Postponement of Dubai Expo to 1st October 2021 has been Approved...

Postponement of Dubai Expo to 1st October 2021 has been Approved...

UAE News:
UAE’s non-oil PMI fell further to 44.1 in April (March: 45.2), with both output and new export orders fell to record lows of 39.9 (March: 47.2) and 35.2 (March: 44.3) respectively. Business expectations for the year ahead weakened to a 32-month low.
The UAE Central Bank estimates that GDP grew by 1.7% in 2019, with the non-oil sector up by 1% alongside a 3.4% rise in the oil sector.
With no unemployment data publicly available in the UAE, one of the proxies to use could be the number of expats seeking repatriation. In the first flights back to India, about 25% of the close to 200k persons disclosed job losses as the reason for returning. Many companies in COVID-19 affected sectors have been announcing job cuts including real estate developers, airlines, and more recently Careem laying off of 31% of its workforce and Air Arabia 57 persons (out of a total ~1k persons).
Sharjah Entrepreneurship Centre pledged USD 1mn solidarity funds to help startups; the fund will be distributed through equity-free grants and commissioned projects.
Dubai South Free zone announced a set of relief measures: this includes a 20% reduction on license renewal fees, waiver of 1st-year license fees for new clients in the aviation, logistics and e-commerce sectors, lease deferrals and flexibility in settling rental fees among others.
The postponement of Dubai Expo – to run from 1st October 2021 for 6 months – has been approved by the 2/3 of the BIE member states.
In a letter to the authorities, UAE’s major restauranteurs (which account for over 50% of persons working in the F&B sector) disclosed losses amounting close to AED 1bn a month in staff salaries, housing and operational costs (excluding rents which could go as high as AED 1bn a year) while predicting recovery no earlier than Q1 2021. The establishments have requested relief measures including on loan repayments, automatic license renewals and payment of municipality tax among others.
The Federal Authority for Government Human Resources disclosed that remote work systems could be in place post-pandemic as well.

MENA News:
Bahrain’s shops and industrial enterprises opened on Thursday 6th May while restaurants remain closed still for dine-in customers.
MPs in Bahrain approved 6 proposals: includes lower fuel prices, support for travel agencies and tour operators, as well as expedited receipt of financial support to unemployed Bahrainis among others.
Egypt’s PMI plunged to a historic low of 29.7 in April (March: 44.2), with new orders down to 14.1 (March: 40.2) while purchasing slipped to 21 (March: 39.5). As business expectations remain strong, the employment sub-index inched down to just 46.1 from 47 the month before.
The Labour Emergency Fund in Egypt disbursed EGP 7.7mn to about 7,500 tourism sector employees in 70 firms, according to the ministry of manpower. Earlier, EGP 75mn was provided to 56,280 persons from 275 firms. Under consideration now are further 3,525 firms.
Jordan expects economic growth to contract by around 3% this year, given the impact of COVID-19. Government revenue declined by JOD 610mn (USD 860mn) in just April this year, according to the finance minister. Most businesses have been allowed to open as of Wednesday 6th May after a nearly 2-month lockdown.
Kuwait has imposed a “total curfew” from 4 pm Sunday (10th May) till 30th May: public sector will work remotely while private sector activity will remain suspended (except vital sectors).
All educational institutions in Kuwait will reopen on 4th August as per the cabinet’s decision. There is no intention to cancel the academic year, though an evaluation of conditions will be submitted to the government in mid-July.
The partial curfews in Kuwait resulted in a 60% decline in gasoline usage, allowing for cancellation/reduction of gasoline imports from abroad, amounting to ~1.4mn litres per day.
Though Lebanon has eased some restrictions last week, it formally extended its COVID-9 lockdown for a further 2 weeks on Tuesday 5th May.
Qatar Airways expects to reopen routes this month, as air travel restrictions are eased across the globe: it hopes to fly to 52 destinations by end-May and up to 80 in June (compared to 165 total destinations previously). Separately Reuters reported that the airline is in talks with banks to secure billions in loans.
Saudi Arabia’s non-oil PMI edged up to 44.4 in April, though below the 50-mark, from March’s 42.4, thanks to slower reductions in new work. Output hit a record low (37.5 in April, from March 37.9); new export orders and employment dropped at the fastest pace since the survey began in August 2009.
The Saudi Ministry of Labour and Social Development will allow private businesses (affected by COVID-19) to reduce working hours and permit wages to be reduced by not more than 40% of the total salary for the next 6 months. Firms cannot reduce wages without reducing working hours while employees do not have the right to object the reduction so long as it does not exceed 40%.
Saudi Aramco raised its prices for June supply of crude after 2 months of low levels: the increases ranged from USD 1 per barrel for crude for American markets to upwards of USD 6 a barrel for crude bound for European and Mediterranean trading zones.
Ahead of the OPEC+ deal coming into effect, oil production in the UAE, Saudi Arabia and Kuwait surged to new highs in April. Combined, their production touched 30.79mn barrels per day (BPD) in April – this offsets losses by other producers like Iraq, Angola and Iran.

Global News:
Stock markets gathered steam last week, hitting weekly highs, rallying in spite of weak macro data across the board and COVID-19 cases crossing the 4mn mark. There is a growing disconnect between equity markets and the deep recession of real economic activity in the US, Europe and globally. The resumption of trade negotiations between the US and China resulted in some renewed optimism, that was also reflected in Asian markets. Regional markets mostly ended in the red last week. Among currencies, the dollar gained versus the euro and Swiss franc. Oil prices edged up, posting the second week of gains, on output cuts and hope that ease in COVID-19 restrictions will slowly revive demand, while gold price hovered near a 2-week high.

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SOURCE:
Nasser Saidi & Associates

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