{"id":88092,"date":"2024-01-18T00:00:00","date_gmt":"2024-01-18T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/uae\/competition-credibility-diversification-are-key-to-pushing-through-global-fragmentation-ministers-say\/"},"modified":"2024-01-18T00:00:00","modified_gmt":"2024-01-18T00:00:00","slug":"competition-credibility-diversification-are-key-to-pushing-through-global-fragmentation-ministers-say","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/uae\/2024\/01\/18\/competition-credibility-diversification-are-key-to-pushing-through-global-fragmentation-ministers-say\/","title":{"rendered":"Competition, credibility, diversification are key to pushing through global \u201cfragmentation,\u201d ministers say"},"content":{"rendered":"

Good morning, friends<\/strong>, and welcome to a quiet morning on the business news front as attention remains squarely focused on Davos, where the World Economic Forum continues through tomorrow. <\/p>\n

<\/a> The big message from Emirati ministers on day four of Davos: \u201cCompetition, <\/strong>credibility, and diversification\u201d are key to weathering global \u201cfragmentation.\u201d<\/strong> Diversification of economies is an essential tool to navigate the recent series of political shocks, top Emirati officials yesterday.<\/p>\n

The messengers: <\/strong>Minister of State for Foreign Trade Thani Ahmed Al Zeyoudi<\/strong>, Minister of State for AI Omar Sultan Al Olama<\/strong>, and Economy Minister Abdulla bin Touq<\/strong> were speaking on a panel yesterday (watch, runtime 45:06<\/a>). The UAE\u2019s shift from relying primarily on oil revenues to broadening its revenue base and becoming a high-tech economy has helped improve its resilience to shocks and earned it the trust of global investors, the ministers said.<\/p>\n

Also in Davos: GCC officials <\/strong>predicted<\/a><\/strong> the Gulf\u2019s collective GDP to reach USD 3 tn <\/strong>by 2030 and USD 6 tn by 2050.<\/strong>Saudi Investment Minister Khalid Al Falih highlighted the importance of political stability and a supportive ecosystem, while other panelists discussed the pivotal role of public-private partnerships and technology, especially artificial intelligence, as the driving force behind the region's economic future.<\/p>\n

More from the forum: Jahiz makes top nine global initiatives in WEF report: <\/strong>The government\u2019s initiative Jahiz has been recognized among the top nine global projects in the WEF annual report, Building a Resilient Tomorrow, according to a statement<\/a>.Jahiz is a national digital platform equipping federal government workers with skills that will be needed in the future, such as data skills, artificial intelligence, and digital expertise. The WEF report recognized Jahiz as a model for cooperation between the government and private sectors in the UAE, emphasizing the importance of resilience in shaping the future.<\/p>\n

AND- <\/strong>Tighter <\/strong>oil market conditions are in the cards: <\/strong>Aramco CEO Amin Nasser sees global oil markets coping with Red Sea disruptions in the short run, but a prolonged disruption could translate into delayed delivery of supply to market on the bank of a shortage of tankers due to longer voyages, he told Reuters on the sidelines of the forum. \u201cIf it's in the short term, tankers might be available ... But if it's longer term, it might be a problem,\u201d he said, adding that \u201cThere will be a need for more tankers and they are going to have to take a longer journey.\u201d<\/p>\n

WATCH THIS SPACE-<\/p>\n

#1- <\/strong>DP World brushes off concerns of supply chain disruptions:<\/strong> Cargo delays affecting European companies due to Red Sea disruption are expected to be temporary as carriers and clients adjust logistics strategies to account for longer routes, DP World Group COO Tiemen Meester told Bloomberg<\/a>. \u201cThere is a temporary dent into this flow, but it will catch up,\u201d Meester said. Just-in-time retailers will have to account for 10 to 12 days of added inventory to keep on top of things, \u201cOnce they have that, the flow will continue,\u201d Meester explained.<\/p>\n

Still, costs will go up:<\/strong> The disruption will have a strong inflationary effect in Europe, DP World CFO Yuvraj Narayan told Reuters<\/a>. \u201cThe cost of goods into Europe from Asia will be significantly higher,\u201d Narayan said.<\/p>\n

The downside risk, in our view: <\/strong>A covid-like situation where shipping containers pile up in destination ports and are not efficiently recycled to new destinations is a clear possibility. Un-snarling that took months (and months), with heavy disruption to the flow of goods translating into shortages on shelves and spiraling prices to consumers and businesses alike. <\/p>\n

<\/a> #2-<\/strong>Oil stockpiles at Port Fujairah dipped for the second consecutive week to a three<\/strong> week low <\/strong>on the week ending 15 January, falling 1.2% w-o-w to 18 mn barrels, according to S&P Global<\/a>. Oil exports, excluding fuel oil, also fell 4.5% m-o-m, reaching 5.25 mn barrels per day in January. <\/p>\n

Behind the drop:<\/strong> The situation in the Red Sea has led to canceled orders, further affecting stockpile figures for low-sulfur fuel oil in particular, S&P Global cites shipowners as saying. <\/p>\n

<\/a> #3-<\/strong>Turkey is eyeing GCC investments in infrastructure megaprojects<\/strong>, with talkscurrently underway to sell a Turkish city hospital to an \u201cArab Gulf investor,\u201d with potentially more to follow, head of the State Investment Office, Ahmet Burak Daglioglu, told Bloomberg<\/a>. The hospital is one of 22 built with the purpose of consolidating smaller healthcare facilities in one location, he said. The investment would go through under a public-private partnership model, and could range from projects like highways to healthcare, Daglioglu said.<\/p>\n

REMEMBER-<\/strong> Last year, the UAE pledged<\/a> over AED 183 bn in investments to Turkish health and defense sectors.<\/p>\n

#<\/strong>4-<\/strong>Emaar is bidding for a EUR 5 bn skyscraper + rail link in Hungary: <\/strong>Real estatedeveloper Emaar launched a bid to construct Budapest's R\u00e1kosrendez\u0151 freight area, where they plan to build Hungary's tallest skyscraper, it said in a DFM disclosure<\/a> in response to a report by Hungary Today<\/a>. The developer would invest some EUR 5 bn in the area, which also involves a rail link project, Hungary Today reports, without providing more details for the timeline of the proposed project. <\/p>\n

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PUBLIC SERVICE ANNOUNCEMENT-<\/p>\n

MSMEs can manage their green credentials with the UAE-launched EcoMark <\/strong>Global Accreditation Initiative<\/strong>, Foreign Trade Minister Thani bin Ahmed Al Zeyoudi said in a post on X<\/a> after launching the tool at the World Economic Forum in Davos. The sustainability accreditation framework streamlines and unifies application processes and eligibility criteria to help MSMEs transition to net zero. It will be monitored by a central body in the UAE, Wam<\/a> reports. <\/p>\n

Eyeing EcoMark status? <\/strong>MSMEs can find document requirement guidelines and a roadmap for sustainability levels also via the platform.<\/p>\n

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HAPPENING TODAY-<\/p>\n

<\/a> Last day to catch <\/strong>Intersec 2024<\/a><\/strong>: <\/strong>The safety, security and fire protection exhibition, will conclude today at the Dubai World Trade Centre (DWTC).The event kicked off on Tuesday in Dubai, and features over 1k exhibitors from more than 60 countries who work in the fields of cybersecurity and safety and fire protection tech. <\/p>\n

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The roundup of news and trends that move your markets and shape corporate agendas delivered straight to your inbox.<\/p>\n

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DATA POINTS- <\/p>\n

#1- The <\/strong>Central Bank of the UAE<\/a><\/strong> processed AED 15.4 tn transactions during the first<\/strong>11 months of 2023<\/strong>through its Fund Transfer System (UAEFTS)<\/a>, marking a 35.4% y-o-y increase, Wam<\/a> reports. Interbank fund transfers conducted during the period amounted to AED 9.907 tn, while customer transfers stood at AED 5.543 tn.<\/p>\n

#2- The UAE's industrial sector contributed AED 197 bn to GDP in 2023<\/strong>, The National<\/a> reports. The UAE initiated Operation 300bn with the goal of becoming an industrial hub by 2031, and has covered 30% of its targets since its launch in 2021.The Industry Ministry reported a 17% increase in the country\u2019s industrial exports since the start of the program to AED 187 bn in 2023.<\/p>\n

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MARKET WATCH-<\/p>\n

The <\/strong>American Carbon Registry (ACR)<\/a><\/strong> listed its inaugural carbon credits on Abu <\/strong>Dhabi Global Market\u2019s <\/strong>ACX <\/strong>Carbon Market Board (ACX CMB)<\/strong>, according to a press release<\/a>. The listing will see ACR-standard Rebellion Energy Solution<\/a> \u2019s carbon credits trading on ACX CMB, the digital trading platform designed for over-the-counter carbon credit transactions, Rebellion said<\/a>.<\/p>\n

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THE BIG STORY ABROAD-<\/p>\n

It\u2019s a busy morning in business news<\/strong>, with three stories capturing the attention of journalists around the world. <\/p>\n

#1- Stocks and bonds retreated yesterday around the world. <\/strong>Investors are digesting signs that the United States, the European Union, and the UK will not move quickly to slash interest rates. European Central Bank Christine Lagarde set off the selldown as she joined peers around the world in signaling that rates are unlikely to start coming down until summertime, rather than this spring. <\/p>\n

Bankers speaking in Davos are singing from the same hymnal on that front<\/strong>, writes Bloomberg, noting, \u201cEveryone from JPMorgan\u2019s Daniel Pinto to Standard Chartered\u2019s Bill Winters to Cantor Fitzgerald\u2019s Howard Lutnick have said they expect monetary policy to ease slower than anticipated by the market.\u201d<\/p>\n

The result: The S&P 500, Nasdaq Composite, EuroStoxx 600 and FTSE 100 all fell <\/strong>yesterday<\/strong>, and Asian markets are mixed this morning. Futures suggest mixed openings for major European benchmarks later this morning and a weak open on Wall Street. Notably, Chinese shares are touching a five-year low. (Financial Times<\/a> | CNBC<\/a> | Bloomberg<\/a>)<\/p>\n

#2- Iran is opening fire on its neighbors, claiming to fight \u201canti-Iran terror groups\u201d:<\/strong> Iran has fired missiles and launched drones against targets in Syria, Iraq, and Pakistan in the span of 24 hours, openly claiming responsibility for the operations. It says the missile attacks underscore that it will be \u201ctough and decisive\u201d with its foes, the New York Times<\/a> reports.<\/p>\n

In other regional tensions: <\/strong>The US listed the Houthis as a terror group<\/a> on the same day that they hit another US-operated ship. <\/p>\n

#3- Samsung\u2019s new Galaxy S24 lineup looks set to be a hit <\/strong>thanks to heavy integration of generative AI tech and modest tweaks to its popular designs. The launch of the new handsets is all over the front pages of the global business press, but gadget nerds will want to start with the Verge\u2019s hands-on with the flagship S24 Ultra<\/a>. (FT<\/a> | CNBC<\/a> | Reuters<\/a>) <\/p>\n

Also:<\/strong><\/p>\n