{"id":95809,"date":"2025-04-08T00:00:00","date_gmt":"2025-04-08T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/ksa\/2025\/04\/08\/its-day-two-of-the-efg-hermes-one-on-one-in-dubai\/"},"modified":"2025-04-08T00:00:00","modified_gmt":"2025-04-08T00:00:00","slug":"its-day-two-of-the-efg-hermes-one-on-one-in-dubai","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/ksa\/2025\/04\/08\/its-day-two-of-the-efg-hermes-one-on-one-in-dubai\/","title":{"rendered":"It\u2019s day two of the EFG Hermes One on One in Dubai"},"content":{"rendered":"

Good morning from next door<\/strong>, where a number of us have joined the dozens and dozens of Saudi companies and investors attending the EFG Hermes One on One, the region\u2019s premier investor conference, in Dubai. <\/p>\n

It\u2019s shaping up to be another huge morning for regional and global markets<\/strong>, with the big business story of the week being the Trump administration\u2019s bid to reshape the post-Second World War trade order. <\/p>\n

The sentiment here on the ground: <\/strong>A 10% tariff is the \u201cnew 0%,\u201d and all major regional markets \u2014 from the Kingdom to the UAE and Egypt \u2014 benefit. That could be good for our manufacturing ambitions in Saudi, but we\u2019ll face competition from Egypt (which is already cheaper than India) and from the UAE. <\/p>\n

AND- Markets have a way of quickly equilibrating. <\/strong>One of the smartest investment bankers we know made the point yesterday that from the dotcom meltdown and the global financial crisis, to covid-19 and fallout from the war in Ukraine, financial markets adapt to crises in a fraction of the time they took in the 1970s, 1980s, or even 1990s. No promises, of course, but \u2026 is there any reason to think that this time will be different? (Other than, of course, the lack of policy clarity emanating from DC\u2026)<\/p>\n

MEANWHILE- Few expect new Saudi market activity to flatline this year, but we\u2019re <\/strong>looking at an adjustment period. <\/strong>The prevailing mood at the moment is \u201clet\u2019s wait and see where this settles.\u201d The (so-far) worst case anyone wanted to put on the table: Some IPOs may slip to the fall window from spring. M&As, meanwhile, seem even less likely to be scuppered by the market\u2019s ongoing temper tantrum. <\/p>\n

THE BIG QUESTION FOR THE KINGDOM: What will a lasting disruption to trade mean to <\/strong>oil prices? <\/strong>We\u2019re thinking here not of first-order effects (price hikes, slowing trade, supply chain disruptions) or even second-order impacts (redomiciling manufacturing bases, longer-term changes in consumer behavior), but long-term, systemic impacts. <\/p>\n

Oil falling durably below USD 60 per barrel will prompt difficult policy discussions in <\/strong>Riyadh <\/strong>about (a) an even slower buildout of gigaprojects and other major infrastructure investments vs. (b) running higher deficits. Much of the spending we\u2019ve promised to take on is not really optional (Expo, the World Cup). <\/p>\n

Most analysts were comfortable about the Saudi fiscal picture, with oil hovering around <\/strong>USD 70. <\/strong>Below USD 60, things get dicier. <\/p>\n

Don\u2019t be misled by the gnashing of teeth, though: <\/strong>Nobody is talking about a pullback from the Kingdom\u2019s economic transformation. It\u2019s more a question of how will policymakers adapt.<\/p>\n

Companies from our part of the world are the stars of the show. <\/strong>Among the top Saudi firms attending:<\/p>\n