Bitcoin is at a ‘tipping point,’ Citi says

Bitcoin is at a ‘tipping point,’ Citi says
Bitcoin’s performance has come with the growing involvement of investors. (Reuters)
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Updated 02 March 2021

Bitcoin is at a ‘tipping point,’ Citi says

Bitcoin is at a ‘tipping point,’ Citi says
  • With the recent embrace of the likes of Tesla Inc. and Mastercard Inc., Bitcoin could be at the start of a ‘massive transformation’ into the mainstream, Citi says

LONDON: Bitcoin rose nearly 6 percent on Monday as risk assets rallied after last week’s bond rout cooled, and Citi said the most popular cryptocurrency was at a “tipping point” and could become the preferred currency for international trade.

With the recent embrace of the likes of Tesla Inc. and Mastercard Inc., Bitcoin could be at the start of a “massive transformation” into the mainstream, Citi added.

Bitcoin, which has risen to $47,000 from $4,700 last March, could in the future become the preferred currency for international trade or face a “speculative implosion,” the investment bank said. It was up 5.7 percent at $47,834 on the Bitstamp exchange. Smaller rival ether rallied 7.5 percent to $1,525.

Bitcoin’s recent performance has come with the growing involvement of institutional investors in recent years, contrasting with its heavy retail investor focus for most of the past decade, Citi added.

If businesses and individuals gain access via digital wallets to planned central bank digital cash and so-called stablecoins, bitcoin’s global reach, traceability and potential for quick payments would see it “optimally positioned” to become the preferred currency for international trade, Citi said.

Bitcoin, designed as a payment tool, is little used for commerce in major economies, hampered by high volatility and relatively costly transactions. 

Still, it has over the past year gained traction in some emerging markets such as Nigeria.

Such a dramatic transformation for bitcoin to the de facto currency of world trade — a status currently held by the dollar — would depend on changes to its market to allow wider institutional participation and closer oversight by financial regulators, Citi said.

Still, shifts in the macro-economic environment may also make the demand for bitcoin less pressing, it added.


IATA predicts Middle East airline losses of $4.2 billion in 2021

IATA predicts Middle East airline losses of $4.2 billion in 2021
Updated 34 min 15 sec ago

IATA predicts Middle East airline losses of $4.2 billion in 2021

IATA predicts Middle East airline losses of $4.2 billion in 2021
  • Airlines will burn through $81 billion of cash this year
  • Industry crisis much longer and deeper than expected

RIYADH: Middle Eastern airlines will endure losses of $4.2 billion in 2021, down from $7.9 billion in 2020, as pandemic travel restrictions remain in place in much of the world, according to the International Air Transport Association (IATA).
Losses will be equal to 13.8 percent of revenues in 2021, an improvement from 28.9 percent in 2020, but still an historically bad number. Demand will be 67.6 percent lower than 2019 levels, while capacity will shrink 58.9 percent, IATA said.
While the region’s carriers will benefit from some of the highest vaccination rates globally, their relatively small home markets mean airlines like Emirates, Etihad and Qatar Airways will remain heavily exposed to international travel restrictions.
Globally, airline industry losses will narrow to $47.7 billion in 2021 from $126.4 billion in 2020, IATA said.
Airlines will burn through $81 billion of cash this year, following $149 billion in 2020, while the industry has taken on a further $220 billion of debt for a burden of $651 billion, IATA said.
“This crisis is longer and deeper than anyone could have expected,” said IATA Director General Willie Walsh. “Losses will be reduced from 2020, but the pain of the crisis increases. Government imposed travel restrictions continue to dampen the strong underlying demand for international travel.”


L&T Construction to build oil and gas supply base in King Salman Energy Park

L&T Construction to build oil and gas supply base in King Salman Energy Park
Updated 36 min 12 sec ago

L&T Construction to build oil and gas supply base in King Salman Energy Park

L&T Construction to build oil and gas supply base in King Salman Energy Park
  • The contract is valued at between $133m and $332m

RIYADH: Indian contractor Larsen & Toubro has been appointed by Oilfields Supply Company Saudi to design and build what it describes as one of the world’s largest oil and gas supply bases, in King Salman Energy Park in Dammam.

The project, valued at between INR1,000 crore ($133.3 million) and INR2,500 crore, involves the construction of industrial facilities, an administration building, ancillary buildings, associated infrastructure and storage yards, and is scheduled for completion in 30 months, L&T said in an emailed statement.

“This project will act as a business incubator to support the oil and gas industry in the Kingdom and help accelerate industrial growth in the energy sector,” said M. V. Satish, senior executive vice president (Buildings), L&T.


Dubai’s ENOC expands petrochemical pipeline and storage tanks in Kingdom

Dubai’s ENOC expands petrochemical pipeline and storage tanks in Kingdom
Updated 54 min 41 sec ago

Dubai’s ENOC expands petrochemical pipeline and storage tanks in Kingdom

Dubai’s ENOC expands petrochemical pipeline and storage tanks in Kingdom
  • Project to boost export capacity
  • ENOC eyes expansion in Kingdom

RIYADH: Dubai’s ENOC Group and Rotary Arabia have completed construction of pipelines and tanks to store and transport petrochemicals in Saudi Arabia.
The infrastructure development between Horizon Terminals Limited, ENOC’s terminals arm, and Rotary Arabia – the front-end contractors for the project, saw the construction of four new pipelines from Farabi Petrochemicals’ Yanbu facility on the Red Sea coast to storage tanks at Arabtank Terminal. ENOC sa
The GCC’s chemical capacity is expected to increase by more than a third over the next decad* reaching 231.8 million tons, driven by refining expansion and chemical integration.
Arab Tank Terminal Limited (ATTL) – which is Horizon Terminals’ Saudi based terminal, has a petroleum and chemical storage capacity of 288,100 cubic meters spread across 26 storage tank.
Two additional pipelines were also constructed from ATTL to Berth 21 at Port of King Fahad Yanbu.
“The GCC chemical industry today is predominantly focused on petrochemicals which make up 72 percent of its total production, with Saudi Arabia being the leading producer in the region, accounting for 68.2 percent of total chemical output,” said ENOC Group CEO Saif Humaid Al-Falasi. “Our expansion into the Kingdom comes at a time when the regional market is poised to step up overseas production capacity by 7.6 percent.”
Farabi Petrochemicals currently supplies to the domestic market and benefits from the Port of King Fahad Yanbu infrastructure to export chemicals to the GCC, Europe and Asia.
The new pipelines from its Yanbu facility will enable faster and more efficient transportation of petrochemical products.


Madinah's Knowledge Economic City taps $209m financing

Madinah's Knowledge Economic City taps $209m financing
Updated 18 min 26 sec ago

Madinah's Knowledge Economic City taps $209m financing

Madinah's Knowledge Economic City taps $209m financing
  • Madinah Gate includes major entertainment hub
  • Region attracts swathe of new investment

RIYADH: Knowledge Economic City has agreed to borrow SR782 million ($209 million) from the Saudi Tourism Development Fund and Riyadh Bank for the development of the Knowledge City Hub project in Madinah.
The financing, which covers 79 percent of the project development cost, will be repaid over 13 years with collateral in the form of plots of land from the company’s land portfolio, according to a stock exchange filing.
The Tourism Development Fund (TDF) will provide half the financing and Riyadh Bank the other half, TDF said in a press release. The SR1.3 billion development will cover 68,000 sq. m at a site about 6 km from from Prophet's Mosque, it said.
Knowledge City Hub is made up of a mall, commercial, residential and entertainment services and a 325-room 5-star hotel that will be managed by Hilton.
Construction is due to start in August 2021 and to be completed by end 2023 with the hotel finished in May 2024.
“This agreement is one of several successful agreements with local banks aimed at providing investors with attractive financial solutions that encourage investments into this promising sector," Qusai Al-Fakhri, chief executive officer of TDF, said in the press release. "It exemplifies our commitment to delivering on the National Tourism Strategy, increasing the GDP contribution of the tourism sector from 3% to 10% by 2030 and creating 1 million new jobs.”
Separately, Knowledge Economic City said it had also agreed terms for the management of the Madinah Gate Fund Project Development with Riyadh Capital.
Madinah Gate is a vast redevelopment of land adjacent to the Haramain High Speed Train Station in the city. It will include a 4-star hotel and a bus station connected directly to the train station.
The detailed development includes a commercial and entertainment center with 23,000 square meters of leasable area with 78 shops, 39 restaurants and cafes, 2 entertainment centers, a cinema with 800 seats capacity, and 800 parking spaces.


Egypt to produce Russia's Sputnik V, rollout expected in Q3 - statement

Egypt to produce Russia's Sputnik V, rollout expected in Q3 - statement
Updated 22 April 2021

Egypt to produce Russia's Sputnik V, rollout expected in Q3 - statement

Egypt to produce Russia's Sputnik V, rollout expected in Q3 - statement
  • Minapharm agrees deal
  • 40 million doses-a-year

CAIRO: Egyptian pharmaceutical firm Minapharm has agreed to produce more than 40 million doses a year of Russia's Sputnik V coronavirus vaccine, the Russian Direct Investment Fund (RDIF), which markets the vaccine abroad, said on Thursday.
The two parties agreed to begin technology transfer immediately, it said in a joint statement with Minapharm, and the rollout is expected in the third quarter of this year.
"RDIF and Minapharm will initially supply over 40 million doses per year. Production will take place in Minapharm's biotech facility in Cairo for global distribution," the statement said.