UAE central bank plans to introduce digital currency

UAE central bank plans to introduce digital currency
It is part of the central bank’s 2023-2026 strategy. (WAM)
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Updated 12 July 2021

UAE central bank plans to introduce digital currency

UAE central bank plans to introduce digital currency
  • The strategy supports the digital transformation of the UAE’s financial services sector

DUBAI: The UAE central bank announced a three-year plan that includes introducing digital currency.

It is part of the central bank’s 2023-2026 strategy, state news agency WAM has reported.

The strategy supports the digital transformation of the UAE’s financial services sector, including adopting modern technology such as artificial intelligence and big data.


Aramco’s Abqaiq facility added to World Economic Forum's ‘Lighthouse’ network for 4IR leadership

Aramco’s Abqaiq facility added to World Economic Forum's ‘Lighthouse’ network for 4IR leadership
Updated 28 sec ago

Aramco’s Abqaiq facility added to World Economic Forum's ‘Lighthouse’ network for 4IR leadership

Aramco’s Abqaiq facility added to World Economic Forum's ‘Lighthouse’ network for 4IR leadership
  • The Global Lighthouse status recognizes factories, value chains, and other business models that demonstrate leadership in fourth industrial revolution (4IR) technologies

DUBAI: Aramco’s Abqaiq facility has been added to the World Economic Forum’s Global Lighthouse Network, making it the Saudi company’s third facility in the prestigious list. 

The Global Lighthouse status recognizes factories, value chains, and other business models that demonstrate leadership in fourth industrial revolution (4IR) technologies.

“Through pioneering the large-scale use of 4IR solutions, such as Artificial Intelligence, Industrial Internet of Things (IioT), automation and robotics, we are setting new benchmarks for global industry,” Nabil Al-Nuaim, Aramco’s digital transformation vice president, said.

The Saudi oil producer claims the Abqaiq facility is the largest oil processing plant in the world, providing five percent of global oil supplies.

Other Aramco projects in the list are Uthmaniyah Gas Plant and Khurais oil complex.


Bahrain cabinet submits draft law to modify VAT amid rumors of a hike

Bahrain cabinet submits draft law to modify VAT amid rumors of a hike
Updated 5 min 43 sec ago

Bahrain cabinet submits draft law to modify VAT amid rumors of a hike

Bahrain cabinet submits draft law to modify VAT amid rumors of a hike

RIYADH: Bahrain’s cabinet has referred a draft law to Parliament which could see value-added tax (VAT) rise from  January 1 2022, Bahrain News Agency (BNA) reported.

Bahraini ministers signed off on taking constitutional and legal measures to submit a draft law modifying some provisions of the value-added law to the legislative authority. 

It has not been officially announced whether VAT is set to rise or fall. 

However, a parliament source and another close to the local government told Reuters on Sunday that the Bahraini Kingdom is considering doubling VAT to 10 percent to increase the country’s revenues and reduce budget deficit.

Bahrain has the smallest economy of the six Gulf Cooperation Council members, and its economy is estimated to have shrunk 5.4 percent amid the pandemic.


UAE-based Dana Gas wins $607.5m in case against Iran’s state oil producer

UAE-based Dana Gas wins $607.5m in case against Iran’s state oil producer
Updated 6 min 31 sec ago

UAE-based Dana Gas wins $607.5m in case against Iran’s state oil producer

UAE-based Dana Gas wins $607.5m in case against Iran’s state oil producer
  • The Abu Dhabi-listed company will enter another round of arbitration with the National Iranian Oil Company (NIOC)

DUBAI: Dana Gas, an energy firm based in the UAE emirate of Sharjah, has been awarded $607.5 million in damages in its gas dispute case with Iran’s state-owned oil producer. 

The Abu Dhabi-listed company will enter another round of arbitration with the National Iranian Oil Company (NIOC), where the claim will be much larger, it said in a stock exchange filing.

The case involves a 25-year contract signed by NIOC and Crescent Petroleum in 2001 for Iran to supply 600 million cubic feet of gas by pipeline to Sharjah. 

NIOC failed to comply due to a dispute over contracted price, and the companies have been under international arbitration since then. 


All-time high mortgage volumes boosting Saudi economy: KPMG

All-time high mortgage volumes boosting Saudi economy: KPMG
Updated 29 min 51 sec ago

All-time high mortgage volumes boosting Saudi economy: KPMG

All-time high mortgage volumes boosting Saudi economy: KPMG

RIYADH: A booming mortgage market has helped fuel economic growth in Saudi Arabia this year, according to financial analysts KPMG.

The firm’s ‘Future Finance’ report claimed businesses operating in the real estate sector are key figures among the Kingdom’s non-bank financial institutions (NBFIs), which are helping the economy recover after the pandemic. 

KPMG estimates the value of Saudi Arabia’s NBFIs — which include automotive, commercial equipment and other consumer financing firms —  at about SR54 billion ($14.5 billion).

This sector plays a pivotal role in lending to certain segments of borrowers within the Kingdom.

Khalil Ibrahim Al Sedais, office managing partner at KPMG in Saudi Arabia said growth momentum which began in the second half of 2020 carried through into the first six months of this year.

“It is especially noticeable in the mortgage industry, where volumes were all time high due to domestic demand for housing, low interest rate environment and government guarantee for the first house of a citizen,” he said. 

Al Sedais added that NBFIs are expected to continue growing thanks to developments in the Saudi financial services sector, including in anti-money laundering compliance, fintech advancement, cybersecurity, business continuity planning and digitalization.

Currently, more than 35 NBFIs are operating in Saudi Arabia. As at the end of the fiscal year 2020, the total paid up capital of these entities was SR14.2 billion ($3.8 billion).

Real estate companies stand at SR3.9 billion ($1 billion), with non-real estate companies at SR8.8 billion ($2.3 billion).

Saudi Real Estate Refinance Company (SRC), as the refinancing entity of the industry, comes in at SR1.5 billion ($403 million).

Industry-wide total assets were SR 53 billion ($14.2 billion) by end of fiscal year 2020, and there was an outstanding loan book, on and off-balance sheet, of approximately SR54 billion ($14.5 billion).

This included the real estate companies’ loan book of SR 23.5 billion.

There was on-balance sheet loan portfolio growth of 16 percent compared to 2019, consisting of SR3.97 billion, according to KPMG. 

Despite SAMA’s new regulations allowing deposit-taking by finance companies, NBFIs are highly dependent on borrowing and securitization as the main source for financing their lending activities. 

At the end of 2020, equity and liabilities totaled SR53 billion of which, liabilities accounted for 63 percent, while capital and reserves represented 27 percent and 10 percent, respectively.


Higher oil prices, widespread vaccine roll-out to drive Saudi Arabia’s economic rebound: S&P

Higher oil prices, widespread vaccine roll-out to drive Saudi Arabia’s economic rebound: S&P
Updated 28 September 2021

Higher oil prices, widespread vaccine roll-out to drive Saudi Arabia’s economic rebound: S&P

Higher oil prices, widespread vaccine roll-out to drive Saudi Arabia’s economic rebound: S&P
  • Growth is heavily observed in non-oil sectors, particularly in real estate where the government aims to drive national home ownership to 70 percent by 2030

DUBAI: Saudi Arabia’s economy will benefit from higher oil prices and its successful COVID-19 vaccine roll-out, ratings agency S&P Global has said as it affirmed the Kingdom’s stable outlook in its latest report. 

The semi-annual review from S&P affirmed the A-/Stable/A-2 sovereign rating of the Kingdom, attributing it to a positive post-pandemic performance as well as an improvement in oil sector dynamics. 

Growth is heavily observed in non-oil sectors, particularly in real estate where the government aims to drive national home ownership to 70 percent by 2030. 

Plastic and petrochemical exports also supported the Kingdom’s non-oil manufacturing, and consumer spending rose 3 percent in the first half of the year. 

The easing of tourism restrictions also supported other non-oil industries, including hotels and hospitality. 

There is also evidence of progress in the oil sector, which was heavily hit by the pandemic and the production cuts that came with it. Saudi Arabia’s GDP contracted by 4.1 percent last year, the biggest since 1987. 

But the S&P report said oil is getting back on track, particularly given the OPEC+ decision to restore and increase overall production by 400,000 barrels per day - 100,000 from Saudi Arabia. 

These indicators could drive economic growth from 2021 to 2024, the report said, especially given government efforts at fiscal control.