Global Entrepreneurs Bet Big on Dubai…

UAE News:

Dubai has several initiatives and support entities to aid the growth and development of startups in Dubai. The UAE is tipped as the leading incubator for startups with over 5,600 businesses registered in Q2 2024, according to Statista. Dubai took the top spot with the startup ecosystem valued at over $23 billion at the end of 2023.

UAE PMI rose to a 9-month high of 55.4 in December (November: 54.2), on robust demand and a rise in new work though new export orders growth eased to a 7-month low and employment sub-index stood near a 31-month low in November/December UAE’s sentiment was the 2nd-lowest since early 2023 while in Dubai, only 6% of respondents expect output to grow in 2025.

Visitors into Dubai increased by 9.2% YoY to 16.79mn in the 11 months to Nov 2024. Western Europe and South Asia accounted for the largest shares of visitors at 19.6% and 17.0% during the period (2.92mn and 2.76mn respectively) while the GCC & MENA regions together accounted for 4.3mn visitors (or 28.2% of the total).

The Ruler of Dubai approved the building of more than 3004 new housing projects worth AED 5.4bn (USD 1.5bn) to benefit citizens across the emirate.

The Chairman of UAE’s real estate developer DAMAC promised a USD 20bn investment in developing Data Centres in the US in coming years “if the opportunity in the market allows us”.

MENA News:

Bahrain Bourse will launch an incentive scheme starting February 2nd to boost trading: this includes liquidity providers qualifying for commission rebates as well as entities reaching certain thresholds receiving up to 30% discounts on trading commissions.

Egypt’s net international reserves rose to USD 47.109bn at the end of December from USD 46.952bn at the end of November. Separately, money supply grew by 29% YoY to EGP 11.34trn (USD 224.11bn) in November while net foreign assets declined by USD 3.25bn to the equivalent of USD 5.96bn.

Egypt saved USD 1.5bn on its petroleum import bill, according to the PM while oil and gas companies operating in Egypt had been able to boost production from existing fields.

Tourists into Egypt clocked in a record-high 15.7mn in 2024 despite the regional turmoil. The minister of tourism and antiquities disclosed that the 40,000 new hotel rooms would be added to the current capacity and that plans are underway to establish an Investment Opportunities Bank (that would have a unified investment map of all tourism opportunities).

Lebanon elected a new President last week for the first time since 2022 and is expected to pave the way for the implementation of much-needed deep institutional and structural reforms, and a national anti-corruption drive. The immediate need for Lebanon is to have a strong-willed PM and a cohesive, competent, and effective government willing to undertake structural reforms without bowing to political pressure. Concurrently, there needs to be a permanent ceasefire in the South to help stabilise the country.

International reserves and foreign currency liquidity at Qatar Central Bank grew by 3.69% YoY to QAR 255.003bn in December.

The WTTC expects travel and tourism to have contributed 11.4% of the GCC region’s GDP in 2024 and it is forecast to account for 13.3% of GCC’s GDP by 2034. International visitors spent in the region were estimated at USD 151.1bn last year (and rose to USD 223.7bn in 2034), while domestic visitors spent USD 72.7bn in 2024 (2034 forecast: USD 108.3bn).  

Funding for startups in the MENA region fell by 29% YoY to just under USD 2bn in 2024, according to MAGNiTT. Funding in Saudi plunged by 44% YoY to USD 750mn while in the UAE it fell by 8% to USD 613mn. Late-stage deals were absent while 47% of MENA investments fell in the USD 1-5mn range.

In 2024, there were 48 IPOs in the GCC, of which 38 were in Saudi Arabia, raising USD 12.06bn in total according to LSEG data. Of the 21 IPOs that raised at least USD 100mn, the most represented were retailers (4), professional or financial services (4), oil and gas (3) and the food and beverage sector (3).

Saudi Arabia allocated SAR 10bn (USD 2.66bn) to activate the Standard Incentives Program for the industrial sector – the first phase of which will target investments in chemical conversion industries, the automotive sector, and machinery and equipment. According to the investment minister, the initiative is expected to generate an estimated SAR 23bn annually in GDP from the targeted projects.

Saudi Arabia has issued more than 36k investment licenses since Vision 2030 was launched; it surged 73.7% YoY to 3810 as of end-Q3 2024. Entrepreneurial license issuance surged by 118% YoY in 2024 while permits in the wholesale & retail sector jumped by 123%. Manufacturing continues to be the sector with the second-most investment licenses issued, following construction.

Riyad Bank Saudi Arabia SME PMI stood at 56.9 in December (November: 57.1), highlighting increased job creation (rising at the fastest pace since Feb) despite higher input costs (raw material prices, wages). Confidence rose to the highest since Mar.

Commercial business registrations in Saudi jumped by 67% YoY to over 160k in Q4, taking the full-year number to more than 1.6mn. The top sectors included cloud computing services, app development, financial technology, tourism, entertainment, and talent development. The e-commerce business registrations grew by 10% YoY to 40,953 in Q4.

Saudi PIF is expected to more than double its current AuM value of USD 925bn to USD 2trn by 2030, enabling it to rank second among all sovereign wealth funds (SWFs) from sixth currently, according to Global SWF projections. PIF’s AuM in 2030 is estimated to be 10.5% of the global SWFs total assets. PIF’s 10-year annualized return from 2013 to 2022 stood at 6.9%, outperforming the SWF average of 5.7% annually.

Saudi Arabia posted a 17.4% surge in mergers and acquisitions approvals in 2024, with the General Authority for Competition approving 202 economic concentration requests and 10 currently under review.

Riyadh’s King Khalid International Airport Terminal 1 expansion, inaugurated last week, will raise the total capacity to up to 7mn passengers per year (from 3mn). Along with ongoing enhancements to Terminal 2, the total capacity is expected to rise to 14mn annually.

A report released by the Ministry of Communications and Information Technology disclosed that there were more than 43 high-growth startups in Saudi (with USD 987mn+ in funding in 2022) and that 50% of the deep tech startups in the country are working on AI and IoT. There were 104 active startup investors registered in Saudi in 2023, up 41% compared to 2018.

Global News:

Major equity markets fell last week, with investors anticipating a slower pace of rate cuts on strong US labour markets (markets were pricing in a single rate cut no sooner than June). Regional markets were mixed with Egypt posting the largest weekly decline while the UAE’s ADX and DFM posted gains of 1.9% and 2% respectively. The dollar remained strong alongside the EUR and GBP dropping to the lowest level since November 2022 and November 2023 respectively. Oil prices rose by more than 3% weekly to 3-month highs, with sanctions expected to hit Russian oil exports, and gold prices increased as well despite strong labour market data.

About Business Exchange Bureau:
Business Exchange Bureau (BXB) is a Professional Marketplace for Business Owners to Buy and Sell Businesses, Investments or Business Assets in the UAE.
The BXB vision is clear - to connect great business minds to great investments.

SOURCE:
Nasser Saidi & Associates