Executive Director & Geopolitical Analyst Middle East & Africa
National Bank of Abu Dhabi
Tel: +971 2 6110 127
Apple Removes Iranian Applications From Its Online Store.
Apple Inc has over the past few months, reportedly been busy removing all Iranian developed apps from its online store in order to comply with existing US sanctions rules, according to a recent NY Times report. The company allegedly sent a letter to all Iranian developers whose applications have been affected by the ban (including a domestically popular ride-hailing service called ‘Snapp’) which read; “Under the U.S. sanctions regulations, the App Store cannot host, distribute or do business with apps or developers connected to certain U.S. embargoed countries.” While Apple does not have an official ‘App store’ in Iran, a ‘Verge’ web article suggests that Iranian developers have created several applications for sale in other Apple App Stores, and iPhones are routinely smuggled in to the country, despite an official ban on their sale. An estimated 48 million smartphones have been sold in Iran, and there are an around 47 million social media users in the country. Meanwhile, as discussed in some of our previous commentaries, there are growing signs that the Trump administration could be preparing to declare Iran non-compliant with the JCPOA nuclear agreement as early as October this year, when the next 90-day US review of Iranian compliance to the accord is due. More evidence of this possibility was highlighted in comments made by the US ambassador to the UN, Nikki Haley, who was quoted by CNBC as saying recently that Iran should be held accountable for "Its missile launchers, support for terrorism, disregard for human rights, and violations of U.N. Security Council resolutions. Iran cannot be allowed to use the nuclear deal to hold the world hostage."
Disruption Of Libyan Crude Output Continues.
A series of new and ongoing pipeline blockades by a number of militia groups in Libya have apparently forced the country’s National Oil Company to shut-down another two of its oilfields these past few days ,and this follows on from the halt in production at the country’s giant Sharara facility more than a week ago. According to Reuters, one of the armed groups behind the disruption are demanding an increase in domestic fuel supplies, and an improvement in the economic conditions currently affecting the Zintan region. Sharara was pumping around 280,000 bpd before the shutdowns.
S&P Affirms Qatar Ratings With A Negative Outlook.
The S&P Global Ratings agency issued a press release late last Friday in which it affirmed its AA-/A-1+ long and short-term ratings on Qatar albeit with a negative outlook. “The negative outlook reflects our view of the potential consequences of the boycott on Qatar's economic, fiscal, and external metrics, especially if the boycott is tightened or prolonged. We could lower our ratings on Qatar if the boycott reduces economic wealth levels to an extent that we no longer assess GDP per capita as a sufficient cushion to offset Qatar's weak trend growth rate. We could lower the ratings if policy predictability in Qatar were to become more uncertain. In order to support its economy and banking system, the Qatari government is liquidating and utilizing part of its fiscal assets, thus If our estimate of the government's liquid assets were to fall substantially, we could also lower the ratings. We could raise the ratings if we saw domestic institutions mature faster than we expected, alongside significant improvements in transparency regarding government assets and external data quality,” S&P statement’s read.
UAE’s Ruler Issues VAT Decree.
The President of the UAE, Sheikh Khalifa bin Zayed Al Nahyan issued a new decree yesterday covering Federal Law No 8 of 2017 for VAT, a key step ahead of the implementation of a 5% value-added tax in January next year. “The Federal Decree-Law is the bedrock of the UAE's planned tax system, which was designed to meet the most stringent of standards and best practices. The Value Added Tax, which is set to be implemented across all GCC countries over the next two years, will bring a new revenue stream for the national economy and GDP. This, in turn, will ensure consistency in the high quality of government services, to mirror the UAE's advanced position on several global competitiveness indexes. The new tax system will provide extra support for the Government to implement the vision of the UAE leadership and build a diversified and productive knowledge economy," the Deputy Ruler of Dubai, UAE Minister of Finance and Chairman of the Federal Tax Authority, Sheikh Hamdan bin Rashid Al Maktoum was quoted as saying by the Khaleej Times following the announcement.
China & KSA To Form US$20 Bio Investment Fund.
Saudi Arabia’s Energy Minister, Khalid Al Falih, has said that his country and China have agreed to establish a joint US$20 bio investment fund. Saudi Arabia has also granted investment licenses to four Chinese firms and signed a series of MOUs with regards to nuclear energy cooperation following a visit to the Kingdom by China’s Deputy Prime Minister Zhang Gaoli last week.
Egypt Set To Receive US$2.15 Bio From Two Saudi Investors.
Egypt’s Investment Minister, Sahar Nasr, was quoted by Bloomberg yesterday saying that two Saudi Arabian businessmen were planning to invest up to US$2.15 bio in fresh commercial ventures in the North African country. US$1 bio would reportedly be channeled into specific resort projects in Sharm El Sheikh and Hurghada, another US$1 bio would go into other real estate developments and US$150 mio into a second production line at a cement factory.
Abu Dhabi’s Non-Oil Related Trade Rises.
According to a recent report issued by the UAE’s official WAM news agency, Abu Dhabi’s non-oil related global trade rose to AED 73 bio during the first 5 months of this year. 15.50% of this trade was with four of its GCC neighbours and separated as follows; Saudi Arabia (7 bio), Kuwait (1.73 bio) Bahrain (1.6 bio) and Oman (1.1 bio). Meanwhile the UAE’s non-oil economy as a whole is expected to expand during the second half of 2017 and into 2018 due in part to an anticipated rise in government spending and projects linked to Expo 2020.
Kuwait’s C/A Surplus Shrinks.
Kuwait’s current account surplus fell from KWD 600 mio in the last quarter of 2016 to KWD 300 mio during the first quarter of this year due to a jump in imports, a decline in investment income and a rebound in net service and expat remittance related outflows, according a recent report by NBK. Meanwhile the World Bank’s country manager for Kuwait has said that while the OPEC/NOPEC oil output cut agreement has placed “a strain” on Kuwait’s economy he expected GDP to reach 3% within the next two years due to ongoping government efforts to improve the country’s overall business/investment climate and expand public-private partnerships.
Omantel To Use Bridging Loan For Zain Purchase.
Oman Telecommunications has said it will be accessing a bridge loan facility to help fund its US$846 mio purchase of a 9.84% stake in Kuwait’s Zain Group. "Acquiring a minority stake in Zain is a deliberate investment for Omantel to position itself as a leading digital service provider," a company statement said last week.
Tunisia’s FX Reserves Receive A Minor Boost.
Tunisia’s foreign exchange reserves rose last week following the arrival of a US$500 mio loan from the World Bank. The Central Bank said that this inflow has helped official reserves increase to US$5.43 bio which would currently cover 103 days of imports against a 30 year low of just 90 days earlier this month.
S&P Amends Zambia Outlook To ‘Stable.’
S&P Global ratings agency has affirmed Zambia’s sovereign credit rating at B and amended its outlook from negative to stable. S&P said its change in outlook was driven by better economic growth prospects and an improvement in liquidity within the country’s domestic banking sector.
Did you know that the first oil discovery made in the Arabian Gulf occurred in Bahrain in 1932?
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