EU Chief Presses UAE President on Russia Sanctions Evasion, Telefonica Deal Tests Europe’s Appetite for Mideast Wealth, Saudi Construction Boom Hands Firms Contracts Worth $250 Billion.
EU Chief Presses UAE President on Russia Sanctions Evasion
Key Takeaways
The European Union is urging the United Arab Emirates to stop serving as a gateway for Russia to bypass EU sanctions triggered by the invasion of Ukraine.
The UAE has seen a surge in imports of technology from Europe and the US, raising concerns that these goods could be used for military purposes by Russia.
The EU wants the UAE to share more trade data and ensure it is not used as a channel for banned Russian goods to enter Europe.
Telefonica Deal Tests Europe’s Appetite for Mideast Wealth
Key Takeaways
Saudi Arabian state-backed telecom firm, Saudi Telecom Co., is set to become the largest shareholder in Spain’s Telefonica SA with a $2.5 billion investment, reflecting the trend of Middle Eastern wealth flowing into European communication assets.
Gulf state-backed companies, including Saudi Telecom Co. and Emirates Telecommunications Group, are increasingly empowered to make international deals, diversifying their investments across various sectors.
The low valuations of European telecom firms make them attractive to Gulf investors, who are willing to take longer-term bets on improving regulatory environments and cash flows.
Saudi Construction Boom Hands Firms Contracts Worth $250 Billion
Key Takeaways
Saudi Arabia has awarded construction contracts worth $250 billion since 2016 as part of its ambitious plan to build mega projects and transform its economy.
The country aims to become a top tourism destination and reduce its reliance on hydrocarbons through the development of giga projects, such as the high-tech city of Neom and the Red Sea tourism development.
Affordability will be a challenge for giga project developers, as they need to cater to domestic buyers with lower budgets while launching residential products with higher price points.
Saudi Arabia Leapfrogs Football Powerhouses With $875 Million Splurge
Key Takeaways
Saudi Arabia’s massive spending on foreign football players reflects its efforts to diversify its economy and reduce dependence on oil.
The arrival of high-profile players like Cristiano Ronaldo and Neymar in the Saudi Pro League highlights the country’s growing prominence in the global football transfer market.
While Saudi Arabia is investing heavily in foreign talent, it still has a long way to go in developing local players and generating revenue from player sales.
US, EU Agree on Mideast-India Rail and Shipping Corridor at G-20
Key Takeaways
The US, along with India and Middle Eastern countries, has signed an agreement to establish a network of railways and sea routes, aiming to counter China’s influence in the region.
The India-Middle East-Europe Economic Corridor will enhance trade and transportation, integrating railway lines and port connections, while also promoting green hydrogen production and improving telecommunications.
The project signifies a shift in US diplomacy in the Middle East, focusing on stability and cooperation, and is seen as a competitor to China’s Belt and Road Initiative.
Turkey’s Credit Outlook Raised by Fitch as New Policies Pay Off
Key Takeaways
Fitch Ratings has revised Turkey’s credit rating outlook to stable, citing the adoption of more conventional policies and efforts to restore foreign reserve buffers.
The appointment of former Wall Street bankers to key economic positions in Turkey has signaled a change in policy direction and a commitment to improving macro-financial stability.
Despite the positive outlook, Fitch warns of uncertainty due to Turkey’s history of policy reversals and changes in central bank leadership.