I will be visiting Dubai this coming week (25-29 Nov) and Riyadh the following week (1-5 Dec), so please reach out if you’d like to meet.
- Brent crude has recovered to $74 as the market weighs geopolitical risks and Chinese demand.
- Trump nominated fracking pioneer Chris Wright as Energy Secretary and met with PIF’s chairman.
- KSA issued a record number of investment licenses in Q3, with strong growth in Chinese and US firms [see (1) below].
- Aramco’s CFO confirmed plans for more debt issuance but denied this would finance dividends.
- PIF more than tripled its money from a 2020 investment in Live Nation, selling its stake for about $1.8bn.
- The UAE equity markets surpassed $1trn in capitalization and Dubai’s index hit a 10-year high.
- The Talabat IPO will raise about $1.5bn at a $10bn value. Dubai Holding is considering some IPOs
- Moody’s now expects Kuwait’s debt law to come sooner, with $7bn in issuance in 2025/26 [see (2) below and graph].
- The IMF issued a brief but complementary statement following its Oman Article IV mission.
- The OQ Base Industries IPO starts building its book next week and will raise about $0.5bn.
- British Airways reversed its plan to cancel Bahrain flights but has still dropped Kuwait.
- Betting markets see a 45% chance of a Lebanon ceasefire this year but just 14% for Gaza. The UN vetoed another UNSC ceasefire resolution.
- Hamas’s officials have departed Qatar but its office has not been permanently closed.
- The ICC issued an arrest warrant for Netanyahu, which most member states said they would respect.
These headlines are taken from a 3,900-word report from my economic research service with GlobalSource Partners, a leading source of independent emerging market intelligence. Click on any report to get guest access and contact me or GlobalSource’s sales team for more information about the service, which also includes the most extensive comparative Databank of GCC economic data available (updated weekly) and direct analytical support. Clients include banks, asset managers and governments spanning the GCC, Asia, Europe and the Americas.
Here are two samples from the report:
(1) Saudi Arabia issues a record number of investment licenses in Q3
- The Ministry of Investment issued a record number of investment licenses in Q3, up 73% y/y and 40% q/q. This came after a dip in Q2 which was the first quarterly decline after six quarters of growth.
- This raw number hasn’t seemed to correlate much with FDI inflows so far, which have been disappointingly low, including just 1% of pro-rated GDP in H1 (1.8% counting just inward inflows), but may yet be seen to do so with a lag.
- The bulk of licenses were in three sectors: construction, manufacturing and professional services. There was strong y/y growth across most sectors.
- A new useful breakdown shows the licenses by company type. The vast majority (94%) are LLCs, and most of these are single-member LLCs which are unlikely to be major sources of FDI. Licenses issued to other types of companies, which may include regional HQs and firms likely to be major investors, were flat y/y. It would be helpful to have a time series by company type and more clarity on interpreting this series.
- On a nationality basis, there was encouraging growth in licenses issued to American, British and Chinese firms, which are more likely to be major investors than others in the top 10 (Egypt, Yemen, Syria etc.).
(2) Moody’s now expects Kuwait to start issuing debt next year
- Moody’s six-monthly rating update shows that it now expects debt issuance to begin in 2025/26, when it sees debt stock increasing by 4.6% of GDP (equivalent to about $7.5bn in net issuance), with a further 4.8% increase in 2026. Back in May, Moody’s thought that there would be no issuance in 2025.
- This suggests that it has more confidence that a debt law, which it says is “on top of [the government’s] policy agenda” will finally be passed before or during the next fiscal year, which begins in April.
- The suspension of parliament on 10 May is expected to help because it means a law could now be issued by decree. Disagreements with parliament contributed to a 7-year hiatus since the previous debt law expired in 2017.
- Moody’s is more optimistic on debt issuance now than Fitch, which sees under $3bn in issuance next year (with no published 2026 forecast year), and S&P which doesn’t see issuance beginning until the 2026 fiscal year, and then only a little. By contrast, the IMF is forecasting substantial issuance before the end of this fiscal year.
- Kuwait needs to issue debt because it has a structural fiscal deficit, with a breakeven oil price of around $90, and is not able to draw down assets from its giant Reserve Fund for Future Generations (albeit that could also be done by decree, although it would be more controversial than debt issuance in the absence of parliament).
