GCC markets provide strong hedge against global economic chaos

Karim Awad, group chief executive of EFG Holding, speaks at the 19th Annual EFG Hermes One-on-One Investor Conference in Dubai on Monday. Photo/Supplied
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Updated 07 April 2025
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GCC markets provide strong hedge against global economic chaos

  • EFG Hermes forecasts strong growth citing strategic diversification

DUBAI: Amid the ongoing global economic turbulence, the Gulf Cooperation Council region has demonstrated resilience, emerging as a dynamic hub. Its capital markets have weathered challenges, from US tariff shocks to fluctuations in oil prices, according to the group chief executive of EFG Holding.

In an interview with Arab News at the 19th Annual EFG Hermes One-on-One Investor Conference in Dubai, Karim Awad highlighted the region’s solid fundamentals, emphasizing that concerns over external shocks often overshadow its long-term growth potential.

“You’re seeing more IPOs coming to the region, and more sectors that are being represented on different exchanges, and this is all a reflection of the dynamism of the region as a whole,” Awad said.

Dismissing concerns over the effects of new US tariffs, Awad told Arab News that that the 10 percent tariff “is not a massive game-changer,” especially compared to the situation with China, but the panic tends to spread.

This optimism persists despite the global uncertainty, which includes rising US-China trade tensions, volatile oil prices, and ongoing geopolitical conflicts. However, Awad stressed that the GCC’s young, tech-savvy population and ongoing efforts toward economic diversification are unlocking unprecedented opportunities for growth.

“Investors are interested in a multitude of sectors. You have a young region, very dynamic technologies coming through today, a lot of tech companies. They like to see the different sectors that are coming from the region,” he said.

Away said the investors value the increasing economic diversification, as it’s not just about oil and gas, which is often the misconception. There is much more to offer, the top executive added.

Saudi Arabia’s diversification plans

Ahmed Shams, the head of research at EFG Hermes, an EFG Holding company, shared Awad’s optimistic views, particularly regarding Saudi Arabia.

Shams explained to Arab News that the Saudi market is driven by two key factors. The first is the transformation and economic diversification plans, and the second is the depth of the financial market, along with the crucial role of capital markets in funding these transformation efforts.

He acknowledged that oil price volatility could cause potential delays in Vision 2030 projects but emphasized that the long-term direction remains unchanged.

“There is no turning back, meaning that this will not derail the economic reform and the economic diversification program in Saudi Arabia. It could lead to some delays and reprioritization and recalibration,” he said.

Shams was particularly optimistic about the Saudi real estate sector. “The demand is huge. But there is an imbalance in the supply and demand, and this is a golden opportunity,” he said, adding that “90 percent of the announced projects, whether they’re PIF-owned or even the private sector players, will not be impacted.” 

Shams also expressed a positive outlook on utilities companies in the Kingdom and shared similar optimism about the banking sector.

“I would say even before the crisis, the valuation was very reasonable to see a bank in Saudi trading almost at book value. This is very interesting.”

Egypt’s reform story

Awad highlighted Egypt’s progress in fintech. “In Egypt, we have one of the best fintech companies, which is Valu, a company that offers buy now, pay later services. It is a company that we started from scratch and pretty much revolutionized the buy now, pay later market in Egypt,” he said.

Mohamed Ebeid, Co-CEO of EFG Hermes, highlighted the firm’s growth in the equity capital markets, noting that EFG Hermes executed deals worth $20 billion last year.

“This is 14 deals in terms of ECM (equity capital market), be it IPOs or accelerated book builds or FMOs (financial market operations),” he told Arab News.

However, the top official noted Saudi Arabia’s challenges in allocating shares to foreign investors due to oversubscription. “International investors are not getting the allocations that they ask for. It’s because there’s oversubscription, that’s No.1. No.2 , the banks, we do the recommendation for the issuer, but the issuer decides and has the final say,” Ebeid explained.

Egypt’s economic resilience was a key focus, with the country’s deputy governor of the central bank, Rami Aboulnaga, outlining the nation’s proactive approach to managing global shocks.

“We’ve been building these buffers throughout the past years to ensure we can immune ourselves and minimize damage from these types of crises,” he stated in a panel discussion during the conference, highlighting Egypt’s transition from a  $29 billion net foreign asset deficit to a  $10 billion surplus since January 2024.

Aboulnaga emphasized that although global trade slowdowns may affect Suez Canal traffic, Egypt’s diversified strategy — where only 7 percent of total trade volume is tied to the US — provides a level of insulation.

He described the foreign exchange market as functioning as a “shock absorber,” enabling real-time adjustments that help prevent structural imbalances.

The deputy governor particularly stressed the importance of policy sustainability, highlighting that February’s inflation drop to 12.8 percent validated Egypt’s orthodox policy mix. He also noted that upcoming reviews by the International Monetary Fund would further solidify the country’s reforms.

“What we’re seeing is very healthy and sustaining it is quite possible because you avoid these one-off hits,” Aboulnaga said.

Dubai’s accessibility boom

The conference’s panel discussions reinforced these themes, with Dubai’s leaders highlighting the emirate’s booming real estate sector and investor-friendly policies.

The CEO of Dubai Economic Development Corp., Hadi Badri, said: “The real estate investment market continues to be very strong. Last year, it grew in terms of value by 27 percent. Coincidentally, that’s the same rate of growth that the Dubai Financial Market index also grew.”

He added that demand continues to outstrip supply. “Our biggest constraint today in Dubai, to be able to attract as many businesses as we are able to attract, is office space,” Badri said.

The CEO of Dubai Financial Market and Nasdaq Dubai, Hamed Ali, emphasized the efforts to attract foreign investors. He reported that last year, the market gained 437,000 new investors, with about 85 percent of them coming from outside the UAE. He shared this during a panel discussion at the event.

Global headwinds

Despite the regional optimism, speakers acknowledged global challenges, such as US tariffs and the potential for stagflation. However, they argued that the MENA region remains relatively insulated from these issues.

Shams told Arab News that the impact had been evident on global trade and the inflation the world experienced post-COVID. He explained that part of this was due to the injection of money supply, while another part was attributed to supply chain disruptions and the reconfiguration of the global grid.

As the conference concluded, EFG Hermes leaders emphasized a unifying message: the MENA region’s story remains intact. While volatility may persist, they argued that strategic positioning — whether in Saudi megaprojects, Egyptian fintech, or Dubai’s property market — provides a hedge against global chaos.

“You should start deploying the market,” Ebeid urged investors, capturing the event’s defiant optimism.


Oman’s non-oil exports surge 8.6% in Q1 2025

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Oman’s non-oil exports surge 8.6% in Q1 2025

RIYADH: Oman’s non-oil exports rose by 8.6 percent year on year in the first quarter of 2025, reaching 1.618 billion Omani rials ($4.2 billion), according to newly released figures.

These exports now represent 28.6 percent of the country’s total exports, which stood at 5.659 billion rials during the same period, the Oman News Agency reported.

The growth reflects ongoing efforts to boost non-oil trade, support domestic industries, attract foreign investment, localize development initiatives, and offer incentives to the private sector.

This aligns with Oman Vision 2040, which aims to diversify the economy, reduce oil dependence, enhance industrial and logistics sectors, and strengthen overall financial stability.

Oman’s non-oil exports comprise a wide range of products, including industrial goods, metals, plastics, machinery, electrical equipment, and chemicals.

According to the statement, the UAE remained the top importer of Omani non-oil products, with imports totaling 292 million rials in Q1 2025 — 18 percent of total non-oil exports. Saudi Arabia followed with 259 million rials, India ranked third at 172 million rials, South Korea was fourth at 154 million rials, and the US came fifth with 88 million rials.

Meanwhile, Oman’s oil exports declined in the first quarter, falling to 3.69 billion rials from 4.39 billion rials a year earlier, in line with lower global oil prices. The average price of Omani crude dropped to $75.3 per barrel, compared to $79.7 per barrel in Q1 2024.

Re-exports also decreased, totaling 351 million rials in Q1 2025, down from 434 million rials in the same period last year. The UAE was the top destination for re-exported goods from Oman, with imports worth 126 million rials — 35.8 percent of the total. Iran followed with 63 million rials, Kuwait with 24 million rials, Saudi Arabia with 22 million rials, and Germany with 10 million rials.

Commodity imports into Oman rose 10.9 percent year on year, reaching 4.312 billion rials in the first quarter of 2025, up from 3.889 billion rials the previous year. The UAE was the leading exporter to Oman, accounting for 995 million rials (23 percent of total imports). Kuwait came second with 466 million rials, followed by China (437 million rials), India (338 million rials), and Saudi Arabia (306 million rials).

Oman’s inflation up

Oman’s general inflation index increased by 0.9 percent year on year in April 2025, based on 2018 as the base year, according to the Consumer Price Index released by the National Center for Statistics and Information.

The most significant price increases were recorded in the personal goods and miscellaneous services category, which rose by 7.0 percent. This was followed by the health sector (3.2 percent) and transportation (3.1 percent). Prices also climbed in restaurants and hotels (1.5 percent), clothing and footwear (0.6 percent), culture and entertainment (0.3 percent), and education (0.1 percent).

Conversely, the food and non-alcoholic beverages category saw a decline of 0.3 percent, while furniture, household equipment, and maintenance prices dipped 0.1 percent.

Prices in housing, utilities, communications, and tobacco remained stable with no notable changes.


Egypt’s manufacturing index rises 3.9% in March

Updated 20 min 31 sec ago
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Egypt’s manufacturing index rises 3.9% in March

  • Egyptian exports to Arab nations rose by 18% to $16.2 billion, while imports grew by 14% to $14.3 billion
  • Saudi Arabia remained Egypt’s top Arab trading partner, with bilateral trade surpassing $11.3 billion

RIYADH: Egypt’s manufacturing and extractive industries index — excluding crude oil and petroleum products—rose by 3.9 percent in March, reaching 120.47 points, up from 115.93 in February, according to the Central Agency for Public Mobilization and Statistics.

The increase was largely driven by seasonal demand for food and a significant boost in steel rebar production, CAPMAS reported.

The monthly index, which uses the fiscal year 2012-13 as its base and reflects producer prices from January 2020 onward, is part of Egypt’s ongoing efforts to enhance industrial measurement standards.

The rise in manufacturing activity also coincides with Egypt’s strengthening economic ties with Arab markets. Total trade volume with Arab countries reached $30.5 billion in 2024—a 16 percent increase from $26.3 billion in 2023.

Egyptian exports to Arab nations rose by 18 percent to $16.2 billion, while imports grew by 14 percent to $14.3 billion. Saudi Arabia remained Egypt’s top Arab trading partner, with bilateral trade surpassing $11.3 billion. Egyptian exports to the Kingdom totaled $3.4 billion, followed by the UAE at $3.3 billion and Libya at $2 billion. On the import side, Egypt received $7.9 billion in goods from Saudi Arabia, $2.7 billion from the UAE, and $947 million from Kuwait.

Sector-wise, the food manufacturing index jumped 10.18 percent in March, rising to 160.02 from 145.24 in February—driven by Ramadan-related consumption. The base metals sector saw even sharper growth, climbing 22.89 percent to 65.92 from 53.64, largely due to heightened steel rebar production amid robust construction and infrastructure activity.

However, not all sectors fared equally. The tobacco products index plummeted by 27.44 percent to 118.84, down from 163.78 in February, reflecting a drop in cigarette consumption. Similarly, the printing and reproduction of recorded media sector fell 14.43 percent to 115.18, attributed to the seasonal completion of textbook printing contracts.

CAPMAS emphasized that the new figures reflect both seasonal trends and long-term structural shifts in Egypt’s industrial landscape.


Conflict-hit states suffer GDP losses of over 60%, says IMF’s Jihad Azour 

Updated 25 min 26 sec ago
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Conflict-hit states suffer GDP losses of over 60%, says IMF’s Jihad Azour 

  • Ongoing conflicts have severely disrupted economic activities, infrastructure, and trade in these areas
  • Azour says diversification efforts have helped GCC nations weather global uncertainty

RIYADH: Conflict-hit Middle Eastern countries have suffered severe economic shocks, with output losses surpassing 60 percent of gross domestic product in some cases, a senior International Monetary Fund official said. 

Speaking at an event on Global and Regional Economic Developments and Outlook in Riyadh, Jihad Azour, director of the IMF’s Middle East and Central Asia Department, identified Lebanon, Syria, the West Bank, and Gaza as among the most affected.  

The ongoing conflicts have severely disrupted economic activities, infrastructure, and trade in these areas, leading to deep recessions and humanitarian challenges that have compounded the economic fallout.

“Those countries over the last few years have been subjected to a lot of suffering, with a strong negative economic impact, with loss of outputs that could exceed 50 or 60 percent of GDP,” Azour said. 

He noted that the ripple effects of these conflicts have extended beyond their immediate borders, saying: “Those conflicts did not only affect countries who were subjected … but also had an impact on the neighborhood.”  

According to Azour, Egypt lost around $7 billion in Suez Canal revenues in under a year, largely due to disruptions in maritime trade routes. Meanwhile, Jordan saw a drop in tourism revenue, a sector crucial to its economic output and employment. 

The director highlighted that global trade tensions are another major contributor to economic uncertainty, citing the sharp increase in tariffs. 

“The rise in tariffs was extremely high. Went from something, for example, for the US — then less than 5 percent — to a peak of 30 percent. This is a big change in such a short period of time,” he said.   

He emphasized that rapid developments, whether geopolitical or economic, are defining today’s global landscape, making it increasingly difficult for nations to maintain consistent projections.   

“We are at a moment where history is accelerated and developments are shaped very quickly,” he said.   

In contrast to the turmoil facing some countries, Azour highlighted the relative stability and resilience of the Gulf Cooperation Council economies.   

Reflecting on the region’s evolving economic landscape, Azour said that diversification efforts have helped GCC nations weather global uncertainty.   

“GCC economies have benefited from the effort of diversification to maintain a level of growth that could withstand any volatility in oil prices or any cut in oil production,” he said.   

He continued: “Over the last three to four years, we had a sustainable level of growth around 3 to 4 percent, 5 percent in certain cases. Thanks to the reforms and to the acceleration of transformation, this has helped GCC countries to maintain a high level of growth, despite the fact that the agreement under the OPEC+ has been extended several times.”   

Looking ahead, the IMF official expressed cautious optimism, suggesting that despite the current uncertain environment, the economic outlook across the region remains positive, particularly for oil-exporting nations. 

“Let me first say that we expect, despite this maybe foggy background, we expect economies to recover this year across the board, in most of the countries in the region, yet the pickup of growth is going to be stronger in the oil-exporting countries, in particular in GCC, where we expect it also to increase by 1 percent this year and another 1 percent in 2026,” he said. 

According to Azour, the anticipated recovery is largely fueled by strong performance and a stable contribution from non-oil sectors across the Gulf, driven by long-term diversification efforts. 

He also offered a more hopeful outlook for countries affected by conflict, noting signs of stabilization and early recovery. 

“We expect the post-conflict countries to preserve a certain level of growth this year and for some to start recovering,” he said. 

Azour added: “The good news is inflation is still under control in most of the countries except a few where the level of inflation is still at double-digit, but for most of the countries, it’s already now getting closer to their objective set in their monetary policy.” 

In a region facing mounting challenges, the IMF’s outlook underscores that reform, stability, and smart investment aren’t just options — they’re imperatives for resilience. 


Human-centered travel takes priority in Saudi Arabia’s tourism vision, says minister

Updated 34 min 7 sec ago
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Human-centered travel takes priority in Saudi Arabia’s tourism vision, says minister

  • Minister says Kingdom’s tourism future lies in authentic human experiences, not just infrastructure
  • Ahmed Al-Khateeb stresses technology should enhance — not replace — personal interaction

RIYADH: Saudi Arabia is placing human-centered travel at the forefront of its tourism strategy, focusing on authentic cultural experiences, meaningful interactions, and community engagement as it reshapes its global tourism identity.

Tourism Minister Ahmed Al-Khateeb emphasized that this people-first approach is designed to balance the Kingdom’s rapid infrastructure development with heritage preservation and stronger community connections. The strategy, he said, forms a cornerstone of Saudi Arabia’s broader ambition to become a leading international tourism destination.

Al-Khateeb’s remarks come amid the launch of TOURISE, a new platform introduced by the Kingdom to unite global leaders across tourism, technology, investment, and sustainability. The initiative aims to foster innovation and collaboration as Saudi Arabia accelerates its tourism growth while maintaining a focus on sustainable and inclusive development.

In an interview with CNN,  Al-Khateeb emphasized the importance of human connection in travel, stating: “We want the experience in travel and tourism to be human.”

While acknowledging the role of innovation, Al-Khateeb stressed that technology should enhance — not replace — personal interaction. “We will definitely always use technology, but we will encourage and protect” human interaction because travel is all about people, he said.

The recently launched TOURISE platform, unveiled in late May, is designed to serve as a global forum bringing together key players in the tourism industry. According to Al-Khateeb, the initiative will unite regulators, operators, investors, and nongovernmental organizations to shape the future of a sector that accounts for “10 percent of global GDP and 10 percent of global jobs.”

He described the initiative as “unique” in its ability to bridge government and business to foster innovation and sustainable development in tourism.  

The Kingdom welcomed 30 million international visitors in 2024, a 9.5 percent increase from the previous year.  This influx is part of the kingdom’s broader strategy to diversify its economy beyond oil. 

Riyadh is a focal point of the Kingdom’s destination development plans. “Riyadh is top priority. Riyadh winter is the most beautiful winter in the world,” said Al-Khateeb, referencing attractions like Diriyah, King Salman Park, and the entertainment hub Qiddiya, which he described as “the largest-ever built sport, entertainment and culture city.”  

Al-Khateeb pointed to the Red Sea as a top priority, noting the launch of new resorts under Red Sea Global.   

“People love to visit the Red Sea, to explore the Red Sea,” he said, highlighting the region’s appeal alongside heritage tourism and Arabian hospitality.  

Despite geopolitical challenges, Al-Khateeb maintained that Saudi Arabia is moving forward with confidence.  

“We’re happy to see that there’s de-escalation in many areas in the region. And I think what is happening in Syria is a very positive thing, and I hope the rest of the region will follow,” he said.   

“It is very normal that you have some huge investment, upload investment in a country like Saudi Arabia, this investment is exposed to, sometimes, risk — capacity, availability risk, financial risk and so on.”   

“However, we know this. We have all the mitigation in place,” he added.  

Looking to the future, Al-Khateeb emphasized the Kingdom’s preparations for hosting the FIFA World Cup 2034 across multiple cities, including the mountainous south.   

“We are holding the World Cup in many cities in Saudi Arabia that will give the chance for the fans to explore the nature and the topography,” he said.  

Among the projects is the new Mohammed bin Salman Stadium in Qiddiya, which he described as “out of this world” and offering a “different experience for fans and for the players.”  

This strategic focus on human-centered tourism aligns with Saudi Arabia's Vision 2030, aiming to position the Kingdom as a leading global tourism destination. 


Riyadh airport tops Saudi on-time performance rankings in April: GACA data 

Updated 25 May 2025
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Riyadh airport tops Saudi on-time performance rankings in April: GACA data 

  • Saudia reported an 89% on-time rate for arrivals and departures
  • Riyadh–Amman route recorded the highest on-time performance at 97%

JEDDAH: Saudi Arabia’s King Khalid International Airport recorded the highest on-time departure rate among the Kingdom’s international airports in April, achieving 90 percent punctuality, official data showed.  

According to the monthly report published by the General Authority of Civil Aviation, the Riyadh-based hub outperformed larger airports such as Jeddah’s King Abdulaziz International, the Saudi Press Agency reported. 

The report comes as Saudi Arabia continues to push operational upgrades under its National Aviation Strategy, part of the broader Vision 2030 plan to position the Kingdom as a regional air transit hub. 

“The report issued in April 2025 indicated that King Khalid International Airport in Riyadh, King Fahd International Airport in Dammam, Abha International Airport, Neom International Airport, Turaif Airport, and Wadi Al-Dawasir Airport topped the advanced positions in the report,” the SPA report stated. 

The rankings are based on data compiled by Matarat Holding Co. and exclude canceled flights. Performance is measured by flights departing or arriving within 15 minutes of their scheduled times. 

In the category of international airports handling more than 15 million passengers annually, the Jeddah-based King Abdulaziz International Airport recorded a punctuality rate of 78 percent, according to the study.  

For international airports serving between 5 million and 15 million passengers annually, King Fahd International Airport in Dammam secured the highest ranking with an on-time performance of 87 percent. Prince Mohammad bin Abdulaziz International Airport in Madinah, which also falls under this category, recorded a 72 percent rate. 

In the segment of international airports accommodating between 2 million and 5 million passengers annually, Abha International Airport posted the highest punctuality rate at 91 percent. This was followed by King Abdullah bin Abdulaziz Airport in Jizan with 90 percent, and Tabuk Airport with 82 percent. 

NEOM Bay International Airport led among international airports with fewer than 2 million passengers annually, achieving a 95 percent on-time departure rate. Other strong performers in this category included Al-Ahsa International Airport at 93 percent and Najran Airport at 89 percent. 

Turaif and Wadi Al-Dawasir airports recorded perfect performance among domestic flight hubs, achieving 100 percent on-time departures. King Saud bin Abdulaziz Airport in Al-Baha followed closely with 99 percent, while Bisha Airport posted 94 percent. 

At the airline level, national flag carrier Saudia reported an 89 percent on-time rate for arrivals and departures. Meanwhile, flynas achieved 86 percent for arrivals and 91 percent for departures, while flyadeal recorded 87 percent and 91 percent, respectively. 

Regarding specific flight routes, the Riyadh–Abha domestic passage maintained a strong on-time departure rate of 96 percent. Other high-performing domestic routes included Riyadh–Tabuk and Riyadh–Dammam, both at 96 percent, while the Jizan–Riyadh route sustained its previous month’s rate of 95 percent. 

Internationally, the Riyadh–Amman route recorded the highest on-time performance at 97 percent, followed by Riyadh–Bahrain at 94 percent, Riyadh–Dubai at 93 percent, and Riyadh–Kuwait at 92 percent. The Jeddah–Amman route also achieved a 94 percent punctuality rate.