The Daily Circuit: Saudi Arabia’s deepening deficit + Alpha Dhabi’s Aldar selloff
👋 Hello from the Middle East!
In the Daily Circuit today, we’re reporting on Saudi Arabia’s split with the IOC over staging the Olympic Esports Games, the new expansion plans for Abu Dhabi’s Zayed International Airport, Alpha Dhabi’s efforts to raise $400 million by selling part of its stake in Aldar, and Lunate’s new $1 billion investment platform. But first, third-quarter numbers show the depth of Saudi Arabia’s budget woes.
After a week of navel-gazing at the FII business conference in Riyadh about the impact of falling oil prices, Saudi leaders received third-quarter data that illustrates why they need to keep making hard decisions on budget cuts.
In the three months ending Sept. 30, the Saudi Finance Ministry said its deficit widened to 88.5 billion riyals ($23.6 billion), bringing the total shortfall for the year to nearly $50 billion. Oil revenue fell to about $40 billion from just under $51 billion a year earlier, while non-oil income held steady at $31.7 billion, according to the report issued Thursday.
Now it becomes clearer why one cabinet minister after another this week took to the stage at the King Abdulaziz International Conference Center to solicit foreign investment, conceding that the government will have to shrink or defer parts of its most ambitious megaprojects like NEOM. Some 9,000 FII attendees went home digesting prospects for a new era of austerity.
Ratifying that conclusion, the kingdom’s number crunchers now project a 2025 deficit of 5.3% of GDP as oil prices have slid in the past three years to below $70 a barrel from a high of $125.
The Saudi Capital Market Authority, meanwhile, has delayed a decision on whether and how to open Riyadh’s Tadawul stock market to non-resident foreign investors until next year, Bloomberg reports. The Capital Market Authority is analyzing public and stakeholder feedback on the move.
“We will be revisiting foreign ownership limits next year,” Mohammed El-Kuwaiz, CMA Chairman, said. “Whether or not we will eliminate foreign ownership limits or more gradually increase them on multiple stages, this will really become the output of our analysis.”
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📰 Developing Stories
OLYMPICS TORCHED
Saudi Arabia and the International Olympic Committee have “mutually” ended a deal to jointly hold the Olympic Esports Games. The IOC and the kingdom will pursue their own esports ambitions separately, Bloomberg reports. The 12-year agreement, signed last year, was supposed to see Saudi Arabia host the inaugural Esports Olympics, a part of its ambition to be a global hub for gaming. The kingdom held its second Esports World Cup over the summer, attracting more than 2,000 professional players from over 100 countries, and its Public Investment Fund has since signed a blockbuster $55 billion deal to take gaming company Electronic Arts private.
AIRPORT EXPANSION
Abu Dhabi is already planning a major expansion of Zayed International Airport, just two years after it doubled its capacity to 45 million passengers a year with the opening of Terminal A. Construction work will start in two years, with plans to increase capacity to 65 million, The National reports. “We opened in November 2023 and at the first board meeting, I broke the news to the board that we had to think about expansion,” Abu Dhabi Airports Managing Director and CEO Elena Sorlini told the Skift Global Forum East event in the capital. The expansion is partly needed to meet the demands of Etihad Airways, which is planning to double in size and carry 38 million passengers by 2030. The airport is also rolling out the use of biometrics to transit passengers to speed up transfers within the airport, which make up 60% of its current traffic.
💲 Sovereign Circuit
International Holding Co.: IHC Real Estate Holding and Alpha Dhabi, both subsidiaries of IHC, sold their stakes in investment and real estate company Modon for more than $7 billion to Abu Dhabi government entity L’imad Holding Co.
International Holding Co.: Alpha Dhabi is also planning to sell about 2% of its 26.5% stake in Abu Dhabi developer Aldar Properties for around $400 million, Bloomberg reports.
Lunate: Alternative investment firm HPS Investment Partners and Abu Dhabi’s Lunate are launching a new investment platform. Lunate will anchor the project with a projected commitment of at least $1 billion.
Mubadala: Pakistan is negotiating with Abu Dhabi Investment Co., a subsidiary of Mubadala, to run Islamabad airport in exchange for 60% of the revenue, Bloomberg reports.
Public Institution for Social Security: Kuwait’s pension fund is restarting private equity allocations and is in discussions with multiple leading buyout firms, Bloomberg reports.
↪↩ Closing Circuit
🏭 Mega Project: Egypt’s Ain Sokhna Industrial Zone, within the Suez Canal Economic Zone, will host three major new projects valued at $3.5 billion under an agreement between Kemet Industries Group and Emirati-Chinese company Al Qalaa Red Flag.
💰 Sharjah Sukuk: Sharjah Islamic Bank plans to issue a $500 million islamic bond, to be listed on Euronext Dublin and Nasdaq Dubai, with Emirates NBD Capital and Standard Chartered Bank appointed as joint global coordinators.
🚦 Green Light: U.K. oil services company John Wood Group has published its half-year financial results, a condition of its $292 million takeover by UAE engineering firm Sidara.
👷 Pipe Dream: A Saudi consortium has secured funding to develop a 587km water pipeline in the kingdom, with the project valued at $2.3 billion.
🗣 Circuit Chatter
🛢️ Fuel Fraud: Lebanon’s judiciary has charged six companies and four individuals and issued arrest warrants over an alleged Russian oil scam, The National reports.
🎮 Banking Games: Emirati lender Commercial Bank International has launched a venture arm to build and invest in products for gamers, starting with a credit card in partnership with Mastercard.
🛡️ Standing Together: The U.K. has signed an enhanced defense agreement with Qatar to deepen military cooperation.
₿ Virtual World: The Abu Dhabi Real Estate Center signed an agreement with five partners to advance blockchain integration in Abu Dhabi’s real estate sector.
🦘 Aussie Connection: Abu Dhabi Investment Office and the Australia Arab Chamber of Commerce and Industry have signed a strategic partnership to boost trade and investment and support Australian companies entering Abu Dhabi’s high-growth sectors.
🌎Power Circuit
Sheikh Khaled bin Mohamed, Crown Prince of Abu Dhabi, met with South Korean President Lee Jae Myung on the sidelines of the Asia-Pacific Economic Co-operation forum in Gyeongju, South Korea, on Friday. The Crown Prince also met with Lawrence Wong, Prime Minister of Singapore, and Christopher Luxon, Prime Minister of New Zealand.
Sheikh Mohammed bin Rashid, UAE Vice President, Prime Minister and Ruler of Dubai, launched the Mohammed bin Rashid Endowment District.
Sheikh Sabah Al Khalid Al Sabah, Crown Prince of Kuwait, met with Yuriko Koike, Gov. of Japan, at Bayan Palace in Kuwait on Thursday.
Sheikh Maktoum bin Mohammed, First Deputy Ruler of Dubai and UAE Deputy Prime Minister and Minister of Finance, met with Georges Elhedery, Group CEO of HSBC, at the Dubai International Financial Centre on Thursday.
Sheikh Jarrah Jaber Al Ahmad Al Sabah, Deputy Foreign Minister of Kuwait, met with Muhammad Anis Matta, his Indonesian counterpart, in Kuwait City on Thursday.
➿On The Circuit
Jamie Dimon, CEO of JPMorgan Chase, told The National that his “cockroach” comment about the health of the private credit market was “blown out of proportion.”
Ed Bastian, CEO of U.S. carrier Delta Airlines, told Arabian Gulf Business Insight that the airline hopes to capitalize on economic development in Saudi Arabia and the potential growth of passenger traffic between the two countries with its new direct flights from Atlanta to Riyadh.
Eric Schmidt, the former CEO of Google, told The National at Saudi Arabia’s FII conference in Riyadh that the rise of AI will create more jobs than it destroys.
James Reynolds, the global co-head of Goldman Sachs Asset Management, said in an interview with Asharq Business that the bank is in “productive” talks with the Public Investment Fund and other players in the region.
Rashid Saeed Al Shamsi, Non-Resident Ambassador of the UAE to Niger, met with Ali Mahamane Lamine Zeine, Prime Minister of Niger, at his headquarters in the capital, Niamey.
🎶 Culture Circuit
🏛️ Rebuilding History: Palmyra’s archaeological museum, which was badly damaged by bombings during the Syrian civil war, will be restored with international funding, The National reports. One of Syria’s most popular sites before the war, Palmyra made headlines in 2025 when ISIS destroyed the Temple of Bel and the Arch of Victory and killed its head of antiquities. Swiss-based foundation Aliph will fund the restoration of the museum, starting with the guesthouse, which will house archaeologists working on the project. Aliph is mostly funded by nations, including the UAE, Saudi Arabia, Kuwait and Morocco, and private donors.
📷 Photo of the Day
📅 Circuit Calendar
Oct 29-31, Abu Dhabi. International Forum of Sovereign Wealth Funds. An annual forum hosted by Abu Dhabi Investment Authority and Mubadala, bringing together global CEOs and senior executives from sovereign wealth funds. ADGM
Nov. 1-2, Dubai. Women’s Empowerment Convention. The 3rd Women’s Leadership Forum unites global trailblazers, headlined by fashion icon Anna Wintour and storytelling pioneer Candace Bushnell. Atlantis The Royal Conference Center.
Nov. 3-6, Abu Dhabi. ADIPEC. Bringing together professionals, companies, and government leaders to discuss and showcase the latest developments in oil, gas, and cleaner energy technologies. ADNEC Center.
Nov. 4-6, Dubai. Gulfood Manufacturing. Billed as the most influential F&B manufacturing event in the world. Dubai World Trade Center.
Nov. 4-9, Dubai. Dubai Design Week. The Middle East’s largest creative festival, showcasing more than 200 events across architecture, product, furniture, interior and graphic design. D3.
Nov. 10-12, Abu Dhabi. DRIFTx. An international exhibition showcasing smart and autonomous mobility solutions. Yas Marina Circuit.
Nov. 10-15, Abu Dhabi. RoboCup Asia-Pacific. A regional competition and event for AI and robotics where teams compete on challenges including humanoid robot soccer matches. ADNEC Center.
Nov. 11-14, Dubai. ICOM 2025. Bringing together museum professionals and cultural experts from around the world to explore the evolving role of museums. Dubai World Trade Center.
Nov. 17-19. Doha. Qatar Entrepreneurship Conference (ROWAD). Qatar’s national entrepreneurship platform and a flagship Global Entrepreneurship Week event, connecting startups, SMEs, and ecosystem leaders. Doha Exhibition & Convention Center.
Nov. 17-21, Dubai. Dubai Airshow 2025. The biennial exhibition attracts aerospace companies from around the world to the UAE. DWC, Al Maktoum International Airport.
Nov. 25-26. Riyadh. Global Sustainability Expo. Dedicated to advancing sustainability practices across industries. The Arena Riyadh.
Nov. 26-27, Abu Dhabi. CyberQ 2025. The UAE’s flagship summit for cybersecurity and quantum technologies. ADNEC Center.
Dec. 8-9, Riyadh. Hydrogen Arabia Summit & Exhibition. The inaugural event is aimed at positioning the Kingdom as a hub for hydrogen and clean energy collaboration. Crowne Plaza Riyadh RDC.
Dec. 8-9, Abu Dhabi. Bitcoin MENA 2025. An event dedicated to advancing Bitcoin and blockchain understanding and adoption. ADNEC Center.
Dec. 8-10, Abu Dhabi. BRIDGE Summit. Bringing together media executives, innovators, academia and NGOs, policymakers, and thought leaders to redefine the media landscape. ADNEC Center.