Global Markets Update:
US stock markets again beat a series of records after inflation data showed that reflation (a monetary policy to expand output and fuel growth) is in full swing. The evidence of a global pickup in manufacturing, with electronics at the forefront, gathers strength (despite the unexpected drop in European industrial production in Dec). Growth in emerging markets has also picked up sharply at the end of last year, as highlighted by industrial production and trade data especially in economies like Singapore and Taiwan that are extremely sensitive to global conditions. Even hard hit Russia and Brazil seem to have stabilised.
The UAE government is not at present considering any increase of VAT above 5%.
According to the UAE Ministry of Finance website, VAT registration will open to qualified companies three months before the roll-out, which is slated for January 1, 2018.
Libya’s oil production recovery may have peaked; The recent sharp recovery in Libya’s oil output which rose by over 350,000 barrels in 2016 to a three-year high of around 700,000 bpd last month, is welcome news from a country still badly riven by civil conflict. However, this is still far below the 1.6m bpd Libya was producing back in 2010 and further strong gains appear unlikely.
Kuwait to fast track construction of new airport: The Kuwaiti government has announced that the target date for the completion of a new terminal at Kuwait’s international airport has been shifted forward to 2020 from 2022. Turkey’s Limak Construction is the main contractor on the US$4.30b project.
Japan provided USD 17mn in aid for displaced people in Iraq: of this, USD 14.3mn is to be allocated to programmes for Iraqis recently displaced due to the Mosul offensive, with USD 2.6mn for the UNHCR’s work for Syrian refugees, mainly in the Kurdistan Region of Iraq.
UAE ranked on top regionally and eighth globally in the latest Index of Economic Freedom Qatar was 29th on the list, while Bahrain was 44th, Kuwait 61st, Saudi Arabia 64th and Oman 82nd.
The UAE central bank has issued draft rules to support the SME sector: As per the draft rules, all banks are required to maintain a dedicated SME unit. Banks should have set targets and limits for SME lending. In return for supporting SMEs, the proposed regulations would allow banks to lower the amount of risk-weighted assets they hold.
Egypt expects to be self-sufficient in gas production within the next two years, disclosed the minister of petroleum and mineral resources.
Egypt is in talks to import 1mn barrels per month of crude oil from Baghdad, and is also looking to other countries to help secure supply of almost 1.012mn tonnes of gasoil for delivery in Feb and Mar.
Exports of crude oil from Iraq rose to 3.93 mn barrels per day in the first 15 days of Feb, almost 122k bpd more than the average for all Jan.
SME’s receive further support from UAE Government. Entrepreneurs from the GCC countries will be treated the same as Emiratis, and will be licenced as members as per DSME terms and conditions, according to a new law that was put in place in mid-November 2016 by His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. Law No. 16 defines policies and strategic plans for SMEs in Dubai. All government bodies, institutions and companies that are owned by the Dubai Government, or in which the Government’s stake exceeds 25 per cent, will be obliged to exempt DSME-licenced members from fees charged and add them to the aforementioned bodies’ suppliers list.
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