Taxation dominates G20 gathering in Riyadh

SAMA governor Ahmed Alkholifey at the G20 meeting. (Reuters)
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Updated 22 February 2020

Taxation dominates G20 gathering in Riyadh

  • Officials express optimism on the tackling of tax evasion and the continued strength of the financial sector globally

RIYADH: The two-day G20 Finance Ministers and Central Bank Governors meeting kicked off in Riyadh on Saturday with taxation dominating the agenda.

Saudi Finance Minister Mohammed Al-Jadaan said this year would represent a key test for tax transparency worldwide.

“It gives us the opportunity to assess what we have achieved collectively in the area of tax transparency and discuss possible ways to encourage further progress, and provides a platform to discuss the way forward to address the tax challenges arising from the digitization of the economy,” he said. 

The minister said that G20 states and the OECD had already achieved major successes in tackling tax evasion. “Today, members of the G20/OECD Global Forum on Transparency and Exchange of Information for Tax Purposes work together to implement the internationally agreed standards on tax transparency,” said Al-Jadaan. “These standards balance the need to access information for tax purposes and the need to protect taxpayers’ confidentiality.”

He said that more than 6,100 bilateral exchange agreements had been signed and that tax-authorities worldwide were now collecting tax revenues utilizing the automatic exchange of information mechanism.

“Information on 50 million financial accounts was exchanged by the end of 2019 for a total value of about €5 trillion ($5,4 trillion), and almost €100 billion in additional tax revenues have been identified, thanks to voluntary compliance mechanisms and investigations,” he said.

Dr. Ahmed Alkholifey, Governor of the Saudi Arabian Monetary Authority (SAMA) said that the global economy had faced headwinds caused by geopolitical uncertainties and social unrest in some parts of the world.

But he said the good news was that the financial sector, and notably the banking sector, has continued to strengthen in both advanced and emerging economies.

The governor also said he expected to see an improvement in the Saudi economy this year.

“As an open economy, Saudi Arabia, just as other countries in the region, is under the influence of these global developments. What I can say, in a nutshell, is that GDP growth in Saudi Arabia is projected to see an upturn in 2020.”

Ministers and central bank governors from the G20 countries and guest nations, as well as heads of international and regional organizations are attending the gathering in Saudi Arabia, the first Arab nation to hold the G20 presidency.


Bayut and Dubizzle fire M&A starting pistol

Updated 46 min 48 sec ago

Bayut and Dubizzle fire M&A starting pistol

  • The two owner companies will also run a $150 million investment round
  • EMGP will continue operating both Bayut and Dubizzle in the UAE

LONDON: The owners of Dubai-based listings sites Dubizzle and Bayut announced the merger of their MENA and South Asia operations as the regional property sector comes under pressure.

Dubai-based Emerging Markets Property Group (EMPG) and OLX Group made the disclosure in a statement carried by the UAE-based WAM news agency website.

The agreement includes a 550 million dirhams ($150 million) investment round, led by existing EMPG shareholders and OLX group. OLX has become EMPG’s largest single shareholder with 39 percent of shares, the statement said.

Both sites are known for their extensive listings in the real estate sector which has come under renewed pressure in recent months because of the coronavirus pandemic.

“This merger of EMPG and OLX will allow us to better serve our customers, given that both operate brands with a strong following and will allow us to leverage existing tech and data to paint a more accurate picture of the state of affairs in the real estate industry across the region,” said Haider Ali Khan, the head of EMPG — MENA . “At the same time, we will be making significant technology investments to provide more value to all users of property, automotive and other segments of the Dubizzle and OLX platforms.”

Merger and acquisition (M&A) activity is expected to accelerate this year as companies facing disruption from the coronavirus pandemic seek to cut costs and adapt to a rapidly changing marketplace.

Ali Maabereh, head of mergers and acquisition (M&A) at KMPG in Saudi Arabia predicted M&A activity will increase in GCC countries large corporates seek capital injections to satisfy working capital needs.

“The current pandemic is creating a lot of uncertainties and contradictions in what to expect after the dust settles. The expected key impacts on companies are shortages of liquidity and working capital requirements. Though companies might be running a healthy P&L, there will be significant pressure on working capital requirements,” he said.