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Monday, 29 Jun 2020

Top 100 Arab family businesses include 36 Saudi firms in 2020


Insights MENA

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Economic Outlook

Economic Outlook

  • The Central Bank of Egypt (CBE) left interest rates unchanged for the third consecutive meeting on Thursday, citing falling inflation, improving global financial conditions, and expectations of an economic recovery. The CBE’s overnight deposit rate is at 25% and the lending rate is at 10.25%. The main operation and discount rates are both at 9.75%.
  • Egypt is among a list of countries being considered by the European Bank for Reconstruction and Development (EBRD) and the UN World Tourism Organization (UNWTO) for emergency finance to support its tourism sector through the covid-19 pandemic.
  • Egypt exported47 million tons of fruits and vegetables in H1-2020, compared to 3.7 million tons Egypt exported in H1-2019, despite the covid-19 pandemic taking a toll on the volume of global trade.
  • Saudi Arabia will levy 15% Value Added Tax (VAT) on products bought through online platforms outside the country. The Saudi customs authority announced that this new rule will be applicable to all those products shipped on or after July 1, 2020.
  • The suspension of international flights and entry and exit by land and sea via all ports and crossing points in Saudi Arabia will continue until further notice. The Saudi government stressed the importance of integration with all transportation users to address the challenges of the stage by their cooperation and having the sense of responsibility that will cause them to comply with the necessary preventative measures and returning to normal life with caution.
  • The value of Saudi Arabia oil exports decreased by 4% in April 2020 which about 12 BN USD worth compared to April 2019. Moreover, Saudi Arabia total exports including non-oil exports of goods such as chemicals and plastics decreased by 23.5%, or about 3 BN USD worth compared to March 2020.
  • His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai announced an additional 320 MM AED (87.1 MM USD) budget which has been approved for national universities in UAE for the next academic year.
  • Dubai investors like Saed Al Awadi, CEO of Dubai Exports, stating that the Covid-19 pandemic has accelerated opportunities in certain sectors such as pharmaceuticals and personal protective equipment (PPE), while motivating a new breed of entrepreneurs to explore the post-Covid manufacturing landscape.
  • In a survey conducted on the global cost of living for expatriates during Coronavirus crisis the Mercer Foundation revealed that Kuwait occupied the last position among Gulf countries and the 8th Arab country in terms of the high cost of living for expatriates, thus becoming the cheapest among Gulf countries for expatriate living in 2020.
  • Inflation rate in Kuwait increased in April 2020 by 85% y-o-y. On a monthly basis, the inflation rate decreased by 0.09%, as the prices of food and beverages solely retreated by 1.63%, while eight price groups went up and another four remained unchanged in April.
Political Events

Political Events

  • Egypt, Ethiopia, and Sudan agreed to go through the last phase of negotiations over the Grand Ethiopian Renaissance Dam (GERD) in a bid to reach a final agreement within 2-3 weeks. The agreement to return to the negotiating table came at an African Union (AU) virtual summit attended by President Abdel Fattah El Sisi, Sudanese Prime Minister Abdalla Hamdok, Ethiopian Prime Minister Abiy Ahmed, and other African heads of state.
  • UAE Ambassador to South Korea, Abdulla Saif Al Nuaimi, has participated in the meeting of the "7th Green Round Table" organized by the South Korean Ministry of Foreign Affairs on post-COVID-19 recovery. The event, held under the theme "Green New Deal," was attended by Korean Minister of Foreign Affairs Kang Kyung-wha and President of the Assembly and Chair of the Council of the Global Green Growth Institute Ban Ki-moon and brought together approximately 120 people from various sectors.
Stock Market

Stock Market

  • The EGX30 ended Thursday’s session down 4%. CIB ended down 1.9%. EGX30’s top performing constituents were EFG Hermes up 2.9%, GB Auto up 2.2%, and Porto Group up 1.9%. Thursday’s worst performing stocks were Orascom Development down 3.9%, Dice down 3.0% and Cleopatra Hospital down 3.0%. The market turnover was 1.1 BN EGP (68.3 M USD), and domestic investors were the sole net buyers.
  • The Saudi Stock Exchange (Tadawul) closed Sunday’s trading up after the Tadawul All Share Index (TASI) increased by 83% or 60.28 points to reach 7,292.62 points. A total of 217.66 million shares were traded via 221,000 deals at a turnover of 4.15 BN SAR (1.1 BN USD). The banks segment headed the winners with 1.81%, whereas the energy sector led the losers with 0.20%.

Note: All values are calculated by last Thursday.

Companies Transactions

Companies Transactions

  • Saudi Arabia has dominated 2020’s Forbes Middle East Top 100 Arab Family Businesses, which are seen as the backbone of the region's economy. Saudi Arabia came in the lead with 36 family businesses, followed by UAE with 21 entries on the list, and in third place came Egypt with only three family businesses on the list. Mansour Group from Egypt made it to the top of the list, with three family members on the Forbes’ World’s Billionaires 2020 list, followed by Al Futtaim Group from the UAE, and Olayan Group from Saudi Arabia.
  • Hassan Allam Construction has signed a contract with the Egyptian Black Sand Company (EBSC) to construct concentration and separation plants for extracting minerals from black sands. Hassan Allam will carry out the design review, procurement and civil and electro-mechanical works for the facility as well as the supply, fabrication and installation of all steel structure and plate works.
  • The National Bank of Egypt (NBE) has sold 147 BN EGP (9.1 BN USD) worth of its high-interest savings certificates as of the end of last week. Meanwhile, Banque Misr has sold 56 BN EGP (3.47 BN USD) worth of the 15% certificates since their launch in March.
  • EFG Hermes and newly set-up mortgage finance company Qasatli have signed an agreement to issue 8 BN EGP (111.7 MM USD) worth of five-year securitized bonds for two of the largest real estate companies in Egypt. The Journals claims that Mansour Amer’s Porto Group and Amer Group are the companies behind the offering.
  • Acdima Pharma signed a Memorandum of Understanding (MoU) with South Korea’s SK Plasma to produce plasma-derived medicinal products in Egypt. Medical centers treating covid-19 have been experimenting with plasma therapy, administering antibody-rich blood from recovered patients to new ones through transfusions.
  • Nasdaq Dubai has welcomed Sharjah Islamic Bank's listing of a 500 MM USD Sukuk to support its activities and strategic development. Oversubscribed 2 times, the five-year Sukuk has attracted 150 regional and international investors. The 500 MM USD Sukuk brings the total value of the bank's Sukuk listing on Nasdaq Dubai to 2 BN USD and Sukuk listed in Dubai to 69.29 BN USD.
  • DP World is expected to sell perpetual Sukuk of 5 BN USD at 6.125%. Dubai Islamic Bank (DIB), Emirates NBD Capital, First Abu Dhabi Bank (FAB), HSBC, Crédit Agricole, Samba Financial Group, Scotiabank, and Standard Chartered Bank were hired for the deal.
  • Maridive and Oil Services announced that Khaled Abdullah Al Subeaei Holding Company offered to acquire its 99%-owned subsidiary Maridive Offshore Projects. The matter is still under consideration until the completion of all the required procedures and organizational aspects and the receipt of the administrative approvals. It is worthy to mention that in 2019, Maridive reported net profits of 2.64 MM USD compared to 14.002 MM USD in 2018.
  • In Saudi Arabia, Taiba Investments Company announced the sale of its 5% stake in Fiber Glass Oasis Co (FGOC), a closed joint-stock associate company. The sale is in line with Taiba’s strategic plans to exit some non-core investments and boost its investment and real estate development activity.
  • Moody's Investors Service (Moody's) has reaffirmed the credit rating of National Bank of Ras Al Khaimah (RAKBANK) at Baa1/P-2, with a negative In Q1-2020, the bank's net profits dropped by 43.2% reaching 153.5 MM AED (41.78 MM USD) compared to 270.2 MM AED (73.55 MM USD) in Q1-2019.
Sports and Culture

Sports and Culture

  • World No.1 squash player Raneem El Welily announced her retirement from the professional scene to focus on family life. The 31-year-old led the world rankings after bringing home the 2017 World Championship in the UK. She won 24 titles since she started her senior career in 2009.
  • Egyptian cinema’s Tunisian darling Hend Sabry won the best actress award for “Noura’s Dream” at the Cannes Film Festival’s Critics Awards for Arab Films event, which was held online this year. Palestinian filmmaker Elia Sulieman’s “It Must Be Heaven” won the best film and director awards.

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