Dubai opens the City to International Tourists from 7th July...

UAE News:
UAE merged some ministries and departments on 5th July, in a bid to make the government “flexible, fast and able to keep up with changes”. Some of the changes included a phasing out of government services within 2 years (becoming digital portals instead), merging 50% of federal authorities or adding them to ministries, and merging ministries among other changes. A strong emphasis has been placed on “agile government”, digital policies and food security, with a self-imposed time limit of one year to meet the new priorities.
Dubai’s GDP declined by 3.5% YoY in Q1 2020, versus 2.2% growth in full year 2019, as COVID-19 affected businesses in the emirate’s key tourism and business sectors. Real estate, finance and manufacturing sectors reported growth in Q1.
Dubai World repaid the final USD 8.2bn of the debts, two years ahead of the agreed schedule. The payment came through the emirate’s own funds, dividend payments from the portfolio companies that together make up “Dubai Inc.” and a loan from Dubai Islamic Bank. This is a sound, pre-emptive move by Dubai given economic and financial market uncertain prospects. This is a time where cash-flow management should be the top priority for businesses and that is driving Dubai World’s actions.
Abu Dhabi Department of Economic Development announced a new coalition project to support micro, small and medium-sized enterprises operating in highly-skilled fields, particularly “science, healthcare, information technology and innovative solutions” via mortgages from leading banks.
UAE issued 4201 new licenses in June, bringing the total number to 652,885. Dubai represented 46% of total licenses issued in the UAE while shares in Abu Dhabi and Sharjah touched 22.3% and 12.9% respectively.
Dubai reported an 83% YoY surge in e-commerce business licenses (to 1947) issued in H1 this year. Lifestyle coaching topped the list of online activities being sought through DED licenses during H1 this year, followed by marketing services through social media.
Dubai will open the city to international tourists from 7th July.
UAE Cabinet approved an additional AED 320mn (USD 87mn) budget for national universities for the 2020-2021 academic year.
Emirates airline disclosed that the firm had processed close to 650k refunds amounting to over AED 1.9bn (USD 517mn) over the past two months.
According to Wealth-X’s latest report, the number of billionaires in UAE declined to 47 last year, from 55 in 2018, with their wealth dropping to USD 163bn (vs 2018’s USD 165bn). Globally, the number of billionaires rose 8.5% to 2,825 in 2019, while combined wealth up 10.3% to USD 9.4trn.

MENA News:
The IMF (International Monetary Fund) expects GCC growth to shrink by 7.6% this year (from -2.7% dip forecast in April 2020), given the impact of low oil prices and the COVID-19 crisis. Last week, the IMF had revised down Saudi growth to -6.8% (from -2.3%), which SAMA’s governor stated to be “more pessimistic” than theirs.
Stimulus measures in Bahrain to be extended: the government will pay 50% of salaries for insured citizens employed in the private sector (in firms most affected by COVID-19) in addition to bearing citizens’ domestic electricity costs for their primary residences. The cost is estimated at BHD 70mn and between BHD 12-15mn respectively for the two measures.
Bahrain’s Labour Market Regulatory Authority will reduce by 50% the fees levied on the issuance and renewal of work permits. The hardest-hit businesses will be exempt from paying fees during July-September.
A gold deposit with estimated resources of 1 million ounces was discovered in Egypt. The government plans to invest more than USD 1bn to develop the deposit over the next decade.
Kuwait’s National Assembly committee approved that a draft law proposing a quota for expatriates is constitutional. The bill – which proposes a quota system, e.g. that Indian expat community should not exceed 15% of the national population – will now be referred to the committee for consideration.
Kuwait will partially resume commercial flights (which have been suspended since March) from August, at 30% capacity i.e. with a maximum of 100 flights and 10k passengers a day. Phase 2 and 3 will begin in February and August 2021 respectively with 60% and full capacity respectively.
Oman Tax Authority started to apply a 100% selective tax on alcoholic beverages from 1st July; it was temporarily reduced to 50% prior to this hike, and the tax is not applicable at duty-free shops.
Oman launched a new tax card system from 1st July, replacing the tax certificate currently in use: this will be proof of the registration for any taxpayer from the Tax Authority. A copy of the card will be requested by when issuing contracts or undertaking any transaction.
The 15% VAT came into effect in Saudi Arabia from 1st July: there was an anticipatory increase in retail sales days before this came into effect, especially after the lockdown measures were eased. VAT will also be applied to goods imported via online platforms.
Saudi Arabia plans to open 38 tourist sites in seven tourist destinations by 2022, revealed the Minister of Tourism, from 15 sites in four tourist destinations ready currently.

Global News:
Stock markets in the US gained after a major uptick in non-farm payrolls; Stoxx 600 posted gains while Asian markets touched 4-month highs as China’s PMI (Purchasing Manager's Index) continue to rise. China’s CSI (China Securities Index) 300 closed at the highest level in 5 years and 6.8% higher compared to a week ago. Regional markets were mostly down, with Saudi Arabia and Abu Dhabi gaining ground, after the former extended government stimulus measures and the latter was supported by Taqa’s asset-transfer deal making it the 3rd largest publicly traded company by market cap in the UAE. Major currencies were little changed except for the GBP, which rose against the dollar on some positive economic data while Brexit negotiations continue unresolved. Oil prices gained compared to a week ago though concerns are rising given COVID-19 resurgence (especially in the US, the largest consumer of oil) and gold price edged up by 0.2% on its safe-haven status. Though many economic indicators have shown recovery from the dismal drops in lockdown months, beware of equating this to a V-shaped recovery.

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SOURCE:
Nasser Saidi & Associates