OPEC emphasises UAE’s ‘capability to withstand global economic challenges’
The UAE’s non-oil sector is expected to continue its robust growth in 2023, building on the solid growth momentum of 2022, according to OPEC’s Monthly Oil Market Report – June 2023.
The global organisation hailed the progress of the the UAE’s travel and tourism sector, noting that it’s “recovering robustly, with a 55.8 percent y-o-y increase in passengers at Dubai International Airport in 1Q23, reaching 95.6 percent of its pre-pandemic levels. ”
It is anticipated, continues the report, that passenger figures will surpass those of 2019 this year.
“This revival in tourism, coupled with a growing population and government support, is contributing to the overall economic growth and the UAE’s capability to withstand global economic challenges.”
The country’s Purchasing Managers’ Index (PMI) has remained at a high level, but retracted slightly in May to a level of 55.5, after 56.6 in April, therefore suggesting that the expansionary trend will be maintained, according to the report.
UAE banking industry to stay stable amid muted economic growth: Moody’s
Despite anticipating a deceleration in economic growth, Moody’s Investor Service has maintained a stable outlook for the UAE’s banking sector.
In its most recent projection, the bond credit rating subsidiary of Moody’s Corp. predicted a steady 4 percent gross domestic product growth for the UAE in 2023 compared to a 7.6 percent expansion in 2022.
An increase in oil prices is set to boost private consumption and investment in the country’s non-hydrocarbon sector where banks operate, Moody’s’ latest report stated.
“Consequently, we expect problem loans to decline, although large loan restructurings will keep loan-loss provisioning charges broadly flat,” it said.
Agreement allows US military dependents to work off base in Bahrain
U.S. military spouses and other dependents living in Bahrain now can work within the local economy without being forced to give up their status of forces agreement visas, the Navy announced this week.
An agreement with Bahrain finalized Sunday also means that U.S. military family members who want to work for a local employer no longer have to leave the country to get a job, then obtain a residence visa and a work permit before moving back, U.S. 5th Fleet said in a statement Monday.
Through the pact, local businesses that want to hire a dependent of a U.S. service member or DOD civilian can request a work permit from a Bahraini government agency responsible for reviewing all requests, 5th Fleet spokesman Cmdr. Timothy Hawkins said.
Those dependents would be required to have their pay deposited directly into a local bank account, according to information on the fleet’s website. They wouldn’t pay income taxes to Bahrain but likely would be subject to U.S. tax laws, government officials say.
It’s unclear how many Americans would take advantage of the change or what jobs might be available to them in the predominantly Arabic-speaking country.
U.S. military spouses and family members in Bahrain already may work remotely without giving up their DOD-related visas.
Naval Support Activity Bahrain, home to U.S. Naval Forces Central Command and 5th Fleet, plays an important role in national security in the Middle East.
Renewable hydrogen from Oman
The production of hydrocarbons has a dominant role in Oman’s economy with oil and gas representing around 60 percent of total export income in recent years. In 2022, Oman announced a target to become net zero by 2050 and an aim to significantly ramp up the domestic production of hydrogen from renewable electricity.
The country is well placed to produce large quantities of renewable hydrogen and hydrogen-based fuels like ammonia thanks to its high-quality renewable resources. Oman has also vast amounts of land for large-scale project development, and existing fossil fuel infrastructure that can be used or repurposed for low-emission fuels. Oman can become a competitive producer and exporter of renewable hydrogen and ammonia already by the end of this decade, while simultaneously increasing the share of renewables in its power mix.
Saudi Arabia is requiring companies to establish headquarters in the kingdom
In 2021, Saudi Arabia issued an ultimatum to international companies: they will no longer be eligible for government contracts starting in 2024 unless they have a regional headquarters (HQ) in the kingdom. There are minimal exceptions to this new policy and, according to experts I consulted, the HQ requirement may eventually impact contracts with state-owned enterprises as well. Some companies are also concerned that the government could shift the goalposts and require more executive presence or include more stringent criteria down the road.
Saudi Arabia’s goal is to get 480 companies to open regional HQs by 2030, believing that this will ensure their sustained presence and retain more corporate expenditure in the kingdom. This will also help achieve the objectives of Vision 2030 and grow the Saudi economy.
Already, eighty companies have been granted licenses to establish headquarters in Saudi Arabia, with companies like PepsiCo leading the way.
Kuwait signs contract with Turkey to buy $367mln worth of drones
Kuwait has concluded a contract worth $367 million with Turkish defence firm Baykar to buy its TB2 drones through direct negotiations between the two governments, the Kuwaiti army said in a statement on Tuesday.
The statement did not reveal how many drones would be delivered to Kuwait or when.
International demand for Baykar’s TB2 drones soared after they featured in conflicts in Syria, Libya and Azerbaijan and interest in them increased further following their use by Ukraine’s military to thwart Russian forces.
The State of Kuwait would be the 28th country in the world to conclude a contract for the Bayraktar TB2 drones.