The Daily Circuit
đź‘‹ Hello from the Middle East!
Today in The Daily Circuit, we’re looking at the Gulf’s new role in the energy transition, the Dolce & Gabbana flagship boutique in Via Riyadh, a turnaround for Oman Air and strong March figures for venture capital investing in MENA. But first, why Dubai real estate is the latest entrant in the region’s “localization” push.   Â
Emiratis will not be left out of the real estate boom underway in Dubai under new localization rules rolled out over the weekend. A tie-up with nine of the UAE’s biggest property developers — including Emaar, Deyaar, and Sobha Realty — and the Dubai Land Department will seek to have 10 to 15% of units sold by Emirati brokers. The next phase of the program will look to establish partnerships with developers and real estate brokers so that more Emiratis can qualify to work in the property sector, according to the land regulatory agency.
The push to increase the employment of citizens in the private sector is a delicate balance in the GCC region, where expat workers are heavily relied upon and nearly 90% of non-government entities are small-to-medium sized. Governments have been taking incremental steps to support “localization” efforts including quotas, incentives for firms that comply and hefty fines for those that don’t. Saudi Arabia’s Ministry of Human Resources has set a target of employing 30% Saudis in the private sector by 2025 and is on track with 23% as of the first quarter of 2022. Oman has set a 40% target under its Vision 2040 economic diversification plan, and was at the halfway point in 2021.
The UAE expanded the scope of its “Emiratization” push at the start of the year – prompting the more than 12,000 companies in the country with 20 to 49 employees to employ at least one UAE citizen in 2024 and a second in 2025. Companies with 50 or more employees are required to achieve a 2% annual growth in Emiratization.
đź“° Developing Stories
DIGGING IN
Gulf countries are making massive investments in mineral mining as Saudi Arabia, the UAE, Qatar and Oman vie to tap into the resources needed for the clean energy transition both at home and abroad, the Financial Times reports. Saudi Arabia estimates $2.5 trillion worth of domestic mineral assets are beneath the kingdom, and wants mining to contribute $75 billion to its economy by 2035, up from $17 billion. The Public Investment Fund’s mining company, Ma’aden, is spearheading the largest mineral exploration project in the world. Oman has broken ground on what may be the world’s largest green steel plant that plans to use iron ore from Cameroon. Meanwhile, the Qatar Investment Authority is now Swiss commodities giant Glencore’s second-biggest shareholder.
SAUDI COUTURE
Dolce & Gabbana was among the first fashion houses to bring international couture culture to Saudi Arabia when it presented its Alta Moda collection in 2022 on a catwalk installed in the ancient desert city of AlUla. Now, the Italian brand is setting up a flagship store in the Saudi capital at the Via Riyadh luxury shopping center. D&G is also entering a formal partnership with Diriyah Co., the state-owned company managing the restoration of the capital’s historic Diriyah section, where it plans to open a 2,000-square-meter immersive space in the Bujairi Terrace restaurant district. “For years, we have been present in this country, initially approaching the market with caution and respect, deepening our understanding of its history and social aspects,” Dolce & Gabbana CEO Alfonso Dolce told Vogue Business.
đź’˛ Sovereign Circuit
Mubadala: Shein, the Chinese-Singaporean fast-fashion retailer that is backed by the Abu Dhabi sovereign wealth fund, doubled its profit in 2023 to more than $2 billion as it awaits regulatory approval for an IPO either in New York or London, the Financial Times reports.
Abu Dhabi Investment Authority: An investors group led by private equity firm PAG, which includes ADIA and Mubadala, announced it would invest $8.3 billion for a 60% stake in Chinese property company’s Dalian Wanda’s mall unit.
ADQ: The sovereign wealth fund and AD Ports are providing support for the installation of so-called Eco Sea Walls Panels – invented by the firm Archireef – at Abu Dhabi’s Al Aliah Ferry Terminal and Saadiyat Marina, with the objective of attracting marine biodiversity back to shorelines that have undergone construction work.
Public Investment Fund: Saudi Arabian Information Technology Company (SITE), a PIF-owned company, has agreed to establish a joint venture with South Korean information security solutions company AhnLab Inc. to deliver security solutions to public institutions and businesses in the kingdom.
↪↩ Closing Circuit
đź’¸ Up and Up: Startups in the MENA region raised $254 million in March across 54 deals, up 186% from February, according to new data from Wamda.
🛫 Turning Around: Oman Air reported a 30% revenue increase and a 36% narrowing of its net loss for 2023, which the company attributed to cost cuts including dropping sponsorship of soccer team Chelsea FC.
⚡ Battery Plant: BTR New Material Group, a Chinese maker of electric vehicle batteries, plans to build a $300 million factory in Morocco to produce cathode components.
🌀 Wind Power: Saudi energy company ACWA Power signed a $263 million power purchase agreement with Uzbekistan’s National Electric Grid for the Nukus2 200-megawatt wind project.
🏝️ Tourism Boom: Annual spending by tourists in Saudi Arabia rose 38% in 2023 to a record high of $40 billion, according to the Saudi Central Bank.
đź—Ł Circuit Chatter
🛢️ Oil Shift: U.S. oil exports are setting records as OPEC+ supply curbs and international sanctions against Russian and Venezuelan companies provide opportunities for American firms to take a greater market share, Bloomberg reports.
🇸🇦 Planting Roots: More than a quarter of Saudi-based expats would like to buy a home in NEOM, according to global property consultancy Knight Frank’s inaugural Destination Saudi report.
✨ Looking Up: S&P Global Ratings revised its outlook on Morocco’s economic prospects from stable to positive, while maintaining the country’s credit rating at BB+/B
â›˝ Gas Expansion: QatarEnergy chartered 19 more LNG carriers from Asian shipyards as part of a massive expansion as it extends gas extraction at its North Field.
🛫Full flight: Bahrain wants to become one of the top 20 countries in logistics under a blueprint that will increase the flow of air freight to 1million metric tonnes.
🌇 Hub Landing: The first Etihad Airways flight to Boston landed on Sunday as the Abu Dhabi carrier began a new route serving its fourth U.S. city, The National reports.
🌍 Power Circuit
Sheikh Mohammed bin Rashid, UAE Prime Minister and Ruler of Dubai, attended the 28th Dubai World Cup of horse racing on Saturday at the Meydan Racecourse.
Sheikh Hamdan bin Zayed, a member of the Abu Dhabi royal family and the Ruler’s Representative in the emirate’s Al Dhafra region, visited ADNOC’s Bu Hasa oil field for an inspection tour on Saturday.
âžż On the Circuit
Waleed Al Bader stepped down as CEO of state-owned Kuwait Integrated Petroleum Industries Co. after starting the job in 2021. No replacement has been named yet.
Nora Alsarhan has been appointed Deputy CEO of the Saudi-backed venture capital fund SVC. She will continue in her role as Chief Investment Officer.
Professor Timothy Baldwin has been appointed as the Provost of the Mohamed bin Zayed University of Artificial Intelligence (MBZUAI) in Abu Dhabi. Baldwin, who has been at the university for two years, had been serving as Acting Provost.
Mashael Al Mubarak, a leader in the field of voluntary work and community service in Saudi Arabia who played a key role in fostering a culture of volunteerism in the kingdom, passed away on Saturday.Â
Gerry Cardinale, founder of RedBird Capital, is the subject of a profile in Fortune about his ambitions for Italian soccer team AC Milan.
🎶 Culture Circuit
🌙 Holiday Time: Public sector workers in the UAE will have a week-long holiday, from April 8 to 14, to mark Eid Al Fitr, with work resuming on Monday, April 15, the UAE Media Office has announced. Private sector holiday dates are still to be announced, but tend to align with the public sector.
đź“· Photo of The Day
đź“… Circuit Calendar
April 8-10, Tel Aviv, Israel: Cybertech Global Tel Aviv. Investors, executives and government officials gather to discuss the future of the cybersecurity industry. Expo Tel Aviv.
Apr. 9, New York: The Information’s Private Capital Conference. An exclusive event for subscribers to join Founder and CEO Jessica Lessin and The Information’s reporters to discuss the future of technology and investing. New York Stock Exchange.
April 10-12, Tel Aviv, Israel: Tel Aviv Sparks Innovation Summit. Showcase for Israeli tech startups. Expo Tel Aviv.
Apr. 16-17, Abu Dhabi, UAE. Green Hydrogen Summit 2024. Bringing together experts, policymakers, and industry leaders to explore opportunities and the industry’s future. Abu Dhabi National Exhibition Center.
Apr. 16-18, Abu Dhabi, UAE: World Future Energy Summit 2024. A platform to showcase the solutions to some of the most critical challenges identified at COP28. Abu Dhabi National Exhibition Center.
Apr. 16-18, Dubai, UAE. Middle East Energy. Energy leaders gather to debate and shape the future. Dubai World Trade Center.
Apr. 23-25, Dubai, UAE: GISEC Global. A forum for furthering the key discussions that are helping to define cyber resilience and connecting the global cybersecurity community. Dubai World Trade Center.
Apr. 25-26, Abu Dhabi, UAE: DriftX. An event for smart, autonomous and sustainable urban mobility across air, land, and sea organized in partnership with the Abu Dhabi Investment Office, Abu Dhabi’s Smart and Autonomous Vehicles Industry (SAVI) cluster and Bayanat. Yas Marina.
Apr. 28-29, Riyadh, Saudi Arabia: World Economic Forum Special Meeting. A gathering of investors, politicians and experts on topics of collaboration, growth and energy for economic development. TBC.
Apr. 29-May 1, Riyadh, Saudi Arabia: Future Hospitality Summit. An international gathering hosted in cities around the world bringing together the most influential hospitality investors and developers. Mandarin Oriental Al Faisaliah.
Apr. 29 – May 5, Abu Dhabi, UAE: Abu Dhabi International Book Fair. A key event for the publishing industry in the Middle East and North Africa. Abu Dhabi National Exhibition Center.
Apr. 30-May 1, Abu Dhabi, UAE: Mobility Live. A conference and exhibition sponsored by the Abu Dhabi transport regulators, gathering disruptive technology developers in transportation and the public sector. Abu Dhabi National Exhibition Center.
Apr. 30-May 1, Abu Dhabi, UAE: Middle East Rail. The leading conference in the region for rail innovation, technology and strategy. Abu Dhabi National Exhibition Center.
May 13-15, Abu Dhabi, UAE: Abu Dhabi Global Healthcare Week. A conference focusing on investments, and innovation to solve the most important global health challenges. Abu Dhabi National Exhibition Center and Abu Dhabi City.
May. 14-16, Doha, Qatar: Qatar Economic Forum, Powered by Bloomberg. A news-driven event dedicated to global business and investment. This year’s theme is “A World Remade: Navigating the Year of Uncertainty.” Request your invite here. Fairmont & Raffles, Doha.
May 29-31, Marrakech, Morocco: GITEX Africa. The second edition of the biggest tech and startup gathering in Africa. Place Bab Jdid.