MENA

The World Bank to Asharq Al-Awsat: Aid to Syrian Refugees Will be Monitored Every 6 Months

The Vice President of the World Bank for the Middle East and North Africa Hafez Ghanem confirmed that the World Bank aims to give $20 billion to the Middle East to help ease the Syrian crisis within the next five years. The figure is three times what the World Bank has spent up until now, and Ghanem added that his institution has given $4.9 billion to the Middle East and North Africa since July last year and most of this went to Iraq, Egypt, Jordan and, to a lesser extent, Lebanon. The increase had already started before the Syria crisis, when $1.6 billion was given to the region every 12 months. With regards to the monitoring of loans, Ghanem said that the World Bank helps the government design a project and provides technical assistance. Then a team of experts supervises it every six months.

Sisi's fund to establish $13 million leasing firm

Tahya Masr (Long Live Egypt) Fund, originally initiated by President Abdel Fattah al-Sisi to support national economy, is planning to launch a leasing firm, its executive chairman Mohamed Ashmawy said. The anticipated firm will be with a capital up to 100 million Egyptian pounds (US$13 million). The firm will help provide job opportunities for the youth. Since the fund was initiated in 2014, individuals and businessmen have contributed billions of Egyptian pounds to the fund. The fund's executive committee encompasses leading businessmen like Naguib Sawiris, former Grand Mufti Ali Gomaa and a representative from the Supreme Council of the Armed Forces.

Maroc : Une banque islamique née d'un partenariat maroco-américain

Un an après l'adoption de la loi autorisant l'implantation de banques islamiques au Maroc, un troisième acteur va faire son apparition sur la scène de la finance islamique au royaume, en l'occurrence de la Banque participative du Maroc. La nouvelle banque est née du partenariat entre la Banque populaire et le groupe américain Guidance financial Group pour créer une filiale (détenue à 80% par la BP) proposant des produits islamiques. Jusque-là, deux banques islamiques ont été créées au royaume. Il s'agit d'Al Baraka Bank, détenue à parts égales par BMCE Bank of Africa et le groupe bahreïni Baraka Banking Group, et Qatar International Islamic Bank (QIIB).

Towards a More Enabling Legal Framework for Microfinance in Iraq

In Iraq, authorities continue to battle ISIS while advancing important political reforms. And microfinance – in the broad sense of providing credit, savings, payments, and insurance to low-income households and small businesses – is one intervention poised to promote local economic activity and help manage economic shocks. The 2014 Findex survey found that only 11% of the adult population has an account at a formal financial institution. It also revealed a significant gap between Iraqi citizens who borrowed formally (4%) and those who did so informally (65%), hinting for a much higher demand than that currently served by the financial sector. This is notably because Iraq’s financial system remains seriously underdeveloped, as highlighted in the World Bank’s 2011 Financial Sector Review.

Tunisia, Bahrain agree to revival Tunis Financial Harbor

President Beji Caid Essebsi and the Bahrain Prime Minister agreed to restart the mega project Tunis Financial Harbor, said official spokesman for the Presidency of the Republic, Moez Sinaoui. This mega project is financed by the Gulf Finance House, an Islamic Investment Bank of Bahrain, with a budget of 7.5 billion dinars. It will set up the first financial center for offshore banking institutions in North Africa. The Financial Harbor will house a set of shopping centers and residential units and recreation spaces: marina, golf courses.

20 Years of Financial Inclusion in the Arab World

It is a common perception that the Arab world lags behind when it comes to financial inclusion. According to the 2014 Findex figures and excluding Gulf countries, the region indeed reports the highest percentage of financially excluded adults, with 80% of the population or about 200 million not having access to an account, and 95% not having access to credit. Yet, this has not always been the case. However, limited advocacy efforts concerted from within the industry as well as a lack of champions within public authorities both played a contributing factor here. Microfinance professionals can attest that 2010 marked the beginning of a new era, with positive signs of long-lasting, albeit arduous, change.

How Low Oil Prices Are Battering the MENA Region

From Oman to Algeria, the MENA region is being hammered by low oil prices, which fell below $28 a barrel on January 18, a drop of more than 60% since June 2014. Some countries have been hurt particularly hard. In Libya, for example, the World Bank estimates that the fiscal deficit is more than 55% of GDP and the current account deficit is about 70% of GDP. In Saudi Arabia, central bank reserves have plunged from $732 billion to $623 billion in less than 12 months. Some 75% of the Saudi government’s budget comes from oil. Given the deficit, the International Monetary Fund (IMF) notes that Saudi Arabia needs to sell oil at around $106 a barrel to balance its budget. A regional country that could potentially do better in 2016 is Iran.

IIRA reaffirms Shari’ah quality rating of Jordan Islamic Bank

Islamic International Rating Agency (IIRA) has reaffirmed its Shari’ah Quality Rating of AA (SQR) assigned to Jordan Islamic Bank (JIB). Rating derives strength from JIB’s evident commitment to Shari’ah compliance, which stems at the helm of the institution and is cultivated across management cadres. It is in majority owned by Albaraka Banking Group (ABG). The rating is also supported by Jordan’s effective regulatory Shari’ah governance standards, which with recent revisions are closely aligned with best practice. The bank has been proactive in adopting the revisions in central bank guidelines, and their full implementation is targeted to be achieved within the ongoing year.

S&P publishes MENA Rating Trends 2016

Standard & Poor’s Ratings Services said that overall sovereign creditworthiness in the Middle East and North African (MENA) region has deteriorated since Standard & Poor’s last published six months ago. The rating agency has published the report Middle East And North Africa Sovereign Rating Trends 2016. The average rating for the hydrocarbon-endowed sovereigns of Abu Dhabi, Bahrain , Iraq, Kuwait, Oman, Qatar, and Saudi Arabia, is currently close to ‘A’, having been at ‘A+’ prior to the downgrade of Saudi Arabia and the inclusion of Iraq in the average. For those with more limited hydrocarbon resources (Egypt, Jordan, Lebanon, Morocco, Ras Al Khaimah, and Sharjah), it is closer to ‘BB+’. The outlooks are negative on Bahrain and Saudi Arabia, reflecting weakening fiscal profiles and uncertain policy responses.

Zain, Islamic International Arab Bank to support startups

Zain Jordan has signed a MoU with the Islamic International Arab Bank on supporting entrepreneurs and startups. Under the agreement, the Islamic International Arab Bank will provide support for Zain Jordan's Innovation Campus members in various areas of collaboration, in addition to exploring development opportunities in creativity and entrepreneurship. Zain Jordan CEO Ahmad Hanandeh said that Zain supports startups in facing challenges and equips them with the latest technological tools.

IFC-backed report finds growing supports for entrepreneurship in MENA

A new International Finance Corporation (IFC)-supported report by Wamda Research Lab finds that although support for entrepreneurs and start-ups has grown substantially across the Middle East and North Africa, many challenges remain, hindering job creation and economic growth. In Exploring Conditions for Entrepreneurs in Egypt, Jordan, Lebanon, and UAE Wamda surveyed nearly 500 entrepreneurs from the four countries, which have seen the majority of entrepreneurship development initiatives in the region. The report looks at the main trends in entrepreneurship and the challenges entrepreneurs face in growing their businesses. Access to finance is one of the main challenges cited by entrepreneurs in the report.

Jordan to issue $211M sukuk to finance National Electric Power Company

Jordan’s Ministry of Finance has prepared a plan of estimated issuance of government bonds for the year 2016 which puts net domestic borrowing for the current year at some JOD 896 million. Separately, the MoF has also revealed plans to issue Sukuk worth JOD 150 million to provide finance for the National Electric Power Company. Secretary-General of the Finance Ministry, Ezeddin Kanakriyeh, said the Sukuk would be tendered in two equal separate issuances. This indicative plan will be updated periodically in accordance with the requirements and developments in the light of the cash flow management plan prepared by the Ministry, which takes into consideration the value of the expected cash revenues and expenses through the implementation of the 2016 budget.

Internet searches for Islamic financial products surge in MENA

Research by Morgan McKinley found a surge in the global value of Islamic banking assets is forecasted for the next few years. Figures are predicted to reach $6.5 trillion by 2020, a huge leap compared to the amount of $150 billion in the mid-1990s. In the UAE alone, the total Islamic banking assets accrued in 2013 was $95 billion (compared to $83 billion in 2012), and it is showing no signs of slowing down, with the Dubai Chamber of Commerce predicting that the annual growth rate will reach 17 per cent until 2018. The increase has been with all consumers, with a recent study from Bloomberg concluding that in the UAE, Islamic finance has also gained popularity amongst non-Muslim expats.

UPDATE 1-Qatar International Islamic Bank, CIH to set up bank in Morocco

Qatar International Islamic Bank (QIIB) has signed an agreement with Moroccan lender Credit Immobilier et Hotelier S.A. (CIH Bank) to set up a bank in Morocco. In November, central bank governor Abdellatif Jouahri said Morocco would start issuing Islamic banking licences within the next year. QIIB will take a 40 percent stake in the new bank, which is expected to launch in coming months after necessary approvals, the Qatari institution said on Thursday without giving details of the venture. The Qatari joint venture is part of QIIB's strategy to pursue overseas investments and diversity its portfolio, the lender said in a bourse statement. Islamic banks from Kuwait, Bahrain and the United Arab Emirates have also expressed interest in entering Morocco.

CI: Jordan Islamic Bank’s ratings affirmed on ‘Stable’ outlook

Capital Intelligence (CI) has affirmed Jordan Islamic Bank’s (JIB) Long- and Short-Term Foreign Currency Ratings (FCRs) at ‘BB-’ and ‘B’, respectively. JIB’s FCRs are constrained by Jordan's sovereign ratings (‘BB-’/’B’/ ‘Stable’), reflecting JIB’s base of operations in Jordan and its exposure to the Jordanian sovereign in the form of balances at the Central Bank of Jordan (CBJ). The Support Level of ‘3’ is affirmed, on the basis of the high likelihood of support from the CBJ in case of need, and from the parent Al-Baraka Banking Group in Bahrain. The Outlook for JIB’s FCRs remains ‘Stable’, in line with the Outlook for Jordan’s Sovereign FCRs. The Bank’s Financial Strength Rating (FSR) is maintained at ‘BBB-’, on a ‘Stable’ Outlook.

Crowdfunding campaign gave destitute Syrian refugee father a new life in Beirut

Abdul Halim al-Attar, 33, fled the war in Syria more than three years ago, moving first to Egypt and then to Lebanon. His wife returned to their home country just months after their departure, but Mr al-Attar resisted; he didn't want to go back to a place where he saw no future for their children, a nine-year-old son and a four-year-old daughter. Day after day, Mr al-Attar relied on selling pens and other small items to support his family. At the time, Mr al-Attar was receiving the equivalent of $US36 ($50) a month from the UN Refugee Agency and supplementing that with painstaking sales - enough for a rundown apartment and the bare necessities, but not to send his son to school. An Indiegogo campaign raised $US188,685 for Mr al-Attar.

IFC, Al Baraka Bank join forces to support Egypt's trade sector

International Finance Corporation (IFC) and Al Baraka Bank are cooperating to expand the availability of trade finance for Egyptian importers to help spur economic growth and create jobs. Under this agreement, Al Baraka Bank becomes the third Egyptian bank, and the first Islamic bank in the country, to join IFC's Global Trade Finance Programme (GTFP). IFC guarantees will help Al Baraka Bank clients import commodities that are critical to the local market, including raw materials, pharmaceuticals, fertilizers and spare parts that will support different manufacturing sectors. In fiscal 2015, IFC's GTFP committed over $1 billion in the Middle East and North Africa region and over $6 billion around the world.

Recycled food served at AFED conference for the first time in Arab countries

Lunch menu during the Arab Forum for Environment and Development’s conference on sustainable consumption constituted entirely of local organic food. Moreover, this was the first conference in the Arab region where “recycled” food was served: intact remains of Mediterranean fish served on day one were used to make a delicious fish-filet plate on day two. In addition, no plastic bottles were used during the two day conference, which were replaced by re-usable glass bottles. Within the same context, and in cooperation with AFED, the International Centre for Advanced Mediterranean Agronomic Studies (CIHEAM) organized a session during the conference on the Mediterranean diet as part of sustainable food systems.

MENA Sukuk market expanded 14 % YTD

The Middle East and North Africa region recorded strong growth in the Sukuk market in the first 10 months of 2015, according to Michele Leung, Director, Fixed Income Indices, S&P Dow Jones Indices.
The market value, as tracked by the S&P MENA Sukuk Index, rose 14 % YTD to 37 billion, compared with the mere 1 % growth in the conventional bond market in the region. The Sukuk market has expanded 37 % since the S&P MENA Sukuk Index’s inception in July 2013. United Arab Emirates is the most active issuing country in the region, and it remains dominant in terms of country exposure at 52 %, followed by Saudi Arabia at 17 %.
Overall, governments have continued to diversify their funding platforms, and the global Sukuk market has witnessed solid support from the lack of primary supply. Looking at the indices’ total return performance, there has been a 1.1 - 1.3 % decline in both Sukuk and bond markets month-to-date. As of Nov 18, 2015, the S&P MENA Sukuk Index rose 1.05 % YTD, while the S&P MENA Bond Index outperformed and gained 1.90 % in the same period.

As Syria refugee aid falters, new approach considered: Massive investment in Mideast hosts

Bold new ideas for helping Syrian refugees and their overburdened Middle Eastern host countries are gaining traction among international donors, shocked into action by this year's migration of hundreds of thousands of desperate Syrians to Europe.
Rather than struggling to gather humanitarian aid for refugees, the plans center around investing billions of dollars, much of it to be raised on financial markets. The money would go for development in countries such as Jordan and Lebanon to improve lives for both their own populations and refugees.
More controversial is a demand by some in the aid community that, in return for such a "Mideast Marshall Plan," Jordan and Lebanon must allow Syrian refugees to work, integrating them more into society. The host countries, however, point to high domestic unemployment in arguing they cannot put large numbers of refugees to work legally.
"We need to be ambitious," the regional chief of the World Bank, Ferid Belhaj, told The Associated Press. "Development is the key."

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