AG&P, ADNOC sign agreement for long-term charter of storage unit for LNG terminal


Liquefied Natural Gas (LNG) distributor Atlantic Gulf & Pacific Co of Manila Inc (AG&P) announced it has signed an agreement with ADNOC Logistics and Services (ADNOC L&S) for conversion, supply, operations and maintenance of a Floating Storage Unit (FSU) at AG&P’s new LNG import facility to be set up at Karaikal Port in Puducherry.

“AG&P has focused on bringing down the unit cost of re-gasification terminals for smaller volumes. AG&P and ADNOC L&S are excited to reach this critical goal for our customers.” Karthik Sathyamoorthy, President of AG&P Terminals & Logistics said in a statement.

The FSU owned by ADNOC L&S is being chartered for 15 years through a commercial model enabling supply to be scaled to match demand. Construction on the terminal will begin in the first quarter of 2020 with commercial operations expected to commence before the end of 2021.

“The Karaikal FSU will be only the 4th FSU-based LNG import terminal in the world, after those in Malta, Malaysia and Bahrain. ADNOC L&S will provide a Japan-built, Moss-type containment vessel as FSU for the project from its fleet of eight LNG ships,” the company said in a statement.

The LNG import facility at Karaikal Port will have an initial capacity of 1 million tonnes per annum (MTPA) which will be expanded to 3 MTPA in the medium-term as demand increases.

The terminal is expected to cater to domestic, industrial and commercial customers within a 500 km radius including the heavily industrialized regions of central Tamil Nadu. In addition, it will serve gas-fired power plants and AG&P’s own city gas distribution network across South India.


Fitch cuts Bahrain rating on combined impact of lower oil prices, coronavirus

Credit rating agency Fitch said it has downgraded Bahrain’s long-term foreign-currency issuer default rating to ‘B+’ from ‘BB-‘, with the cut reflecting the combined impact of lower oil prices and the coronavirus outbreak on the country.

Bahrain’s outlook is stable, Fitch Ratings said in a statement on Friday.

The pandemic and the lower oil prices have marked increases in the budget deficit and government debt, and caused a sharp gross domestic product contraction for Bahrain, Fitch said.

Bahrain’s government revenue fell 29 per cent in the first half of 2020, the country’s state news agency said on Monday.

Fitch said it forecast the state budget deficit to widen to 15.5 per cent of GDP in 2020 from 4.6 per cent of GDP in 2019.

The small oil producing Gulf state was bailed out in 2018 with a $10 billion aid package from wealthy Gulf neighbours to avoid a credit crunch and had been working to plug its budget deficit.


Gulf Air set to transfer operations to new Bahrain International Airport terminal

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Gulf Air, the national carrier of Bahrain, announced on Tuesday that it plans to move its entire operations for inbound and outbound flights to the new Bahrain International Airport terminal later this month.

The airline said the move from January 28 to the new airport terminal will open a “new chapter in the kingdom’s journey in aviation history” while supporting the vision for Bahrain to strengthen its position as a hub and facilitate the movement of millions of passengers.

The new airport terminal will feature a dedicated check-in area for both Falcon Gold and economy class passengers of Gulf Air as well as a new Falcon Gold lounge that is double in size and capacity compared to the previous one in the old airport.

The lounge will be operational around the clock with a capacity of over 400 passengers at any given time.

The new passenger terminal, which will boost the airport’s capacity to 14m passengers every year, spans approximately four times the footprint of the existing terminal.

Ahead of the move, Gulf Air’s acting CEO, Waleed AlAlawi, said: “It will be a big day for the kingdom of Bahrain’s aviation history and for Gulf Air. We started our operations back in 1950 in a small facility in Muharraq and soon we will see a world-class airport being officially opened to welcome the world to our beloved kingdom.

“The new airport is our new home and we are proud to have a bigger, more modern home to be Gulf Air’s hub.”

He added: “With our own check-in area and a brand new Falcon Gold lounge, we are now more equipped than ever to carry and serve more passengers and expand our operations. We welcome our passengers to fly with us through the new airport which I am sure will impress everyone with its design, facilities, capacity and welcoming feel.”

In November, Gulf Air introduced a new pricing concept of its air fares as it looks to rebound from the devastating impact of the coronavirus pandemic on the region’s aviation industry.

The airline said the move aims to make it easier and clearer to its passengers regarding what’s included in each price bracket. The new Boutique Fares come in three branded options for economy class and two branded options for Falcon Gold class.

With Light, Smart and Flex fare options introduced in economy class and Smart and Flex introduced for Falcon Gold class, all passengers can choose any price option, which comes with a set benefits including luggage, flexibility in changing or cancelling itineraries, earning Falconflyer miles, advanced seat selection, priority boarding and Falcon Gold lounge access.

Gulf Air said it has also revamped its internet booking engine and mobile app to accommodate the new fare changes to provide a “faster booking process for the customers”.


Ithmaar says advisors start work on sale of Bahrain banking ops to BBK

Dubai-listed Ithmaar Holding has announced that its advisors have started preparations for the potential sale of the Bahrain operations of its banking unit.

Bank of Bahrain and Kuwait (BBK), one of the largest commercial banks in Bahrain, has entered into talks with Ithmaar Holding to acquire the Bahrain operations of Ithmaar Bank.

In a filing to Dubai Financial Market, Ithmaar Holding said it has “started working through its financial and legal advisors on the initial preparations that are necessary for the potential acquisition”.

It did not give a timeline for the completion of the proposed acquisition.

BBK operates the largest Islamic retail banking network in Bahrain. The acquisition also includes specific assets of IB Capital, a wholly-owned subsidiary of Ithmaar Holding.

The plans are subject to shareholder and regulatory approvals.


Here’s why UAE’s construction industry needs to pick up pace of change

The construction industry, although one of the largest contributors to the UAE economy, is particularly vulnerable to economic cycles. The pandemic has disrupted an industry that faces challenges around the globe and has a history of being slow to change and resistant to adopting technology.

A 2020 McKinsey report found construction is the biggest industry in the world – and yet, it is not performing well, even outside of crises. In numbers, the industry represents 13 per cent of global GDP and 14.5 per cent of the UAE’s GDP as of 2018. However, globally, it has recorded only 1 per cent annual growth.

It is evident that the industry needs to adapt to grow profitably in a post-COVID-19 world. I will outline four shifts that I predict will change the course of the UAE construction industry, and how they can enable the industry to survive and thrive.

In the UAE, there are far too many players, and a clean-up of the construction industry is required. We expect distressed players will exit leaving room for established companies to compete, collaborate and grow together.

Governments around the world, including the UAE, have been looking at implementing measures to mitigate the impact of global movements on the industry, while simultaneously encouraging players to operate in a more energy-efficient and cost-efficient manner.

Regulation, such as the new building code issued by the Dubai government, coupled with new technologies will help streamline overall costs, improve profitability and eventually contribute to a new future for the industry.

Disruption by tech
New technologies will play a key role in the new future of the construction industry – enabling collaboration, data-led decision making and greater control of the value chain. For example, robots are slowly appearing in construction sites, conducting image capture or laser scanning work in places that humans cannot reach. There are robots that improve the speed and quality of regular construction work as well.

Artificial intelligence, 3D printing, and drones have also made an appearance, improving timelines and safety on construction sites. The use of these will facilitate the move towards a sustainable future for contractors and developers.

Climate change
Looking beyond the buildings themselves, the threat of climate change is increasing and cannot be ignored by the construction industry. Sourcing the right materials to create healthy living spaces will also become a priority.

Recognising the very real threat of climate change, the UAE has implemented a number of initiatives including the UAE Green Development Strategy. As a key contributor to the UAE economy, the construction industry will be increasingly aware of their impact on the environment.

Companies will increasingly consider the carbon and general environmental impact of sourcing construction materials, gravitating towards materials that use less energy and water. Supply chains will be optimised in a way that makes it possible to source energy-efficient and sustainable materials.

Shift in focus
As we move towards a post-COVID-19 world, it is evident that priorities in construction and development will change, as customers will become increasingly sophisticated. The pandemic has made all of us re-asses the spaces we want to live and work in.

Residents will look for energy-efficient, smart buildings that have good indoor air quality. Subsequently, these sorts of buildings will become a higher priority for developers. Healthy buildings will be a key component of future cities, and governments will need to work closely with contractors in order to introduce regulation that ensures all buildings, specifically schools and hospitals, are built to standards in a cost-efficient manner.

Like in other industries, the pandemic has accelerated changes that were already underway in construction. The cities of the future will be even more concerned with the health of residents, opting for policies that promote better air quality, and energy efficiency.

New technology combined with the appropriate regulation and used in a way that prioritises sustainable development will be the key to unlocking a valuable and sustainable future for the construction industry.


Lifting of UAE-Qatar restrictions brighten stock market prospects

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The UAE’s decision to resume trade ties with Qatar is seen markedly improving investment prospects between the two countries, with investor optimism rising as stocks gained in both markets.

Major Gulf stock markets ended the first trading week of the New Year on a high and logged weekly gains as regional markets benefited from a rise in oil prices and an easing in trade restrictions with Qatar.

Lifting of trade and travel restrictions will help better trade, tourism and logistics between both countries, analysts at Standard Chartered evaluated in a note, with both markets set to benefit even further.

UAE property sector to benefit
With the UAE-Qatar bilateral trade resumption, analysts widely view that the real estate and construction sector in the UAE stands to profit, as Qatar gains further access to sectors in the emirates.

A rush of investments is eyed between the countries upon the borders and trade opening up again, which is a much-needed boost for the UAE infrastructure industry, which has many projects on hold.

There is pent up demand in Dubai’s property market, with real estate seen rebounding and buyers set to capitalise on low prices – making the latest developments viewed as aptly-timed for the fraught sector.

Stock markets, economies to profit
Qatar’s stock markets, sectors and economy stand to equally benefit as well. Standard Chartered now sees Qatar’s economy growing 3 per cent, revising upward its previous growth target of 2.1 per cent – higher than the 2.2 per cent forecast Qatar gave last month in its 2021 budget.

“The end of the blockade should encourage Gulf tourists back to Qatar when the pandemic eventually eases,” analysts Fitch Ratings wrote. “This should help reduce the pressure on the country’s distressed real estate and hospitality sectors, which are the largest sources of asset-quality problems for banks.”

Apart from this, and with new markets now opening in both Israel and Qatar, multiple Dubai-based analysts predict a “very” bullish UAE stock market during the ongoing first quarter with a rush of investors looking set to take advantage of new opportunities – a benefit that is seen from a business standpoint as well.

Qatar banking stocks to get boost
Qatari companies including banks are forecast to get a shot in the arm from a deal to end Doha’s row with Gulf States, analysts at Qatar National Bank’s Financial Services Research reiterated in a note.

The blockade led to the withdrawal of about $30 billion of non-resident deposits from Qatari banks in June-October 2017, predominantly by Saudi Arabian depositors but also by some from the UAE, causing tightening of foreign-currency liquidity, Fitch Ratings noted.

“We expect Saudi clients, who withdrew deposits from Qatari banks due to the blockade, to start shifting some of their funds back,” the analysts at Fitch Ratings further added, which will help improve view of banking stocks and sectors as well.

Investors in UAE, Qatar cheer move
While Qatar’s index concluded last week with a 2.3 per cent gain – helped by a near 1 per cent jump at the end of the week – the Gulf’s biggest lender Qatar National Bank rose 1.4 per cent on Thursday.

The past week saw investors cheer the breakthrough in Qatar’s over three-year diplomatic rift with Saudi Arabia and other GCC countries as Arab leaders gathered for a summit focused on ending a long-running dispute.

While Dubai’s blue-chip benchmark gained in four of the five sessions last week to post a weekly gain of 5.4 per cent, the Abu Dhabi index ended 2.4 per cent higher for the week. Dubai unveiled its fifth stimulus package, worth Dh315 million to counter the economic impact of the COVID-19 pandemic.

Moreover, another factor aiding both stock markets is the rising price of oil. Crude hit its highest since late February after a fall in US stockpiles added further support following Saudi Arabia’s unilateral decision to cut output.


UAE-Qatar ties: Reopening of borders to benefit UAE and GCC economies


The reopening of land, air and sea borders between the UAE and Qatar is expected to see a surge in businesses between the two nations while the ending of a three-year standoff between Qatar and its immediate neighbours will benefit Qatar and GCC economies in the medium term, according to analysts.

“The reopening of borders will allow the recommencement of cross-border trade, services and travel that has been largely in hiatus since the embargo was imposed in June 2017, the diplomatic thaw is unlikely to have immediate material credit ramifications due to the limited intra-GCC trade linkages,” said Thaddeus Best an analyst at rating agency Moody’s.

According to Moody’s, the prolonged duration of the diplomatic spat, which provided Qatar with ample time to build trade and financial ties with new partners outside the GCC in the interim and thus the short-term impact on Qatar economy will be limited. It will nevertheless have some economic benefits for tourism and trade in the region at a time when both sectors are still reeling from the coronavirus shock.

Qatar’s main exports to the GCC, namely piped natural gas to the UAE through the Dolphin pipeline, continued undisrupted throughout the diplomatic dispute. Abu Dhabi National Oil Company (ADNOC) and Qatar Petroleum also renewed an oilfield concession in 2018 despite the embargo.

Tourism impact
The agreement will once again allow visitors to Qatar from Saudi Arabia, Bahrain and the UAE, which accounted for almost 40 per cent of total visitors prior to the dispute. Tourism is not a major contributor to the Qatari economy, accounting for around 9 per cent of GDP, and the pandemic will constrain near-term upside potential, Moody’s noted.

“That said, over the medium-term, the normalisation of relations will allow regional football fans, especially from Saudi Arabia, to attend the 2022 FIFA World Cup. It will also allow Qatar Airways to resume flights over the rest of GCC,” said Alexander Perjessy, an analyst at Moody’s.

Rating agency Fitch said the reopening of borders with neighbours will help Qatar’s battered non-oil economy.

“A resumption of travel links will eventually lift tourism inflows, and greater interest from regional buyers could support the real estate market, which has been in a multi-year downturn,” Krisjanis Krustins, Director, Sovereign Ratings, Fitch Ratings.

UAE and Saudi gains
The UAE – especially Dubai – and Saudi Arabia may benefit more from the reopening of trade, tourism and investment channels with Qatar given their tourism and real estate sectors, according to Moody’s.

However, the rating agency said these gains should be kept in perspective in the context that Qatari tourists accounted for about 1 per cent of Dubai’s visitors before the border closure although they accounted for a proportionately larger share of tourism receipts because of high income levels. As such, the reopening of borders will have limited impact on government revenue and overall fiscal performances across the GCC.

Qatar’s financial system could also benefit if lenders and depositors from the blockading GCC sovereigns return. The normalisation of relations could support renewed inflows of deposits and cross-border lending from the GCC, potentially reversing the decline witnessed since the dispute, but the relatively high average credit rating for Qatari banks has supported ample access to foreign funding regardless.


Bitcoin’s wild weekends turn efficient market theory inside out

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Bitcoin just notched one of its best weeks on record, surging about 40 per cent over the seven days through Friday. Anyone expecting the notoriously volatile digital currency to take a breather this weekend had better buckle up.

It’s on Saturdays and Sundays, when most other assets barely budge, that Bitcoin tends to go particularly nuts. Take the first weekend of 2021. Coming off a 300 per cent gain last year, the world’s largest digital coin rose as much as 14 per cent Jan. 2 and another 10 per cent Jan. 3, a period when most of Wall Street was still in holiday mode. The swings were bigger than on any weekday in the prior two weeks and the biggest intraday moves since the weekend before, when it jumped 10 per cent on Dec. 26, according to Bloomberg data.

Bitcoin’s not alone in trading all day, every day. What sets the coin apart is how big its price swings are outside of established business hours. It’s tough to find pricing for the dollar, for example, with currency-market participants usually in agreement to take weekends off. Bitcoin’s average swing on Saturdays and Sundays during the fourth quarter, on the other hand, was 1.5 per cent.

Why weekend swings?
The cryptocurrency’s weekend volatility spikes owe to a couple of factors. One is that it’s held by relatively few people – about 2 per cent of accounts control 95 per cent of all available Bitcoin supply. If these whales trade when volumes are thin, price swings will be magnified. Another is its market structure, which consists of hundreds of disconnected exchanges that in effect are their own islands of liquidity.

“People always tout Bitcoin as 24/7, 365 liquidity, but what that actually means is you have periods of very thin liquidity,” said Nic Carter, a partner at crypto-focused venture firm Castle Island Ventures. “If you want to deploy $500 million of Bitcoin, you probably want to do it during core banking hours.”

The crypto market is relatively nascent. Bitcoin, the original crypto, brought forth the movement a little more than 10 years ago. According to Greg Bunn, chief strategy officer at digital-asset firm CrossTower, the market remains hugely fragmented from an infrastructure standpoint.

Many platforms operate under different standards and with “different philosophies,” said Bunn, who spent decades with firms including Citadel and Deutsche Bank. Yet it lacks a centralized market structure akin to that of traditional assets, which tend to have common means of custody and settlement, for instance.

“If you think about the structure, that makes it conducive to things that are going to be very volatile and where you’re going to have big moves,” he said. “That’s obviously going to be impacted by when people are trading, when people are awake, when people are watching the markets.”

To Binance.US’s Catherine Coley, Bitcoin’s wild weekend patterns are reminiscent of her time trading currencies in Hong Kong in the early 2010s. Volatility sometimes became subdued during lunchtime lulls and around holidays. Professional traders, she says, tend to keep Monday-through-Friday schedules, so it makes sense that liquidity – or how easily an asset can be traded – would wane on weekends.

Market liquidity factor
What’s seen as liquidity requires a steady supply of both buyers and sellers – an ease in freeing up the value of one asset for another. If there are fewer buyers than sellers – or vice versa – then that makes transactions harder, a situation that usually leads to either a spike or crash in prices. Last weekend, Bitcoin’s price was “absolutely ripping on low liquidity,” said Coley, who is Binance.US’s chief executive officer. “In these periods of illiquid times, you’re going to be getting pricing that is a little bit cushioned.”

That could mean someone with a large sell order can’t as easily unload a position over weekend trading. “To some extent, it’s going to be more difficult for them to offload the risk that they’ve got,” she said. “So that’s where you see these weekend moves of dramatic price spiking.”

No one knows for sure and theories explaining Bitcoin’s weekend action abound. Bitwise Asset Management’s Teddy Fusaro says it’s also possible liquidity providers and market-makers are lightly staffed on weekends, which can lead to volatility.

“It’s a feature of the market that has always been there and we expect that it will be a feature of the market that remains into the future,” Fusaro, the company’s chief operating officer, said. “Efficient market hypothesis people would assume that the market should price in the idea that there could be less liquidity on the weekends.”

Mati Greenspan, founder of Quantum Economics, says that while institutional players have been in the spotlight recently, retail investors could be re-entering the space again, as well. They played a big role in Bitcoin’s notorious 2017 run-up – and many got burned when it crashed the following year.


Emirates A380 premium economy debut is well timed, say experts

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Emirates airline’s recent introduction of ‘premium economy’ seats is indicative of shrewd long-term decision making, according to experts.

The Dubai-owned airline announced on January 3 that it would deploy its latest flagship A380 aircraft featuring new premium economy seats and enhancements across all cabins to London Heathrow.

While the seats are not yet bookable, passengers flying on the daily EK003/004 flight can experience the new-look premium economy as a discretionary upgrade until more seats are rolled out commercially and at scale.

According to Tobias Rueckerl, president and CEO, Advanced Aviation Consulting Limited (AACL), Emirates would likely have had the plan in the offing for “three to four years” but now is a “good time” to roll out the Middle East’s first premium economy offering.

“This is might seem a strange time to launch this product but it’s not a bad move,” said Rueckerl.

“The pandemic has acted as a catalyst for [aviation] developments that have been coming to pass for years. More and more global airlines have decided to remove first-class products, upgrade business class products and install premium economy,” he said.

Global trends such as business teleconferencing and scaling back luxury corporate travel have been on the rise since the onset of the financial crisis in 2008, the aviation consultant said.

“After the crisis, many western companies changed their travel policies permitting employees to travel in economy only,” ” said Rueckerl. “First class was often filled with mile-collecting upgraders. In this context, it makes sense to re-think the cabins. In the coming years, business travel will become less important and leisure travel will become more popular.”

The AACL expert predicted that business and first-class cabins could be eradicated entirely in the coming years, making space for more low-cost airlines and products offering economy and premium economy.

Fascinating move
Andrew Charlton, managing director at Switzerland-based Aviation Advocacy, said the introduction of premium economy seats by Emirates represents a “fascinating” move.

“There is no doubt that post-pandemic business travel volumes will drop and travel budgets will be tightened, so a value-offer like premium economy may help,” he said. “After the pandemic, many people will want to visit their families or treat their relatives to special flights, so a reasonable upgrade offer might be a good call.”

Charlton predicts that in the coming years business travellers will take occasional longer, consolidated business trips rather than frequent trips.

Stealing a march on competitors
Saj Ahmad, chief analyst at London-based aviation consultants StratAero, said Emirate’s use of a solitary A380 to roll out its premium economy offering highlights that limited scheduling is an issue amid pandemic times.

“Until more airplanes with this cabin are made available for use, it is at Emirates’ discretion regarding who uses premium seats,” he said.

“At the same time, it does allow customers to get a first look at a new product: Emirates is the only GCC airline that has a premium economy suite and so the novelty factor will definitely be an eye-catcher for regular travellers.”

Ahmad added that Emirates has “stolen a march” on its Gulf rivals with its new offering.

“Once we’re through this pandemic, Emirates will have yet another string to its bow for engaging and enticing customers,” he said. “You have to wonder how Gulf competitors will sit on the sidelines before they develop and introduce their own versions.”

Major route
The heavily trafficked route between London airports and Dubai has been a growing battleground for global carriers in recent years.

The London Heathrow-Dubai route alone was the fourth busiest route in the world and attracted 3.4 million passengers in 2017, according to a RoutesOnline study.

The UK capital has historically been a leading aviation hub, providing convenient connections for Emirates passengers to the rest of the UK and wider Europe.

Last week, Sir Tim Clark, president Emirates, said: “The Emirates A380 is already one of the most sought-after travel experiences in the skies, and now we’ve made it even better. While others cut back, Emirates is working hard to restore the products and services that we’ve had to suspend or adjust due to pandemic precautions, and introduce new offerings and enhancements.”

The airline received its newest A380 aircraft from Airbus in December and its remaining order of five A380s will also be delivered with premium economy cabins over 2021 and 2022.

What’s in Emirates premium economy?
The premium economy cabin will have 56 seats in a 2-4-2 cabin layout.
With a pitch of up to 40-inches, Emirates’ premium economy seat is 19.5 inches wide, and reclines eight inches into a comfortable cradle position with ample room to stretch out.
Each seat has a 13.3″ screen, one of the largest in its class as well as easily accessible in-seat charging points, a wide dining table and side cocktail table.
Emirates premium economy is located at the front of the main deck, with two lavatories dedicated to customers.

UAE hotel group boss sees tourism positives in new Qatar agreement

The CEO of UAE-based Rotana Hotels has said the Qatar accord will serve to accelerate the recovery of UAE’s hospitality industry as it gets back to its feet in the wake of the coronavirus pandemic.

The positive impact is likely to echo across several tourism-related sectors including aviation, retail, and hospitality, industry experts agreed.

“Following what was undoubtedly the toughest year on record for the hospitality industry, it is important to unite efforts to promote travel and tourism throughout the Middle East,” said Guy Hutchinson, CEO and vice president of Rotana Hotels.

“The restoration of ties between the UAE and Qatar will have numerous positive effects across many industries such as cross-border trade, investment, aviation, and travel & tourism sectors, accelerating the speed of recovery in 2021,” he continued.

The UAE joined Saudi Arabia, Bahrain and Egypt on Tuesday in signing an accord with Qatar during a summit of Gulf Cooperation Council (GCC) leaders, effectively ending a three-and-a-half year split between the countries.

While Dubai’s real estate sector is likely to reap the biggest benefits from the Qatar Accord in the long run, the emirate’s tourism sector could see a faster positive impact, said industry stakeholders.

“Dubai’s hospitality sector is more likely to see an immediate impact as Qatari tourists begin to return to the emirate. Whilst Qatari tourists were not so significant in terms of overall quantum of tourists visiting Dubai, accounting for 176,000 out of 14.9 million overnight visitors in 2016, their spending power and affinity towards luxury properties is likely to underpin stronger demand levels in this market segment,” said Taimur Khan, head of research at Knight Frank.

“More so, as both corporate and leisure inbound tourism increases we will also see the emirate’s retail and F&B sectors benefit from this trend,” he added.

Full recovery of Qatari tourism to Dubai, however, will be gradual given that multiple countries across the world continue to grapple with the pandemic.

“Qatar has, in the past, been a large market for the UAE. However, taking into account the new world norms, it will take time to return to the previous numbers,” said Hutchinson.

The aviation industry also stands to benefit from the restoration of ties with Qatar, with low-fare carriers Flydubai and Air Arabia expected to be among the big winners.

“The restoration of intra-Gulf links should feed through to lower fares and less flight time for travellers, providing a particular advantage to upcoming events such as Expo in 2021 and FIFA World Cup 2022, aiding to boost the overall GCC tourism sector,” explained Hutchinson.

Direct routes to and from Qatar, from Saudi Arabia, the UAE, Bahrain and Egypt, were halted as part of the country blockade implemented in June 2017. It meant passengers from the four countries travelling to or from Qatar were forced to take connecting flights, through Kuwait or Oman for example, while Qatar Airways was prevented from travelling over the respective airspaces.

That changed on Monday when Saudi Arabia lifted its ban and reopened its borders to Qatar and after the historic agreement was signed in Al Ula at the GCC summit on Tuesday, the other three countries are expected to follow suit.