Middle east economies will reach 2019 gdp level in 2022: IMF
The Middle East region will lag the other regions with most of the countries not recovering to their 2019 GDP until 2022, the International Monetary Fund (IMF) said on Thursday.
Jihad Azour, director of the Middle East and Central Asia Department at the IMF, said the road to recovery for the Middle East and Central Asia region will hinge on containment measures, access to and distribution of vaccines, the scope of policies to support growth, and measures to mitigate economic scarring from the pandemic.
“Countries that put in place stronger fiscal and monetary support in response to Covid-19 are also expected to have a stronger recovery, aided by a shallower trough in 2020. In particular, while Caucasus and Central Asia countries as a group are projected to reach 2019 GDP levels in 2021 — due to their stronger Covid-19 response — those heavily impacted by the second wave will lag behind and not regain pre-pandemic GDP levels until 2022,” he said.
“Fragile and conflict-affected states will be especially battered, with 2021 GDP levels projected at 6 percent lower than in 2019,” he said.
The IMF noted that GCC countries have the widest coverage of the vaccination as well as the most advanced plans, targeting agreements that in some cases include doses in excess of those needed to inoculate the entire population.
In October 2020 forecast, IMF had revised up forecast for the Middle East and North Region by 1.2 percentage points, to an overall contraction of 3.8 percent. It projects 3.1 percent in 2021 and 4.2 in 2022.
Rakbank’s 2020 profits plunge 54pc, hit by covid-19, economy
The National Bank of Ras Al Khaimah (RAKBank) posted net profit of Dh505.4 million for 2020, decreasing by Dh589.9 million, or 54 percent, over the previous year due to impact of the pandemic on customers and the economy.
Total assets stood at Dh52.8 billion, decreasing by 7.6 percent over 2019, and gross loans and advances closed at Dh32.2 billion, down by 11.2 percent over the previous year.
The bank’s customer deposits grew by Dh118 million to Dh36.9 billion compared to 2019 while operating expenses decreased by Dh175.1 million, down by 11.1 percent compared to the previous year.
Total income for the financial year ended December 31, 2020 amounted to Dh3.6 billion, decreasing by 10.4 percent. Net interest income and net income from Islamic finance stood at Dh2.5 billion for the year 2020, decreasing by 9.9 percent year-on-year. Non-interest income decreased by Dh138.4 million year-on-year to Dh1 billion, mainly due to a decrease of Dh139.9 million in net fees and commission income.
The bank’s board of directors recommended distributing cash dividend of 15 percent of the share capital, or 15 fils per share.
Mohamed Omran Alshamsi, chairman of RAKBank, said: “We have been very focused on doing what we can, which is to continue running our business in the best way possible, responding and supporting our customers.”
OPEC+ sticks with oil policy as prices rise towards one-year high
Opec+ maintained its oil output policy at a meeting on Wednesday, a sign producers are happy that their deep supply cuts are draining inventories despite an uncertain outlook for a recovery in demand as the pandemic lingers.
A Joint Ministerial Monitoring Committee of Opec+ met virtually on Wednesday, pronouncing itself
“optimistic for (a) year of recovery in 2021,” a statement issued after the meeting said.
Oil has rallied from historic lows hit last year as the pandemic hit demand, thanks to record output cuts by the Organisation of the Petroleum Exporting Countries (Opec) and allies, known as Opec+ that the group is beginning to unwind.
“While inventories are drawing fast, the market is pricing in a smooth rollout of vaccines and that may be premature,” said Amrita Sen, co-founder of Energy Aspects.
The Opec+ panel made no mention of changing policy, which calls for most members to hold supply steady in February and top exporter Saudi Arabia to cut output voluntarily by 1 million barrels per day this month and next.
“While economic prospects and oil demand would remain uncertain in the coming months, the gradual rollout of vaccines around the world is a positive factor for the rest of the year, boosting the global economy and oil demand,” the statement issued after the meeting said.
A document seen by Reuters on Tuesday showed Opec expects the output cuts will keep the market in deficit throughout 2021, even though the group has revised down its forecast of the pace of this year’s oil demand recovery.
Oil prices extended gains on Wednesday after the meeting ended and benchmark Brent crude traded as high as $58.74 a barrel, the highest since late February 2020.
Sharjah investment tracker brings real-time mapping of investments
The Sharjah FDI Office (Invest in Sharjah), operating under the Sharjah Investment and Development Authority (Shurooq), has announced the launch of the Sharjah Investment Tracker, a plug-and-play website that publishes real time investment statistics of Sharjah and aims to map out the investment landscape in the emirate through analyzing FDI flows.
Providing real-time data on both FDI and domestic investment, the investment portal will also use a Geographic Information System (GIS) mapping tool to provide comprehensive site-specific data about the companies investing in the emirate.
The Sharjah Investment Tracker has been developed in partnership with Wavteq, a global FDI technology and consulting company that develops the leading databases and operating systems for economic development.
As a vital tool to analyse investment flows and trends, the Sharjah Investment Tracker has different filters that provide real time information on investment type
– foreign, domestic, reinvestment, mergers and acquisitions, or new forms of investment; technology level – low, medium, or high; source country; and industry type – transportations and logistics, agriculture, education, manufacturing, information and communication technology (ICT) and more.
Updated daily, the comprehensive data service will provide a reliable project database of investments in Sharjah with advanced filtering, trends, analysis, and reporting tools.
Kuwait imposes curfew on businesses; bans gatherings for national day
The Kuwaiti government on Wednesday imposed a series of restrictions to prevent the spread of the coronavirus after a new rise in the number of infections in the country.
In a statement, the Kuwait cabinet announced it had ordered the closure of gyms and salons and asked other commercial businesses to cease operating at 8pm to 5am every day for one month, starting February 7. Pharmacies, supermarkets and other food supply stores, however, would be exempt from the rule.
Deputy Prime Minister and Minister of state for Cabinet Affairs Anas Al-Saleh also noted that all health clubs, resorts, beauty salons and hairdressing centres were also ordered shut.
Additionally, all restaurant reception halls have also been ordered to close from 8pm to 5am. However, home delivery services will be allowed to operate during the closure time.
Celebration halls and tents, as well as all gatherings — even for National Day celebrations later this month — are banned.
Finally, all sports federations have also been asked to suspend all formal and friendly sports activities.
The Cabinet noted that it had instructed the Civil Service Commission to set a number of penalties on civil servants who do not abide by Covid-19 preventive measures.
Covid-19: Saudi Arabia closes down malls, sports centres; suspends events, weddings
Saudi Arabia has enforced further measures to stem the spread of the coronavirus, announcing the closure of cinemas, restaurants, cafes, shopping malls, gyms and sports centres for 10 days, subject to extension.
The Saudi Press Agency (SPA) cited an official source at the Ministry of Interior who said that the measures were put in place in light of emerging indicators of “an increase in the epidemic curve” in some regions of Saudi Arabia caused by lax implementation of precautionary measures.
The country has also suspended all events and parties, including weddings, corporate meetings and gatherings for a period of 30 days, subject to extension.
The Ministry of Interior said the decision follows a second outbreak of Covid-19 in some countries, and as an effort to preserve public health and prevent the outbreak of a second wave of the epidemic in the Kingdom, which may further strain the country’s health facilities.
UAE: new banking guidelines to protect consumers
The UAE Central Bank has issued its first comprehensive financial consumer protection regulatory framework that defines the relationship between banks, financial firms and consumers.
Abdulhamid M. Saeed Alahmadi, Governor of the Central Bank, said the financial sector in the UAE is growing and expanding in terms of diverse products and services and technology— all of which add to the complexity for consumers to make the right decision. The new framework will ensure the protection of financial consumers and strengthen confidence in the sector.
Moreover, the principles set responsibilities for responsible financing practices, complaint management and dispute resolutions, consumer education and awareness, financial inclusion, and Shariah compliance for financial services.
Importantly, to address concerns of over indebtedness by the consumers, banks and financial institutions will have to incorporate principles for responsible financing by ensuring consumers’ financial situations are properly considered while determining an appropriate level of financing to be provided to the consumer.
“The issuance of the Consumer Protection Regulation comes within the Central Bank’s keenness to promote transparency and fairness when Licensed Financial Institutions deal with their consumers. It will enhance competitiveness, integrity and stability of the banking and financial sector,” said the Central Bank governor.
It’s vital to have financial advice in the UAE, say experts
More than seven out of 10 people in the UAE currently don’t have have a financial advisor, reveals a new research.
“Furthermore, less than half (44 percent) of those in the top income bracket of Dh40,000 or more a month have a financial adviser, according to a survey by wealther manager Quilter and YouGov.
The survey results revealed that just 10 percent of 40 to 50-year olds and only 12 percent of 51 to 60-year olds have a financial advisor, which could mean that these age groups are missing out on getting advice at a crucial time in their life.
Out of the various nationalities in the UAE, westerners were most likely to have an adviser with 21 percent saying that they currently take financial advice, followed by 20 percent of Emiratis.
When respondents were asked what they would do if they had extra money to save or invest, just 10 percent said that they would seek financial advice.
“This research shows that there is a clear need in the UAE to change the perception and understanding of advice and financial planning and the value it offers. Financial advice is about more than just the investment performance. It’s about taxation, investment choices and how an adviser can help you navigate your emotions, behavioural biases, and the practicalities that life throws at you,” said Brendan Dolan, global distribution director of Quilter International.
Mark Leale, head of Quilter Cheviot’s Dubai branch office, said, “Our lives are complex and as such the value that a good financial adviser brings to the table should not be underestimated. Working with a properly regulated firm and qualified adviser, should offer the guidance and reassurance that you are making the appropriate decisions based upon your individual circumstances. This should develop into a trusted relationship wherein regular reviews ensure that you continue to structure your finances appropriately.”