CGI Gulf Insights of the Week 12 Feb 2017 (247)

ByCGI Gulf Insights of the Week
Sunday, 12 February 2017
Published inFebruary 2017

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CRIF – Dun & Bradstreet is pleased to bring to you the latest edition of our newsletter ‘CRIF Gulf Insights’ (CGI). CGI will keep you informed about the current trends in the GCC markets and highlight key events in the regional and global economy.

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CRIF Dun & Bradstreet Communications Team

CGI | Issue 56 | February 2017

Country Risk Update - UAE

The UAE is less vulnerable to falling oil revenues than many of its regional neighbours, on account of its more diversified economy.The weakness in the oil price is feeding through into the banking sector. The strain the lower oil revenues are putting on the fiscal position has resulted in the government withdrawing deposits from the banking sector, while at the same it is also borrowing more from the banking sector in order to sustain its spending commitments. This has seen y/y loan growth consistently outperforming y/y deposit growth since April 2015, with the result that the loan-to-deposit ratio has risen from a post-financial crisis low of 94.8% in August 2014 to 103.6% at end-November 2016.

Business, Finance and Commodity News

Kuwait projects $25.9bn budget deficit next fiscal year

Kuwait’s government projects a budget deficit of KD7.9bn ($25.9bn) in the new fiscal year starting on April 1. That forecast is after a contribution of 10 per cent of revenues to the sovereign wealth fund, and conservatively assumes an average oil price during the year of $45 a barrel. Brent crude oil is currently around $55 a barrel. Spending is projected at KD19.9bn next fiscal year and revenues at KD13.3bn.

Saudi Aramco said to borrow up to $1.6bn with domestic sukuk

A planned domestic sukuk issue by oil giant Saudi Aramco is likely to be in the region of 3 to 6 billion riyals ($800 million to $1.6 billion), according to Saudi Arabia-based debt capital market bankers. It would be the first sukuk issue by the state entity, which plans to approach the local investor base first and offer US dollar-denominated sukuk to international investors at a later stage.

Pressure on Qatar finances easing but austerity still needed

Pressure on Qatar's state finances is easing because of higher oil prices and the government may not need to issue an international bond this year, but it is still seeking ways to save money, according to finance minister Ali Sherif al-Emadi. Qatar's 2017 budget, announced in mid-December, projected its deficit would shrink to 28.3 billion riyals ($7.8 billion) from 46.5 billion riyals planned for 2016.

Dubai’s non-oil private sector sees strongest growth in nearly two years

Dubai’s non-oil private sector posted strong growth in January driven by rising output and new orders, according to the monthly survey by Emirates NBD. The seasonally adjusted Emirates NBD Dubai Economy Tracker Index stood at 57.1 at the start of the year. Travel and tourism remained the best performing category in January (index at 57.8), followed by wholesale and retail (57.7) and construction (55.4).

Commodity Tracker

D&B Article of the Week

Data, Degloblization & Dark Horses

We do business in an era of digital dystopia. In many areas of the modern world, our relationships are now defined in part, if not in whole, by digital transactions. Our words, our ideas and our very identities infiltrate the digital landscape—leaving trails of data as pen marks recording pieces of our legacies on the world around us. These marks reach faster, further and at a higher velocity than light itself, and they accumulate around us in piles of structured and unstructured data. But, is this data truly bringing the world closer together? Airbnb owns few assets and no hotels. In short order, Airbnb will pass Hilton Worldwide and InterContinental Hotels Group as the largest hotelier in the world. Its operating model is based on the digital exchange of data. A room owner has a room to rent. A renter needs a room for a night. Owner lists the room. Renter selects room, pays and stays. Read more

CRIF D&B Highlights

Dun & Bradstreet acquires Avention
Dun & Bradstreet acquired Avention, which provides company, contact, and market data through its OneSource® solutions.This acquisition combines Dun & Bradstreet’s best-in-class content with Avention’s intuitive, user-friendly platform to provide sales and marketing professionals with actionable market and company information.

CRIF in the 2016 FinTech Forward Top 100 ranking
American Banker BAI ranked CRIF in its prestigious FinTech Forward Top 100 ranking of solution providers that derive more than one-third of their revenue from financial institutions.

CRIF assessments can be used by banks and insurance companies as ECAI ratings
On October 12, the European Commission published the definitive mapping based on which ratings issued by CRIF Ratings from November 1 can be used to fulfill the prudential capital and solvency requirements of banks, financial institutions, and insurance and reinsurance companies.

Upcoming Events this Week

World Government Summit
Feb 12-14
Dubai

Solar Middle East 2017
Feb 14-16
Dubai World Trade Centre

Reading Recommendation of the Week

Spark- How to Lead Yourself and Others to Greater Success

In SPARK, entrepreneurs, business consultants and military Veterans Angie Morgan, Courtney Lynch, and Sean Lynch show how anyone can become an extraordinary leader by embracing seven key behaviors.

Release Date:
January 3, 2017