The Daily Circuit: Emirati entrepreneurs eye Europe + Saudis build up debt

👋 Hello from the Middle East!

Today we’re looking at the economic burden of Saudi Arabia’s spending spree on NEOM and other megaprojects, the UAE’s effort to get dropped from the “gray list,” Turkey’s suspension of its bond sale to ADQ and the Israeli economy’s slowdown. But first, Emirati entrepreneurs see fertile new frontiers in Europe.

Emirati business owners are setting their sights beyond the Middle East and focusing overseas. In an HSBC study of multimillionaire entrepreneurs, the UAE ranked second after Hong Kong in ambition to expand internationally, with 86% of Emirati firms looking abroad.

First choice for foreign expansion among UAE business owners with assets of between $2 million and $20 million was Europe, the favored site for 55% of those surveyed. Next was the Middle East with 42%, North America at 32% and Asia at 23%.

“It is no surprise that entrepreneurs and family business owners based in the UAE have a global outlook,” Farzad Billimoria, HSBC’s Head of Global Private Banking for the Middle East, said in the bank’s report on the survey. “The country’s strategic location, pro-entrepreneurial policies, advanced infrastructure and market access encourages global outreach and expansion.”

Key factors in looking abroad for business were access to direct investments, real estate opportunities and operational efficiencies, the survey found. HSBC polled nearly 1,000 entrepreneurs across nine markets for the study, including the UAE, the U.S., the UK, India, Hong Kong and mainland China.

The subject of foreign expansion is bound to generate interest at next month’s Abu Dhabi Family Office Summit, one of the largest meetings in the Middle East of family businesses and investors, which starts March 1.

In Abu Dhabi, meanwhile, the emirate’s Competitiveness Office and Hub71 startup accelerator launched the Abu Dhabi Regulatory Sandbox Program on Monday, aimed at helping firms in healthtech, mobility, and agritech learn to innovate within the scope of government regulations.

Mubadala: Global Foundries, a Mubadala-backed chipmaker, won a $1.5 billion U.S. government grant aimed at bolstering the semiconductor industry.

Public Investment Fund: The Saudi sovereign wealth fund said it has acquired a 40% stake in Zamil Offshore Co., one of the country’s largest operators of maritime support vessels and services for offshore oil and gas platforms.

ADQ: Turkey suspended its planned $8.5 billion sale of Islamic sukuk bonds to ADQ, the Abu Dhabi Development Holding Co., opting to shop around for cheaper options, Bloomberg reports.

💵 Seeking Redemption: The UAE will likely be taken off the “gray list” this week of a global watchdog group that identifies nations known as money laundering havens, Bloomberg reports.

🇨🇳 China Ventures: Saudi Arabia is attaching new demands to a series of massive tech deals with China, requiring that companies such as Alibaba and SenseTime invest in the kingdom by establishing joint ventures with Saudi firms, the Financial Times reports.

🏂 Saudi Slopes: Raffles Hotels & Resorts will open a ring-shaped mountain resort in Trojena, the high-elevation part of Saudi Arabia’s NEOM project that will feature ski slopes and extreme sports.

🌡️ Tech Research: Siemens Energy is opening a global innovation center focused on climate research at the UAE’s Khalifa University of Science and Technology, in partnership with the Abu Dhabi Investment Office.

🏭 Out of the Gate: Saudi Arabia’s new $100 billion investment firm Alat announced a string of deals Tuesday, including a partnership with Japan’s SoftBank Group to build a manufacturing and engineering hub in Riyadh.

📈 Profits Climb: Kuwait’s eight top banks saw a collective increase in annual profit of 29% last year, led by Kuwait Finance House, where profit surged 63% from 2022.

🏗️ Port Expansion: DP World is beginning construction on a $150 million agri-terminals complex at Dubai’s Jebel Ali port with partners in the project Adroit Overseas Canada and Al Amir Foods.

💰 Early Stages: iAngels, an Israeli venture capital firm, raised $70 million for a fund focused on early-stage startups that will each receive between $2 million to $4 million.

Egyptian President Abdel-Fattah El-Sisi opened the Egypt Energy Show in Cairo on Monday, acknowledging that his own country and most of the African continent will have difficulty meeting their commitments to substantially reduce usage of fossil fuels.

UAE President Mohamed Bin Zayed met with the Democratic Republic of the Congo’s President Felix Tshisekedi on Monday in Abu Dhabi, where they talked about trade, investment and renewable energy.

Emir of Kuwait Sheikh Mishal Al-Ahmad Al-Jaber Al-Sabah heads to Qatar today, on his first state visit since assuming power.

UN Secretary-General Antonio Guterres met with Sheikh Mohammed bin Abdulrahman bin Jassim Al-Thani, Qatar’s Prime Minister and Minister of Foreign Affairs, during a visit to the country for the second meeting of special envoys on Afghanistan in Doha.

Musabbeh Al Kaabi, ADNOC’s Executive Director for Low-Carbon Solutions and international Growth, told the Egypt Energy Show on Monday that the Abu Dhabi-based energy company will be focusing this year on gas exploration and production.

Kiril Evtimov, Chief Technology Officer of Abu Dhabi-based G42, talks in an interview with the Zawya news agency about the artificial intelligence company’s plans for international expansion, including operations in Africa and the U.S.

Dana Khraiche has been promoted to Dubai Bureau Chief at Bloomberg and Ammar Ben Aziz has been made Managing Editor at Al Arabiya English, Telum Media reports.

🎶 Culture Circuit

🎞️ Movie Makers: Saudi Arabia’s MEFIC Capital and Roaa Media Ventures are launching a $100 million film fund with the kingdom’s Cultural Development Fund to support local movie productions

🍴 Gourmet Kingdom: Saudi Arabia’s efforts to woo tourists by recruiting international star chefs, opening trendy pop-up restaurants and sponsoring global food industry conferences is the subject of a feature story in The Peak magazine.

📗 Reference Check: Saudi Arabia launched Saudipedia, a digital platform for the Saudi encyclopedia, at the Future of Media Exhibition. The encyclopedia aims to “serve as an authentic source of knowledge” about various aspects of the kingdom for regional, Arab, and international media.

📷 Photo of the Day