Borrowing in the Middle East and North Africa will decline by 6 per cent to $181 billion in 2018 as fiscal consolidation and higher oil prices decrease the need for tapping debt, S&P Global Ratings said in a report.
The expected decline in borrowing follows a 30 per cent dip in 2017.
"The decline will result from fiscal consolidation measures across the GCC and the uptick in oil prices which will likely push down net-oil-exporting governments' financing needs," said the report, authored by Dubai-based S&P analysts Trevor Cullinan and Shokrukh Temurov.
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About 40 per cent of the $181bn that will be borrowed by Mena sovereigns in 2018 will go towards refinancing maturing long-term debt. The share of debt from countries with the highest credit rating in the region - Abu Dhabi, Kuwait and Qatar - which all have AA ratings, will make up 19 per cent of total debt, up from 16 per cent in 2017. Saudi Arabia and Ras Al Khaimah, which both have an A rating, are expected to account for 20 per cent of the total debt, S&P said.
Issuers in the region, especially from the GCC, went on a bond-selling spree in the aftermath of the 2014 oil crash. Governments in the oil-rich Arabian Gulf had not tapped the bond market in any significant way until 2016. Most countries in the region had maintained budget surpluses before the crash in the price of oil price crash began in the summer of 2014, which led to more than a 60 per cent price plunge.
That drop in the value of crude oil, the lifeline for many countries in the region, changed the equation, leading to a record year for regional bond issues in 2016 with over $60bn worth of fixed income sold. Governments also used the cash to pump money into the banking system to reinvigorate the local lending market and to help diversify economies.
However, governments have been able to decrease reliance on borrowing to plug deficits through a series of measures, such as reducing energy subsidies and the introduction of a 5 per cent VAT in Saudi Arabia and the UAE.
"In recent years, GCC sovereigns have implemented fiscal consolidation measures to cut government spending and increase non-oil government revenues," the report said.
"We expect regional fiscal deficits to moderate as a result, while the modest recovery in oil prices of late should boost non-oil revenues."
Brent crude oil has gained 0.7 per cent this year after rallying 17 per cent last year.
Egypt has the biggest current outstanding debt of with $46.4bn, or 26 per cent of the region's gross commercial long-term borrowing, followed by Iraq with $35bn or 19 per cent of the total, and Saudi Arabia with $31bn or 17 per cent.
S&P said the estimates for the borrowing needs of the 13 Mena sovereigns focuses on debt issued by a central government in its own name, but excludes local government and social security debt as well as the debt of other public entities and government-guaranteed obligations.
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
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About Proto21
Date started: May 2018
Founder: Pir Arkam
Based: Dubai
Sector: Additive manufacturing (aka, 3D printing)
Staff: 18
Funding: Invested, supported and partnered by Joseph Group
PREMIER LEAGUE FIXTURES
Saturday (UAE kick-off times)
Watford v Leicester City (3.30pm)
Brighton v Arsenal (6pm)
West Ham v Wolves (8.30pm)
Bournemouth v Crystal Palace (10.45pm)
Sunday
Newcastle United v Sheffield United (5pm)
Aston Villa v Chelsea (7.15pm)
Everton v Liverpool (10pm)
Monday
Manchester City v Burnley (11pm)
Final scores
18 under: Tyrrell Hatton (ENG)
- 14: Jason Scrivener (AUS)
-13: Rory McIlroy (NIR)
-12: Rafa Cabrera Bello (ESP)
-11: David Lipsky (USA), Marc Warren (SCO)
-10: Tommy Fleetwood (ENG), Chris Paisley (ENG), Matt Wallace (ENG), Fabrizio Zanotti (PAR)
What went into the film
25 visual effects (VFX) studios
2,150 VFX shots in a film with 2,500 shots
1,000 VFX artists
3,000 technicians
10 Concept artists, 25 3D designers
New sound technology, named 4D SRL
More on Quran memorisation:
Profile of Tamatem
Date started: March 2013
Founder: Hussam Hammo
Based: Amman, Jordan
Employees: 55
Funding: $6m
Funders: Wamda Capital, Modern Electronics (part of Al Falaisah Group) and North Base Media
What can you do?
Document everything immediately; including dates, times, locations and witnesses
Seek professional advice from a legal expert
You can report an incident to HR or an immediate supervisor
You can use the Ministry of Human Resources and Emiratisation’s dedicated hotline
In criminal cases, you can contact the police for additional support
The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
THE BIO:
Favourite holiday destination: Thailand. I go every year and I’m obsessed with the fitness camps there.
Favourite book: Born to Run by Christopher McDougall. It’s an amazing story about barefoot running.
Favourite film: A League of their Own. I used to love watching it in my granny’s house when I was seven.
Personal motto: Believe it and you can achieve it.
Match info
Manchester United 1 (Van de Beek 80') Crystal Palace 3 (Townsend 7', Zaha pen 74' & 85')
Man of the match Wilfried Zaha (Crystal Palace)
Financial considerations before buying a property
Buyers should try to pay as much in cash as possible for a property, limiting the mortgage value to as little as they can afford. This means they not only pay less in interest but their monthly costs are also reduced. Ideally, the monthly mortgage payment should not exceed 20 per cent of the purchaser’s total household income, says Carol Glynn, founder of Conscious Finance Coaching.
“If it’s a rental property, plan for the property to have periods when it does not have a tenant. Ensure you have enough cash set aside to pay the mortgage and other costs during these periods, ideally at least six months,” she says.
Also, shop around for the best mortgage interest rate. Understand the terms and conditions, especially what happens after any introductory periods, Ms Glynn adds.
Using a good mortgage broker is worth the investment to obtain the best rate available for a buyer’s needs and circumstances. A good mortgage broker will help the buyer understand the terms and conditions of the mortgage and make the purchasing process efficient and easier.
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How it works
Booklava works on a subscription model. On signing up you receive a free book as part of a 30-day-trial period, after which you pay US$9.99 (Dh36.70) per month to gain access to a library of books and discounts of up to 30 per cent on selected titles. You can cancel your subscription at any time. For more details go to www.booklava.com
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
