Good morning, wonderful people. The Strait of Hormuz is still holding onto relative calm, and markets are starting to relax: Oil is holding below USD 70 / bbl, with traders reading the quiet as more than a blip.
Calm isn’t quite the same as resolved, though. We dig into how Oman, Saudi Arabia, and the UAE area each recalculating their relationship with Washington after four months of war. Read more in this morning’s News Analysis, below.
MEANWHILE- It’s a big morning for AI. The White House has lifted export controls that forced Anthropic to pull its two newest models, Fable 5 and Mythos 5, offline worldwide by saying foreign nationals could have no access. Access will start to return today, Anthropic said on X.
The reversal comes just as Beijing cheers another AI milestone: Hot off suggestions that Z.ai’s GLM 5.2 may rival Fable 5 on coding and some other tasks, tech outfit Meituan open-sourced its LongCat-2.0 yesterday, saying the 1.6-tn parameter model was trained end-to-end on domestic chips. It’s yet another sign that China is building an AI stack that needs no American silicon.
Closer to home: Shares of US giant Concentrix, one of Egypt’s largest outsourcing employers, cratered yesterday, falling c. 21% after weak earnings stoked fears that AI is hollowing out the call-center model. That took shares of rival Teleperformance down c. 13% as the market starts to price in exactly the disruption to MENA’s services industry that called earlier this year.
Why it matters: Concentrix committed around USD 1 bn to Egypt under a 2025 agreement with ITIDA — 16k jobs and a 35k-strong workforce by 2028.
There's a version of the narrative this morning that reads as calm all around — oil steady, a ceasefire holding, Anthropic’s models back online, Beijing crowing about its own chips. But calm is doing a lot of work in that sentence: None of these threads is actually resolved, and each could just as easily unravel as settle into something durable. –Patrick
Iraq’s banking system has a big problem: Its banks don’t do much lending. Private-sector lending sits at just under 15% of GDP, far below the global average of 50%. Fewer than one in six adults holds a bank account and the three largest state banks — Rafidain, Rasheed, and the Trade Bank of Iraq — control roughly 85% of banking sector assets. Rafidain and Rasheed hold net negative asset positions, while simultaneously acting as treasury arms of the Finance Ministry, not commercial lenders. And the 50+ private banks that make up the rest of the sector are, for the most part, not in the business of taking deposits and extending credit either.
IN CONTEXT- A new prime minister with a banking background, a new central bank governor, a Washington-led pressure campaign, a war- and an anti-corruption sweep that landed 47 officials in custody have put Iraq’s long-delayed banking overhaul back in the spotlight. Last month, we covered the fiscal view the new government is in: A Hormuz-driven collapse in oil revenue, a budget that needs USD 84 / bbl to balance, and two bankrupt state banks bleeding the central bank’s reserves. This is the other half of that story — the reform meant to fix it, and whether it sticks.
Why the system doesn’t lend much
The diagnosis is fairly structural: “Iraq is still largely a cash-dominated economy,” Ahmed Tabaqchali, chief strategist of the AFC Iraq Fund and a board member of Arab Iraq Bank, tells EnterpriseAM. “Cash remains both the medium of exchange and the store of value. Banks play a marginal role in economic activity, generating income from services and fees rather than lending,” he adds.
Staying cash-based is bad for banking growth — and overall economic growth. “A bank cannot grow its lending without access to funding sources such as deposits,” Tabaqchali says. And after four decades of near-continuous conflict — the Iran-Iraq war, the invasion of Kuwait, sanctions, the US invasion, the ISIS insurgency — Iraqis had little reason to trust institutions with their money. “There were no breathers for us,” Tabaqchali adds.
Private banks in Iraq were built for a different business entirely. “Most were created to profit from the CBI’s foreign currency auctions rather than undertake the slow, risky business of lending to companies and households,” Iraqi financial markets and banking expert Ali Hamoudi tells us.
Even the banks that want to lend can’t price risk. Iraq has credit bureaus, but they are not activated — only 1-2% of the public and 2-3% of firms are captured in them, says economics professor and Iraq specialist Frank Gunter. It also takes 14 weeks to register collateral and 33 days to process a standard commercial loan, he adds. “You cannot run a business that way; enterprises need timely decisions to make operational commitments for the following month.”
Can fintech just leapfrog traditional banks?Not yet, despite the massive growth of e-payment platforms. Gunter points to platforms like Zash, Key Card, and FIB expanding alongside a wider ATM rollout, and Hamoudi notes the rapid uptake of wallets like ZainCash. “The growth has been dramatic because we started from almost nothing,” Tabaqchali says.
But payments are not to be mistaken for banking. “Iraqi fintech today is largely limited to payments, not credit,” Hamoudi says. That means fintech can help Iraq address its low rates of financial inclusion, but not the private sector’s inability to access credit.
Still, with relative stability in the last few years, this could be the golden moment for Iraqi banks to metamorphose into something new and commercially solid, Tabaqchali believes. “The conditions simply did not exist for much of post-2003 Iraq,” but the last five or six years are the first window in which a functioning banking system could realistically take root, he says.
The reform package
The clearest picture of what “reform” looks like in practice is First Rafidain. The state bank’s performing assets would move to a new commercial entity, with the government keeping a 24% stake and selling the rest — a proposed good-bank/bad-bank split that isolates decades of bad debt from a fresh, investable shell. “The First Rafidain strategy isolates legacy state debts, giving investors a clean institution into which they can inject capital,” Hamoudi says. Tabaqchali calls it a “textbook solution for troubled banking systems.
That’s the centerpiece, but it sits inside a wider package of reforms. Baghdad engaged EY, Oliver Wyman, and K2 Integrity to review state banks and propose governance overhauls. These are the same consulting groups that independent Iraqi economist Hamzeh Al Gaood says, alongside the US embassy and other foreign missions, pushed for the appointment of Nizar Hussein as CBI governor last week. The appointment puts a 25-year career regulator who ran the central bank’s anti-money laundering office in the chair — two days after the FATF placed Iraq on its grey list on 19 June.
Beyond personnel, a mandate to raise minimum paid-up capital — paired with asset-quality reviews — is meant to force weak banks to recapitalize or exit. New ownership and governance rules, including board-independence standards Tabaqchali calls “way ahead of global standards right now in so many ways,” are being imposed on survivors.
ICYMI- Some 10 banks were reportedly liquidated last year after the CBI rolled out hiked capitalization requirements. Al Gaood tells us we shouldn’t read too much into that. “I don't think it was truly ten banks. Maybe two were actually banks. The rest were essentially currency exchange offices that went bankrupt.”
Whether the package works may depend on which banks it’s aimed at. Tabaqchali expects private lenders to move first: “These [state-owned] institutions have been mismanaged for decades; this will be a long-term project. I am banking more on the growth of private-sector banks. The state banks will simply take much longer.”
For Rafidain and Rasheed specifically, Gunter sees a deeper obstacle than capital rules and governance: Both banks “historically extended loans to state enterprises with no commercial expectation of repayment from either the borrower or the lender. It was a fiscal subsidy disguised as a loan transaction,” he says. Renaming or restructuring won't work “if the same personnel remain involved.”
Is this time really different?
The external pressure is real, but it’s not the whole story. The US has blacklisted more than 30 Iraqi banks from USD clearing since November 2022 over Iran sanctions-evasion concerns, and Iraq’s oil revenues clear through a New York Fed account. But the FATF process is multilateral, the fiscal crisis is homegrown, and the most durable driver of all may be the one that has nothing to do with Washington: time.
Tabaqchali’s bull case rests on what he calls the cumulative effect of relative stability. “The last five or six years, irrespective of what everybody else in the world went through, have represented relative stability for us. Every year, there is a buildup on top of that.” Iraq’s modern history, as he tells it, has been a near-unbroken run of catastrophe — the Iran-Iraq war, the invasion of Kuwait, sanctions, the US invasion, civil war, and then ISIS. Set against that sobering backdrop, half a decade without a system-level shock is the longest runway Iraqi institutions have had to build anything in two generations — and the global disruptions of recent years barely registered by comparison. “When these global changes happened, everybody worried about Ukraine, covid. All of them were destructive, but for us, they were peanuts compared to what we've been through.”
The market is pricing in that stability: Iraq’s equity index has rallied roughly 224% from end-2022 and is up another 9% this year, Tabaqchali says — a run he attributes to real growth in corporate and bank profits rather than speculative froth, and one that has held up even with the regional war on Iraq’s doorstep. The deposits, the credit demand, the corporate balance sheets that a functioning bank would lend against — they're forming now, in a way they simply weren’t a decade ago. In other words, the economy is outrunning the banking system, and the cost of leaving the banks broken rises every year the gap widens.
Two more recent developments add to that case, in different ways. Ali Al Zaidi — Iraq’s first PM with hands-on financial-sector experience — chaired Al-Janoob Islamic Bank until 2019. But Al-Janoob is also one of eight banks the CBI barred from USD transactions in early 2024, at the direction of the US Treasury and the New York Fed, over money-laundering concerns. Gunter reads the background as a net positive. “A PM who understands the granular, technical components of financial regulation keeps the technocrats honest, because they know the head of government completely understands the mechanics of the sector.”
The anti-corruption campaign that just led to 47 arrests could also be another positive sign. Counter-terrorism units sealed the Green Zone and detained MPs, lawmakers, and oil-ministry officials, the kind of operation past PMs only talked about. Gunter, who says he “did not see that coming… It is a positive step.”
But not everyone is buying in: Al Gaood points out that consultants have been in-country for over a year to support a reform plan announced in April 2025, but with little to show for it. “Have I seen any real evidence of this happening? Of course not — not yet. The only evidence I have is the arrests and the change in the governor. Plans and announcements are very different from implementation.”
That leaves the capitalization deadlines as the point worth watching. True transformation, in Al Gaood’s view, “requires the government to enforce the law when banks miss the 2027 capital deadlines.” If non-compliant banks dodge the new requirements or skirt Hussein's AML audits, the system reverts. What happens to First Rafidain is also key — whether it moves from announcement to legal structure, and whether named investors emerge for the private stake.
The US-Iran agreement signed earlier this month may not have answered the questions that started the conflict, but markets are reacting like it did. Brent is back near pre-war levels, tankers are loading at Ras Tanura, Dubai's benchmark has gained over 13% over the past three months, and the Gulf’s risk premium is shrinking. Now the question is whether the recovery holds, or whether the region is absorbing a long-term re-rating it won’t shake off.
The rally is real — but so is the gap beneath it. Dubai’s DFM General Index has climbed c. 13% from its March low and is on course for its best quarter in a year. Abu Dhabi has recovered by less, but its sovereign-backed, defensively weighted index having fallen less sharply to begin with. “This rebound can mainly be attributed to a reversal of geopolitical risks in the region, as the region's fundamentals have remained strong despite the tensions,” Century Financial Chief Investment Officer Vijay Valecha tells EnterpriseAM.
The easing of concerns around Hormuz helped investors move back into riskier assets, CFI financial market analyst Christy Achkar tells us. “While geopolitical developments triggered the rebound, the market has been able to sustain it because the underlying fundamentals remain strong,” Achkar adds.
Yet we are not back to normal, and the ceasefire looks fragile. The DFM remains c. 12% below its pre-war high and the ADX is still c. 9% lower. Within days of signing the agreement, an Iranian drone hit a cargo ship in the strait, the US struck some 10 Iranian targets near Hormuz, and Iran fired on US-linked sites in Bahrain and Kuwait. The MoU and the Switzerland talks didn’t settle the core issues — Iran’s enrichment rights, its highly enriched uranium stockpile, or the sanctions timeline.
“They’ve deferred it by 60 days with a more formal wrapper around the uncertainty,” Aseel Al Aranki, research and analysis department manager at River Prime, tells EnterpriseAM. And that shows in how the two sides publicly disagree on what they signed. Iran denied committing to inspector access on the same day Washington called it a milestone.
The likeliest outcome of the 60-day window is another partial pact — an agreement “that kicks the nuclear and ballistics questions further down the road and leaves the fundamental threat architecture in place,” Al Aranki predicts.
Recovery comes in different shapes
Dubai fell harder — and is bouncing back faster — while Abu Dhabi held up better and had less recovery needed. Dubai leans heavily on tourism, aviation, real estate, and global capital flows, sectors acutely sensitive to flight disruption and any threat to the city’s safe-haven brand. Dubai slipped into bear-market territory in March, but 34 of 41 stocks in its benchmark ultimately rose during 2Q, with consumer discretionary stocks up nearly 49% from March lows. In Abu Dhabi, real estate returned more than 16% from the March low, followed by industrials at c. 15% and energy at nearly 13% — supported by sovereign wealth backing and a defensive listed mix.
Saudi carries a different overhang. Riyadh’s Red Sea access, the East-West pipeline, and its geographic depth leave it better insulated than Hormuz-dependent neighbors: “If there’s a Gulf recovery trade, Riyadh captures a disproportionate share of it,” Al Aranki says. But the war landed on top of an already-underway gigaprojects recalibration: Neom was broken up and rephased, The Line scaled back, and the PIF booked a USD 8 bn write-down. “The Kingdom has had a very ambitious vision and there are question marks now about the gigaprojects and their continuity,” Omar El Shenety, managing partner at Zilla Capital and head of the financial markets unit at the Egyptian Center for Economic Studies, tells EnterpriseAM. “Investors will be waiting to see the revised version of this vision and the destiny of such gigaprojects.”
The capital-flow split
Sovereigns are holding pace, but foreign inflows are the harder story: The PIF, Adia, and Mubadala have largely held their deployment pace, but with a redirection: The PIF has already cut its international allocation from 30% to 20%, redirecting capital home. “The war didn't cause this shift entirely, but it accelerated it and gave it political cover,” Al Aranki says. “The Gulf, especially Saudi Arabia, will stay a very attractive region for investors across many sectors, but most global investors will be cautious in the short term,” El Shenety says. Global capital is “waiting to see the strategic priorities of Gulf countries and the revised national agendas before they jump in again.”
“When a credible ceasefire takes hold, investors start to undo their caution — but gradually rather than all at once,” Valecha says. Hedge funds and trend followers have moved first, unwinding hedges and buying beaten-down assets before anything is formally signed. Brent's retreat toward its pre-war range is an early example of that repositioning. But pension funds, insurers, and cautious retail investors want confirmation before rotating out of USD, Treasuries, and gold and back into regional equities and cyclical stocks. “That second wave would be crucial to turning the relief rally into a more durable recovery,” Valecha adds.
What's next
The 60-day clock is the immediate risk: The MoU runs to mid-August. Watch for movement on the nuclear file at the Switzerland track, any break in the fragile Lebanon ceasefire, and whether renewed Hormuz incidents force another repricing.
Longer term, the exposure has been demonstrated: The Gulf model’s vulnerabilities — Hormuz dependency, desalination, and food imports — has been shown in a way many investors and sovereigns won’t unsee. And as long as Iran retains ballistic capability and the Israeli-Iranian confrontation stays open, foreign capital prices a higher permanent risk premium on Gulf exposure. “I’d want meaningful hedges on any medium-term Gulf positioning until there's clarity on at least the nuclear file,” Al Aranki says.
The bigger issue in our minds this morning is less “will it hold” and more “what does it all mean?” Sure, there’s a chance the shooting war resumes. But four months on, we’re seeing signs that Oman, Saudi Arabia, and the UAE are each engaged in what John Foster Dulles would have called an “agonizing reappraisal” of their relations with the United States.
Oman has clearly broken ranks: Muscat and Tehran are pressing ahead with a plan to charge ships for passage through Hormuz — despite loud US objections, the New York Times reports. Oman has handed Washington and European capitals a formal proposal modeled on the Straits of Malacca and Singapore, where a private Japanese foundation collects voluntary contributions for safe navigation. Foreign Minister Badr al-Busaidi is being careful to call these “service fees,” not transit tolls, but Tehran insists the fees are (a) mandatory and (b) going into effect whether Oman joins it or not. Needless to say, Europe and much of the rest of the world aren’t down with the idea of a toll. (Trump suggested in May that he would bomb Oman if they didn’t “behave.”)
The bottom line, in a couple of sentences: “Call it voluntary if you like — Hormuz was completely open before this war, and now it isn’t,” the Royal United Services Institute’s H.A. Hellyer told the NYT. “That is not Oman's doing… All this hassle is part of Washington’s bill for starting an ill-advised war.”
MEANWHILE-The WSJ writes that the war has significantly frayed ties between Washington and Riyadh. The fallout we can all see: Secretary of State Marco Rubio’s Gulf tour last week pointedly skipped Riyadh and Crown Prince Mohamed bin Salman turned down his G7 invitation while the leaders of the UAE, Qatar, and Egypt showed up. The Journal says the White House is now mulling whether to redeploy troops in Saudi to Israel and Jordan — and Riyadh has opened its own line to Tehran, brokered by Pakistan.
AND- The UAE doubled down on security ties with Washington and Israel, further widening the rift between MbS and UAE President Mohamed bin Zayed.
What’s next: US “envoys” Steve Witkoff and Jared Kushner were in Doha this week for indirect talks with Iran — no face-to-face, Qatari officials stressed — with the release of USD bns worth of frozen Iranian assets and the future of the strait still on the line. Whatever happens with those talks, we’re in the early days of a long (and likely not-so-quiet) rearrangement of relations in the GCC.
The EU is starting to talk about reconstruction in Sudan, but the war is nowhere close to ending. The EU Delegation to Sudan hosted its first meeting with Sudanese private sector representatives in Cairo last week to discuss leveraging private enterprise for economic recovery. The EU envisions Sudanese businesses as the engine for post-war development, but addressing political instability, volatile exchange rates, and crumbling infrastructure would be key to reverse European capital flight, Yacine Hichem Tekfa, the EU delegation’s deputy head, said.
The stakes are immense: After more than three years of a conflict between the Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF), rebuilding Sudan’s ruined infrastructure will require an estimated USD 300 bnfor Khartoum alone, and USD 700 bn for the rest of the country, according to Sudanese authorities. About 60% of the country’s electricity infrastructure is now destroyed, leaving Sudanese people with severe and prolonged power outages at a time when humanitarian needs are staking up, the country’s energy minister said earlier this week.
The war, meanwhile, grinds on despite efforts for a political settlement. The epicenter of fighting has shifted to Kordofan, where reports suggest a troop surge around El-Obeid — a city of 500k — raising fears of another humanitarian crisis similar to El Fasher’s from last October. Drone strikes alone killed over 1k civilians in the first five months of 2026. So far, the conflict has displaced close to 14 mn people — the world’s largest displacement crisis — and the country is now effectively split in two.
The split Sudan is facing isn’t just territorial. The RSF currently recognizes banknotes issued before 2024 in the territories it controls, raising worries that Sudan might be seeing the emergence of a two-currency system. This comes as competing governments work on building separate financial systems, with parallel central banks and governments, each recognizing different banknotes based on their date of issuance, Asharq Al Awsat reports.
Adding to the infrastructure collapse, Sudan also faces severe fiscal pressure. Traditional revenue streams like taxes and customs have collapsed, and oil production — historically accounts for some 20% of the country’s export revenues — almost halved to just 24k bbl / d last year. Meanwhile, China canceled USD 50 mn of sovereign debt and signaled openness to future grant-based cooperation, but the waived amount is a drop in the ocean compared to the government’s staggering external debt, which was most recently estimated at USD 69 bn in 2023.
IN CONTEXT- The gap between Khartoum’s demand for unconditional RSF surrender and the international community’s push for a negotiated settlement looks as wide as ever. Cairo convened a four-party meeting with Saudi Arabia, Turkey, and the US on 20 June, with a Sudanese delegation meeting separately with US Senior Adviser Massad Boulos and Turkish FM Hakan Fidan on the sidelines. But the Sudanese military arrived carrying the same roadmap it has pushed for months: Full RSF disarmament, restoration of state control across all territory, and no framework that treats the SAF and the RSF as equals. Al-Burhan underlined the point days later, publicly ruling out any negotiations unless the RSF disarms.
Two M&A stories at the top of this morning’s column suggest Gulf investors continue to have appetite for assets that Western owners have tired of, betting that emerging market expertise will allow them to debottleneck growth.
BACKGROUND- Emirates NBD already owns Denizbank, Turkey’s ninth-largest lender with 500-plus branches, while HSBC has been pulling back, with 36 locations now from 315 in 2013.
AND- Adnoc Distribution is in advanced talks to buy Shell’s South African fuel-retail business for about USD 1 bn. The transaction would give it more than 600 locations and c. 10% of the continent’s largest fuel market, South Africa’s Engineering News reports.
Gulf investors are also snapping up port and logistics capacity — and the redundancy to go with it — as part of a build-out that, alongside defense, we think will run for a decade or more. CMA CGM and Oman’s Asyad Group are putting USD 400 mn into a jointly operated multipurpose terminal at Sohar, according to a statement. Meanwhile, AD Ports and Emirates Global Aluminium are investing AED 84 mn to enlarge EGA’s dedicated Khalifa Port berth for larger Newcastlemax vessels, and DP World and Arcapita’s Lintara broke ground on a 20k sqm logistics center in Jebel Ali, making it Lintara’s second Jafza groundbreaking in three weeks.
Look for more of this in key sectors including energy, infrastructure, food security plays, and financial services.
Gulf sovereign wealth funds have joined their global peers in rotating out of public markets. The world’s biggest sovereign wealth funds are pulling money out of listed equities and into private markets, and Gulf funds lead the pack, according to Invesco’s annual sovereign wealth study (pdf), covering 90 funds with combined AUM of USD 17.2 tn.
Mubadala already holds 59% of its assets in private equity, infrastructure, and real estate, while Singapore’s Temasek sits at 49% unlisted, and the shift is accelerating: 17% of SWFs plan to cut listed-equity exposure this year and 28-35% want more exposure to private equity, private credit, and infrastructure.
Why it matters: Index concentration and the AI build-out are the two forces at play here. The top 10 stocks in the S&P 500 now make up 38% of the index — double their weight a decade ago — so a passive allocation has concentrated risk in a handful of US megacaps. Meanwhile, the capital the world needs for the buildout of data centers and the power to run them is mostly outside listed markets.
IN CONTEXT- Total commitments to 2026 data-center investments has more than doubled this year to USD 151.5 bn, with regional players including Adia, Mubadala, and Humain knee deep in it all.
Adia is backing what could be Hong Kong’s biggest IPO of the year: The Abu Dhabi SWF is joining Temasek, GIC, Hillhouse, Tencent, and Millennium to cornerstone up to USD 1.5 bn of Luxshare Precision Industry’s Hong Kong IPO. The Shenzhen-based electronics components maker (it makes Apple’s AirPods, among other things) is looking to raise HKD 24.3 bn (USD 3.1 bn), it said in its prospectus (pdf).
Egypt’s privatization pipeline gets a second flagship float: Misr Insurance Holding’s shareholders approved a 20% EGX float of subsidiary Misr Life Insurance, joining Hussein Abaza’s Banque du Caire in the pipeline. The numbers underneath are strong: consolidated net income and retained earnings rose 32% y-o-y to EGP 37 bn (USD 750 mn) in FY 2025, and total assets grew 13% to EGP 247 bn (USD 5 bn). The Sovereign Fund of Egypt has tapped EFG Hermes as sole global coordinator.
Investors still have plenty of appetite for Gulf banks, looking past the disruption of the last four months (and the medium-term headwinds that are likely to follow). Our friends at Mashreq are back in the debt markets with a benchmark-sized, USD-denominated additional tier-one (AT-1) note. Meanwhile, the UAE’s Rakbank has mandated 11 banks (including Mashreq) for investor meetings ahead of a five-year USD benchmark bond under its EMTN program. And AlJazira in Saudi closed a fresh USD 500 mn AT1. They follow recent trips to market by FAB, Emirates NBD, and Dubai Islamic Bank, among others.
From The Planet of the Asset Managers:State Street has landed a fund management license from Saudi Arabia’s CMA, clearing the US custody giant to run funds from inside the Kingdom rather than merely hold assets there. It already sits on USD 127 bn in Saudi assets under custody and manages another USD 60 bn locally
MEANWHILE-Arab Bank Switzerland is the latest of more than two dozen firms to have entered, expanded in, or won new licenses from ADGM or DIFC since the war began. ABS Middle East will will open in DIFC and plant its nearly USD 25 bn in AUM in the city
Sovereign-AI startup 1001 raised USD 30 mn in a Series A led by US venture firm Lux Capital, eight months after a USD 9 mn seed, per a statement. PIF-backed Sanabil joined alongside Hanabi and others, with the funds earmarked for engineering and GCC expansion. 1001 builds AI for energy, industrials, aviation, ports, and logistics.
MEANWHILE- BasharSoft, the company behind recruitment platform Wuzzuf, is leading a USD 400k seed round (pdf) for Brainsmingle, an AI professional-networking platform, its first deal since buying consultancy iCareer last year.
ALSO WORTH KNOWING THIS MORNING-
Momentum, the UAE entertainment group, and US sports-and-gaming platform Fanatics have formed a JV to build a regulated commercial gaming business in the Emirates, pairing Momentum’s existing lottery, iGaming, and sportsbook licenses with Fanatics’ scale, according to a press release.
XRG, Adnoc’s international investment arm, and Italy’s Eni have each taken a 32% stake in three YPF-operated gas blocks in Argentina, the upstream leg of a USD 12.5 bn integrated LNG project, according to a press release (pdf).
OSN Streaming has made a preliminary, non-binding bid to take Abu Dhabi-based Anghami private at USD 3.39 a share.
JLL has closed the purchase of a stake in FMTECH, PIF’s facilities-management platform, for an undisclosed sum. It has also named 20-year JLL veteran Mike Thompson as CEO.
Kuwait’s Zain is making one of the biggest foreign bets so far on post-Assad Syria: The USD 1.5 bn acquisition of a license to operate what will become Syria’s second mobile network operator.
Zain is paying USD 747 mn for the license and will spend another USD 800 mn to modernize and expand the network (which will include 5G connectivity), according to Bloomberg, with the Syrian government taking a 25% stake in the new operator. The license was previously owned by MTN Group, Africa’s largest operator, which wrote down the full value of its Syria business and walked away in March after a settlement with Damascus.
Qatar’s Ooredoo was also going after the license to compete with Syriatel, following Doha-based Estithmar Holding into the country. Estithmar was one of the first really big foreign investors to move in with its April acquisition of 49% of Shahba Bank.
Other early investors eyeing Syria include Emaar founder Mohamed Alabbar, who said he wants to set up a USD 18 bn fund to invest in the country. Building materials companies from across the region and into Europe are also looking at Syria’s cement industry, banking on heavy demand from reconstruction projects now in the pipeline.
Offshore green light
Cyprus’sbiggest gas discoveryis commercially viable — and that’s great news for Egypt as it looks to cement its position as the eastern Mediterranean’s premier energy hub. Cyprus, QatarEnergy and ExxonMobil confirmed yesterday that the deep-water Glaucus and Pegasus fields have c. 7-9 tcf of marketable gas, moving the project from exploration into development.
The partners expect gas to start flowing through a pipeline to Egypt’s LNG plants and then onward to Europe as early as 2033 provided the project passes a final investment decision expected in 2029.
Deeper pockets
Saudi Arabia’s Public Investment Fund reported that its net profit more than doubled last year to SAR 65.1 bn (USD 17.3 bn) — and that total assets grew 5% to SAR 4.5 tn (USD 1.2 tn), crossing the USD 1.2 barrier for the first time. Arab News and Al Arabiya have more.
The fund has more than SAR 350 bn in cash on hand, and the improved profitability will give PIF more room to commit capital at home, where the crown faces pressure to rationalize its infrastructure buildout while still delivering a wholesale re-imagining of the economy away from oil. PIF wants to see offshore investments accounting for 20% of its book going forward from a previous target of 30%.
Hotel hunting in Oman
Egypt-based asset managerZaldi Capitalis eyeing hotel acquisitions in Oman in partnership with Better Home Real Estate, founder Mohamed Negme says. The wider expansion strategy includes developing a new residential and hospitality project under the Midtown brand in Muscat, with self-funded initial investments of USD 500 mn and a potential expansion into the insurance sector.
WATCH THIS SPACE #1- German automakers are scouting Algerian suppliers as they mull setting up local bases in the North African country. Six German companies — spanning materials, engineering, logistics, and digital supply tools — are in Algeria this week to vet subcontractors and raw material providers that they could fold into their supply chains, Algeria’s daily Echorouk reports.
The timing lines up with a local supply-chain push. Turkish-owned Tosyali Algeria will start producing advanced steel for the domestic auto industry starting in July, it said last month. Stellantis, meanwhile, says it wants to push local-content rates past 30% by 2026 — ahead of Algeria's own rules, which mandate 10% within two years and 30% within five. Stellantis’s German brand Opel is also eyeing what would be its first plant outside Europe in Algeria.
WATCH THIS SPACE #2- The first thing Abu Dhabi did with Covestro, its new German chemicals champion? Point the money our way. The German maker of insulation and foam chemicals now owned by Adnoc has unveiled its first big investment since the takeover — a EUR 2 bn housing insulation plant in Shanghai at a cost of EUR 2 bn and, potentially, another in the UAE at the same cost, the Financial Times reports.
WATCH THIS SPACE #3- India may go the bilateral route on trade agreements in the GCC, wagering that one-on-one agreements will close faster than a GCC-wide deal, Business Standard reports.
Indian diplomats will keep the door open to a comprehensive agreement with the six-member block, but will in parallel use bilateral agreements with the UAE and Oman as blueprints for talks with the rest of the GCC countries. Nearly 99% of Indian exports have low-or-no duty access to the UAE and Oman, including zero-duty access for labor-intensive industries such as jewelry, textiles, leather, footwear, engineering goods, and pharmaceuticals.
Bahrain may get there first if Qatar keeps pushing to negotiate a bilateral investment treaty at the same time as the two sides pursue trade talks. The hitch: India’s Commerce Ministry is responsible for the trade talks, while the Finance Ministry is taking point on negotiations for an investment treaty.
SIGN OF THE TIMES- MENA+ developers of green energy projects will likely find it harder to get concessional finance from the World Bank and the IFC after the lender said yesterday it would “retire” its goal of having 45% of its lending flow into projects with climate change benefits. The change comes as Washington pressures the bank to back away from climate pledges it made during the Biden administration — and as the White House pulls the plug on green energy projects at home. The World Bank also said it was extending its climate change action plan, which is now in review by its executive board.
Happening today
UAE to begin compliance checks on1H 2026 Emiratization targets: The Human Resources and Emiratization Ministry will be using a digital inspection system that flags fake Emiratization practices, and human inspectors will also verify that Emirati staff are registered with the social security fund and that contributions are being paid.
Data point
Foreign direct investment in Tunisiaroseby 25% y-o-y to TND 1.3 bn (USD 440 mn) in the first four months of 2026, according to the official Tunisian news agency. The increase was largely driven by inbound interest in manufacturing (+71%) and energy sectors (+19%).
This means Tunisia may be on its way to meet its annual FDI target of TND 4 bn in 2026. Last year, FDI increased by 30% to record TD 3.5 bn also driven by European nearshoring in the manufacturing sector, as well as the IT sector, we reported last month.
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