Egypt, Jordan, Iraq to implement commercial, industrial integration

The trade and industry ministers of Egypt, Jordan and Iraq have agreed to start actual steps of implementing commercial and industrial integration among the three Arab countries.

During the virtual meeting on Thursday, the three ministers agreed to send an Egyptian technical team to Iraq within the coming few days, with the participation of the Jordanian embassy in Baghdad, to assess Iraqi factories and find out the needs of the Iraqi market and the potential investment opportunities in the country, reports Xinhua news agency.

Egyptian Trade and Industry Minister Nevine Gamea said that the meeting came as a result of the visit of the Jordanian and Iraqi ministers to Egypt earlier this month, where they discussed implementation of a number of joint projects in the fields of trade and industry.

Gamea noted that the targeted sectors of joint cooperation include pharmaceutical, chemical, petrochemical, leather and ceramics industries, besides studying the establishment of a permanent exhibition for Egyptian and Jordanian products in the Iraqi capital.

For her part, Jordanian Minister of Industry, Trade and Supply Maha Ali emphasized the importance of electronic linkage between the customs authorities of the three countries to facilitate the process of trade exchange among them.

Meanwhile, Iraqi Minister of Industry and Minerals Manhal Aziz al-Khabbaz, expressed his country’s keenness to open up to the Egyptian and Jordanian markets and to start urgent steps towards achieving economic integration, “in light of the Iraqi government’s aspiration to restore its strong economic relations with all partners, especially at the regional and Arab levels”.

The Ministers also agreed on the necessity of lifting restrictions and obstacles that hinder the flow of intra-trade among the three countries, through granting easier access of their products to the three markets.


Saudi Arabia signs deal for rapid response to environmental threats in Red Sea

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Saudi Arabia has agreed a deal with Lamor Corporation for a project that will provide rapid response operations to combat oil spills and leaks of other harmful substances in the Red Sea.

Abdulrahman bin Abdulmohsen Al-Fadhli, the minister of environment, water and agriculture and chairman of the board of directors of the National Center for Environmental Compliance (NCEC), and Fred Larsen, board member of the Finnish environmental company, signed the contract. It will help to protect the marine environment off the shores of the Kingdom and build national capacities in this field.

“The project aims to implement response operations and combat oil spills and other harmful substances and accidents in the marine environment on the Red Sea strip, using ships and aircraft specialized in rapid-response operations,” according to a statement published by the Saudi Press Agency.
It will also enhance Saudi Arabia’s ability to respond rapidly to oil spills and other environmental dangers through the development of contingency plans, simulated response programs, and mechanisms for their implementation.
Under the contract, three platforms will be established to provide a quick response to oil spills and other threats to the Red Sea coast. In addition, training programs will be developed to enhance the capabilities of national teams of specialists in this field, and to facilitate the transfer of international expertise.

The NCEC works to promote and sustain the environment, and contribute to the prosperity of development sectors to improve the quality of life in the Kingdom. It works with other authorities to improve environmental compliance by monitoring pollution and providing environmental assessment, oversight and guidance. It also sets environmental standards and regulations, tracks and controls pollution levels and sources, and issues and renews environmental licenses and permits for businesses.


PIF’s Saudi Real Estate Refinance Company issues $1.07bn sukuk

British DIY retailer B&Q is coming to Saudi Arabia amid rising home ownership across the Kingdom.
The move follows a franchise deal between owner Kingfisher and the Dubai-based Al-Futtaim Group.
B&Q is expected to launch two 50,000-square-foot stores by fall to introduce the DIY franchise to Saudi customers, the company said in a statement.

The news helped to drive up the stock of Kingfisher by 4 percent in early London trading on Tuesday.
“This franchise agreement is a great opportunity to expand our business in the attractive Middle Eastern home improvement market with B&Q, one of our most established retail banners,” said Kingfisher CEO Thierry Garnier.
Home improvement has fared better than most of the retail sector amid the pandemic. Millions of people around the world have used increased time at home to renovate their properties, spurring sales across the DIY retail sector.
The expansion into Saudi Arabia represents a significant move for B&Q and comes amid the development of a local mortgage market in the Kingdom.

The first B&Q stores in Saudi Arabia will stock a full range of home improvement products. Brands on offer will include Kingfisher’s portfolio, including Erbauer, Magnusson and GoodHome, alongside locally and internationally sourced products

The Al-Futtaim Group operates more than 200 brands across the Middle East, Asia and Africa. It has operated the retail franchises in the Middle East for Marks & Spencer since 1998 and for IKEA since 1991.


Bahrain’s Investcorp said to raise $1bn for North American deals


Investcorp Holdings has raised about $1 billion for its first private equity fund focused on North American assets, according to people familiar the matter.

The biggest private equity and alternative asset manager in the Middle East is set to complete a first close on the fund soon, and aims to eventually raise about $2 billion, the people said.

The fund will focus on investing in areas including technology and data companies, along with supply chain and industrial services.

Among the fund’s backers are a Middle East sovereign wealth fund and large asset managers from the US and Europe, the people said, declining to be named because the information isn’t public.

Bahrain-based Investcorp, which oversees about $34 billion, is raising more funds for specific uses as it looks to boost assets under management. It’s previously tended to book deals on its own balance sheet and sell them on to investors.

Set up in 1982, the money manager is already the Gulf’s largest private investor in US real estate and has said it wants to boost its assets under management to $50 billion in the coming years. Abu Dhabi sovereign fund Mubadala in 2017 acquired a 20 percent stake in Investcorp, which has backed companies including Tiffany & Co and Gucci.


Bahrain eases coronavirus restrictions, shops, industries to open

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Shops and industrial enterprises in Bahrain can open from Thursday while restaurants will stay closed to in-house diners, the Health Ministry said, as the Gulf state eases restrictions designed to stop the spread of the new coronavirus.
Bahrain shuttered non-essential shops and businesses in late March and barred entry of foreign visitors, but did not impose a curfew, unlike some other Gulf states.
Health Ministry officials told a news conference on Wednesday that employees and customers must wear face masks and practice physical distancing. Cinemas, sports facilities and salons remain closed.
Bahrain has reported 3,720 infections with eight deaths from the virus. The total count in the six Gulf Arab states exceeds 76,000 with 421 deaths.
Other Gulf countries eased curfews and other social and business restrictions with the start of the Muslim holy fasting month of Ramadan two weeks ago.
Bahrain this week opened a 152-bed COVID-19 field hospital intensive care unit on an empty piece of land in Sitra, as part of a plan to create 500 additional ICU beds for critical cases.


Explosion rocks Singapore-flagged tanker off Saudi port

An explosion rocked a Singapore-flagged oil tanker off the Saudi port city of Jeddah Monday, the vessel’s owner said, in the latest in a series of attacks on energy infrastructure in the kingdom.

No group has so far claimed responsibility for the blast on the tanker BW Rhine, but it comes as Iran-backed Huthi rebels in neighbouring Yemen step up cross-border attacks against Saudi targets in retaliation for a five-year military campaign led by Riyadh.

“BW Rhine has been hit from an external source whilst discharging at Jeddah… causing an explosion and subsequent fire onboard,” its owner, Singapore-based shipping company Hafnia, said in a statement.

“The crew have extinguished the fire with assistance from the shore fire brigade and tug boats, and all 22 seafarers have been accounted for with no injuries,” it added.

Saudi authorities did not immediately confirm the blast off Jeddah, a key Red Sea port and distribution centre for oil giant Saudi Aramco.

Hafnia reported “hull damage” in the blast, which struck just after midnight on Monday, and did not rule out the possibility of an oil spill.

“It is possible that some oil has escaped from the vessel, but this has not been confirmed and instrumentation currently indicates that oil levels on board are at the same level as before the incident,” Hafnia said.

Dryad Global, a London-based maritime intelligence firm, also reported the latest explosion, saying it struck a vessel while “carrying out operations within the main tanker anchorage at the Saudi Aramco Jeddah port”.

But it identified the Dominican-flagged tanker Desert Rose or the Saudi-flagged Al Amal Al Saudi as the possible targets.

Series of attacks

The incident comes after an explosion last month rocked a Greek-operated oil tanker docked at Saudi Arabia’s southern port of Shuqaiq, an attack that a Riyadh-led military coalition blamed on Yemen’s Huthi rebels.

No injuries were reported in that blast on the Maltese-flagged Agrari tanker, according to its Greece-based operator TMS Tankers.

Last month, the Huthi rebels said they struck a plant operated by Saudi Aramco Jeddah with a Quds-2 missile. Aramco said that strike tore a hole in an oil tank, triggering an explosion and fire.


Consumer prices fall sharply year-on-year in April


Consumer prices fell 1.5% from the previous month in April, following March’s 0.1% month-on-month uptick. According to the Statistical Service of Cyprus (CYSTAT), the drop mainly reflected a sharp decline in prices for transport, and housing and utilities.

Consumer prices dipped 1.2% on an annual basis in April, after inflation had come in at 0.7% in March—marking the lowest reading in nearly four years. Meanwhile, annual average inflation ticked down to 0.0% from 0.1% in the prior month. Lastly, harmonized inflation fell to 0.1% in March (February: 1.0%), which is the latest month for which data is available.

FocusEconomics panelists project harmonized inflation to average 0.0% in 2020 and 0.6% in 2021


GDP growth eases to five-year low in Q1

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Activity softened markedly in the first quarter as Covid-19 started to bite, with GDP expanding 0.9% on an annual basis in the first quarter (Q4 2019: +3.4% year-on-year)—the worst reading since Q1 2015. According to the preliminary release by the Statistical Service of Cyprus (CYSTAT), the slowdown chiefly reflected the impact of the preventive measures implemented to contain the spread of the pandemic, which suspended non-essential activities. The hospitality, manufacturing, leisure and construction industries were the hardest hit.

On a quarterly basis, the economy contracted 1.3% in Q1, following Q4 2019’s 1.0% expansion. Q1’s reading marked the worst downturn since Q2 2013.

More detailed national accounts data will be released on 29 May.

FocusEconomics panelists project GDP to increase 7.4% in 2020, which is down 4.1 percentage points from last month’s forecast, and rebound by 6.0% in 2021.


Industrial production falls at sharpest rate in over six years in March

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Industrial output plummeted 12.7% year-on-year in March (February: +3.8% yoy), marking the steepest drop since November 2013. March’s plunge was primarily driven by heavy drops in manufacturing and water supply production.

Meanwhile, the trend pointed down, with the annual average growth of industrial production coming in at 1.1% in March, down from February’s 2.2%.

FocusEconomics Consensus Forecast participants see fixed investment plunging 12.5% in 2020, which is up 3.8 percentage points from last month’s estimate, and growing 10.5% in 2021.


Economy loses notable steam in the first quarter

GDP growth eased to 0.9% year-on-year in the first quarter from 3.4% in the fourth quarter on partial Covid-19 effects. Q1’s print marked the worst reading since Q1 2015.

Household spending growth eased to 1.8% in Q1, marking the weakest expansion since Q2 2015 (Q4 2019: +2.2% yoy). Public spending accelerated, increasing 16.8% in Q1 (Q4 2019: +3.4% yoy). Meanwhile, fixed investment soared 31.4% in Q1, rebounding strongly from the 33.0% contraction logged in the previous quarter.

Exports of goods and services contracted 9.5% in Q1, marking the worst result in three years (Q4 2019: +4.8% yoy). On the other hand, imports of goods and services climbed 0.3% in Q1 (Q4 2019: -7.8% yoy).

On a seasonally- and working-day-adjusted quarter-on-quarter basis, the economy contracted 1.3% in Q1, contrasting Q4 2019’s 1.0% expansion. Q1’s downturn marked the worst reading since Q2 2013.

FocusEconomics panelists see GDP shrinking 7.0% in 2020, which is up 0.4 percentage points from last month’s forecast. In 2021, GDP growth is seen at 5.9%.