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ADGM Announces Fee Revision for Commercial Licences Starting 2025

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Shams
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ADGM Announces Fee Revision for Commercial Licences Starting 2025

ADGM, the international financial centre of the UAE’s capital, has announced significant revisions to its licensing fee schedule as part of its transitional arrangements for Al Reem Island businesses.  Starting from 1st January 2025, ADGM will implement major reductions of 50% or more for obtaining non-financial and retail licences within its jurisdiction. This initiative aims to enhance ADGM’s business ecosystem, making it more attractive and accessible for various enterprises.

Under the revised fee schedule, new registrations within the non-financial category of businesses will see fees reduced from USD 10,000 to USD 5,000. In contrast, the annual licence renewal fees for the same category will decrease from USD 8,000 to USD 5,000. Fees for the retail category have also been significantly reduced, with new registration fees cut by two-thirds from USD 6,000 to USD 2,000. Licence renewals for the retail category will also see a 50% reduction, bringing the annual renewal fees down to USD 2,000.

The effective date of the revised licensing fees has been set as 1st January 2025 to align with the expiry of the current transition period, which ends on 31st December 2024. The new fee structure will be applicable across ADGM’s jurisdiction, which includes both Al Maryah and Al Reem Island.

The introduction of these fee revisions is in line with the series of consultations conducted in 2023 by ADGM with a focus group of Al Reem Island businesses to gather feedback and insights related to ADGM’s jurisdiction expansion. These discussions covered major topics such as the ease of obtaining an ADGM commercial licence and the relevant fees. Following these consultations, the Registration Authority (RA) of ADGM conducted a comprehensive review of its fee structure to meet the expectations of its newly expanded jurisdiction and commercial landscape, ensuring a smooth transition for its new business segments.

Hamad Sayah Al Mazrouei, the CEO of ADGM RA said, “To facilitate a seamless transition, ADGM and its Registration Authority have proactively introduced various initiatives, prioritising our business community at the core of every decision. We assessed the financial impact on different business categories and previously implemented a fee waiver for qualifying non-financial and retail businesses on Al Reem Island. Building on these efforts, we have now revised our fee structure to include significant reductions for the same categories starting next year. Our aim is to minimise potential disruptions for businesses transitioning to an ADGM licence, enabling them to operate efficiently within our jurisdiction.”

The cut-off date for the previously introduced fee exemption for qualifying non-financial and retail businesses located on Al Reem Island is 31st October 2024. Fee revisions for other categories include changes in the fee structure within the financial category, increasing from USD 15,000 to USD 20,000 and renewals rising from USD 13,000 to USD 15,000 for an annual ADGM licence. Additionally, there is a minor adjustment for tech and fintech startups, with fees changing from USD 1,000 to USD 1,500 for both new and existing licence renewals. The fees for the Special Purpose Vehicle (SPV) category remain unchanged at USD 1,900.

The full fee schedule that will be applicable for new business registrations as well as licence renewals from 1st January 2025, will be published in December.

Offa launches ultra-quick buy-to-let Islamic finance for British expats

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Shams
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Offa launches ultra-quick buy-to-let Islamic finance for British expats

Offa, the UK’s first Shari’ah-compliant bridge finance fintech, has today launched an innovative new buy-to-let finance (BTL) service providing fast funding decisions for British expats, delivered via a modern paperless process.

Powered by next-generation technological innovation, Offa’s BTL service replaces legacy  finance systems with its flexible and ethical Islamic property finance solutions, and end-to-end digital processes making it fast and easy for expats to apply and get a quick decision.

These Islamic BTL products are available to new and seasoned British landlords living in the Gulf Cooperation Council (GCC) states, Australia, the European Union, Canada, Singapore and Brunei.

Sagheer Malik, Offa’s Chief Commercial Officer and MD of Retail Finance, said: “I have met many British expats who need Islamic buy-to-let finance, but who struggle to cope with the onerous paperwork and old-style systems that they typically face. Our modern, ultra-fast, paperless buy-to-let finance solves that problem.

“With our team’s decades of industry experience and a streamlined digital application process, we are bringing 21st century Shari’ah-compliant BTL finance to our customers.”

UAE-based Gulf Islamic Investments group (GII), a leading Shari’ah-compliant global alternative investment company with over $4.5 billion of assets under management, took a majority stake in Offa in mid-2022. 

GII’s co-Founders and co-CEOs, Mohammed Alhassan and Pankaj Gupta, said: “This latest market innovation from Offa brings additional investment opportunities in UK property to Britons resident across the Arabian Gulf and further afield. We applaud Offa’s initiatives to attract further expatriate capital to the UK’s vibrant property market as an exciting alternative asset management strategy.”

Instead of using interest, Offa follows the Islamic finance principles of co-ownership-with-leasing. Customers acquire the property in partnership with Offa and make monthly payments to increase their share, over time owning it.

Another key feature of Offa’s BTL product is that where a customer’s rental income is not sufficient for the required affordability criteria for the BTL finance, Offa allows them to make up the difference with their personal monthly income (commonly known in the industry as top-slicing).

The service is available to anyone purchasing property in England and Wales aged 21 or over, either under their personal name or as a limited company, and where the property’s value is between £60,000 and £1 million. First-time landlords can also apply, and Offa’s BTL solutions are also available for houses in multiple occupancy (HMOs).

Offa provides an ethical finance model designed in accordance with Islamic finance principles, which means not charging interest and investment into sectors deemed harmful to society – such as alcohol, tobacco, and the arms trade.

In April, Offa announced a £100 million credit line for its bridge finance arm from a fund managed by GII. The credit line is the largest of its kind outside of the Gulf, creating significant capacity for the Birmingham-headquartered business to expand and diversify its financial propositions in the UK property market.

EBRD and FATEN boost support to small businesses in the West Bank

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Shams
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EBRD and FATEN boost support to small businesses in the West Bank

The European Bank for Reconstruction and Development (EBRD) is intensifying its support for micro, small and medium-sized enterprises (MSMEs) in the West Bank and Gaza, with a US$ 5 million (€4.7 million) loan to microfinance institution the Palestine for Credit and Development (FATEN). The facility will enable FATEN to on-lend to MSMEs based in the West Bank during the challenging operating environment.

The loan is funded by the West Bank and Gaza Net Income Allocation Trust Fund and will be accompanied by a 20 per cent first-loss risk cover, funded by the European Union under its Financial Inclusion Programme in the form of a partial portfolio guarantee.

With these new funds, FATEN will be able to scale up its lending to MSMEs in the West Bank as they struggle with the repercussions of the ongoing war in Gaza and its impact on the wider Palestinian economy. The World Bank estimates that the private sector in the West Bank and Gaza has suffered a severe negative impact valued at around US$ 1.5 billion.

The financing will also help FATEN cater to underserved economic segments such as women and borrowers in rural areas of the West Bank. Currently, women-led businesses face significant difficulties in accessing finance, and they account for less than 5 per cent of all banking sector loans as of the end of 2023.

Established in 1999 as a private non-profit company, FATEN became licensed and monitored by the Palestine Monetary Authority in 2014 and is the largest microfinance institution in the West Bank and Gaza, with a market share of 51 per cent. FATEN operates through 34 branches there, serving nearly 26,600 borrowers.

Since the start of its operations in the West Bank and Gaza in 2017, the EBRD has approved 27 projects worth a total of €142 million.The EBRD is a multilateral bank that promotes the development of the private sector and entrepreneurial initiative in 36 economies across three continents. The Bank is owned by 73 countries as well as the EU and the EIB. EBRD investments are aimed at making the economies in its regions competitive, inclusive, well-governed, green, resilient and integrated.

CIB Poised for Explosive Growth: Analysts Predict 24% Annual Net Income Increase Over Five Years

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Shams
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CIB Poised for Explosive Growth: Analysts Predict 24% Annual Net Income Increase Over Five Years

HC Brokerage resumes coverage on Commercial International Bank (COMI) expecting outstanding bank’s profitability in 2024 as a result of the expected NIM expansion. 

Economist and financial analyst at HC, Heba Monir commented: “The Ras El Hekma investment deal improved Egypt’s external position and outlook: The Egyptian economy restored confidence after concluding the Ras El Hekma USD35bn investment deal with the UAE in February 2024. The disbursement of the first and second cash tranches worth USD24bn, helped narrow the banking sector’s net foreign liabilities (NFLs) significantly by c85% y-o-y to USD3.64bn in April, from USD29bn in January 2024. On 6 March, the Central Bank of Egypt (CBE) hiked policy rates by 600 bps, raising them by 800 bps y-t-d and 1,900 bps since it started tightening rates in March 2022, and allowed market forces to determine the exchange rate, leading to an EGP devaluation of c35% y-t-d to EGP47.7/USD currently. Following this, and given the impact of the Gaza war on tourism and Suez Canal receipts, the International Monetary Fund (IMF) and the Egyptian authorities reached a staff-level agreement on a set of comprehensive policies and reforms needed for the Extended Fund Facility (EFF) arrangement, increasing it significantly to USD8.0bn from the previously approved USD3.0bn in December 2022, leading to the disbursement of USD820m in April and another USD820m to be disbursed in June. The European Union (EU) also pledged a EUR7.4bn (USD8.06bn) aid package for Egypt to be disbursed through 2027. All this reflected positively on Egypt’s economic and banking sector credit ratings; S&P Global Ratings and Fitch Ratings upgraded Egypt’s economic outlook to Positive from Stable and Moody’s to Positive from Negative. Despite these positive developments, we do not expect CAPEX lending growth before 2025, given the prohibitive high borrowing cost and our expectation of delayed monetary easing to late 2024 or early 2025. Yet, we expect banks to benefit in 2024 from the higher treasury yields and high deposit auction rates, leading to unusually high net interest margins (NIMs).” 

“We expect solid banking sector profitability in 2024 due to high treasury yields and real growth in loans: We forecast the banking sector’s loans to grow by c31% y-o-y to EGP7.25trn in 2024, mainly driven by EGP loans to finance working capital needs and inflated by the EGP devaluation. Given the high-interest rate environment, we do not expect CAPEX lending to materialize before 1H25. In January 2024, the state-owned National Bank of Egypt (NBE) and Banque Misr introduced a one-year certificate of deposits (CDs) at a 27.0% interest rate paid annually. Following the 6 March EGP devaluation, they introduced in March a three-year declining interest rate CDs paying interest annually of 30.0% in the first year, 25.0% in the second year, and 20.0% in the third year. In January 2024, some private banks like Commercial International Bank (COMI) followed suit and issued three-year CDs at a monthly 20–22% interest rate while setting a minimum value per CD of EGP0.1–5.0m. Therefore, we estimate market deposits to increase by c27% y-o-y to EGP13.7trn in 2024. Regarding profitability, we expect local currency NIMs to continue expanding, given the high treasury yields and high interest rates. We see room for higher treasury yields by 100–200 bps if inflation accelerates, which would represent an upside risk to our numbers. Regarding asset quality, we forecast that large to medium-cap banks will report good asset quality, as most of them increased their provisions charges during 4Q23. Meanwhile, we could see higher NPLs for small-cap banks. As for the capital adequacy ratio (CAR), most banks’ CARs are above the CBE’s minimum requirement, and if they happen to be impacted by the EGP devaluation, we expect them to recover, helped by their solid profitability.” Heba Monir added. 

HC’s economist concluded: “We forecast COMI’s net income to grow at a 5-year CAGR of c24% while maintaining its leading market share: We forecast COMI’s net income to grow at a 5-year CAGR of c24% from 2023–28e, with a c70% y-o-y growth in 2024e to EGP50.4bn on higher interest rates, the EGP devaluation, and a favorable deposit mix, as its current account savings accounts (CASA) represent c55% of its total deposits. We estimate its NIM to increase to 9.57% in 2024e from 7.75% in 2023e, with an ROE of 49.8%, up from 37.5% in the previous year. We forecast COMI to maintain its attractive deposit market share, which we estimate at 6.4% in 2024e, growing its deposits by c23% y-o-y to EGP835bn in 2024e, on our numbers, and we estimate its loan market share at 4.9% in 2024e, growing its loan portfolio by c29% y-o-y to EGP303bn in 2024e to finance corporates’ higher working capital needs, inflated by the c35% EGP devaluation. We expect COMI to report an adequate asset quality, with NPLs of 4.65% of gross loans, higher than the 3.59% it reported in 2023, due to more volatile business conditions and the precautionary measures required by the expected credit loss (ECL) model of IFRS 9. We forecast the bank to record a lower coverage ratio of 276% in 2024e from 305% in 2023 due to its good provisioning and the sound credit profile of its corporate clients. We estimate its net loan-to-deposit (L/D) ratio to increase to 36.3% in 2024e from 34.8% a year earlier. We estimate the bank’s financial investments holdings to surge by c39% y-o-y to EGP378bn, representing c45% of customer deposits in 2024e from c40% in 2023 due to the attractive treasury yields. We expect COMI’s CAR to increase to 30.3% in 2024e from 26.2% in 2023.” 

About HC Brokerage

HC Brokerage is an affiliate of HC Securities & Investment– a full-fledged investment bank providing investment banking, asset management, securities brokerage, research, and custody services. HC Brokerage is an Egyptian registered company and member of Egypt’s Financial Regulatory Authority (FRA), and its registered address is 34 Gezirat Al-Arab St., Mohandessin, Giza, Egypt, Dokki 12311

ADNOC Drilling Awarded $733 Million Contract for Three Newbuild Island Rigs

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Shams
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ADNOC Drilling Awarded $733 Million Contract for Three Newbuild Island Rigs

ADNOC Drilling Company PJSC (“ADNOC Drilling” or “the Company”) (ADX symbol: ADNOCDRILL / ISIN: AEA007301012) today confirmed the award of an estimated total contract value of $733 million[1], by ADNOC Offshore, for three island drilling rigs in support of the growing operations at the offshore Zakum field.

Abdulrahman Abdulla Al Seiari, Chief Executive Officer of ADNOC Drilling, said: “ADNOC Drilling is honored to receive this substantial award, which marks a significant milestone in our company’s accelerated growth journey. These new island rigs will be the most advanced in the world, embracing artificial intelligence, the most tranformative technology of our generation.

“Our partnership with HH will amplify the creativity and ingenuity of our industry as we design and build these rigs of the future that drive efficiency and safety and deliver exceptional value for our customer ADNOC Offshore.”

Commenting on the award, Tayba Abdul Rahim Al Hashemi, Chief Executive Officer of ADNOC Offshore, said: “ADNOC Drilling’s technical expertise and enhanced capabilities are key enablers as we safely and sustainably accelerate to meet the world’s growing energy demands. This award will strengthen our partnership in the future as we work together to harness AI and innovation to maximise energy, minimize emissions and unlock significant value for stakeholders.”

The contract award will follow existing agreements with revenue underpinned by the long-term duration with guaranteed returns. The three new island rigs will operate on existing and newly constructed innovative artificial islands at the offshore Zakum field for drilling and completion of wells.

The rigs, which will be constructed by Honghua Group (HH), will incorporate industry leading technology and automation. Delivery of the rigs and commencement of operations is expected during 2026. The rigs will be designed and built as part of a partnership between ADNOC Drilling and HH. This partnership has been specifically formed to harness the transformative nature of AI, digitization, and advanced technology in the design and operation of these next generation drilling rigs. ADNOC Drilling and HH will look to also collaborate with AIQ, an Abu Dhabi based artificial intelligence (AI) pioneer contributing to the energy sector globally.

The design of the rig operating systems will look to utilize real-time condition, performance and utilization data to create actionable insights, enhancing rig performance and increasing efficiency, leading to improvements in safety and well delivery times. Additionally, drilling operations on ADNOC’s innovative artificial islands create the ideal conditions for extended reach drilling (ERD) with the top five longest wells in the world being delivered from these islands off the coast of Abu Dhabi, the most recently delivered being over 52,000 feet. The rigs will be built to deliver ERD as well as having the state-of-the-art capability of walking between wells eliminating the need for the rigs to be dismantled to be moved. These capabilities dramatically improve efficiency and safety while vastly reducing costs and emissions.

The total capital expenditure expected for the purchase of the new island rigs is approximately $210 million, mostly concentrated in 2025, with the first full-year revenue from the new rigs expected to be 2027. The full-year 2024 guidance of $200-250 million for the Island rig segment, which currently operates 10 island rigs, is unchanged. The ADNOC Drilling fleet is now expected to total at least 148 by 2026 including these three new rigs as well as the previously announced three land rigs for the initial phase of the unconventionals development. Since the fourth quarter 2021, when the IPO took place, ADNOC Drilling has invested more than $2.2 billion in building one of the largest integrated drilling fleets in the world.

About ADNOC Drilling 

 ADNOC Drilling, listed on the Abu Dhabi Securities Exchange (ADX symbol “ADNOCDRILL;” ISIN AEA007301012), is the largest drilling and well completions company in the Middle East by fleet size, owning and operating one of the largest multi-discipline drilling fleets in the world. The Company is a critical link in ADNOC’s upstream business, as ADNOC accelerates its production capacity targets and enables gas self-sufficiency for the UAE. ADNOC Drilling incorporated Integrated Drilling Services into its portfolio in 2018 and now offers a total solution of start-to-finish wells and associated services that encompass the entire drilling value chain. To find out more, visit: www.adnocdrilling.ae 

Nativex Opens Dubai Office, Bridging Chinese Investors with Middle East Travel and Real Estate

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Shams
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Nativex Opens Dubai Office, Bridging Chinese Investors with Middle East Travel and Real Estate

Nativex, a globally renowned digital marketing platform, is embarking on an ambitious expansion journey with the inauguration of its 18th office in Dubai Media City. With its specialized marketing solutions tailored to the real estate and travel market, Nativex’s Dubai office is strategically situated to contribute to the growth of the regional sector.

Suki Lin, Principal Director at Nativex, and Intan Agustina, Sr. Director of Client Growth, will lead the new office, bringing with them a wealth of experience and expertise in the mobile marketing industry. Their leadership will ensure that Nativex continues to deliver innovative solutions and unparalleled service to clients in the Middle East, helping them navigate the complexities of the Chinese market and achieve their business objectives.

The newly established office in Dubai will serve as a strategic base for Nativex’s operations in the Middle East, enabling the company to provide end-to-end, tailored marketing solutions to regional clients. With a focus on empowering real estate and travel & tourism businesses to connect with Chinese consumers effectively.

Empowering Middle East Businesses to Attract Chinese Investors/Customers

In an era where China plays an increasingly pivotal role in the global economy, enterprises across the Middle East are awakening to the immense potential of engaging with Chinese consumers effectively. 

Nativex’s expansion into Dubai underscores its unwavering commitment to aiding brands in the Middle East in navigating the intricate landscape of the Chinese market. This move aims to help these brands increase their brand awareness in China and attract more Chinese consumers, thereby unlocking new avenues for growth.

Expressing enthusiasm about this strategic move, Suki Lin, remarked, “The opening of our Dubai office signifies a momentous achievement for Nativex. The Middle East presents itself as a dynamic marketplace with boundless opportunities, and we are thrilled to bring our wealth of experience and expertise in China marketing to businesses across the region. Our objective is to empower brands with cutting-edge tools and invaluable insights to thrive in the Chinese market and realize their business objectives.”

Nativex Statistics:

  • Founded in 2000, Nativex has over decades of experience in digital marketing.
  • Nativex serves more than 3,000 advertisers worldwide, including Fortune 500 companies in the gaming, consumer brands, travel, and real estate sectors.

About Nativex: Nativex is a leading digital marketing platform committed to helping brands and apps achieve cross-regional growth. With a specialized focus on media buying, influencer marketing, and creative customization, we provide innovative solutions to expand our clients’ reach across global markets. As the official agent for major Chinese advertising channels like Petal Ads, Baidu, Xiaohongshu, Ocean Engine, and Weibo, Nativex leverages its global, localized service teams and extensive experience to help clients from different countries and industries achieve growth in China.

For media inquiries, please contact:

nativex@activedmc.com

ADNOC Drilling Confirms New Enhanced Dividend Policy with Minimum 10% Annual Growth for Five Years

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Shams
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ADNOC Drilling Confirms New Enhanced Dividend Policy with Minimum 10% Annual Growth for Five Years

ADNOC Drilling Company PJSC (“ADNOC Drilling” or the “Company”) (ADX symbol: ADNOCDRILL / ISIN: AEA007301012) announces shareholder approval of new progressive dividend policy at its General Shareholder Meeting. The new, progressive policy will see dividends grow by at least 10% per annum on a dividend per share basis over the next five years (2024-2028).

The expected cumulative minimum yield from the new policy in the period 2024-2028 is more than 27%[i]

Furthermore, the Board of Directors, at its discretion, may approve additional dividends over and above the progressive dividend policy after considering free cash flow accretive growth opportunities. Dividends are expected to be paid semi-annually with a final dividend distributed to shareholders in the first half, and the payment of the interim dividend in the second half of each fiscal year.

Commenting on the new dividend policy, Abdulmunim Saif Al Kindy, ADNOC Upstream Executive Director and Vice Chairman of ADNOC Drilling, said: “The approval of this enhanced dividend policy reflects ADNOC Drilling’s commitment to delivering increasing value to shareholders, enabled by an accelerated and multi-faceted growth strategy that embraces artificial intelligence, digitization, and advanced technologies both in the UAE and internationally. 

“ADNOC’s recent placement of an additional 5.5% of ADNOC Drilling’s share capital means there is now a greater number of shareholders to benefit from these enhanced returns.”

On May 23, 2024, ADNOC completed a $935 million institutional placement of ADNOC Drilling shares. This placement represented 5.5% of ADNOC Drilling’s total issued and outstanding share capital and increased the Company’s free float to 16.5%. 

This transaction represents the largest ever ABB (“Accelerated Book Building”) done in the MENA region so far, reflecting the strong demand from the market. 

The higher free float resulted in a higher weight in FTSE indices and is expected to provide a pathway towards inclusion in the Morgan Stanley Capital International (MSCI) Emerging Market Index, subject to the Company meeting the relevant inclusion criteria. MSCI inclusion will contribute to the diversification of the Company’s investor base and significantly broaden awareness of the unique value proposition.

ADNOC Drilling’s strategy is focused on the expansion of its fleet and the development of integrated drilling services to enable ADNOC’s production capacity growth, which includes leveraging the transformational opportunities presented by the UAE’s world-class unconventional energy resources.  ADNOC Drilling has established a new company – Turnwell – to focus on the considerable opportunities in unconventional resources, including an initial contract to deliver 144 wells and the potential for thousands more over time which are incremental to the current growth guidance. Additionally, ADNOC Drilling is actively pursuing regional growth through the expansion of its operations and potential regional acquisitions.

Through its strategic joint venture with Alpha Dhabi, Enersol, ADNOC Drilling aims to acquire and invest in global energy technologies, fostering a scalable technology ecosystem to enhance market value and improve operational efficiencies. Enersol has recently acquired a 67.2% controlling stake in Gordon Technologies, closing of the transaction is subject to customary regulatory approval, and is in the final stages of two additional transactions, with a major focus on investments that support the UAE’s wider energy security ambitions, net-zero agenda, and ongoing economic diversification efforts. These transactions would drive additional growth for ADNOC Drilling over and above the current growth outlook.

About ADNOC Drilling 

ADNOC Drilling, listed on the Abu Dhabi Securities Exchange (ADX symbol “ADNOCDRILL”; ISIN AEA007301012), is the largest drilling and integrated drilling services (IDS) company in the Middle East by fleet size, owning and operating one of the largest multi-discipline drilling fleets in the world. The Company is a critical link in ADNOC’s upstream business, as ADNOC responsibly accelerates its production capacity targets in light of globally increasing demand for energy and enables the UAE’s gas growth. ADNOC Drilling incorporated IDS into its portfolio in 2018 and now offers a total solution of start-to-finish wells and associated services that encompass the entire drilling value chain.

To find out more, visit: www.adnocdrilling.ae

For media inquiries please contact: 

Iain Cracknell

Vice President, Corporate Communications 

+971 2 698 3614

For investor inquiries please contact:

Massimiliano Cominelli

Vice President, Investor Relations

+971 2 698 3383

ICAEW: GCC non-energy growth remains resilient despite oil output cuts

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Shams
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ICAEW: GCC non-energy growth remains resilient despite oil output cuts

The latest Economic Insight report for the Middle East, commissioned by ICAEW and compiled by Oxford Economics, predicts a slow recovery for the region in 2024 due to extended oil production curbs. The GCC growth forecast has been revised down to 2.2% from 2.7% three months ago, though non-energy sectors remain resilient, including in Bahrain and Qatar. 

The OPEC+ group’s extension of voluntary output cuts through Q3 implies a delayed recovery in GCC energy sectors. GCC oil output will now shrink by 2.6% this year instead of the 1.3% expansion forecasted three months ago. Saudi Arabia, which is cutting production to the greatest extent, will see oil activities contract by 5% this year, down from a predicted growth of 0.7% three months ago. However, as voluntary production cuts are reversed in 2025, energy sectors will begin making positive contributions to GCC growth.

Qatar’s GDP growth projection for this year stands at 2.2% and is expected to rise to 2.9% in 2025. In contrast, Bahrain’s GDP growth is 3.1% this year, but is expected to slow to 1.4% in 2025. Since Qatar is not involved in the OPEC+ production quotas, its gas sector is a priority, with authorities doubling down on the North Field gas expansion project, promising a positive medium-term impact. Bahrain, on the other hand, continues to diversify its economy and reduce reliance on oil revenues. Last year its non-oil growth grew by 3.4%, accounting for nearly 84% of GDP. 

High-frequency data paints a positive outlook for non-energy sectors across the GCC. In Saudi Arabia, investments are expected to flow into key sectors supporting giga-projects, including construction, manufacturing, and transportation. Strong momentum in the sports and entertainment sector will also be seen as the country’s transformation continues. The hospitality sector will likely follow, with tourism remaining key to Saudi’s growth agenda. Tourism is a strategic sector in other countries too, and will remain a key growth driver. Tourism activity has rebounded strongly, with record visitor numbers across the GCC in 2023, extending into this year. 

Non-oil economies will continue to grow despite the GCC’s fiscal positions deteriorating. Saudi Arabia, Bahrain, and Kuwait will likely see budget deficits this year and next as the current oil price level is below the fiscal breakeven point. However, the overall GCC budget position will likely remain in surplus, bolstered by strong financial standings and favourable credit ratings, allowing continued access to funding from capital markets and IPOs. 

Hanadi Khalife, Head of Middle East, ICAEW, said: “While geopolitical risks present headwinds for the GCC and wider Middle East, we are encouraged by the ongoing commitment to diversification and sustainability targets. Qatar, for example, became the first GCC sovereign to issue green bonds despite not having explicit net-zero targets. Bahrain is also aligning its non-oil economic growth with its Economic Vision 2030 and COP28 commitments to reduce carbon emissions by 30% by 2035.”

Scott Livermore, ICAEW Economic Advisor, and Chief Economist and Managing Director, Oxford Economics Middle East, said: “Although the region faces escalating pressures amid slowing global economies, the GCC remains relatively positive due to strong bilateral deals and investment. Qatar recently signed a 20-year supply contract with India for 7.5 million tonnes of liquefied natural gas annually, and a 27-year contract with Taiwan for 4 million tonnes. “Bahrain has also seen significant investment growth following the launch of the Golden License initiative in April 2023, which requires a minimum investment of US$50mn and the creation of at least 500 jobs. Bahrain’s financial services sector contributed nearly 18% of GDP, surpassing oil, which contributed 16%.”

The GCC inflation forecast for 2024 has been lowered by 0.3 percentage points to 2.2% this year, with a further slowdown to 2.1% expected next year. Excluding housing rents in some countries, notably Saudi Arabia, inflationary pressures remain contained, with rates below 2% in all GCC countries except Kuwait and the UAE.

Given the exchange rate pegs against the US dollar, GCC central banks tend to track the US Federal Reserve’s policy rates. The US Federal Reserve is expected to begin gradually cutting policy rates in September, totalling a 150bps reduction by the end of 2025.

ADNOC Drilling and Alpha Dhabi’s “Enersol” JointVenture Increases Equity Stake in GordonTechnologies to 67.2%

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Shams
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ADNOC Drilling and Alpha Dhabi’s “Enersol” JointVenture Increases Equity Stake in GordonTechnologies to 67.2%

ADNOC Drilling Company PJSC (“ADNOC Drilling” or the “Company”)(ADX symbol: ADNOCDRILL / ISIN: AEA007301012) and Alpha Dhabi Holding PJSC (‘’Alpha Dhabi’’) (ADX: ALPHADHABI) announced today that their joint venture Enersol RSC LTD (“Enersol” or the ‘’ JV’’) has agreed to acquire an additional 42.206% equity stake in Gordon Technologies LLC (“Gordon’’) for consideration of approximately $270 million, making Enersol the majority equity holder. The consideration is based on a valuation in line with the one underpinning the initial 25% stake purchase announced in January 2024.

Approximately 80% of the consideration for the 42.206% additional stake acquired by Enersol will be funded upon closing. The remaining part of the consideration is expected to be paid in the next two years, subject to certain performance conditions. Closing of the transaction is subject to customary regulatory approvals and closing adjustments.

Gordon is debt-free, and its acquisition is economically accretive to Enersol from a profitability, valuation multiple, cash flow generation and dividend potential standpoint, along with a FY2023 free cash flow yield of more than 10%.

Enersol is actively advancing plans to acquire and/or invest in multiple businesses, subject to regulatory approvals, and foster a scalable ecosystem that will enhance market value and improve operational efficiencies. A major driver of investment decisions will be the ability of those investments to support the UAE’s wider energy security ambitions, net zero agenda and ongoing economic diversification efforts.

Gordon is a leading provider of measurement while drilling (‘’MWD’’) technology to the oil and gas industry. MWD technology measures key information near the drill bit and transmits data to the surface without interrupting normal drilling operations. Gordon completed setting up its Abu Dhabi business with the intention to start field operations in the MENA region in Q2 2024.

Positioned as one of the industry’s leading fully integrated MWD providers with one of the largest fleets of modern MWD systems, Gordon enables a faster, more robust, and efficient MWD system allowing operators to achieve industry foremost performance and reliability in both conventional and unconventional as well as standard temperature and high temperature applications. With a relentless customer focus and commitment to technological innovation, Gordon recently launched rotary steerable interconnectivity systems which is continuing to drive the company’s growth.

Forbes Middle East Reveals The Top Listed Companies In Egypt

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Shams
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Forbes Middle East Reveals The Top Listed Companies In Egypt

Forbes Middle East has unveiled its annual Top 50 Listed Companies in Egypt ranking for 2024, showcasing the country’s most valuable and profitable players. 

The 50 listees in the 2024 ranking witnessed their sales in USD shrink by almost 20% to $26.4 billion in 2023 compared to 2022. Their total net profits decreased by 9% to $4.5 billion, and total assets fell by 18.1% to $89.4 billion, down from $109.2 billion in 2022. The aggregate market cap of these companies reached $29.4 billion as of April 26, 2024, reflecting a 3.3% decline compared to the previous year.

However, financial metrics improved in local currency, with market cap, sales, profits, and assets increasing by 49.8%, 25%, 41%, and 27% in EGP, respectively.

The list, derived from the Egyptian Exchange, ranked firms based on their sales, assets, and profits for the financial year of 2023, alongside their market value as of April 26, 2024. Each metric was given equal weight and companies with identical scores received the same rank. Companies that had not disclosed their 2023 audited financial statements as of April 26, 2023, were excluded. 

Egypt’s largest private bank, Commercial International Bank (CIB), leads the list with a market cap of $4.7 billion and $17.4 billion in assets. In 2023, CIB’s net profits soared by 83.5% to $619 million.

QNB ALAHLI and industrials titan Elsewedy Electric round up the top three, each boasting a market cap of $1.4 billion. 

The banking and financial services sector dominates the ranking with 16 entries, generating $8.4 billion in sales and holding $58.5 billion in total assets. The real estate and construction industry, along with the industrials sector, follow with nine and seven entries, respectively. Billionaire-founded Orascom Construction stands out as the nation’s largest real estate player, with a market cap of $543 million. 

Notably, the list includes only one company each from the media (Egyptian Satellite Company – Nilesat), shipping and transportation services (Alexandria Container & Cargo Handling Company), telecommunications (Telecom Egypt), and utilities (TAQA Arabia) sectors. 

Top 5 Listed Companies in Egypt 2024

1 | Commercial International Bank (CIB)

Sector: Banking & Financial Services 

2 | QNB ALAHLI 

Sector: Banking & Financial Services 

3 | Elsewedy Electric

Sector: Industrials  

4 | Telecom Egypt  

Sector: Telecommunications 

5 | Orascom Construction 

Sector: Real Estate & Construction 

Click here for the complete ranking of the Top 50 Listed Companies in Egypt 2024. 

About Forbes Middle East

Forbes Middle East is a licensed edition of Forbes for the Arab world, championing inspiring business journalism and entrepreneurial capitalism. Its online and social platforms break news covering billionaires, business, investment, technology, economy, entrepreneurship, leadership, and luxury lifestyles. The monthly magazine, featuring in-depth interviews with the Middle East’s most influential and innovative leaders, is published in print in English and Arabic, with digital versions available to both regional and global audiences online. Forbes Middle East extends the Forbes brand of journalism across the Arab world, conducting its own comprehensive research to publish original lists that adhere to strict methodologies. Its content attracts business leaders, investors, active and potential entrepreneurs, and a wide audience of ambitious and influential executives.

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