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$154 Million Worth Emirati-French Investment in New Abu Dhabi Terminal

Sheikh Khalid bin Mohammed bin Zayed, member of the Executive Council of Abu Dhabi, during his meeting with officials from Abu Dhabi Ports Group and CMA CGM Group, on the sidelines of the signing of the agreement. (Asharq Al-Awsat)
Sheikh Khalid bin Mohammed bin Zayed, member of the Executive Council of Abu Dhabi, during his meeting with officials from Abu Dhabi Ports Group and CMA CGM Group, on the sidelines of the signing of the agreement. (Asharq Al-Awsat)
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$154 Million Worth Emirati-French Investment in New Abu Dhabi Terminal

Sheikh Khalid bin Mohammed bin Zayed, member of the Executive Council of Abu Dhabi, during his meeting with officials from Abu Dhabi Ports Group and CMA CGM Group, on the sidelines of the signing of the agreement. (Asharq Al-Awsat)
Sheikh Khalid bin Mohammed bin Zayed, member of the Executive Council of Abu Dhabi, during his meeting with officials from Abu Dhabi Ports Group and CMA CGM Group, on the sidelines of the signing of the agreement. (Asharq Al-Awsat)

Abu Dhabi Ports and shipping company CMA CGM Group have formed a joint venture and signed a 35-year concession agreement to develop and operate a new terminal at Khalifa Port.

The partners are expected to commit about AED570 million ($154 million) to the project, Abu Dhabi Ports said in a statement on Thursday.

The construction starts in 2021, with an initial quay length of 800 meters and an estimated annual capacity of 1.8 million TEUs.

The terminal will be managed by the joint venture company 70 percent owned by CMA CGM’s subsidiary CMA Terminals and 30 percent owned by Abu Dhabi Ports.

The new terminal will have an annual capacity of 1.8m TEU. Abu Dhabi Ports will be responsible for developing up to a total of 1,200 m of quay wall, a 3,800 m breakwater, a full built-out rail platform, and 700,000 sq m of the terminal yard.

Falah Mohammed Al Ahbabi, chairman of Abu Dhabi Ports, stated that “as well as driving increased trade volumes through our port, we expect the facility’s capacity and added trade links with other high-profile port destinations will drive investment into local businesses and our industrial zones, fast-track the development of key sectors including manufacturing and logistics and raise demand for manpower.”

“In all, we project that over the next five years, the CMA Terminals joint venture will drive the further development of the Khalifa Industrial Zone Abu Dhabi (KIZAD), while simultaneously contributing significantly to the national GDP,” he added.

Captain Mohamed Juma Al Shamisi, group CEO, AD Ports Group, said: “At home, we expect the presence of the shipping line terminal, which will link directly to Khalifa Port's upcoming rail terminal and utilize its services, to accelerate trade flows moving in and out of the UAE, while also encouraging CMA CGM Group's customers to consider establishing a presence in Abu Dhabi.”

Rodolphe Saadé, chairman and CEO of CMA CGM, said: “The ambitious project we are launching today in Abu Dhabi marks an important milestone in CMA CGM’s development strategy in the region.”

He added that “this state-of-the-art terminal will contribute to enhancing Khalifa Port’s position as a leading global hub and to boosting the region’s economy, accelerating trade flows in and out of Abu Dhabi.

“It will also enable our group to expand its shipping and logistics network in the region, where we see a lot of growth potential.”

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Dollar Strengthens on Elevated US Bond Yields, Tariff Talks

A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
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Dollar Strengthens on Elevated US Bond Yields, Tariff Talks

A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo
A teller sorts US dollar banknotes inside the cashier's booth at a forex exchange bureau in downtown Nairobi, Kenya February 16, 2024. REUTERS/Thomas Mukoya/File photo

The dollar rose for a second day on Wednesday on higher US bond yields, sending other major currencies to multi-month lows, with a report that Donald Trump was mulling emergency measures to allow for a new tariff program also lending support.

The already-firm dollar climbed higher on Wednesday after CNN reported that President-elect Trump is considering declaring a national economic emergency as legal justification for a large swath of universal tariffs on allies and adversaries.

The dollar index was last up 0.5% at 109.24, not far from the two-year peak of 109.58 it hit last week, Reuters reported.

Its gains were broad-based, with the euro down 0.43% at $1.0293 and Britain's pound under particular pressure, down 1.09% at $1.2342.

Data on Tuesday showed US job openings unexpectedly rose in November and layoffs were low, while a separate survey showed US services sector activity accelerated in December and a measure of input prices hit a two-year high - a possible inflation warning.

Bond markets reacted by sending 10-year Treasury yields up more than eight basis points on Tuesday, with the yield climbing to 4.728% on Wednesday.

"We're getting very strong US numbers... which has rates going up," said Bart Wakabayashi, Tokyo branch manager at State Street, pushing expectations of Fed rate cuts out to the northern summer or beyond.

"There's even the discussion about, will they cut, or may they even hike? The narrative has changed quite significantly."

Markets are now pricing in just 36 basis points of easing from the Fed this year, with a first cut in July.

US private payrolls data due later in the session will be eyed for further clues on the likely path of US rates.

Traders are jittery ahead of key US labor data on Friday and the inauguration of Donald Trump on Jan. 20, with his second US presidency expected to begin with a flurry of policy announcements and executive orders.

The move in the pound drew particular attention, as it came alongside a sharp sell-off in British stocks and government bonds. The 10-year gilt yield is at its highest since 2008.

Higher yields in general are more likely to lead to a stronger currency, but not in this case.

"With a non-data driven rise in yields that is not driven by any positive news - and the trigger seems to be inflation concern in the US, and Treasuries are selling off - the correlation inverts," said Francesco Pesole, currency analyst at ING.

"That doesn't happen for every currency, but the pound remains more sensitive than most other currencies to a rise in yields, likely because there's still this lack of confidence in the sustainability of budget measures."

Markets did not welcome the budget from Britain's new Labor government late last year.

Elsewhere, the yen sagged close to the 160 per dollar level that drew intervention last year, touching 158.55, its weakest on the dollar for nearly six months.

Japan's consumer sentiment deteriorated in December, a government survey showed, casting doubt on the central bank's view that solid household spending will underpin the economy and justify a rise in interest rates.

China's yuan hit 7.3322 per dollar, the lowest level since September 2023.