Middle East & African Monitor – 08 November 2017

  • US Points Finger At Iran Over Yemen Missile – SAMA Says Business In KSA Unaffected By Arrests.
  • IMF Says Egyptian Economy Is Improving– President Sisi Will Not Seek A 3rd Term.
  • Kenyan Court Considers Election Petitions.
  • Moodys Downgrades Nigeria Ratings.
  • Qatar Foundation To Offload Stake In Bharti Airtel.
  • UAE Cabinet Approves Expansionary Budget.
  • Investcorp Adds To Property Portfolio.
  • Kuwait Ponders Cap On Expats.
  • Libyan Dinar Weakens Again.
  • Qatar CB Reserves Dip.


US Points Finger At Iran Over Yemen Missile – SAMA Says Business In KSA Unaffected By Arrests.
The US ambassador to the UN, Nikki Hayley, has suggested that the missile Saudi Arabian forces managed to successfully intercept on Saturday, which had been fired towards Riyadh by Houthi militants in Yemen, was probably an Iranian made ‘Qiam’ type projectile and called for Tehran to be held accountable for this and what the US called its previous missile-related violations. “By providing these types of weapons to the Houthi militias in Yemen, Iran’s Islamic Revolutionary Guard Corps is violating two UN resolutions simultaneously. We encourage the release of any information that will help to hold Iran accountable for its support of violence and terrorism in the region and the world,” Hayley was quoted as saying by various media outlets late yesterday, adding that "The United States is committed to containing Iran's destabilizing actions, and will not turn a blind eye to these serious violations of international law by the Iranian regime." Meanwhile according to a Gulf News report published this morning, the Saudi Arabian government has reaffirmed its commitment to protecting the rights of domestic and foreign firms operating within the Kingdom and the Crown Prince, Mohamed bin Salman, has ordered that the day-to-day operations of those companies whose owners are currently being investigated on corruption charges, should not be disrupted while these cases are being examined by the attorney general’s office, and that the government recognized the importance of these companies to the national economy and the significance of ensuring that investors can operate confidently in Saudi Arabia. These comments were highlighted again in a statement released by Saudi Arabia’s Monetary Authority, which said that only the personal bank accounts of those “persons of interest” had been frozen not company ones; “In other words, corporate businesses remain unaffected, it is business as usual for both banks and corporates,” the statement read adding that there was no restriction on money transfers executed through the normal banking channels.

IMF Says Egyptian Economy Is Improving– President Sisi Will Not Seek A 3rd Term.
A number of IMF officials are in Egypt this week as the fund conducts its latest review of that country’s progress in its economic reform program. An IMF spokesperson was quoted last week suggesting that Egypt was moving in the right direction stating that; “Signs of economic recovery are witnessed, both in terms of increased growth in certain sectors and in terms of growth in revenues, in areas such as tourism and FDI flows.” Meanwhile an unnamed official within Egypt’s Ministry of Finance was quoted as saying by the local ‘Daily News’ outlet yesterday that the IMF; “told us that everything is going well, however they now are negotiating about accelerating the pace of reform as scheduled to meet the fund’s demands.” In other news the Egyptian President, Adbel Fattah al Sisi, said yesterday that he would not attempt to extend his time in office into a 3rd term. (According to the country’s constitution a President is restricted to a maximum of two terms each of which lasts for four years). Sisi also voiced his strong support for Saudi Arabia’s unprecedented social and economic reform program saying; “I would like to express my admiration for what is going on inside Saudi Arabia from giant reclamation steps that will leave a positive impact inside the Kingdom and outside it. The Kingdom is adopting a moderate policy that aims to counter extremism.”

Kenyan Court Considers Election Petitions.
Kenya’s Supreme Court is currently considering a number of petitions contesting the validity of the recent re-run of the country’s Presidential election, although one of these applications has already been rejected for not meeting a legal threshold. The court now has until next Tuesday to rule on the remaining cases and if it dismisses them then the incumbent and winner of the re-run, Uhuru Kenyatta, will be sworn in officially as President. His main challenger and opposition party leader, Raila Odinga, did not stand in the recent poll alleging that the vote was unfair as the country’s electoral commission had failed to implement certain reforms.

Moodys Downgrades Nigeria Ratings.
Moodys has downgraded its long-term issuer and unsecured debt rating on Nigeria to B2 from B1 albeit with a stable outlook. In a statement justifying its decision the agency said that the primary reason for the downgrade was; “Nigeria's slower than anticipated progress in addressing its key structural weakness, which is its significant reliance on a single sector to drive government revenues as well as growth and exports. The oil shock severely weakened Nigeria's public finances, with general government revenues suffering a 50% decline between 2014 and 2016 (from 10.5% of GDP to 5.3% respectively). The damage wrought by the oil price shock has not yet been undone, and the downgrade reflects Moody's view that this weakness in Nigeria's public finances will remain for some years to come; Moody's forecasts general government revenue to average only 6.4% of GDP over 2017-2019, the lowest level of any sovereign rated by Moody's.”

Qatar Foundation To Offload Stake In Bharti Airtel.
Three Pillars Pte Ltd, a subsidiary of the Qatar Foundation, is currently offering to sell its 5% stake in India’s Bahrti Airtel for around US$1.46 bio according to a recent Reuters report.

UAE Cabinet Approves Expansionary Budget.
The UAE government has approved a AED51.4 bio federal budget for 2018 which is a 5.60% increase on 2017, while the total budget earmarked for 2018-21 will be AED201.1 bio.  A number of sectors will benefit from the planned increase in spending next year including health and education. (Note that the federal budget number does not include each of the Emirates own budgets which are separate). Meanwhile the IIF has released its latest economic review in which it expects the UAE’s fiscal deficit to fall to just 0.80% of GDP next year, supported in part by an increase in public revenues following the implementation of VAT. The country’s Vice President, Sheikh Mohammed bin Rashid Al Maktoum, was quoted by Arabian business as saying after the federal budget’s approval that; All strategies and budget plans are invested in the service of the UAE society in the first place, and we will spare no efforts in providing all the requirements for our people's happiness and well-being. The UAE people are our most valuable asset."

Investcorp Adds To Property Portfolio.
Bahrain based Investcorp has reportedly purchased two office buildings in New York’s central Manhattan area for US$156 mio. “As one of the largest foreign investors in US real estate, we have invested over US$2 bio in the last 18 months and will continue to focus on uncovering opportunities in gateway cities across the country,” Investcorp’s chairman Mohammed Alardhi, was quoted as saying by the ‘Gulf Business’ website.

Kuwait Ponders Cap On Expats.
The Kuwaiti government has reportedly appointed a special parliamentary committee to consider various proposals seeking to address the current demographic imbalance in that gulf country. According to a Gulf News article a potential 15-year residency time cap on expatiates is one of the proposals under discussion. Expats currently make up over 69% of Kuwait’s total population.

Libyan Dinar Weakens Again.
USD/LYD was reportedly trading as high at 9.10 against the US dollar in the ‘kerb’ market this week compared to an official exchange rate of 1.37 according to a report in the Libya Herald newspaper. A shortage of hard currency is driving the move, with the paper quoting a local money changer as claiming that the black market in LYD had now moved offshore, “Most of the big businessmen are now operating from Istanbul where the real market price for large amounts has an additional premium,” this unofficial currency trader alleged.

Qatar CB Reserves Dip.
The latest official data released by Qatar’s Central Bank shows that its FX reserves and liquidity slipped to US$35.60 bio in September 2017 compared to US$39 bio in August.


Archeologists have recently discovered the remains of 2,300 year old gymnasium within the site of an ancient village just outside of Cairo.

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