UK fintechs seek ‘cure for Brexit’ in Lithuania

UK fintechs seek ‘cure for Brexit’ in Lithuania
The Baltic eurozone state with a population about a third the size of London is now leading the EU in fintech with over 230 companies, according to the Invest Lithuania government agency. (AFP)
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Updated 21 February 2021

UK fintechs seek ‘cure for Brexit’ in Lithuania

UK fintechs seek ‘cure for Brexit’ in Lithuania
  • One of the first to come after the 2016 Brexit referendum was London-based Revolut bank
  • Invest Lithuania estimates that the sector employs more than 4,000 people in the country

VILNIUS: Thanks in part to Brexit, Lithuania is becoming a fintech hub as a growing number of UK-linked digital financial companies are getting licenses there so they can continue to operate in the European Union.
The Baltic eurozone state with a population about a third the size of London is now leading the EU in fintech with over 230 companies, according to the Invest Lithuania government agency.
Some two dozen have links to Britain.
One of the first to come after the 2016 Brexit referendum was London-based Revolut bank.
“Lithuania is currently a hub for our European operations after Brexit,” Virgilijus Mirkes, CEO of Revolut Bank in Lithuania, told AFP.
“We opened our Vilnius office in 2017 after considering the fintech-friendly business environment,” he said, pointing to a speedy licencing process and good local talent.
Invest Lithuania estimates that the sector employs more than 4,000 people in the country — an increase of more than 18 percent in the past year.
“During the Brexit transition period, fintech companies began to search for an alternative EU harbor and thus Lithuania has become one of their primary options,” said Jekaterina Govina, a senior official in charge of supervision at Lithuania’s central bank.

Lithuania says it can process license applications in as little as three months, more quickly than anyone else in the EU.
The central bank has granted a total of 118 fintech licenses allowing companies to operate anywhere in the EU — far higher than Germany with 77 licenses and France with 76, according to a report from Invest Lithuania.
Britain is still first by far with 610 licenses.
Lithuania’s central bank has also set up a “regulatory sandbox” — a framework to allow fintech companies to test out innovations.
“That was a lighthouse for companies searching for a cure for Brexit,” Govina said.
While the capital Vilnius does not offer the big city attractions of London and getting there is tricky at the moment because of coronavirus restrictions, Internet speeds in Lithuania are good and it has a tech-savvy workforce.
Revolut employs some 200 people in the country, including in product development and customer support, and Mirkes said the company would “continue to scale (up) our operations here.”
Revolut started its operations in Vilnius in a gleaming glass-fronted office hub called Rockit, which is funded by Swedbank and provides workspace and industry events for some 30 member companies.
“Our hub helps to create a fintech community where foreign companies can easily find local partners,” Rockit CEO Sarune Smalakyte told AFP during a recent visit to the space.
But the push into fintech also comes with risks.
Sergejus Muravjovas, CEO of Transparency International Lithuania, said “the ambition to become a fintech center comes with a responsibility to take money laundering prevention to a new level.
“There is a need for a firmer and more data-driven approach from monitoring the institutions involved,” he told AFP.
Govina said the authorities were “fully aware” of their responsibilities as a license in the Baltic state opens the gates to the entire EU market.
Another company that has recently set up in Lithuania is London-based DiPocket Group, which has developed an e-money wallet app.
“Brexit was definitely the trigger event,” said DiPocket CEO and co-founder Fedele Di Maggio.
He said he found the central bank “both strict and supportive” and described the local workforce as “generally English-speaking and with reasonable financial expectations.”


ArcelorMittal takes over TAQA’s JESCO

ArcelorMittal takes over TAQA’s JESCO
Updated 54 min 2 sec ago

ArcelorMittal takes over TAQA’s JESCO

ArcelorMittal takes over TAQA’s JESCO
  • With the deal, JESCO’s 100 percent ownership has been transferred to AMTPJ

RIYADH: Saudi Arabia’s Industrialization and Energy Service Co. (TAQA) on Sunday sold all its shares in Jubail Energy Services Co. (JESCO) to ArcelorMittal Tubular Products Jubail (AMTPJ).
With the deal, JESCO’s 100 percent ownership has been transferred to AMTPJ, TAQA said in an emailed statement, without disclosing the value of the deal.
Commenting on the sale of stocks, TAQA Chairman Ahmed Al-Zahrani said: “The divestiture of JESCO is in line with TAQA’s 2021 strategy to become a major player in Vision 2030 realization by maximizing the value of local investment and creating a more diverse and sustainable economy. The transaction will result in a much stronger industry in the steel sector serving not only the Kingdom but also the rest of the world.”
The company’s mandate is to lead the way in localizing industries in the Kingdom, supplying specialized equipment, and development of oil and gas resources in the Middle East and North Africa (MENA).
TAQA CEO Khalid Nouh said: “The divestiture of non-core businesses such as JESCO allows TAQA to expand its portfolio through acquisitions of additional services and technologies.” 


Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend
Updated 01 August 2021

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend
  • Bitcoin is currently trading above $41,000 and up more than 15 percent over the past week

RIYADH: Bitcoin, the leading cryptocurrency in trading internationally, traded higher on Sunday, rising by 0.02 percent to $41,447.73 at 4:41 p.m Riyadh time.

Ether, the second most traded cryptocurrency, traded at $2,580.98.76, up 5.33 percent, according to data from Coindesk.

Here is a rundown of major crypto news:

Bitcoin is currently trading above $41,000 and up more than 15 percent over the past week. The uptrend continues after the massive sell-off in May and two months of consolidation above the $30K support level, according to CoinDesk.

Germany plans to allow some institutional funds to invest billions of dollars in crypto assets for the first time, Bloomberg has reported.

A law effective Monday will allow so-called Spezialfonds with fixed investment rules to put up to 20 percent of their holdings in Bitcoin and other crypto assets. The funds, which can only be accessed by institutional investors, currently manage about $2.1 trillion.

“Most funds will initially stay well below the 20%,” said Tim Kreutzmann, an expert on crypto assets at BVI, Germany’s fund industry body.

In Ukraine, President Volodymyr Zelensky has signed the Law on Payment Services adopted by the Verkhovna Rada on June 30, the President's administration announced this week.

The new legislation aims to “modernize and further develop” the payment services market, and encourage innovation in the financial sector, according to a press statement.

The National Bank of Ukraine has also given the power to issue its own digital currency.

In an interview with Bloomberg on Thursday, Henri Arslanian, crypto leader at accounting and financial services firm PricewaterhouseCoopers (PWC), explained that crypto firms have high valuations due to the entry of major investors.

He mentioned investment firms and family offices are backed by major venture capitalists, private equity funds, and even some pension funds, and noted smaller venture capital firms are not satisfied with the trend.

Over to the US, Lael Brainard, a member of the Federal Reserve Board of Governors, highlighted the urgent need to develop a digital dollar, speaking to the Aspen Institute’s Economic Strategies Group on Friday.

He cited several reasons for creating a digital version of the US dollar, while the central bank agreed that it will have both international and domestic applications.


Saudi Arabia’s real estate price index rises by 0.4% in Q2

Saudi Arabia’s real estate price index rises by 0.4% in Q2
Updated 01 August 2021

Saudi Arabia’s real estate price index rises by 0.4% in Q2

Saudi Arabia’s real estate price index rises by 0.4% in Q2
  • The report said a 1 percent hike in the prices of residential plots jacked up the prices of residential properties

RIYADH: The real estate price index in Saudi Arabia rose by 0.4 percent in the second quarter of 2021 compared to the same period of the previous year, official data showed on Sunday.
The statistics issued by the General Authority for Statistics showed a 0.8 percent increase in the residential real estate prices in the second quarter while prices of commercial and agriculture properties declined by 0.5 percent and 0.2 percent respectively.
The report said a 1 percent hike in the prices of residential plots jacked up the prices of residential properties.
Meanwhile, the Wafi program, which regulates off-plan property activity in the Kingdom, issued a report highlighting its performance during the first half of the year.
Wafi issued 55 licenses for off-plan sales projects providing 24,328 housing units during the first half of 2021.
Off-plan property sales represent a growing sector of the Saudi real estate market, but some consumers are still wary of developers’ abilities to deliver quality homes on time.
The sector has been steadily increasing its share of total residential sales and data from the Wafi program.
According to real estate consultancy company, Knight Frank, off-plan units represent around 9 percent of total existing housing stock, but a massive 60 percent of total future supply in Saudi Arabia.
Saudi Arabia’s real estate sector is a key and effective economic driver for the country’s gross domestic product (GDP) and is connected to at least 120 industries.
Mortgage lending in Saudi Arabia increased 27 percent this year through May, as interest rates decreased to between 1 percent and 4.9 percent, compared to about 6 percent early last year.
Residential real estate financing contracts offered to individuals by local banks reached 133,006 through May, with a value of SR69.5 billion ($18.5 billion), according to data from the Saudi Central Bank (SAMA).
Real estate financing grew by 50 percent compared with the same period in 2020 when SR46.6 billion was lent via 104,000 contracts.


Saudi net foreign assets jump in June, central bank data shows

Saudi net foreign assets jump in June, central bank data shows
Updated 01 August 2021

Saudi net foreign assets jump in June, central bank data shows

Saudi net foreign assets jump in June, central bank data shows
  • Data from the Saudi Central Bank (SAMA) showed the assets rising by 34 billion riyals ($9.1 billion)

DUBAI: Saudi Arabia’s net foreign assets rose over 2 percent in June, as the global oil industry gradually recovers from the impact of COVID-19.

Data from the Saudi Central Bank (SAMA) showed the assets rising by 34 billion riyals ($9.1 billion) to 1.65 trillion riyals in June from the month before.

Total assets increased by 16.18 billion riyals to 1.842 trillion riyals, the central bank said.


Saudi Arabia’s economy likely to grow in 2021 and 2022, says report

Saudi Arabia’s economy likely to grow in 2021 and 2022, says report
Updated 01 August 2021

Saudi Arabia’s economy likely to grow in 2021 and 2022, says report

Saudi Arabia’s economy likely to grow in 2021 and 2022, says report
  • Capital Economics' forecast a further evidence that the Saudi economic recovery has taken off in 2021

RIYADHH Saudi Arabia’s economy is poised to grow from 2.2 percent to 4.8 percent in 2021 and from 4.1 percent to 6.3 percent in 2022, said a Capital Economics report.

The new forecasts are further evidence that the Saudi economic recovery has taken off in 2021.

At the start of the year, the Kingdom’s Ministry of Finance said that it expected 3.2 percent growth this year — reversing the pandemic-driven downturn of 2020. The International Monetary Fund forecast just 2.1 percent growth two months ago.

The Saudi economy is expected to maintain growth in the second half of the year. The expansion is also backed by higher oil output amid an OPEC+ agreement.

The Kingdom’s finance, insurance, real estate, and business sectors are likely to expand by 9 percent annually and their relative share to overall economic activity will grow by 12.7 percent.

Meanwhile, the services sector is also likely to grow about 10 percent annually on average, implying that its relative gross domestic product (GDP) share will climb to almost 40 percent in 2030.