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Saudi Arabia may tap debt market as oil output cuts hit revenues-sources
April 13, 2020--Riyadh increased its debt ceiling to 50% of GDP from a previous 30% in March.
Saudi Arabia is likely to sell new international bonds soon as Sunday's historic deal to cut oil output among major producers puts further pressure on revenues already hurt by the collapse in crude prices, four banking sources said.
Riyadh increased its debt ceiling to 50% of GDP from a previous 30% in March. Neighbours Qatar and Abu Dhabi emirate successfully sold a combined $17 billion of bonds last week.
World Bank MENA Economic Update: How Transparency Can Help the Middle East and North Africa
April 9, 2020--Transparency about critical economic issues-such as public debt and employment-will be the key to driving growth and enhancing trust in government in the Middle East and North Africa (MENA) region. The need for greater transparency comes as the MENA region faces unprecedented dual shocks from the COVID-19 (Coronavirus) pandemic and the collapse in oil prices.
The shocks have exacerbated already slow economic growth in the region, due, in part, to lack of data transparency. As of April 1, changes in forecasts implied that the costs for MENA were about 3.7% of the region's 2019 GDP (approximately US$116 billion) compared to 2.1% as recently as March 19.
view the World Bank-MENA Economic Update: How Transparency Can Help the Middle East and North Africa
BlueStar Israel Market Update-April 2020 Israeli Equities fall in sync with Global Markets; Energy, Real estate & Discrectionary stocks lead downdraft.
April 6, 2020--Israel’s Government Responds Dramatically To Contain Covid-19 And Mitigate Health & Economic Impact.
Israeli stocks, as defined by the BlueStar Israel Global Index(R) (BIGI(R)), fell precipitously, in tandem with the global market sell-off, losing 16.57% in March. BIGI continues to outperform MSCI EAFE by 3.27%, MSCI EM by 4.15% and the S&P500 by 0.15% YTD, respectively.
Israeli technology stocks, as defined by The BlueStar Israel Global Technology IndexTM (BIGITech(R)), lost 13.68% in March, underperforming the Dow Jones US Tech and S&P Global Tech indexes by 4.29% and 2.97%, respectively.
BIGI outperformed the flagship local Israeli TA-125 Index in March by 3.03% and maintaining a 3.66% lead for 2020 YTD.
Coronavirus: Emerging markets, including Saudi Arabia, headed for recession?
April 1, 2020--Emerging Markets economies facing severe stress resulting from health crisis: S&P
Economies in the emerging markets (EM), including Saudi Arabia, are likely to fall into a recession or see sharply lower growth in 2020 amid widespread economic activity stoppage and quarantine measures, a ratings agency said.
S&P Global Ratings said in a new analysis released on Wednesday that emerging markets are now facing "severe stress" resulting from the global pandemic and that countries within the Asia-Pacific region are headed for the lowest growth in over two decades, at 3 percent.
IMF Executive Board Concludes 2020 Article IV Consultation with Kuwait
March 30, 2020--Nonoil growth strengthened to estimated 3 percent in 2019, propelled by government and consumer spending. With oil output contracting by 1 percent, broadly in line with the OPEC+ agreement, overall growth slowed to estimated 0.7 percent in 2019 from 1.2 percent in 2018.
Fiscal and current account surpluses narrowed on account of lower oil prices and output. Inflation rebounded to 1.1 percent as food and transport prices recovered. Credit growth accelerated to 4.4 percent in 2019, spurred by relaxation of macroprudential ceilings on personal loans and supportive monetary conditions.
Can Saudi Arabia Survive The Oil Price War It Started?
March 9, 2020--As the world watches an oil price war unfold between Russia, OPEC, and US shale, another major crisis is looming in the Middle East.
Saudi Arabia is facing multiple existential threats as a renewed oil price slump threatens to not only hit the country's revenues and economic diversification programs but also the already fragile position of Saudi Crown Prince Mohammed bin Salman.
Last week, international media reported on the crackdown of two major power brokers inside the Saudi Royal Family.
The Saudi economy may expand slower than predicted. Here's why
March 1, 2020--Weaker global oil demand forecasts are now exacerbated by a coronavirus-related economic slowdown and a travel ban.
While Saudi Arabia's economy is expected to rebound in 2020 from the downturn last year, weak global oil demand forecasts, which are now exacerbated by a coronavirus-related demand slowdown and barring foreign pilgrims from entering the kingdom, could hinder its recovery.
IMF-The Future of Oil and Fiscal Sustainability in the GCC Region
February 6, 2020--Summary:
The oil market is undergoing fundamental change. New technologies are increasing the supply of oil from old and new sources, while rising concerns over the environment are seeing the world gradually moving away from oil.
This spells a significant challenge for oil-exporting countries, including those of the Gulf Cooperation Council (GCC) who account for a fifth of the world's oil production. The GCC countries have recognized the need to reduce their reliance on oil and are all implementing reforms to diversify their economies as well as fiscal and external revenues.
Nevertheless, as global oil demand is expected to peak in the next two decades, the associated fiscal imperative could be both larger and more urgent than implied by the GCC countries' existing plans.
view the IMF Departmental Papers-The Future of Oil and Fiscal Sustainability in the GCC Region
Ensuring the Benefits of Capital Flows in the Middle East
January 15, 2019--Since the global financial crisis of 2008, emerging market economies have experienced a surge in capital flows in response to significant monetary easing by major central banks. Gross capital inflows to the Middle East and North Africa (MENA) have remained high compared to other emerging markets, but their composition has changed significantly, with a surge in portfolio flows (equity and bond instruments) and a decline in foreign direct investment.
Capital flows are a boon to the region in a variety of ways. They can serve as a source of financing for countries and contribute to job creation for a fast-growing population.
But the region's economies must do more work to ensure the benefits of portfolio inflows while securing more stable and growth-friendly foreign direct investment, our research shows.
Sharp rise in flows
With the increased integration of MENA countries into global capital markets, portfolio and bank inflows to the region surged to more than $155 billion over 2016-2018.
First set of guiding principles on sustainable finance published by leading financial authorities in the UAE
January 15, 2020-First-of-its-kind initiative aimed at furthering the UAE's sustainability agenda
UAE Financial authorities forge commitment to ensure sustainability of UAE economy
Leading financial authorities in the UAE have published the UAE's first set of Guiding Principles on Sustainable Finance, which serves as a catalyst in the implementation of the UAE’s sustainability priorities.
The launch of the initiative was unveiled during the second edition of the Abu Dhabi Sustainable Finance Forum (ADSFF), a prominent event organized by Abu Dhabi Global Market (ADGM) and held during Abu Dhabi Sustainability Week.
Premised on the United Nations Agenda for Sustainable Development, the initiative was implemented as a result of collaborative efforts among a number of financial services authorities in the UAE, including: Abu Dhabi Global Market; the Ministry of Climate Change and Environment; the Central Bank of the UAE; the Insurance Authority of the UAE; the Securities and Commodities Authority; the Dubai Financial Services Authority; the Dubai Islamic Economy Development Centre; the Abu Dhabi Securities Exchange, the Dubai Financial Market and Nasdaq Dubai.
