Good morning, friends, and happy FRIDAY. We’re nearly at the halfway point of Ramadan, and there’s still no news slowdown in sight.

THE BIG STORY OF THE DAY is Aldar’s third debt issuance of the year, in the form of a USD 500 mn green sukuk, which was 7.2x oversubscribed. We also have an M&A in the works, with TC MENA submitting a mandatory tender offer for a controlling stake in Gulf Cement, as well as news of a new USD 100 mn drama-focused fund in ADGM.

Plus: Limited supply pushed property prices up in Abu Dhabi last year, with secondary transactions seeing record activity.

So, when do we eat? Maghrib is at 6:31 pm today in Dubai and 6:35 pm in Abu Dhabi. You’ll have until fajr prayers at 5:12 am in Dubai and 5:16 am in Abu Dhabi tomorrow to finish your sohour.

☀️WEATHER- We’re in for some great weather today, with temperatures cooling in Dubai to a high of 25°C, before dropping to 19°C overnight, according to our favorite weather app. In Abu Dhabi, temperatures will peak at 23°C and reach a low of 19°C.

WATCH THIS SPACE-

#1- Could we see an exodus of Russians if a Ukraine ceasefire goes through? According to S&P Global, it won’t be that straightforward. A ceasefire is not expected to lead to an immediate reversal of increased Russian labor and financial inflows into the UAE, as continued political and economic uncertainty is expected to persist beyond a potential ceasefire agreement, S&P Global said.

ICYMI- The US proposed a ceasefire plan to Russia that Russian Vladimir Putin has accepted in principle, after Ukraine said it would support a ceasefire plan. US Secretary of State Marco Rubio hopes an agreement could be reached within days, Reuters said this week. We have more on this in Big Story Abroad, below.

One foot in, one foot out? The lack of stability will encourage “individuals and businesses to maintain at least some presence and funds in the UAE,” the report reads. Even if sanctions begin to ease, individuals and businesses are expected to maintain their presence to “benefit from the UAE’s flexible and supportive economic environment, as well as its business-friendly regulations and low tax regime,” according to S&P Global.

The banking sector is also expected to be unaffected, with UAE banks having “more than enough liquidity” to handle potential outflows from Russian citizens and companies. Despite potential real estate divestments from Russian migrants, the effects of this on the UAE’s residential real estate sector are expected to be limited “given continuous strong demand and population growth.” Meanwhile, high yields and capital gains along with asset security could provide additional reasons for Russians to continue investing in the UAE.

#2- UAE official to seek more access to US advanced tech in Washington visit: National Security Advisor and G42 Chair Sheikh Tahnoon Bin Zayad Al Nahyan is planning to advocate for easier access to advanced chips, including from Nvidia, at a meeting with Trump cabinet officials as soon as next week, Bloomberg reports, citing anonymous sources familiar with the matter. The meeting will also discuss UAE investments in the US, and will likely see him sit down with Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent, and National Security Advisor Mike Waltz.

REMEMBER- The US in January introduced export restrictions on AI chips and GPUs affecting 120 countries, including the UAE, as part of its effort to maintain AI leadership. The regulations divided the world into three tiers, restricting access to rivals like China and Russia, and permitting it to close allies, with the UAE sitting in the middle tier. The regulations, which have yet to be implemented, are currently being reviewed by the Trump administration.

The US and the UAE are close AI partners: This comes amid increasing Emirati investment into the US’ data center sector, which includes a USD 20 bn investment from Damac Properties and a portion of the USD 100 bn for a JV that includes Abu Dhabi AI fund MGX. State AI firm G42 also secured a USD 1.5 bn investment from Microsoft in April 2024, for which it requires large-scale AI component deliveries, including Nvidia chips and GPUs. Exports had begun late last year after the US gave its stamp of approval, and after the two reached an agreement to prevent access to the facility by personnel from countries with US arms embargoes, or who are on the Bureau of Industry and Security (BIS) Entity List, including China, and to lock the facility down with US defense tech.

#3- UAE aviation authority rolls out new drone regulations: The UAE General Civil Aviation Authority (GCAA) introduced new regulations defining standards for drone service providers, Khaleej Times reports. The regulations, titled CAR Part U-space, cover operational standards, contracts, training, safety, and auditing to ensure the safe integration of drone operations with commercial aviation.

ICYMI- Earlier this year, the UAE lifted restrictions on recreational drone use for individuals, except in Dubai, where drone operations are regulated by the Dubai Civil Aviation Authority.

#4- Aluminium exports saw a spike in early March ahead of new 25% US tariff: UAE exports of aluminum to the US saw an uptick in March as buyers looked to secure supply before US President Donald Trump’s 25% tariff plan took place, Reuters reports citing data from the US Department of Commerce. Some 68.6k metric tons have arrived so far this month, compared to 16.1k metric tonnes for the whole month this time last year.

In context: The UAE is the US’ second-largest supplier of aluminum after Canada, with analysts saying US importers are likely to prefer alternative suppliers of aluminum due to ongoing trade tensions with Canada and the threat of increasing tariffs. “On average, the business costs of UAE producers are lower than for Canadian ones, according to CRU estimates, while Emirates Global Aluminium is the lowest-cost producer globally,” Yulia Buchneva, director at Fitch Ratings said, adding that the UAE would still be able to profitably export to the US even with a tariff.

#5- The Net Zero Banking Alliance (NZBA) is considering revising its climate commitments by shifting from the Paris Agreement’s 1.5°C target to a “well below 2°C” goal, the Financial Times and Reuters report, citing the coalition’s chair and other sources. The move follows the departure of 14 major US banks, including JPMorgan Chase and Bank of America, reducing NZBA’s membership to 134 banks.

A vote on the proposal is expected later this month, following pressure from European banks threatening to leave unless rules were softened, the Financial Times reports. If approved, the NZBA would shift from enforcing strict emissions targets to supporting banks in carbon accounting and transition planning. The revisions reflect evolving scientific, regulatory, and policy landscapes that affect how banks facilitate net-zero transitions, FAB’s Chief Sustainability Officer Shargiil Bashir told Reuters.

Where the UAE stands: Despite the shake-up, UAE signatories First Abu Dhabi Bank (FAB) and Abu Dhabi Commercial Bank (ADCB) are still part of the coalition, with ADCB joining in November 2023 and FAB signing in October 2021. FAB published its first climate targets in April 2023, while ADCB is set to release its targets by May 2025, according to the NBZA website.

#6- Abu Dhabi-based Alpha Data aims to triple Saudi sales to 10% by next year as it expands beyond the UAE, CEO Fayez Al Abini told Asharq Business. The digital and IT services provider opened offices in Saudi Arabia and Qatar in 2022 but is adopting a cautious approach toward its expansion, focusing on projects that can “[ensure] payment commitments” and “avoid delays in signing and implementation,” Al Abini said.

ICYMI- Alpha Data debuted on the ADX earlier this week with a 40% stake sale that raised AED 600 mn (USD 163 mn).

PSA-

The Federal Tax Authority (FTA) is reminding taxpayers to update their tax records ahead of the expiration of a grace period until 31 March 2025, according to a statement. The grace period, which began on 1 January 2024, allows businesses to report changes such as company name, address, trade license details, business activities, and legal entity type, without incurring fees associated with delays. Normally, registrants must update their records within 20 business days using the approved FTA procedure, according to a press release.

The FTA clarified that any penalties imposed between 1 January 2024 and the grace period announcement will be automatically reversed requiring no action from registrants.

THE BIG STORY ABROAD-

Two stories are dominating headlines this morning:

#1- Russian President Vladimir Putin agreed to talks with the US over a potential ceasefire agreement in Ukraine, but stopped short of accepting the proposal for an immediate 30-day ceasefire. Putin said any ceasefire agreement will need to “eliminate the cause of this crisis” and lead to long-term peace, setting out a series of tough conditions that would need to be met ahead of a ceasefire. US President Donald Trump’s Middle East envoy Steve Witkoff is currently in Moscow ahead of expected talks with the Russian leader. (Reuters | Bloomberg | FT | AP | Guardian)

#2- More threats of tariffs — this time of a 200% tariff on wine and alcoholic beverages from France and other countries in the EU — sent the S&P 500 firmly into correction territory, falling more than 10% from its peak in February, while the tech-heavy Nasdaq — already in correction territory — also lost some 1.9%. The sell-off comes despite relief earlier this week coming from positive signs for the US economy and inflation trends. (Reuters | CNBC | Bloomberg | NYT)

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MARKET WATCH-

Opec+ oil output jumped in February to 41.01 mn bbl / d, rising 363k bbl / day from the previous month, according to Opec’s monthly oil market report (pdf). The increase was driven primarily by higher output from Kazakhstan, which added 198k bbl / d to its monthly production — “at least 300k bbl / d above its Opec+ ceiling,” Bloomberg notes.

Oil prices fell 3.2% m-o-m to an average of USD 76.8 per barrel, while the group’s predictions for global oil demand remained unchanged at 1.45 mn bpd for this year, and at 1.43 mn bpd for 2026. The need for transportation fuels is set to keep demand buoyed as both international and domestic air traffic returns to pre-pandemic levels, and the biggest uptick in demand is expected to come from non-OECD countries.

REMEMBER- The group recently agreed to push ahead with production hikes next month citing a “positive outlook,” and despite concerns over weak market prices on the back of weakened Chinese demand and increased US output. Opec+ kept the door open, however, for future changes in policy, saying that the increase may be paused or reversed depending on market conditions.

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