Dubai Suspended the 30% Municipality Tax on all Alcoholic Beverages …

Dubai Suspended the 30% Municipality Tax on all Alcoholic Beverages …

UAE News:
Three new laws come into force in January 2023: the unemployment insurance scheme for both private sector and Federal Government Departments (with subscription fee dependent on the employee’s basic salary); the Emiratisation rule (firms with 50+ employees need to achieve an Emiratisation rate of 2% for skilled jobs); and the UAE’s new family business law will come into effect in January.
Sharjah’s Ruler approved the AED 32.2bn (USD 8.76bn) budget for 2023, with spending 12% lower than last year and giving priority to infrastructure and capital projects (35% of the budget) and economic development (34%). Operating expenses represented 30% of the 2023 budget, a decline of 4% from the previous year.
The CEPA(Comprehensive Economic Partnership Agreement) agreement between UAE and Israel is expected to generate an annual USD 10bn in bilateral economic activity by 2026 (2 years ahead of projections). Non-oil trade between UAE and Israel grew by 114% YoY to USD 2bn in January -September 2022. 
Fuel price in the UAE has been reduced for January 2023 by 16% – 17% MoM depending on the grade of petrol (to AED 2.59 for E-plus 91 to AED 2.78 for higher grade Super 98).
Starting 1st January 2023, Dubai suspended the 30% municipality tax on all alcoholic beverages (this has been described as on a 1-year trial basis) and also announced that the personal liquor license fee has been scrapped.
Dubai welcomed 12.82mn overnight international travelers in January-November 2022, reaching more than 85% of pre-Covid levels of the same period in 2019; this compares also to the 6.02mn visitors reported in January-November 2021. India, Oman, Saudi Arabia, the UK, and Russia were the top five source markets.
The Dubai International Airport announced that nearly 2mn flyers were expected in and out of the airport over the 8 days starting December 27th. Average daily traffic is expected to be around 245k (with over 257k flyers on 2nd January), making this one of the busiest since 2019.
Clean energy production in Dubai reached 2027 MW, or about 14% of Dubai’s total power production capacity, according to Dubai Water and Electricity Authority (DEWA)’s CEO. It was also separately revealed that a new DEWA project (thermal energy storage and turbine inlet air chilling project) had contributed to the reduction of 44,000+ tonnes of carbon dioxide emissions annually, equivalent to planting two million trees.
Off-plan resales are ticking up in Dubai, according to Property Monitor: as of November 2022, total resale transactions grew by 3.2% to 4,425, i.e. a market share of nearly half (43.4%). Overall year-to-date deals, at 87,426, accounted for 142.6% of the entire annual transaction volume last year.
 
MENA News:
Bahrain’s Economic Development Board (EDB) attracted over USD 1.1bn of direct investment in 2022 (exceeding the USD 1bn target set early in the year). The investments are from 88 firms and will likely generate more than 6300 jobs over the next 3 years.
Egypt removed a key restriction on imports – to use letters of credit, introduced in February to ease a dollar shortage – and will now allow direct payment. Also, the list of economic activities that the government would leave to the private sector was approved. Both these changes were required to secure funding from the IMF.
Saudi Arabia is the second largest investor in Egypt, with investments amounting to USD 6.1bn in 6,017 projects. Bilateral trade touched USD 4.572bn in 2021, up 41.3% YoY.
The inflation rate in Lebanon increased to 189.4% YoY in January-November 2022, staying above 100% for the 29th straight month in November.
International visitors to Qatar rose to 600k in November, according to Qatar Tourism, with the largest share from Saudi Arabia (16%), India (8%), the US (7%), the UK (6%), and Mexico (5%). Ticket sales for the World Cup also exceeded that for Russia in 2018.
Unemployment in Saudi Arabia inched up to 9.9% in Q3 (Q2: 9.7%), with unemployment among Saudi females up to 20.5% (up 1.2 ppts from Q2) while the labor participation rate of Saudis increased to 52.5%.
Saudi Arabia issued 38 new mining licenses in November (October: 21), bringing the total mining exploration licenses to 2201.
The number of SMEs in Saudi Arabia grew by 9.3% YoY to 978,445 firms in Q3. These firms received around SAR 221bn worth of credit facilities from financial institutions as of the end-Q2 2022. It was also reported that venture capital funding surged by 93% YoY to a total SAR 3.1bn in January-September 2022.
Operating revenue of businesses in Saudi Arabia reached SAR 4.081trn in 2021, with manufacturing, mining and quarrying and wholesale and retail activities accounting for the largest shares – of 27%, 22% and 18% respectively. Separately, the operating revenues of SMEs grew by 25% YoY to about SAR 1.2trn while spending surged by 33% to SAR 659.5bn.
 
Global News:
Capital markets had a horrendous year in 2022, the worst since the Global Financial Crisis in 2008, with global stocks and bonds losing more than USD 30trn last year, with the MSCI(Morgan Stanley Capital International) All-World Index losing about 1/5-th of its value, posting the biggest decline since 2008; US equity markets posted the first annual loss since 2018 (and the largest drop since 2008). The Russia-Ukraine War, surging inflation rates not seen in 40 years, peaking food and energy prices, change in monetary regimes with rising interest rates and the growing US trade and tech war on China all contributed to a dismal 2022 for markets and heralding near global recession in 2023. With Covid19 cases surging in China, CSI300 (China Securities Index) declined the most among major markets in the last week of 2022. Among regional markets, Saudi gained the most in the last week of 2022; the best performer in 2022 among regional markets was Egypt, while Qatar shed the most (-8.1%), recording the first yearly loss since 2017. A strong dollar was the highlight of 2022, with the currency posting its biggest annual increase since 2015; GBP had its worst performance since 2016 while the yen had its worst year since 2013 (thanks to BoJ’s dovish stance). Oil posted its second consecutive annual gain: in Mar, Brent had touched USD 139.13 a barrel, the highest since 2008. Though gold price gained in the last week of 2022, it posted an annual drop.

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SOURCE:
Nasser Saidi & Associates
 

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