swift recovery from a slump that lasted from 2014 to 2020. The market turned higher so quickly it caught many off guard. Villas in a Four Seasons Residences project in Dubai that sold for about 40 million dirhams in 2021, pre-construction or “off plan,” are now worth about 100 million.
Saudi Arabia Super App Startup ToYou Hires Moelis to Help Raise Funds - Bloomberg
Saudi Arabia’s ToYou, a startup that provides a range of services from ride hailing to food delivery, has hired Moelis & Co. to help raise funds to fuel the super app’s growth.
Talks for the financing round are at an early stage and the target amount is still being firmed up, according to people familiar with the matter, who asked not to be identified because the information is private.
Representatives for the New York-based investment bank and ToYou declined to comment.
Founded in 2019, ToYou started with a main focus on food delivery, but has added more features since, including a buy-now-pay-later service earlier this year. The Riyadh-based company is seeking to compete against other regional super apps, including Uber Technologies Inc.’s local unit Careem and Saudi sovereign wealth fund-backed Noon.com.
Last year, Algeria’s Yassir secured $150 million to roll out its super app while Uber’s Careem is still in the process of raising new funding.
Despite increasing headwinds for the global technology sector, Saudi and a number of regional tech firms have continued to attract significant investments. Saudi startups raised $359 million last quarter, 13% more than the same period in 2022, and outperformed peers in the United Arab Emirates for the first time, according to data from Magnitt.
Dubai Asks Binance, Other Crypto License Applicants for More Information - Bloomberg
Dubai is tightening scrutiny of crypto license seekers in the wake of last year’s bankruptcy of digital-asset exchange FTX, requesting additional information from applicants like Binance, people familiar with the matter said.
Officials at Dubai’s Virtual Assets Regulatory Authority have in recent weeks asked Binance to provide more information on its ownership structure, governance and auditing procedures, said the people, who requested anonymity to discuss private deliberations. VARA is requesting similar information from all international companies seeking permits, three of the people said.
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Dubai’s stricter approach is a potential headache for Binance Chief Executive Officer Changpeng “CZ” Zhao, who lives there and has made it the linchpin of expansion in the Middle East, as he faces increasing pressure from US regulators. The emirate is trying to balance fostering innovation with the need to have proper oversight of an industry that’s been mired in high-profile scandals in the past year, the people said.
“VARA wants to turn Dubai into a capital for the digital-assets economy while safeguarding its business ties with Western jurisdictions like Europe that are adopting more muscular crypto regulations,” said Sam Blatteis, CEO of The MENA Catalysts, which provides government-relations advice to fintech multinationals expanding in the Persian Gulf.
Most Gulf markets decline as economic worries persist | Reuters
Most stock markets in the Gulf ended lower on Wednesday in line with global shares as signs that the economic outlook is weakening spurred caution.
MSCI's world equity index (.MIWD00000PUS) pulled further away from Tuesday's almost seven-week highs, while Asia trade was thinned by holidays in Hong Kong and China.
Weak U.S. economic data this week has exacerbated recession worries, taking the edge off recent stock market gains.
Saudi Arabia's benchmark index (.TASI) dropped 0.3%, hit by a 5.2% fall in Dr Sulaiman Al-Habib Medical Services (4013.SE), while Arabian Centres Co (4321.SE) retreated 4.3% as the mall operator went ex-dividend.
In the previous two sessions, the Saudi index posted sharp gains after a surprise announcement by OPEC+ to further cut oil production.
The surprise cuts to the OPEC+ group's output targets could push oil prices towards $100 a barrel, setting the scene for another clash with the West, which is grappling with higher interest rates to tame inflation, analysts and traders said on Monday.
The Saudi market is at some risk of price corrections after its recent strong increases as traders move to secure their gains, said Daniel Takieddine, CEO MENA at BDSwiss.
"At the same time, the market continues to see strong fundamentals as shown by the improved credit rating, which could help push sentiment and prices up," he said, referring to an upgrade on Wednesday of Saudi Arabia's credit rating from ratings agency Fitch to A+ from A.
Dubai's main share index (.DFMGI) declined 0.7%, weighed down by a 0.8% decrease in Dubai Electricity and Water (DEWAA.DU).
In Abu Dhabi, the index (.FTFADGI) eased 0.1%.
The Qatari index (.QSI) lost 0.4%, ending two sessions of gains.
According to Takieddine, the Qatari bourse remained under pressure as natural gas prices failed to recover from multi-month lows.
Outside the Gulf, Egypt's blue-chip index (.EGX30) rose 0.1%.
Egypt's net foreign reserves rose slightly to $34.447 billion in March from $34.352 billion in February, the central bank said on Wednesday.
Pick-up in new orders underpin UAE non-oil private sector growth in March - PMI
A rapid growth in new orders and resulting capacity pressures led UAE's non-oil private sector to increase staffing levels, according to a latest business survey.
The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) ticked up to 55.9 in March from 54.3 in February signaling a sharp and quicker improvement in the health of the sector.
The 1.6-point rise in the index was the largest month-on-month uplift since October 2021, "with all five sub-components providing a positive directional influence".
The Employment Index rose to its highest reading since July 2016. "The sub-indices for employment and stocks of purchases rose to 80- and 60-month highs respectively, signalling notable uplifts in staffing numbers and inventories in the latest survey period," said David Owen, Senior Economist at S&P Global Market Intelligence.
The expansion was underpinned by a robust increase in new order intakes, with the rate of growth accelerating to a five-month high, albeit remaining below the post-COVID-19 peak seen in late-2021. Similarly, output levels expanded at the quickest rate for five months.
Qatari economy achieves real growth of 8% during Q4 of 2022 year-on-year
The Qatari economy achieved a real growth rate - constant prices - of 8 percent during the Q4 of 2022, year on year, compared to the same period of 2021.
The data of the Planning and Statistics Authority (PSA) released on Tuesday showed that the quarterly GDP at constant prices increased by 8 percent in Q4 of 2022 (QR179.99 billion) compared to the estimate of Q4 of 2021 (QR166.68 billion). When compared to Q3 of 2022 revised estimate (QR175.32 billion), an increase of 2.7 percent is also recorded.
In the same context, the quarterly GDP at current prices in Q4 of 2022 is estimated at QR220.43 billion. This represents an increase of 26.2 percent compared to the estimate of Q4 of 2021 placed at QR174.65 billion. When compared to previous quarter (Q3) of 2022 revised estimate of QR229.69 billion, a decrease of 4 percent is recorded.
The nominal gross value added (GVA) estimate of Mining and Quarrying activities is estimated at QR91.25 billion in Q4 2022, which shows an increase of 43.4 percent over the estimate of Q4 2021 placed at QR63.64 billion. Compared to the previous quarter Q3 2022 revised estimate (QR106.76 billion), a decrease of 14.5 percent in the GVA of this sector is recorded.
Mideast Stocks: Major Gulf markets retreat in early trade
Major stock markets in the Gulf were subdued in early trade on Wednesday, as signs of a slowing U.S. labour market made investors nervous about the economic outlook.
Asia trade was thinned by holidays in Hong Kong and China, leaving MSCI's Asia-Pacific index excluding Japan faring little better than flat, while Japan's Nikkei fell 1.6% and was set for the biggest one-day percentage fall since mid-March.
Saudi Arabia's benchmark index eased 0.2%, hit by a 1.5% fall in Dr Sulaiman Al-Habib Medical Services and a 0.4% decrease in Al Rajhi Bank.
Elsewhere, Arabian Centres Co slid 4.4% as the stock traded ex-dividend.
In the previous two sessions, the Saudi index posted sharp gains after a surprise announcement by OPEC+ to cut more production jolted markets.
Surprise new cuts to the OPEC+ group's output targets could push oil prices towards $100 a barrel, setting the scene for another clash with the West grappling with higher interest rates, analysts and traders said on Monday.
Dubai's main share index dropped 0.1%, with utility firm Dubai Electricity and Water Authority losing 0.8%.
In Abu Dhabi, the index retreated 0.2%.
Separately, non-oil business activity growth in the United Arab Emirates bounced back to the fastest pace in five months in March, a business survey showed on Wednesday, supported by new orders and the quickest jobs growth in almost seven years.
The Qatari index fell 0.2%, on course to end two sessions of gains, weighed down by 1.7% fall in Commercial Bank.
Abu Dhabi Seeks About $1 Billion in Adnoc Logistics & Services IPO - Bloomberg
Abu Dhabi’s main energy company is seeking to raise about $1 billion from the initial public offering of its shipping and logistics unit, according to people familiar with the matter.
Abu Dhabi National Oil Co., which listed its gas business last month, has added banks EFG Hermes, Credit Agricole SA, Societe Generale SA, Arqaam Capital Ltd., Abu Dhabi Commercial Bank PJSC and International Securities as joint bookrunners on the potential IPO of Adnoc Logistics & Services, the people said, asking not to be identified as the information isn’t public.
HSBC Holdings Plc has been added as a joint global coordinator alongside Citigroup Inc., First Abu Dhabi Bank PJSC and JPMorgan Chase & Co, they added.
Saudi Arabia Upgraded By Fitch On Strong Fiscal Buffers, Oil Shift - Bloomberg
Saudi Arabia’s sovereign debt rating was raised to A+ by Fitch Ratings, which cited the country’s efforts to diversify its economy away from a reliance on oil sales and large reserves.
The upgrade reflects the kingdom’s “strong fiscal and external balance sheets” and “assumes ongoing commitment to gradual progress with fiscal, economic and governance reforms,” Fitch said in a statement.
The upgrade comes just days after the country led a group of oil producers in cutting production, a move that caused crude prices to jump more than 6% to over $85 a barrel. Saudi Arabia recorded its first budget surplus in almost a decade in 2022, and is forecasting another surplus this year helped by high oil prices and rapid growth in the non-oil sector.
