Newsletter 100 Issue December (Copy 91)

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Country Risk Update
United Arab Emirates

Risk Indicator - DB3c
Risk Level - Slight
Ratings Trend - Improving

Growth in the largest emirate, Abu Dhabi, remained virtually stagnant in Q1 2018 but is expected to pick up into 2019. The UAE will continue to strengthen its position as a regional safe haven and business hub.
Market Overview
Dubai Real Estate Transactions Top $44 Billion
In the latest report issued by Dubai Land Department (DLD), Dubai’s real estate market witnessed a continuous growth driven by optimism among investors and developers, where the market recorded 39,802 real estate transactions worth AED 162 billion ($44 billion) from the beginning of the year till the end of September. Commenting on these promising figures, HE Sultan Butti bin Mejren, Director General of DLD, stressed that these results were achieved thanks to the wise policies adopted by HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, and the recent incentives consolidate the Emirate’s position as a preferred investment destination.Bin Mejren added: “The positive results of these decisions are evident in the prevalent confidence among the various relevant parties in the market. These positive repercussions will continue to resonate in the short and long terms by introducing new sales categories for either personal use or for investing.”According to the report issued by DLD’s Department of Real Estates Studies & Research, in the first 9 months of 2018 recorded 25,473 sales transactions worth more than AED 56.6 billion, about 11,000 mortgage transactions worth over AED 86 billion, and 3,486 other transactions valued at AED 19.3 billion.
Dubai Launches World’s First Government-Backed Cryptocurrency
Consumers in Dubai, UAE will be able to use digital currency to make retail payments in-store, pay for government utilities, telecommunication, and school fees in government shopfronts via emcash – Dubai’s digital currency launched by emcredit, a state-backed subsidiary of the Dubai Department of Economic Development. This comes as a result of a partnership between blockchain payment provider Pundi X, Ebooc Fintech & Loyalty Labs, and emcredit – Dubai’s Credit Bureau. The bespoke, Pundi X POS (“point of sale”) device created for ebooc fintech & loyalty labs for the exclusive use of emcredit with their branding will be dedicated to running a stable, digital equivalent of the UAE dirham. Ebooc – the first Emirati fintech company is the exclusive partner of Pundi-X and providing blockchain-based NexGen technology and loyalty solutions for the financial services sector. The announcement confirms Dubai’s status as a global blockchain innovation centre and the first global capital to afford citizens the option to make essential payments on a digital currency. XPOS devices are expected to be rolled out at shopfronts the region following today’s deal with provisions for an increase in coming years.
SoftBank Looks To Invest Between $15 Billion To $20 Billion In WeWork For Majority Stake
Japan-headquartered investment firm SoftBank is reportedly in talks to invest between $15 billion to $20 billion in shared office space provider WeWork as it looks to obtain a majority stake in the company.  The investment would most likely come from SoftBank’s Vision Fund that has investors such as Saudi Arabia’s Public Investment Fund and Abu Dhabi’s Mubadala, The Wall Street Journal reported citing anonymous sources. The Vision Fund already has a 20% stake in WeWork but the latest investment will provide it a significant controlling force within the company. The discussions are still at an early stage and there is no guarantee for a deal. WeWork’s growth has baffled investors and industry players who consider it an over-valued company who might get wiped out in the short-term. The New York-based company, which leases office space, also released its second-quarter earnings for the first time ever this year. The company’s sales more than doubled but WeWork’s losses increased on the other hand.
UAE National Brand Value Rises 19%
The UAE’s nation brand has grown an impressive 19% since last year, taking it to the 20th spot in the nation brand ranking which is promising, especially in the run-up to Expo2020.  Construction projects across the Emirates are continuing at a fast pace, new world-class theme park brands such as Legoland Dubai and Warner Bros World Abu Dhabi have opened their doors to visitors and steady hotel occupancy rates also indicate that the UAE remains a popular tourist destination for visitors from around the world. The country also benefits from its sponsorship commitments with high profile sporting events such as hosting the annual upcoming Emirates Airline Dubai Rugby Sevens and Abu Dhabi Mubadala World Tennis Championships.”Andrew Campbell, Managing Director, Brand Finance Middle East, commented, “The UAE’s outstanding performance can be attributed to the diversification of its economy and the ability to mitigate risk. The lower reliance on oil and a higher emphasis on tourism have both undoubtedly played a vital role. What is more, the country is improving its scores in brand strength metrics within the fields of judicial system efficiency, the reliability of police services, and ethical behavior of firms.”
Bahrain-based cryptocurrency exchange to launch across GCC in 2019
A Bahrain-based cryptocurrency exchange is set to expand in the GCC, aiming to secure a full operational license across the region by 2019. Rain, which is backed by bitcoin developer Jimmy Song, would then become the region’s first regulated digital currency exchange. Investors in the GCC have traditionally been cautious of cryptocurrency trading due to the lack of regulations, security concerns, and market volatility.  “The biggest issue in this industry is that of trust. We want our customers to feel safe when they are using our product and have taken measures to ensure this, including establishing two stable bank partnerships and incorporating banking grade security checks and verification into our product,” Rain said in a statement. “We will provide the GCC with a digital currency exchange that meets the highest international standards in terms of pricing, product, security, and regulation,” it added. Rain, which allows users to buy, sell and store digital currency, launched limited operations in November 2017 as part of the Central Bank of Bahrain’s
fintech sandbox trial. The programme supports start-ups in the fintech sector, where investment increased to $8.2 billion in the third quarter of 2017 from $6.3bn in the same period in 2016, according to KPMG’s Pulse of Fintech report.
Commodity Tracker
Business Events this Week In UAE
GITEX Technology Week
@ Dubai World Trade Centre
Date: 15 October 2018 To 18 October 2018
Business Updates
Many opportunities exist within a business environment but it is important for a business owner or an investor to understand the true value of any proposition. Buying a business, selling a business or leveraging a business’s value to raise funds can be quite complex and there will always be situations where one party to a business transaction will have more knowledge about the transaction than the counter-party.
At D&B we understand these kind challenges faced and strive to put everyone on equal footing in order for more informed decision making.
We would like to hear from you write to us at [email protected] for
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