Tabreed, CVC acquire PAL Cooling. Plus: DFM hits 17-year high

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WHAT WE’RE TRACKING TODAY

THIS MORNING: Fuel prices up in July + Joby Aviation completes first air taxi test flight in Dubai

Good morning, wonderful people. It’s the first day of a new quarter and of the second half of the year — where has the time gone? — but we’re yet to see signs of a summer news lull.

THE BIG STORY here at home is district cooling firm Tabreed and private equity firm CVC acquiring Abu Dhabi district cooling provider PAL Cooling from Multiply. Plus: We have a deluge of macro data on Abu Dhabi, including inflation figures in May, and industry and construction prices in 1Q 2025.

ALSO- UAE stock exchanges ended 2Q with a bang: The Dubai Financial Market (DFM) hit its highest level since May 2008 in intraday trading yesterday, Reuters reports, after gaining 0.7%, and settling up 0.4%. The index is up 10.7% YTD. Meanwhile, the ADX closed up 0.7% yesterday, and is up 5.7% YTD.

ELSEWHERE IN THE REGION- Tadawul is down 7.3% YTD, and the EGX is up 10.5%.

WEATHER- Dubai will see an afternoon high of 42°C, though it will feel as hot as 55°C at the peak. Overnight temperatures will cool down a bit to 31°C, according to our favorite weather app. Abu Dhabi temperatures are cooler, with afternoon temperatures reaching 36°C before cooling down to 30°C overnight.

PSA-

#1- New month, new fuel prices: The Fuel Price Committee raised fuel prices across the board for July, after prices remained mostly flat in June, according to a post on X. The July adjustment marks the first across-the-board increase in several months.

Here’s the new breakdown per liter:

Super 98 is now AED 2.70, up from AED 2.58 in June (+4.7%);
Special 95 is AED 2.58, up from AED 2.47 (+4.5%);
E-Plus 91 is AED 2.51, up from 2.39 (+5.0%);
Diesel is AED 2.63, up from AED 2.45 (+7.3%).

#2- Budget carrier Air Arabia will restart direct flights between Sharjah and Damascus starting from Thursday, 10 July, according to a press release. The carrier will operate two daily flights between Sharjah International Airport and Damascus International Airport. The resumption follows similar moves from Emirates and Flydubai that end a 12-year hiatus after the ouster of former president Bashar Al Assad.

WATCH THIS SPACE-

#1- Inching closer to air taxis in Dubai: California-based electric aircraft developer Joby Aviation and Dubai’s Roads and Transport Authority (RTA) completed the region’s first Joby air taxi test flight, Dubai Crown Prince Hamdan bin Mohammed said in a post on X. The two partnered last year to launch air taxi services in the UAE by early 2026.

REMEMBER- The UAE has big targets for urban mobility. Abu Dhabi also recently saw the first eVTOL test flight take place in partnership with Chinese autonomous aerial vehicle firm EHang and Multi Level Group (MLG) ahead of a planned commercial rollout this year. Archer Aviation is also set to begin test flights for its Midnight electric vertical take-off and landing (eVTOL) aircraft this summer, ahead of a planned commercial rollout by 2026. The capital’s Zayed Port is also being developed into the UAE’s first hybrid heliport, a joint project between AD Ports Group, Falcon Aviation, and Archer, designed to serve both helicopters and eVTOLs.

Market reax: Joby’s shares shot up 11.8% on news of the successful test flight.

#2- More road improvements, this time for Al Safa Street: Dubai’s Roads and Transport Authority (RTA) has greenlit the expansion of Al Safa Street in a bid to streamline traffic flow, according to a statement. The project covers nearly 1.5 km — spanning from Al Safa Street’s junction with Sheikh Zayed Road to the junction with Al Wasl Street — and aims to double the street’s capacity to 12k vehicles per hour in both directions and cut travel time from twelve to three minutes. RTA is set to construct two bridges and two tunnels — spanning a combined 3.1 km — as well as widen road surfaces and upgrade traffic signal systems.

In context: The project is a part of a larger plan to improve Dubai’s Umm Suqeim and Al Wasl streets, which looks to “enhance connectivity between four strategic corridors in the Emirate — Sheikh Zayed Road, Al Khail Road, Sheikh Mohammed bin Zayed Road, and Emirates Road,” RTA Chairman Mattar Al Tayer said.

#3- Asia’s largest budget airline, AirAsia, will set up a new hub in the GCC this year at a yet-to-be-determined Gulf airport, CEO Tony Fernandes told the Financial Times in an interview. The move aims to support the Malaysia-based airline’s plans to expand its flight network to more European destinations, given the region’s proximity to Europe. The airline seeks to offer “longer-haul fares, and start taking people around the world through a one-stop and multi-hop strategy,” Fernandes noted.

On the shortlist: Ras Al Khaimah is one possible destination for the new hub, as is one in Saudi Arabia, the airline’s chief executive Tony Fernandes said in a radio interview picked up by The National. He ruled out Dubai and Sharjah, saying DXB is a big, complicated airport and that Sharjah’s airport would not benefit from the network AirAsia offers, given it is “well-served” by Air Arabia.

DATA POINT-

The volume of air cargo dispatched from the Middle East and South Asia rose 10% w-o-w the week ending 22 June, after crashing by some 15% in the first two weeks of June amid conflict between Israel-Iran and Eid Al Adha holidays, Stat Trade Times reports, citing WorldACD Market Data. Airport operations in regional hotspots are now in recovery after the now-dubbed 12-day war between Iran and Israel triggered widespread cancellations and diversions. Essential international transit hubs — Doha and Dubai, which were among the most impacted after Iran’s attack on a US military base in Qatar — are now back on track after facing further disruptions last week.

In context: Intra-regional traffic from the region dropped by 26% w-o-w between 4 June and 10 June, while flows to Africa were down 16% w-o-w.

But things are looking up again: A significant uptick came from the Kingdom with a 40% w-o-w jump, and the UAE at a 10% w-o-w jump.

Outbound traffic experienced an upward tick: The region recorded a 17% w-o-w hike in its air cargo traffic to Europe, while intra-regional traffic rose some 12% w-o-w, and cargo traveling to Asia Pacific was up by 11% w-o-w.

THE BIG STORY ABROAD-

All eyes are on the US Senate as they race to vote on amendments to US President Donald Trump’s so-called “big, beautiful bill,” — a sweeping legislation that aims to pass a trove of tax cuts and reduce spending on medicaid and clean energy tax credits — ahead of the president’s 4 July deadline. Senate Republicans are expected to vote throughout the night, after a day that saw discussions drag as they work to find a balance that would appease the bill’s opposers, and that could pass the House later. The Senate needs no more than three GOP Senators to reject the bill in order to still be able to pass it — and currently, two senators have already decided they are firmly against it.

What’s on the drawing board? Softening the phase-out of clean energy subsidies, changes to Medicaid, and changes to the rural hospital fund.

The story is leading front pages everywhere: Bloomberg | New York Times | Guardian | Wall Street Journal | Financial Times

PLUS- Trade talks between Canada and the US are back on track after Canada scrapped its plans to tax US tech firms, with an eye to complete talks by 21 July. (Guardian | Reuters)

AND- Netanyahu to visit Trump next week: Israeli Prime Minister Benjamin Netanyahu will meet US President Donald Trump at the White House next Monday to talk Iran, Gaza, Syria, and regional security. The visit comes as Trump presses Israel to end its war on Gaza and secure hostage releases. (Reuters | Bloomberg | Associated Press)

News of the visit came after Israeli strikes killed at least 60 people across Gaza yesterday. The attacks came following fresh evacuation orders from the Israeli military in northern Gaza, as Israeli Strategic Affairs Minister Ron Dermer travelled to Washington for talks on a possible ceasefire and hostage release agreement. (Reuters | The Guardian | BBC)

ALSO- Trump lifts US sanctions on Syria post-Assad: Trump signed an executive order yesterday terminating US sanctions on Syria to boost its war-torn economy and support its new government. (Reuters | Bloomberg | Financial Times)

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Multiply Group agrees to offload PAL Cooling to Tabreed + CVC

Tabreed, CVC acquire PAL cooling: ADX-listed Multiply Group agreed to sell 100% of its district cooling arm PAL Cooling Holding to state-owned district cooling firm Tabreed and Luxembourg-based PE firm CVC’s infrastructure investment platform CVC DIF in a transaction valuing the business at AED 3.8 bn (USD 1 bn), according to two separate statements (here and here). The transaction is still subject to regulatory approvals.

The agreement includes eight concessions, including three long-term concessions in Abu Dhabi and five in Al Reem Island. The concessions are serviced by five existing district cooling plants, with some 182k RT capacity as of last December, with another plant under construction and three more in the planning phase. The plants and concessions are expected to have a total capacity of 600k RT.

Background: The transaction, first reported in March, is the latest sign of interest among global private equity firms in infrastructure and real estate in the UAE. This comes as the region as a whole sees an increase in investments in infrastructure projects, including district cooling plants — a more energy- and cost-efficient alternative to conventional cooling systems for a region that is highly dependent on air conditioning.

Expected impact: “The acquisition also serves to strengthen our already investment-grade status with safe, long-term concession agreements and assured future growth, evidenced by current and planned developments on Reem Island,” said Tabreed CEO Khalid Al Marzooqi. The acquisition is also expected to provide CVC DIF with exposure to a strategic segment of the UAE’s utilities sector, amid rising PE interest in regional infrastructure assets.

The money is earmarked to finance Multiply’s growth in core verticals: The transaction “reflects our ability to realise significant value from our assets while enhancing liquidity to fuel Multiply Group’s next phase of growth — both across our core verticals and on the global stage,” Multiply’s CEO Samia Bouazza said. Multiply had acquired PAL in July 2021.

Market reax: Multiply Group’s shares rose 2.6% to close at AED 2.41 yesterday, while Tabreed’s were up 1.8% to close at AED 2.84.

ADVISORS- Standard Chartered and Clifford Chance are advising Multiply Group, while Citi, Synergy Consulting, and White & Case are buy-side advisors.

Abu Dhabi inflation cools further in May

Abu Dhabi’s consumer price index continued its downward spell in May, this time falling a further 0.6% y-o-y, following a 0.1% fall in April, according to data from the Abu Dhabi Statistics Center. On a monthly basis, inflation saw a mere 0.1% increase, after it had remained unchanged at 0.0% a month before.

The annual picture: Prices rose at least slightly in most categories in May on an annual basis, led by a 17.7% price rise in the recreation and culture basket, as well as a 13.5% rise in ins. and financial services. However, this was offset by a 14.4% decline in transport prices — the second largest component in the inflation basket — as well as a 0.9% decline in food and beverage prices.

On a monthly basis, the recreation and culture segment once again saw the sharpest m-o-m rise with a 5.5% increase, followed by restaurants and hotels with a 1.2% rise. Meanwhile, clothing and footwear prices fell by 1.2% on a monthly basis.

Meanwhile, in Dubai: Dubai’s annual inflation saw a slight uptick in May, coming in at 2.37% y-o-y, compared to 2.31% in April, reversing a four-month trend of softening following January’s peak of 3.22%. However, most components of the basket showed only moderate price growth, with Emirates NBD anticipating that inflation is expected to stay around current levels for the rest of this year, the bank said in a research note.

How the UAE’s overall inflation is expected to play out this year: The IMF now expects inflation in the UAE to come in at 2.1% in 2025, in what is a slight upward revision from the fund’s earlier estimate of 2% inflation for the year. This puts the IMF’s prediction just above that of the Central Bank of the UAE, which recently lowered its inflation forecast for 2025 slightly down by a 0.1 percentage point to 1.9% due to a “continuous downward trend in transportation costs” and “moderating energy prices.

OTHER ABU DHABI MACRO NEWS-

Abu Dhabi’s industrial producer price index (PPI) rose 2% q-o-q in 1Q 2025, reversing a 1% decline in the previous quarter, according to data (pdf) from the Abu Dhabi Statistics Center. The quarterly uptick was driven by price gains in wearing apparel (+8.2%), food products (+7.7%), and rubber and plastic products (+5.8%), while declines were recorded in basic metals (-7%) and paper products (-2.3%). Prices in the petroleum products category — carrying the largest weight — rose 3.3% q-o-q.

The PPI increased 3.9% y-o-y, led by surging prices of machinery and equipment repair and installation (+28%), motor vehicles, trailers, and semi-trailers (+19.5%), and fabricated metal products (+16.3%). The steepest declines came from furniture (-18.9%) and rubber and plastic products (-12.9%), while petroleum product prices fell 3.8% y-o-y.

Meanwhile, Abu Dhabi’s construction sector saw prices rise by 0.8% q-o-q this quarter, according to new data (pdf) from Abu Dhabi’s Statistics Center. The 0.8% uptick in the construction cost index in 1Q 2025 was driven primarily by labor costs, contributing with a 69.5% of the increase through a 2.4% quarterly jump and a 6.7% y-o-y increase. On an annual basis, construction costs rose by 1.9%.

Also driving price pressures: Electrical works materials also saw prices rise by 5.9% y-o-y, though they saw a more modest rise of 0.6% on a quarterly basis.

On the other hand, segments seeing an easing in prices on a quarterly basis include the mechanical works A/C (-0.6%) and equipment (0.8%) sectors, while on an annual basis, the services segment led with a 2.8% drop in prices, while a 0.9% dip in finishing materials and a 0.5% drop in construction materials also eased overall cost growth.

PLUS- The emirate’s population grew to 4.1 mn in 2024, a 7.5% rise y-o-y and a 51% uptick since 2014, according to data from the Abu Dhabi Statistics Center. The workforce expanded by 9.1% to 2.8 mn, including 6.4% growth in professional roles.

Adnoc drilling lands USD 800 mn contract for fracturing services

Adnoc Drilling secured a contract worth up to USD 800 mn from Adnoc Onshore for integrated hydraulic fracturing services for conventional and tight reservoirs, according to a disclosure (pdf). The five-year agreement, slated to begin this quarter, will support Adnoc’s efforts to boost flow rates and hydrocarbon recovery rates across assets in Abu Dhabi. Adnoc Drilling is in charge of design, execution, and evaluation of the treatments.

The tech stack: Adnoc Drilling will deploy proprietary fracturing simulation software, intelligent fluid systems that respond in real time to reservoir conditions, and automated pumping and blending units. The tech stack is designed to maximize efficiency, improve fracture performance, reduce environmental impact, and cut down the need for on-site manpower.

This is Adnoc Drilling’s fifth major contract victory in just over two months. Recent contracts from Adnoc Offshore include a USD 1.6 bn contract for integrated drilling services, a USD 806 mn contract for three island rigs, and a USD 1.15 bn, 15-year contract for two jack-up rigs. Adnoc Drilling is also managing a USD 400 mn backlog tied to its recent acquisitions in Oman and Kuwait.

IN OTHER ADNOC NEWS-

Vallourec lands tubular supply contract with Adnoc: French tube manufacturer Vallourec will supply more than 30k tons of carbon steel tubulars to Adnoc under an existing long-term agreement, according to a press release (pdf). The material will be sourced from Vallourec’s facilities in Brazil, China, and Indonesia. The agreement also includes field services and digital solutions to improve efficiency, and installation and maintenance operations across Adnoc’s oil and gas fields.

In context: Vallourec extended its contract with the Adnoc last year for an additional two years until January 2027, to provide Adnoc with tubes and connections for onshore and offshore oil and gas fields. The original contract was valued at around USD 900 mn.

Pakistan is on the cusp of a digital banking revolution — and Mashreq wants a piece of the pie

Last December, our friends at Mashreq became the first to receive a restricted license from the State Bank of Pakistan (SBP) to begin pilot operations as a digital retail bank. This expanded Mashreq’s operations to 14 countries, with the lender poised to offer digital and Islamic banking services in the country this year, with a view to onboard mns of customers over the next five years.

The bank has been operating on a pilot basis — offering banking services to bank employees and their families — for the past six months, and is looking to receive the greenlight from the SBP to begin commercial operations sometime this year, following the completion of the review of their pilot operations.

We spoke with Mashreq Pakistan’s CEO Muhammad Hamayun Sajjad (LinkedIn) about the size of the potential in Pakistan — home to nearly 250 mn people — as well as the challenges of bringing digital banking to a still heavily cashbased economy. Edited excerpts from our conversation:

Enterprise: Why did Mashreq choose Pakistan for its latest post in Asia? And why now?

MS: Pakistan has 55 financial institutions, as of June 2024, from fintechs, to microfinance, to large, conventional banks, and we have decent digital penetration in terms of smartphones, access to the Internet, and social media. We are a fairly digitally ready country. But the banking sector is still at a nascent stage in terms of digital offerings.

Out of more than 90 mn depositors, we have 18.7 mn mobile app banking users and 12 mn Internet banking users in Pakistan. The real challenge remains that most of the digital banking users are still underserved and in case of an issue, they look for a contact or relationship at their bank to help resolve their complaints.

Can you imagine opening a bank account in the good old days, getting your checkbook to write a check, and the bank tells you you can only write a check for up to PKR 200? Digital banking in Pakistan currently restricts users to transferring limited funds per day. There are daily, weekly, monthly, and even yearly limits, and people are struggling trying to even remember those limits, track their transactions, and monitor how much of their limits they’ve used up. These restrictions have caused customers to experience constant friction and a lack of trust in digital banking in Pakistan.

The SBP’s statistics show that paper-based transactions have seen a decline in volume but an increase in value of more than 50% to PKR 447.7 tn in FY 2024, indicating higher-value transactions being conducted through paper-based methods even now. We also have more than 18k bank branches in the country. There were more than 750 branches added in just one year, between FY2023 and FY2024. And banks are still opening branches.

We want to be the torchbearer of the digital banking evolution in Pakistan. We are the only global bank in Pakistan with a history of over 50 years, coming into the market as a digital-first, cloud-enabled platform to catalyze the future of banking in Pakistan. The bank was live in a record time of less than 18 months, with less than 115 employees and no physical branches.

Enterprise: What’s your strategy when entering the market? What types of clients will you be targeting?

MS: Our strategy for targeting customers is two-fold: a) To bring banking solutions to financially excluded Pakistanis and b) Target the existing digital banking customers who are underserved.

We understand the challenges tech-savvy digital banking customers in Pakistan face with digital banking as it stands today. They understand how mobile applications work, and how digital onboarding works, but they’re struggling with the existing banking experiences on offer. Leveraging Mashreq’s seamless globally benchmarked digital banking capabilities, we aim to give these customers superior experiences that are safer, simpler and centered on their needs and preferences.

We believe creating such experiences would naturally make them our advocates and proponents for the other underserved and financially excluded segments of society. People move from rural areas to cities for work, and they become increasingly accustomed to more digital lifestyles. And when they go back home during vacations to their families, they take that lifestyle and expand their trust and learnings to others back at home. That’s a big part of the literacy transition happening in Pakistan.

E: With Pakistan shifting all of its banking services to an Islamic model by 2028, how is Mashreq preparing for the transition?

MS: There has been a huge inclination for the past 10 years in Pakistan towards Islamic banking, and the primary driver for that is the ethical, transparent, and fair banking that customers believe Islamic banking offers.

Mashreq in the UAE operates an Islamic banking window. Our advanced digital capabilities have set a benchmark in the global Islamic banking industry, and we are excited to bring the same level of excellence to our operations in Pakistan.

We are poised to be an Islamic-first digital bank in the country, bringing a truly end-to-end pure Islamic digital banking experience to Pakistan that is easy, transparent and accessible for all. For the first time, customers can open an Islamic banking account from anywhere in the country, within minutes, and manage their finances fully online without visiting a branch.

E: What about your strategy from an operational perspective — what products and services do you plan to focus on in the first few years of operations?

MS: As an international digital leader, we are committed to bringing in several of our global award-winning, pioneering digital-first solutions like Mashreq NEO, NEOBiz, and NEO NXT. Mashreq NEO was the first in the UAE to provide access to international markets for investments, including foreign equities, gold trading and foreign currency accounts. Today, NEO has expanded its presence beyond UAE, to Egypt and now to Pakistan — giving Pakistanis, for the first time, access to a full-service and fully digital banking platform.

We also envision integrating Mashreq NEO NXT into our offerings to cater to the youth’s digital fluency. Mashreq NEO NXT offers a seamless, mobile-first experience with engaging, age-appropriate financial literacy tools for Generation NXT (ages 8-18).

Our ultimate goal is to build trust in our bank in a country where people currently think of digital as a ‘wallet’ — they think digital banking is for small payments and real banking happens in branches. So, when we launch commercially, we aim to launch as a bank rather than as a digital bank, so we can build that holistic understanding and trust in our brand.

One of the top priority areas is home remittances. Pakistan saw USD 30.3 bn in remittances in FY2024 alone, and that’s forecast to jump to USD 35 bn in FY2025. Despite this, the process of getting remittances in the country is still inconvenient — a significant percentage of remittances are received over-the-counter.

We are very well-placed given our presence in the UAE, which is the second largest remittance corridor for Pakistan, with close to USD 6 bn in remittances last year, of which Mashreq contributes to around 7.3% of volumes. We are also present in all the major international hubs where Pakistanis are present, and we are launching some unique remittance products and services that do not exist in the country today.

The second is a focus on small and medium enterprises. Full-service digital banks focused on SMEs are not as common as they should be. When small and medium enterprises adopt digital banking, their business grows, they are able to engage in more B2B and B2C flows, and they participate in the economy by creating more jobs.

SMEs today in Pakistan are highly underserved. They can only open their banking relationship in the branch, and there is no digital onboarding offered by banks. There is also no digital channel; banks give them access to an individual banking app, and they are given complex corporate and large enterprise banking portals. Mashreq is bringing a dedicated new business SME banking platform to the country backed by the knowledge and success it has witnessed in the UAE.

In the UAE, Mashreq is also piloting several SME-focused initiatives, including unsecured lending, soft tokens, and expanded trade financing solutions through its full-service SME digital banking proposition, Mashreq NEOBiz. Following piloting and regulatory approvals, we are preparing to launch NEOBiz in Egypt this year. Pakistan will follow closely.

Emirates REIT’s 1Q net income surges 6x on revaluation gains

Emirates REIT’s net income for 1Q 2025 rose to USD 149.7 mn — more than 6x higher than the same period last year — driven by an unrealized valuation gain of USD 148.6 mn, according to a quarterly factsheet (pdf) published by the trust’s manager Equitativa. The increase reflects stronger portfolio valuations despite the loss of income from two asset disposals in 2024.

Total property income held firm at USD 19.2 mn, down just 2.5% y-o-y, as higher rental rates and stronger occupancy helped offset the impact of divestments. Portfolio occupancy climbed to 95%, up 6% y-o-y.

The trust made progress on reducing its leverage position, cutting its financing-to-value ratio to 20%, down from 41% a year earlier, following substantial loan repayments. Net asset value rose 64% y-o-y to USD 857.9 mn, or USD 2.69 per share — a new record for the REIT.

REFRESHER- In 2024, Emirates REIT divested Trident Grand Mall and Office Park, optimizing its capital structure and generating USD 54 mn in net gains. Proceeds from the sales contributed to sukuk repayments, including redemptions of USD 19.3 mn in August and USD 105 mn in October. The REIT issued a new USD 205 mn senior secured sukuk in December to fully refinance its existing facility, supporting its broader deleveraging strategy.

UAE names Saeed Al Hajeri as chair of Emirates Drug Establishment

The cabinet has named Saeed Al Hajeri (LinkedIn) as chairman of Emirates Drug Establishment’s board of directors, state news agency Wam reports. Currently the Assistant Minister for Economic and Trade Affairs, Al Hajeri was previously executive director of the Abu Dhabi Investment Authority (ADIA) and was also chairman of Salama Ins. Company’s board of directors as well as Abu Dhabi Commercial Bank’s board. He also serves as the UAE’s sherpa to Brics.

What’s pushing people (and crypto firms) to Dubai, according to experts

Crypto firms pivot to Dubai as Singapore tightens rules: Dubai and Hong Kong are emerging as key landing spots for crypto exchanges facing a clampdown in Singapore, after the Monetary Authority of Singapore (MAS) ordered unlicensed offshore-facing platforms to shut by 30 June, the Financial Times reports. The move has pushed major players like Bitget and Bybit to consider shifting staff and operations to more crypto-friendly jurisdictions.

MAS’ rationale: Platforms that only serve non-residents are harder to supervise and pose higher anti-money laundering risks. The bar for licensing such exchanges remains deliberately high, according to MAS, which said it would generally avoid granting them.

Dubai’s property market is also back in the international spotlight, after haus & haus Sales Director Clementine Munro told Bloomberg (watch, runtime: 03:19) that the city is a safe haven amid regional tensions. “When there is geopolitical instability in the region, it only makes Dubai look safer,” Munro said, noting a surge in short-term rental demand from Iranians after recent unrest. Munro’s observation echoed in earlier Bloomberg coverage, which highlighted how business activity, markets, and investor sentiment quickly rebounded despite the Iran-Israel flare-up.

The emirate is also a relative bargain: “It’s almost 4x cheaper to live in Dubai than it is in London,” she added, citing an average price of USD 418 per sq ft, versus USD 1.4k in London and nearly USD 1.7k in New York. The UAE is increasingly attracting high-net-worth individuals (HNWIs), particularly British m’naires, amid a record outflow from the UK driven by changes to the non-domicile regime. A net 9.8k HNWIs are expected to move into the UAE in 2025 — the largest inflow globally.

Global South Utilities plans 250 MW renewables projects in Madagascar

RENEWABLES-

UAE firm to boost Madagascar renewables: UAE-based Global South Utilities has inked two agreements with Madagascar’s Energy and Hydrocarbons Ministry to support Madagascar’s renewable energy transition, state news agency Wam reports. The island nation had previously said it is looking to bring in Emirati investments in the energy sector.

The details: The first agreement will see GSU develop a 50 MW solar plant with 25 MWh of battery storage capacity in the city of Moramanga, paving the way for a power purchase agreement with state-owned Madagascan utilities firm Jirama. The project is slated for completion within 12 months. The second agreement outlines joint plans to develop a wider pipeline of renewable projects with a combined capacity of up to 250 MW, pending feasibility assessments.

CAPITAL MARKETS-

#1- Pimco launches two DIFC feeder funds via Aditum: Global fixed-income investment firm Pimco partnered with Dubai International Financial Center (DIFC)-based asset manager Aditum Investment Management to launch two locally-registered feeder funds for UAE wealth investors, according to a press release. The feeder funds — the Pimco GIS Income Fund and Pimco Balanced Income and Growth Fund — are structured under Aditum’s Global Access ICC platform and registered with the Dubai Financial Services Authority (DFSA), according to another statement. The launch comes after Pimco opened its first regional office in Dubai in February.

Uh, Enterprise, what are feeder funds? Domestic feeder funds — sub-funds that channel capital into larger offshore master funds — are a vehicle through which retail investors can access global strategies that would otherwise be out of reach.

REFRESHER- The UAE has seen a wave of feeder fund launches since the Securities and Commodities Authority banned foreign-domiciled funds from being publicly offered to retail investors in April 2024. Franklin Templeton has since launched eight DIFC-based feeder funds, while in ADGM, Varys Capital partnered with UAE-based FundRock to manage a feeder fund focused on early-stage blockchain and Web3 investments.

#2- ASB launches second global sukuk fund, this time with Arqaam: Al Salam Bank-backed asset manager ASB Capital has launched the ASB Global Sukuk Fund in partnership with Dubai-based investment bank Arqaam Capital, according to a press release. Domiciled in the DIFC and regulated by the DFSA, the fund will invest in a diversified portfolio of sukuk securities with an average investment-grade credit rating. It is open to institutional investors, family offices, insurers, and high-net-worth individuals, and is benchmarked against the Dow Jones Sukuk Index.

ICYMI- The firm, which entered the market in February with USD 4.5 bn in assets under management, partnered with State Street Global Advisors (SSGA) in April to roll out a DIFC-based Shariah-compliant global equity fund benchmarked to the Dow Jones Islamic World Index and managed by SSGA’s active fundamental equity team.

CONSTRUCTION-

#1- AED 100 mn contract awarded for Ras Al Khor eco project: Dubai Municipality has awarded a AED 100 mn contract for the first phase of its redevelopment of Ras Al Khor Wildlife Sanctuary, according to Dubai Media Office. This marks the first phase of the two phase AED 650 mn project, which aims to transform the protected wetlands into a major eco-tourism destination.

The first phase, covering 6.4 sq km of land and set to be completed by the end of next year, will increase water bodies area by 144%, create new irrigation channels, and rehabilitate mangrove forests. The mangroves, along with salt flats, are expected to boost carbon dioxide absorption by 60%.

Next up: Phase two will add a visitor center, birdwatching towers, and eco-themed commercial facilities, along with 5.6 km of cycling tracks and 3 km of walking trails. Visitor numbers are forecast to increase sixfold to up to 300k annually once the project is completed.

#2-Palma taps APCC for piling works on AED 5 bn Serenia project: Real estate developer Palma Developments appointed homegrown APCC Piling & Marine Contracting to start shoring and piling works for part of its AED 5 bn Serenia District project in Jumeirah Islands, according to a press release. The firm will start work on the foundations for West Residence, the first residential tower within the wider 600k sq ft masterplan which is set to include six integrated towers in total and 3.5 mn sq ft of built-up area.

M&A-

ESG to acquire six towers in Al Reem Island for AED 120 mn: ADX-listed IHC subsidiary Emirates Stallions Group ’s (ESG) general assembly authorized the company — via one of its wholly owned subsidiaries — to purchase the Hydra Avenue project on Al Reem Island in Abu Dhabi for AED 120 mn, with additional financial obligations of AED 86 mn tied to the project, according to a disclosure (pdf). The project consists of six towers, which will be sold by Hydra Properties, which is currently under liquidation.

REAL ESTATE-

Another Dubai South development: Dubai South Properties has launched Hayat, a 10 mn sq ft luxury master-planned development in its Golf District near Al Maktoum International Airport, according to the Dubai Media Office. The project will feature around 2.5k residential units — ranging from townhouses to mansions — set within an integrated community also including parks, retail, and fitness facilities. The first phase is due for completion in 2Q 2028.

LOGISTICS-

#1-Singapore’s Singauto to set up shop in Abu Dhabi: Abu Dhabi’s Khalifa Economic Zones (Kezad Group) has inked a 50-year land lease agreement with Singapore-based tech innovator Singauto to set up a facility in Kezad Al Ma’mourah, according to a statement. Under the agreement, Singauto has earmarked AED 100 mn to build a 100k sqm facility to develop intelligent refrigerated vehicles, and in turn, expand local sustainable automotive industry capacity.

#2-Autoworld International invests AED 45 mn in Jafza hub: The UAE-based regional distributor for India’s Bajaj Auto, Autoworld International, is investing AED 45 mn to develop a new logistics and assembly center in Jebel Ali Freezone (Jafza), according to a press release. The facility will support the growing demand for fuel-efficient two- and three-wheelers across Africa and the Gulf, on the back of increased urbanization, and e-commerce and last-mile delivery activity.

Timeline and details: Built over 162k sq ft and slated to be completed before 2026, the site will include a Bajaj assembly plant, as well as warehousing and distribution for spare parts, tires, and lubricants.

#3- Amazon, 7X partner on hub use for faster delivery: Amazon UAE has partnered with 7X, the Dubai-based logistics-focused investment conglomerate behind EMX and Emirates Post, to boost delivery speed through the use of hyperlocal dark stores, according to a press release. Under the agreement, Amazon will use EMX’s hubs to deliver its products.

SOUND SMART- Hyperlocal dark stores are mini-warehouses located within urban areas that are solely designed to fulfill online orders.

USD bns of capital cross the Atlantic as investor confidence in the US wanes

Investors are increasingly diverting funds to Europe, viewing it as a more stable market amid the “absolute uncertainty” of US tariff policies and increased political intervention under President Donald Trump, Reuters reported yesterday, citing interviews with over a dozen executives and fund managers. Investors are being pushed from the US by fears that Trump’s tariff policies and tax cuts will harm corporate earnings, increase inflation, and widen the budget deficit. Meanwhile, Europe is pulling investors in with a new era of fiscal stimulus marked by increased government spending on defense and infrastructure — especially Germany — and aggressive interest rate cuts from the European Central Bank (ECB).

By the numbers: So far this year, investors have poured over USD 100 bn into European equity funds — a threefold y-o-y increase — while US funds recorded outflows of USD 87 bn, according to LSEG data. This shift is echoed in Germany, Europe’s largest economy, where foreign direct investment has more than doubled to EUR 46 bn over January-April 2025, reaching its highest level since 2022, according to Bundesbank data.

Investors’ rising appetite for European markets comes as a 9 July deadline approaches for a potential trade agreement between Washington and Brussels, with Trump threatening to impose 50% tariffs on all EU goods if no agreement is reached.

Ending a decade of underperformance, European markets dramatically outpaced the US in 1H 2025, with the pan-European Stoxx 600 index’s returns hitting 16% — outperforming “US peers by the biggest margin on record in USD terms during the first half,” Bloomberg reports. The EUR gained 13% y-o-y against the USD in 1H and is forecasted to reach USD 1.20 by year-end, up from USD 1.04 in 2024.

Investors are now overweight European equities (net 34%) and underweight US stocks (net 36%), a Bank of America survey shows. Meanwhile, European equity funds have seen a USD 46 bn inflow so far this year, compared to a USD 66 bn outflow last year. For fixed income, European bond funds have attracted over USD 42 bn, far outpacing the USD 5.6 bn flowing into US funds.

Despite the rally, European stocks remain attractively valued, trading at a 35% markdown to their US peers. They also offer higher dividends and comparable buyback yields, which Goldman Sachs’ Peter Oppenheimer expects to gain momentum. “While [earnings] growth in Europe may not be as strong as in the US, the valuation gap remains very big,” he said.

Analysts are split on Europe’s long-term outlook, with some cautioning that Europe’s prospectus window is temporary, with KfW’s Stefan Wintels warning, “This sentiment can quickly turn again.” A potential US rebound hinges on tech strength and Fed rate cuts, though structural changes in Europe’s fiscal policy provide a compelling long-term growth story.

Others see a more permanent shift, with UBS forecasting a EUR 1.2 tn (USD 1.4 tn) of capital rotation to European equities from the US in the next five years.

Not all sunshine and rainbows in the Eurozone: Despite rate cuts by the ECB, lending growth to Eurozone businesses stalled at 2.5% in May from 2.6% in April, as trade uncertainty and weak economic growth weighed on investment, Reuters reports, citing ECB data. The monthly flow of new business loans turned negative for the first time in over a year. While household lending growth edged up slightly to 2.0%, the M3 money supply indicator held steady at 3.9%, signaling a continued but anemic economic activity dominated by uncertainty.

MARKETS THIS MORNING-

Asia-Pacific markets are looking like a mixed bag in early trading today. Investors are once again fretting over US President Donald Trump’s tariff policies as a 90-day pause on higher tariffs — which came into effect in April to grant time for negotiations — is scheduled to expire next week, according to CNBC. Japan’s Nikkei and the Hang Seng Index are both in the red, while South Korea’s Kospi and China’s Shanghai index are each trading up so far. Meanwhile on Wall Street, futures suggest that markets will open just barely in the green.

ADX	9,958	+0.7% (YTD: +5.7%)
DFM	5,706	+0.4% (YTD: +10.6%)
Nasdaq Dubai UAE20	4,707	+0.9% (YTD: +13.0%)
USD : AED CBUAE	Buy 3.67	Sell 3.67
EIBOR	4.3% o/n	4.1% 1 yr
TASI	11,190	-0.1% (YTD: -7.2%)
EGX30	32,858	-1.1% (YTD: +10.5%)
S&P 500	6,205	+0.5% (YTD: +5.5%)
FTSE 100	8,761	-0.4% (YTD: +7.2%)
Euro Stoxx 50	5,303	-0.4% (YTD: +8.3%)
Brent crude	USD 67.61	-0.2%
Natural gas (Nymex)	USD 3.46	0.0%
Gold	USD 3,316	+0.2%
BTC	USD 107,282	-0.7% (YTD: +14.6%)
Chimera JP Morgan UAE Bond UCITS ETF	AED 3.59	-0.3% (YTD: +0.7%)
S&P MENA Bond & Sukuk	145.29	-0.1% (YTD: +3.8%)
VIX (Volatility Index)	16.73	+2.5% (YTD: -3.6%)

THE CLOSING BELL-

The DFM rose 0.4% yesterday on turnover of AED 1.1 bn. The index is up 10.6% YTD.

In the green: United Foods Company (+14.8%), National General Ins. Company (+12.5%) and Amanat Holdings (+5.7%).

In the red: Agility The Public Warehousing Company (-4.1%), Chimera S&P UAE Shariah ETF (-2.2%) and Emirates Central Cooling Systems Corporation (-1.8%).

Over on the ADX, the index rose 0.7% on turnover of AED 2.4 bn. Meanwhile, Nasdaq Dubai was up 0.9%.

UAE, Ecuador expand economic ties

UAE, Ecuador talk cooperation: A delegation led by the UAE’s AI Minister Omar Sultan Al Olama met with Ecuador’s President Daniel Noboa and top ministers in Quito, Ecuador to deepen ties across trade, technology, and investment, state news agency Wam reports. The visit saw the launch of the UAE-Ecuador Economic and Business Forum and the formation of the UAE-Ecuador Parliamentary Friendship Group to boost bilateral cooperation. The delegation held sector-specific talks with over 15 Ecuadorian ministers spanning finance, telecoms, energy, production, tourism, housing, and education.

CALENDAR

JULY

6-7 July (Sunday-Monday): BRICS Summit, Rio de Janeiro.

29-30 July (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

SEPTEMBER

1-6 September (Monday-Saturday): Dubai Fashion Week, Dubai Design District.

8-10 September (Monday-Wednesday): DigiHealth exhibition, World Trade Center, Dubai.

8-19 September (Monday-Wednesday): WHX-Tech Expo, Dubai World Trade Centre.

10-11 September (Wednesday-Thursday): Mena Public-Private Partnership Forum ,Dubai.

12-14 September (Friday-Sunday): The International Real Estate and Investment Show, Abu Dhabi.

16-17 September (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

24-25 September (Wednesday-Thursday): The KT UniExpo, The H Dubai.

24-25 September (Wednesday-Thursday): Mohammed Bin Rashid Leadership Forum, Mohammed Bin Rashid Center for Leadership Development, Dubai.

24-25 September (Wednesday-Thursday): Dubai World Congress for Self-Driving Transport, Dubai.

OCTOBER

1-2 October (Thursday-Friday):World Green Economy Summit (WGES), Dubai World Trade Centre.

30 September – 2 October (Tuesday-Thursday): The Water, Energy, Technology, and Environment Exhibition (WETEX), Dubai World Trade Centre.

3-16 October (Friday-Thursday): Dubai Home Festival.

7-9 October (Tuesday-Thursday): The International Symposium on the System of Radiological Protection, the Ritz-Carlton Abu Dhabi, Grand Canal.

9 October (Thursday): Family Office Summit, Park Hyatt, Dubai.

9-15 October (Thursday-Wednesday): IUCN World Conservation Congress, Abu Dhabi.

14-16 October (Wednesday-Friday): Global Future Councils, Dubai.

22-24 October (Wednesday-Friday): World Investment Conference, Expo Centre Sharjah.

27-29 October (Monday-Wednesday): Future Hospitality Summit, Madinat Jumeirah, Dubai.

27-29 October (Monday-Wednesday): Asia Pacific Cities Summit, Dubai Exhibition Center.

28-29 October (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

NOVEMBER

11-17 November (Tuesday-Monday): International Council of Museums (ICOM) General Conference, Dubai

12-17 November (Wednesday-Monday): RoboCup Asia-Pacific, Khalifa University, Abu Dhabi.

15-17 November (Saturday-Monday): Myplant & Garden Middle East Green Expo, Dubai Exhibition Centre, Expo City.

17-21 November (Monday-Friday): Dubai Airshow 2025, Al Maktoum International Airport, Dubai.

18-19 November (Tuesday-Wednesday): Dubai Future Forum, Museum of the Future, Dubai.

DECEMBER

1-3 December (Monday-Wednesday): Eid Al Etihad (UAE National Day).

1-5 December (Monday-Friday): The World Congress of Neurosurgery, Dubai World Trade Center.

7-14 December (Sunday-Sunday): Asian Youth Para Games, APC headquarters, Dubai.

8-9 December (Monday-Tuesday): BTC Mena Conference, Adnec, Abu Dhabi.

8-10 December (Monday-Wednesday): BRIDGE media summit, Abu Dhabi.

9-10 December (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

18-23 December (Thursday-Tuesday): Games of the Future, Adnec, Abu Dhabi.

29-30 December (Monday-Tuesday): World Sports Summit, Dubai.

Signposted to happen sometime in 2025:

The Middle East Electric Vehicle Show, Expo Center Sharjah.
e& will complete Adnoc’s private 5G network.
Executive Committee Meeting (EXCOM 2025) conference of the World Smart Sustainable Cities Organisation (WeGO)
The International Civil Aviation Organization’s Global Implementation Support Symposium, Abu Dhabi.
Universal Postal Congress 2025, Dubai.

Signposted to happen sometime in 2H 2025:

Closing of XRG’s acquisition of Covestro

Signposted to happen sometime in 2026:

1 January: Client asset regime changes in Dubai International Financial Center take effect.
9-11 January (Friday-Sunday): 1 Bn Followers Summit’s fourth edition, UAE.
28-29 January (Wednesday-Thursday): IBA Arbitration Day Conference, Abu Dhabi.
3-5 February (Tuesday-Thursday): The World Governments Summit.
12-15 February (Thursday-Sunday): The Society for Incentive Travel Excellence Global Conference, Abu Dhabi.
11-13 May (Monday-Wednesday): AI Everything Global, Adnec Center.
The UAE to host the Arab Competition Forum
Dubai to host the Arab Actuarial Conference
United Nations Water Conference 2026, UAE
The first edition of Dubai Future Finance Week
Investopia Global Talks, Tashkent

Signposted to happen sometime in October 2026:

Abu Dhabi Space Week, Abu Dhabi.

Signposted to happen sometime in 2027:

Abu Dhabi’s solar and battery energy facility, combining 5.2 GW of solar capacity and 19 GWh of battery storage, is set for commissioning.

Signposted to happen sometime between 2027 and 2029:

Sibos 2029 organized by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), Dubai.
The commissioning of the seventh phase of Mohammed bin Rashid Al Maktoum Solar Park.

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