FDI inflows to Bahrain grew 114% in 2017, according to data released by the United Nations Conference on Trade and Development (UNCTAD), the fastest growth rate in the GCC. The rapid growth came in spite of a drop in global FDI of 23%.
Growth in investment was supported by a number of major economic reforms in recent years – with UNCTAD citing Bahrain’s amendments to its commercial companies law allowing 100% foreign ownership in additional sectors as an example of liberalisation supporting FDI growth. This has continued into 2018 with several significant developments in the first half of the year.
“Foreign direct investment creates jobs, diversifies the economy and fuels growth – so we are delighted to see such strong momentum, even against a challenging global backdrop. This proves the growing interest in the GCC opportunity is translating into investment,” said Khalid Al Rumaihi, Chief Executive, Bahrain EDB.
“We have undertaken a number of significant initiatives in the first half of this year to build on this success and we expect to announce a number of further measures in the coming months, helping investors to access the GCC opportunity.”
Bahrain’s reforms were also recognised as Site Selection magazine recently named Bahrain as the best place to invest in the Middle East and Africa per capita for the third year in a row.
The ‘Best to Invest’ rankings are determined by the level of capital investments in the country and performance on key international indices published by organisations such as the World Bank, WEF and UNDP. The rankings also saw Bahrain EDB included in the list of Top Investment Promotion Agencies for 2018, one of only four agencies from the region included.
As well as being among the leading locations to invest, Bahrain has also been ranked as the best place in the world for expatriates to live, reflecting the high quality of life on offer in the country. The InterNations Expat Insider rankings ranked the Kingdom as the top expat destination in the world – citing the welcoming environment and ease of settling in as key factors.
Among the most prominent developments in 2018 has been the growth of the Bahrain FinTech ecosystem, including the launch of Bahrain FinTech Bay, the largest fintech hub in MENA; the establishment of a $100m Fund of Funds to help fund start-ups across the Middle East; and a growing number of companies using the Central Bank of Bahrain’s regulatory sandbox to develop new products and services.
These advances were reflected in the recent Global Startup Ecosystem Report, released by the Global Entrepreneurship Network and Startup Genome, which included Bahrain in global ‘ecosystems to watch’ in both fintech and gaming. Bahrain was the only Arab country to be included in either list.
The Kingdom also saw a number of major announcements last month during Gateway Gulf Forum, which brought together over five hundred global investors and business leaders to explore ways of unlocking the opportunities being created by the economic transformation in the GCC. The event provided a direct route into accessing the GCC market by showcasing major investment-ready projects worth USD $18billion, with projects in the planning phase driving up the value of the project pipeline to USD $26 billion.
Among the announcements were the launch of the $1bn Bahrain Energy Fund, the first such fund in the GCC and which will be unique in providing institutional investors with access to local energy assets and the launch of Bahrain’s first five star ‘retreat’ style destination by Al Sahel Resort Company, as part of the broader development of the country’s tourism sector.
Betting on death of petrol cars, Volvo to go all electric by 2030
By Nick Carey and Helena Soderpalm
LONDON (Reuters) – Volvo’s entire car line-up will be fully electric by 2030, the Chinese-owned company said on Tuesday, joining a growing number of carmakers planning to phase out fossil-fuel engines by the end of this decade.
“I am totally convinced there will no customers who really want to stay with a petrol engine,” Volvo Chief Executive Håkan Samuelsson told reporters when asked about future demand for electric vehicles. “We are convinced that an electric car is more attractive for customers.”
The Swedish carmaker said 50% of its global sales should be fully-electric cars by 2025 and the other half hybrid models.
Owned by Hangzhou-based Zhejiang Geely Holding Group, Volvo said it will launch a new family of electric cars in the next few years, all of which will be sold online only. Volvo will unveil its second all-electric model, the C40, later on Tuesday.
Samuelsson said Volvo will include wireless upgrades and fixes for its new electric models – an approach pioneered by electric carmaker Tesla Inc.
Carmakers are racing to switch to zero-emission models as they face CO2 emissions targets in Europe and China, plus looming bans in some countries on fossil fuel vehicles.
Last month, Ford Motor Co said its line-up in Europe will be fully electric by 2030, while Tata Motors unit Jaguar Land Rover said its luxury Jaguar brand will be entirely electric by 2025 and the carmaker will launch electric models of its entire line-up by 2030.
And last November, luxury carmaker Bentley, owned by Germany’s Volkswagen, said its models will be all electric by 2030.
Electrification is expensive for carmakers and as electric vehicles have fewer moving parts, employment in the auto industry is expected to shrink.
Last week, the head of Daimler AG’sDE> truck division said going electric will cost thousands of jobs in the company’s powertrain plants in Germany.
Volvo said it will invest heavily in online sales channels to “radically reduce” the complexity of its model line-up and provide customers with transparent pricing.
The carmaker’s global network of 2,400 traditional bricks-and-mortar dealers will remain open to service vehicles and to help customers make online orders.
Via volvocars.com customers will be able to choose from a simplified range of pre-configured electric Volvos for quick delivery – but they will still be able to order custom-made models.
(Reporting By Nick Carey; editing by Barbara Lewis)
Oil extends losses on worry over possible supply increase from OPEC
By Yuka Obayashi
TOKYO (Reuters) – Oil prices fell more than 1% on Tuesday, extending losses that began last week, as investors unwound long positions on concern that OPEC may agree to increase global supply in a meeting this week and Chinese demand may be slipping.
Brent crude dropped 78 cents, or 1.2%, to $62.91 a barrel by 0138 GMT, after losing 1.1% the previous day. U.S. West Texas Intermediate (WTI) crude slid 74 cents, or 1.2%, to $59.90 a barrel, having lost 1.4% on Monday.
Investors are worried the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+, will boost oil output, said Hiroyuki Kikukawa, general manager of research at Nissan Securities.
“Oil prices remained under pressure as investors were making position adjustments ahead of the OPEC meeting,” he said.
The group meets on Thursday and could discuss allowing as much as 1.5 million barrels per day (bpd) of crude back into the market.
OPEC oil output fell in February as a voluntary cut by Saudi Arabia added to reductions agreed to under the previous OPEC+ pact, a Reuters survey found, ending a run of seven consecutive monthly increases.
Market sentiment was also dampened by weak manufacturing data out of China, Nissan Securities’ Kikukawa said.
China’s factory activity growth slipped to a nine-month low in February, which may curtail Chinese crude demand and pressure oil prices.
(Reporting by Yuka Obayashi; Editing by Tom Hogue)
Brexodus from City of London to the EU slows
By Huw Jones
LONDON (Reuters) – The shift in financial staff and assets from the City of London to the European Union because of Brexit has eased after Britain completed its full departure from the bloc, a tracker from consultants EY showed on Tuesday.
Financial services are not included in the EU-UK trade deal that came into effect on Jan. 1, largely cutting off the City from the EU.
Financial firms in Britain have opened subsidiaries in the EU, with Dublin and Luxembourg the most popular destinations, EY said.
“After the major hurdle of standing up new EU hubs, the days of significant swathes of asset and job relocation announcements appear to have passed and will likely be replaced by the slower yet ongoing movement of people and assets to Europe for compliance purposes,” Omar Ali, a financial services managing partner at EY, said.
EY said in its latest Brexit Tracker that job moves have risen to almost 7,600, up by 100 since October, while the number of new hires in Europe since Britain’s EU referendum in 2016 remains flat at around 2,850 new jobs.
The loss is a small fraction of total jobs in British financial services and is far lower than initial predictions.
There was also an incremental rise in the relocation of assets, now totalling almost 1.3 trillion pounds ($1.82 trillion), up from 1.2 trillion pounds previously, EY said.
On Jan. 4, more than 8 billion euros ($9.63 billion) in daily share trading shifted from London to Amsterdam and Paris, followed by chunks of trading in euro-denominated swaps.
The EU is targeting the clearing of euro swaps, which London dominates, although EU’s Ali said splitting markets would not benefit Europe.
“Fragmentation of European financial services will serve to only benefit the U.S. and Asia,” he said. Some of the swaps trading that has left London has moved to New York.
EY calculated its figures from public statements by 222 of the largest banks, insurers, fintechs and asset managers since June 2016 to the end of February 2021. A quarter, or 57 firms, said Brexit has or will have a negative impact on them, up from 49 in January 2020.
(Reporting by Huw Jones; editing by Barbara Lewis)
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