January Fourth Week Middle East Finance Newsletter
QatarEnergy, TotalEnergies SE, and Eni SpA to search for natural gas in Lebanese waters
Key takeaways:
- QatarEnergy, TotalEnergies SE, and Eni SpA have signed an agreement to search for natural gas in Lebanese waters.
- The US brokered a historic accord between Lebanon and Israel to end a dispute over a potentially gas-rich area in the Mediterranean waters.
- Lebanon's geographic location could allow it to supply gas to Europe and encourage international companies to participate in the second licensing round.
Counter arguments:
- The exploration efforts in Block 4 have been halted due to disappointing results.
- Lebanon is in a deepening financial crisis, which could affect the exploration efforts.
A new transcontinental trade route is being built by Russia and Iran
Key takeaways:
Russia and Iran are investing billions of dollars to speed up cargo delivery along rivers and railways linked by the Caspian Sea.
The emerging trade corridor would allow Russia and Iran to shave thousands of kilometres off existing routes.
The goal is to shield commercial links from Western interference and build new ones with the giant and fast–growing economies of Asia.
Counter arguments:
The US and its allies are seeking to block transfers of Iranian drones and other military supplies they say are aiding the Kremlin’s war in Ukraine.
The Biden administration is concerned with any effort to help Russia evade the sanctions.
IHC. has announced an investment of 1.4 billion dirhams ($400 million) in Gautam Adani's $2.5 billion.
Key takeaways:
International Holding Co. is controlled by a key member of Abu Dhabi’s royal family.
The investment is worth 1.4 billion dirhams ($400 million).
Adani's follow-on share sale is worth $2.5 billion.
The United Arab Emirates and India are discussing ways to boost non-oil commerce in rupees.
Key takeaways:
The UAE is looking to strengthen ties with India, its second-largest trade partner.
The UAE is exploring the role of cryptocurrencies in commerce.
The UAE expects to finalize economic agreements with Cambodia and Georgia in the coming months.
Counter arguments:
Oil sales in the Indian currency are not under consideration.
The UAE is imposing a 9% corporate tax later this year, but there will be an overlap for some time between the normal fees and the corporate tax.
The New Bankers to the World Aren’t on Wall Street
Key takeaways:
Middle Eastern sovereign wealth funds are managing more than $3.5 trillion and are bankrolling some of the world’s biggest rescue packages, investments and acquisitions.
Middle Eastern investors are becoming more strategic and are rejecting deals that don't fit with their goals of nation-building or generating returns.
Middle Eastern funds are facing complex decisions, as the biggest decisions often require a nod from the ruling sheikhs.
Counter arguments:
Not everyone can secure funds from Middle Eastern funds, as some executives have been turned down due to questions about their finances.
Deals can also fall through at the last moment due to the complexity of the transaction.
Saudi Arabia's Public Investment Fund attempted to acquire Formula 1 motor racing in 2020.
Key takeaways:
Liberty Media Corp., the owner of F1, was not interested in selling the franchise.
Saudi Arabia has been investing heavily in sports as it opens up to more Western-style forms of entertainment.