Global Markets update:
The recent partial recovery in the FTSE All-World index and the S&P 500 led to a broadly upbeat mood across markets (as US-China trade talks struck a positive tone and in spite of the ongoing US government shutdown), especially ahead of the US quarterly earnings season next week. In Europe, the Stoxx closed higher though other markets ended negative on weak data (also affected the euro) and lack of clarity on the trade talks. Regional equity markets were mostly up, with Qatar’s index hitting the highest since March 2017. On the currency front, onshore Renminbi posted the best week versus the dollar since 2005 while the pound sprang to a 2-week peak vis-à-vis the euro on optimism on a possible Brexit extension. Oil prices saw a temporary reprieve with Brent oil price holding above USD 60 per barrel and gold price edged up posting a fourth straight week of gains.
Total amount of loans extended to SMEs under a central bank initiative reached EGP 180bn by end-2018, according to the chairman of Egypt’s Association of Investors for SMEs. He also disclosed that banks would direct EGP 50bn of funding to SMEs this year (up 66.7% YoY on the EGP 30bn given last year).
Saudi Arabia’s oil and gas reserves have been valued by independent experts: the latest estimate places total oil reserves at 268.5bn barrels at the end of 2017, including reserves in the “partitioned zone” between Saudi Arabia and Kuwait. Natural gas reserves were also upgraded survey, showing 325.1 trn standard cubic feet (scf) of gas compared to a previous estimate of 307.91 trn scf.
Saudi Arabia announced an extension of the validity of work visas for expatriates to two years, from the one-year period currently – without any additional fees.
Total funding of MENA based startups increased by 31% YoY to USD 893mn (of which USD 200mn was the outlier funding for Careem), according to a MAGNiTT report, which disclosed that the average deal size in the region also picked up by 26% YoY. The UAE remained the most active ecosystem accounting for 30% of all transactions, while Egypt was the fastest growing, up to 22% from 7% in 2017.
An expansion plan for the Dubai International Financial Centre (DIFC) will see the creation of 6.4mn square feet of new office space in addition to 1.5 million square feet of residences, and 1.3 million square feet of retail space.
Banks’ reserves at the UAE central bank grew by 4.3% YoY to AED 283.4bn as of end-November 2018. Separately, banking investments grew by 6.4% to AED 331.1bn during January-November 2018. Deposits outvalued loans at UAE-based banks by AED 85bn during January-November 2018. The banking sector is highly solvent: the Eligible Liquid Assets Ratio rose by end-November to 17% from 16.5% in October, with the Capital Adequacy Ratio up to 18.2%.
In a bid to lower costs and support investments in the tourism sector, Dubai Tourism has released approximately AED 250mn (USD 68mn) in bank guarantees for tourism-related service providers. Previously, tourism companies, including inbound and outbound tour operators, were required to furnish a bank guarantee ranging from AED 100k-600k, depending on the type of business activity, as a precondition for the Department of Economic Development (DED) to grant a trade license.
The Dubai Department of Economic Development has announced a 50% reduction on commercial fines– applicable only for the first violation in the calendar year. The net value of fines settled under the 50% reduction in 2017-2018 was AED 23.4mn.
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Global Markets update: