World Bank Raises Egypt's Package by $300 Million to Counter Iran War Impacthttps://english.aawsat.com/business/5271377-world-bank-raises-egypts-package-300-million-counter-iran-war-impact
World Bank Raises Egypt's Package by $300 Million to Counter Iran War Impact
Construction work on buildings in downtown Cairo (Photo: Abdelfattah Farag)
Egypt will receive an extra $300 million as part of a World Bank development financing package to help it confront fallout from the Iran war, Stephane Guimbert, the World Bank's division director for Egypt, Yemen, and Djibouti, told reporters on Saturday.
The package, consisting of $800 million from the World Bank and a $200 million British guarantee, is to support private sector–led job creation, macroeconomic stability, and the green transition. The bank's board approved it on Friday.
The bank's share was increased from $500 million due to "the uncertainty in the region and the shock facing Egypt, like other countries, because of the war in Iran," Reuters quoted him as saying.
The financing is on terms unavailable in commercial markets — at around 6% interest, with a maturity of 30 years and a grace period before repayments begin, Guimbert said.
The operation is the second in a three-part program. The first was approved in June 2024; a third is planned for next year.
Other lenders, including the Asian Infrastructure Investment Bank, are expected to provide complementary parallel financing.
Private investment in Egypt has risen to around 6% of GDP from roughly 4%, Guimbert said, but noted this remained far below peer economies where private investment often exceeds 20% of GDP. The bank is also advising Egypt on how to boost foreign direct investment.
Egypt has the potential to achieve 6% annual medium-term growth if macroeconomic stability and structural reforms are maintained, he added. At that pace, Egypt could generate roughly 2 million jobs annually compared with around 600,000 currently.
On social protection, Guimbert said Egypt's Takaful and Karama cash transfers offered more targeted support to poor families than its large-scale bread subsidy program. "In times of crisis, you want to lean heavily on Takaful and Karama," he said.
EU's Side of US Trade Deal to Come Into Force on July 1
FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa
The European Union's side of a trade deal struck with the United States last year, which will remove import duties on many US goods, will come into force on July 1, said a formal European Union regulatory filing.
The EU said this regulation would apply from July 1 until December 31, 2029, Reuters reported.
"Where appropriate, the Commission shall submit together with the comprehensive assessment a legislative proposal to extend the period of application of this Regulation," added the regulatory filing.
Under the agreement, the EU agreed to remove import duties on US industrial goods and provide preferential access to US farm produce.
It will also extend duty-free imports of US lobster, a mini-deal struck with Trump during his first term as president.
The EU legislation expires at the end of 2029 and includes multiple safeguards that would allow the EU to suspend concessions if the United States breaches the trade deal's terms.
Saudi Real Estate Developers Move to Capitalize on New Foreign Ownership Ruleshttps://english.aawsat.com/business/5290026-saudi-real-estate-developers-move-capitalize-new-foreign-ownership-rules
A general view of buildings and homes in the Saudi capital, Riyadh (File photo: Reuters)
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Saudi Real Estate Developers Move to Capitalize on New Foreign Ownership Rules
A general view of buildings and homes in the Saudi capital, Riyadh (File photo: Reuters)
Saudi Arabia's real estate market has entered a new phase of testing the practical impact of the executive regulations governing property ownership by non-Saudis, as listed developers move swiftly beyond welcoming the decision and the initial positive market reaction to translating it into strategic growth plans.
While the sector index has extended its early gains on expectations that the new rules will broaden international demand, the competitive advantage is beginning to shift toward companies with high-quality assets that are ready to be marketed and sold.
The real estate index on the Saudi stock market posted a sharp gain following the announcement, rising from 2,924 points to 3,044 points. The increase was driven by investor expectations that allowing non-Saudis to own property under specific regulations would expand demand for Saudi real estate assets, particularly in cities and projects with strong investment and religious appeal.
Real estate stocks led the market's gainers in the session following the announcement. Shares of Umm Al Qura for Development and Construction (Masar) hit the daily 10 percent limit, while Knowledge Economic City rose about 9.3 percent. Jabal Omar Development, Retal, Emaar The Economic City, and Makkah Construction and Development also posted strong gains.
Financial and economic adviser Dr. Hussein Al Attas told Asharq Al-Awsat that allowing non-Saudis to own property represents an important structural shift for Saudi Arabia's real estate market, but said the impact will not be uniform across all developers. Instead, the market will increasingly differentiate between companies with attractive assets and projects in locations targeted by international investors and those without them.
Master plan of the Masar Makkah destination (Masar)
He added that asset quality, location, financial strength, the size of developable land holdings, and the ability to attract international investors will be among the key factors determining how much companies benefit from the decision in the coming period.
Al Attas expects the sector to perform positively over the medium to long term. However, he said the real impact of the decision will ultimately be measured by companies' ability to turn this opening into actual sales, partnerships, and cash flows, rather than by the initial rise in share prices following the announcement.
In the first concrete move by a listed company since the regulations were approved, Jabal Omar Development on Sunday outlined its strategy for capitalizing on the decision after its project in Makkah was included within the geographic areas where non-Saudis are permitted to own property.
The company said the decision would broaden its base of potential investors and property owners among Muslims around the world, supporting demand for its real estate assets. It also announced plans to offer 400 existing hotel residential units for sale this year as the first phase of the program, with the proceeds earmarked to reduce debt and lower financing costs.
The company also plans to redesign the seventh and final phase of the project by increasing the number of hotel residential units available for sale while making greater use of off-plan sales programs to reduce financing requirements and strengthen reliance on internally generated liquidity.
Al Attas said the market's response to the regulations has unfolded in two stages. The first was a broad wave of optimism that lifted most real estate companies. The second has begun as investors seek to identify the companies best positioned to convert the decision into tangible growth in sales, cash flow, and profitability.
The decision to allow non-Saudis to own property forms part of a broader package of measures introduced by the Kingdom in recent months to restore balance to the real estate market and strengthen its investment appeal.
These measures include allowing the sale, purchase, and development of land in new areas north of Riyadh, increasing fees on undeveloped land, imposing fees on vacant properties, and freezing annual rent increases in Riyadh for five years.
The decision also coincides with signs of improving real estate and construction activity across the Kingdom. The construction sector returned to growth in May, supported by stronger residential building activity and renewed growth in new orders.
Although the full impact of the regulations will take time to emerge, recent moves by real estate developers indicate that the market has already begun shifting from expectations to execution as companies seek to attract a new segment of investors and buyers from outside the Kingdom.
China Imposes New Export Controls, Deepening Japan Rowhttps://english.aawsat.com/business/5289863-china-imposes-new-export-controls-deepening-japan-row
FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo
China Imposes New Export Controls, Deepening Japan Row
FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo
China put 20 more Japanese organizations on a blacklist Monday over the export of items with both military and civilian possible uses, adding fuel to a months-long row with Tokyo.
The new additions, including major companies, "have participated in enhancing Japan's military capabilities", the Chinese commerce ministry said in a statement.
Japan's government spokesman Minoru Kihara called the measures "unacceptable and deeply regrettable" and said Tokyo had "lodged a strong protest and demanded that the measures be withdrawn."
The countries' have been at row since Japanese Prime Minister Sanae Takaichi suggested in November that Tokyo may react militarily to an attack on Taiwan, the self-ruled island Beijing has vowed to seize control by force if necessary.
China responded furiously, including by advising its citizens -- previously the biggest cohort of foreign tourists -- to avoid Japan.
Chinese authorities ramped up pressure in February by imposing export restrictions on dozens of Japanese firms it said were involved in building up Tokyo's military.
The 20 additions to the export blacklist named Monday include specialized subsidiaries and technology firms involved in supplying components and engineering support for Japan's defense sector.
Among them are the National Institute for Defense Studies and Mitsubishi Electric Defense and Space Technologies Corporation, the statement said.
China's commerce ministry said the controls require exporters to submit risk assessments and guarantees that dual-use items will not enhance Japanese military strength prior to making shipments.
Those named on the watchlist can apply to be removed by cooperating with "verification" procedures according to Chinese law, the ministry said.
China is the world's largest producer and refiner of rare earths, which are crucial for various high-tech products including electric vehicles, smartphones, missile guidance systems and lasers.
Japan has "strayed further down the wrong path, intensifying its push for a 'new form of militarism'", an unnamed commerce ministry spokesperson said in a statement on the latest measures.
- China-Russia patrols -
Since Takaichi took office in October, Japan has quickened its pivot towards a more proactive defense policy, further shaking off -- with US encouragement -- a pacifist outlook, which has been in place since the end of World War II.
Tokyo has loosened rules on exports of lethal weaponry and deepened military cooperation with other countries in the region at odds with China including the Philippines.
Japan and the United States, as well as many other countries, are seeking to curb dependence on China in rare earths, as Beijing increasingly uses its dominance for geopolitical leverage.
Japan on Monday also joined South Korea in criticizing joint flights by Chinese and Russian bombers and fighters over the weekend in the region.
Fellow US allies South Korea and Japan both scrambled fighter jets in response to the patrols by the convoy of around 15 aircraft on Saturday.
"This marks the 10th instance of such long-range activities by Chinese and Russian bombers in the vicinity of Japan since December last year," Japanese government spokesman Kihara said Monday.
Beijing's defense ministry said that the Chinese and Russian air forces conducted a "strategic air patrol" over the Sea of Japan, the East China Sea and the western Pacific Ocean, "demonstrating their determination and capability to jointly uphold regional peace and stability".
Tokyo last week also rejected Beijing's accusations that the Japanese military "harassed" a Chinese aircraft carrier strike group during 40 days of exercises in the Pacific.
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