NL/11.12.2017

/ / 2017, December 2017, Newsletters

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DEC 2017 ISSUE

CGI. 99

Country Risk Update – Kuwait

Although Kuwait has strong reserves low oil prices will remain a drag on spending and business confidence. Kuwait’s ranking in the influential Global Competitiveness Index disappoints falling by 14 places to leave it ranked 52nd globally.Overall Kuwait declined in 8 of the 12 pillars that comprise the index including substantially in business sophistication, technological readiness and primary education .Some of the indicators which feed into the index are lagged and there have been a few more positive business environment developments recently such as public private partnership tenders which have not been factored .

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Market Overview
UAE ‘surprised’ at inclusion in EU tax-haven blacklist
The UAE government said it’s “surprised and disappointed” to be included on the European Union list of non-compliant tax jurisdictions, according to Undersecretary of Finance Yousef Haji Al-Khouri. On 5th December 2017, the EU adopted a blacklist of 17 Non-EU tax havens including the UAE and Bahrain following a year of negotiations singling out countries that EU officials have accused of facilitating the creation of shell companies and other structures designed to aid tax avoidance.A further 47 countries are on a “grey list”, according to sources quoted by the AFP. In a statement Mr.Al-Khouri said, “The UAE has worked to meet the European Union’s requirements in terms of exchanging tax-related information.The UAE government has said it is confident it will be recognized as being an internationally compliant partner at the EU’s next review.
Outlook for GCC banks “stable”, says sources
The outlook for GCC banks remains stable, reflecting strong financial fundamentals in the region’s largest banking systems that provide resilience to profitability and loan quality challenges posed by slower economies, according to a new report. The report forecasts that real GDP growth in the region will rise to approximately 2 percent in 2018, up from 0 percent in 2017, with oil prices stabilizing between $50 and $60 a barrel.Although fiscal consolidation efforts are ongoing in the region, a number of large-scale projects – such as Dubai’s Expo 2020 and the Saudi National Transformation Program – will support the capital spending and credit growth, which sources believe will expand by 5 percent in 2018.
Dubai fund invests in US farming tech start-up
Investment Corporation of Dubai (ICD), the emirate’s investment arm, has completed a major investment in US-based farming technology start-up Indigo Agriculture.The Dubai fund was the largest investor in its Series D funding round which raised a total of $203 million. Indigo did not give a figure for the ICD investment.Indigo, a company dedicated to harnessing nature to help farmers sustainably feed the planet, said in a statement that ICD will hold a board observer seat at Indigo.“Indigo is working on solutions that address the massive problems of food security and the effects of agriculture on environmental and human health,” said David Perry, Indigo’s president and CEO.The Series D round will support Indigo’s global commercial expansion, along with its continued investment in the plant microbiome and development of software and data tools, he added.
Saudi private sector growth rises by most since August 2015
Growth in the Saudi Arabia’s non-oil private sector saw its steepest improvement since August 2015 in November, according to new research.November data from the Emirates NBD Saudi Arabia Purchasing Managers’ Index (PMI) signaled a strong upturn, driven by output and new order expansions.The headline seasonally adjusted PMI rose to 57.5 in November, from 55.6 in October. This figure indicated the steepest improvement in the non-oil private sector for 27 months.Meanwhile, foreign demand improved at a modest pace and job creation continued. On the price front, cost burdens rose moderately, whilst output prices were unchanged since October amid strong competition in the sector.The growth of new business accelerated during November, with the respective index hitting a 27-month high.
Abu Dhabi becomes minority shareholder in India-based credit business
An entity of the Abu Dhabi Investment Authority (ADIA) has become a significant minority shareholder in global investment firm KKR’s India Financial Services (KIFS), an alternative credit business in India.“KIFS has consistently provided flexible credit financing solutions to companies and shareholders, keeping in mind their long-term objectives for their business.“ADIA’s investment in KIFS gives us a high-calibre partner to work alongside as we further scale our platform and deliver creative solutions in the market,” said BV Krishnan, Member at KKR and CEO of KIFS.Hamad Shahwan AlDhaheri, executive director of the Private Equities Department at ADIA, noted: “India is one of the world’s fastest growing and most dynamic markets, and Indian businesses are increasingly seeking alternative credit solutions.” No further details were disclosed.
Saudi Arabia signs major markets upgrade with Nasdaq
Saudi Arabia has signed a deal with US group Nasdaq to upgrade the country’s financial markets infrastructure, another step towards its long-term goal of diversifying its economy.The country’s stock exchange, the Tadawul’s representative on 4th December 2017 said it would use technology from the US group as the backbone for share trading. Nasdaq, which supplies trading technology to dozens of markets around the world, will replace Tadawul’s current registry, depository, clearing and settlement systems, which are more than 16 years old. The upgrade will be completed by 2020.
Bitcoin, Ethereum ‘Not Suitable’ For Muslims, Says Turkish Government
Turkey has claimed Bitcoin is in fact “not compatible” with Islam due to its government being unable to control it.In a statement from a meeting of the state Directorate of Religious Affairs (Diyanet), lawmakers said that Bitcoin’s “speculative” nature meant that buying and selling it was inappropriate for Muslims.“Buying and selling virtual currencies is not compatible with religion at this time because of the fact that their valuation is open to speculation. They can be easily used in illegal activities like money laundering, and they are not under the state’s audit and surveillance,” Euronews translates the statement republished by local news outlet Enson Haber. Diyanet issued the guidance on Nov 24th several days prior to Bitcoin’s latest bull run which saw the virtual currency top $11,000 before falling 15 percent.Turkey was previously a target of Bitcoin startups after the country infamously banned PayPal, but conditions have remained unstable.
Industry Stalwarts set to headline the 24th World Islamic Banking Conference
Amwaj Islands, Kingdom of Bahrain, November 30 2017: Under the patronage of HRH Prince Khalifa bin Salman Al Khalifa, The Prime Minister of the Kingdom of Bahrain, the 24th edition of The World Islamic Banking Conference (WIBC), the largest and most prestigious gathering of Islamic banking and finance leaders in the world, was held on December 4th, 5th & 6th in the Kingdom of Bahrain.Convened by Middle East Global Advisors – a leading financial intelligence platform facilitating the development of knowledge-based economies in the MENASEA markets and in strategic partnership with the Central Bank of Bahrain, the three-day long forum took place at the ART Rotana Hotel in Amwaj Islands.The theme for WIBC 2017 was “Drivers of Economic Growth & Risks: Policymakers & Regulators”,it is in line with the conference’s steady vision to serve as a compass for the global Islamic finance and banking industry, and it drew participation from over 1300 global industry leaders, policymakers, innovators and stakeholders, all focused on generating breakthrough insights that help navigate through the complexities of the global financial system.
Bitcoin charges through $14,000 as investors pile in

Bitcoin hit a fresh record of $14,000 on 7 December 2017, as investors piled in, triggering a warning the cryptocurrency was “like a charging train with no brakes” which would inevitably slip back.It touched a new a high of $14,400 in Asian trade before slipping back to $13,900, according to Bloomberg News.The rally came just a day after the virtual currency, which has been used to buy everything from an ice cream to property, hit the $12,000 mark for the first time.Bitcoin – which came into being in 2009 as a bit of encrypted software and has no central bank backing it – has risen from a 2017 low of $752 in mid-January, and surged dramatically in the past month.The increased interest has been driven by growing acceptance among traditional investors of an innovation once considered the preserve of computer nerds and financial experts.

UAE’s Federal Tax Authority announces full VAT supplies list

The Federal Tax Authority (FTA) has announced the supplies that will be subject to Value Added Tax (VAT) as of January 1, 2018, revealing selected sectors that will be assigned zero-rated tax, such as education, healthcare, oil and gas, transportation and real estate.Selected supplies in sectors such as transportation, real estate, financial services will be completely exempt from VAT, whereas certain government activities will be outside the scope of the tax system (and, therefore, not subject to tax).These include activities that are solely carried out by the government with no competition with the private sectorand activities carried out by non-profit organisations.

Commodity Tracker
Commodity 4 Dec 11 Dec Chg.%
Brent 63.39 63.24 -0.24
WTI 57.97 57.21 -1.31
Natural Gas 3.11 2.83 -9.00
Gold 1277.1 1252.10 -1.96
Business Events this Week In UAE

 

 

Middle East Organic & Natural Product Expo

11 December 2017 to 13 December 2017

Dubai

Business Updates
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CRIF GULF DWC LLC
Level 15, ’48 Burj Gate’, Downtown Burj, Shaikh Zayed Road, Dubai, UAE
Tel. +971 4 406 9900
www,crif.ae  /  www.dnbuae.com

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CRIF GULF DWC LLC · 48 BURJ GATE, DOWNTOWN BURJ AREA, SHEIKH ZAYED ROAD · Dubai · United Arab Emirates