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Monday, 06 Jan 2020

U.S. airstrike kills top Iran general, Qassem Soleimani, at Baghdad airport


Insights MENA

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Economic Outlook

Economic Outlook

  • The government and the Central Bank of Egypt (CBE) have launched a 100 BN EGP initiative to boost domestic manufacturing by allowing medium-sized factories access to subsidized loans at a declining 10% interest rate.
  • The foreign direct investments (FDIs) in Egypt increased to 4 BN USD in Q1-2019/2020 compared to 1.4 BN USD in Q1-2018/2019, the highest since 2017, driven by 0.84 BN USD increase in net inflows for Greenfield investments to 1.5 BN USD.
  • Suez Canal revenues increased slightly to 8 BN USD in 2019 compared to 5.7 BN USD in 2018. The canal kept its transit toll unchanged in 2020 for all types of vessels except dry bulk vessels and liquefied petroleum gas (LPG) carriers which will increase by 5% compared to 2019.
  • The CBE is considering the introduction of its own cryptocurrency, as a way of making the banking sector more efficient and to avoid being left behind by new tech developments.
  • Saudi Arabia Purchasing Managers' Index (PMI) decreased to 9 in December 2019, the lowest reading in five months, compared to 58.3 in November 2019.
  • Saudi Arabia’s non-oil sector GDP reported a growth of 3% in Q3-2019 compared to 2.9% in Q2-2019. However, oil sector GDP slipped 6.4% y-o-y largely attributed to production cuts.
  • The number of trademarks registered in UAE increased by 5% in December 2019 compared to November 2019, reflecting the country’s growing leadership as a regional business center in the Gulf Cooperation Council, GCC, and throughout the Middle East.
  • A growing number of expatriates in UAE are increasingly looking for cost-effective ways to obtain a residency in Canada. Over the last few weeks alone, the number of applicants jumped by 300%, with many of those who have expressed interest originating from Pakistan, Palestine, Syria, Lebanon, India and Bangladesh.
  • Kuwait Revenues from the tourism sector jumped up by 69% y-o-y during the first nine months of 2019 reaching 152.1 MM KWD (503.2 MM USD) compared to 90 MM KWD (297.7 MM USD) in the corresponding period last year.
  • Kuwaiti trade balance surplus retreated by 6% reaching 7.25 BN KWD (23.94 BN USD) in the first nine months of 2019, compared to 8.11 BN KWD (26.79 BN USD) in the year-ago period, according to the Central Statistical Bureau (CSB).
Political Events

Political Events

  • Qassem Soleimani, the head of Iran's elite Quds military force and one of the most powerful figures in the Islamic Republic, was killed early Friday in an airstrike by the US in Baghdad. This US strike came after the Iranian government announced Sunday that it would no longer abide by the terms of the 2015 nuclear deal. Noting that Mr. Trump tweeted Saturday that the US will target 52 Iranian sites if Iran get revenge for the strike.
  • Bahrain signs customs deal with Saudi Arabia. The Saudi official highlighted that the agreement will reinforce historical relations and hoped it will promote the flow of goods between both countries.
Stock Market

Stock Market

  • Saudi Aramco shares briefly recorded 45 SAR (9.18 USD) in early trade, their lowest level since its shares began trading on December 11, following a record-setting initial public offering (IPO). They have lost almost 11% since hitting a high of 38.70 riyals. The IPO was priced at 32 riyals per share, valuing Aramco at 1.7 TR USD, making it the world's most valuable company.
  • The ordinary general meeting (OGM) of Eshraq Investments, listed on the Abu Dhabi Securities Exchange (ADX), approved the cross-listing of the company’s shares on the Saudi Stock Exchange (Tadawul) during its meeting on Sunday 5 January.

Note:  Weekly values are calculated on Thursday of each week.

Companies Transactions

Companies Transactions

  • State-owned Banque du Caire (BdC) has tapped Grant Thornton Financial Advisors to conduct the fair value assessment for the bank's upcoming EGX debut. The plan is that the bank would sell around 49% on the EGX in Q1-2020.
  • National Bank of Egypt-owned Al Ahly Capital has signed a final agreement with Pharos Holding to acquire 100% of its brokerage arm, Pharos Securities. The acquisition is reportedly worth 120 MM EGP.
  • A group of Egyptian and Saudi investors will be investing 6 BN EGP to launch the first phase of the planned Al Fanar University in Alexandria. Al Fanar will include seven main faculties, including engineering, technology, pharmacy, dentistry, physical therapy, mass communication, and arts and design.
  • US oil giant ExxonMobil has acquired more than 7 million acres for offshore exploration in Egypt. Exxon will operate and hold 100% interest in both blocks, where operations are expected to start in 2020.
  • Saudi Arabian communications service provider Mobily and Ericsson signed an agreement whereby Mobily will be leveraging Ericsson's cutting-edge products and solutions to empower the kingdom's government and private sectors towards digital transformation, accelerate the deployment of digital services, and expand the provision of Internet of Things solutions.
  • The Saudi Ground Services Company has signed a contract with flynas, the Saudi national air carrier, to provide ground handling services to domestic and international flights for a total amount of 1 BN SAR (266.5 MM USD).
  • The Abu Dhabi Islamic Bank (ADIB) a leading financial institution, has signed an agreement to provide a 80 MM USD Shariah-compliant Ijara facility to the Oman Shipping Company (OSC), a member of the ASYAD Group, for the financing of two Very Large Crude Carriers (VLCC) tankers within the OSC group.
  • Dubai Electricity and Water Authority (DEWA) won the Sustainable Excellence certificate from the European Foundation for Quality Management (EFQM). This new achievement enhances DEWA’s global leadership.
  • Qatar Petroleum (QP) signed a 15-year agreement to supply Kuwait with up to 3 million tons of liquefied natural gas (LNG) per year. Deliveries to Kuwait’s al-Zour port will begin in 2022 to meet Kuwait’s growing energy needs, particularly in the power generation sector.
  • Kuwait Burgan Bank, the Gulf state’s second largest bank by assets, has signed an agreement to sell its 8% stake in Bank of Baghdad to Bahrain-based United Gulf Holding Company.
Sports and Culture

Sports and Culture

  • The Confederation of African Football (CAF) revealed the statistics of the trio nominated for the award for the best player in Africa for 2019, which is Mohamed Salah, the Egyptian team and Liverpool club, Sadio Mane, the Senegal team and the Liverpool club, and Riyadh Mahrez, the wing of the Algerian team and Manchester City English club.
  • Rashid Al Dhaheri, the young Emirati karting star, voted as "Best Mini driver of the 2019” The ranking took into consideration two distinctive parameters: the ranking points based on the results obtained during the season and the vote of fans.

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