The Briefing

Weekly business & investment updates curated for you.

Erbil Rotana

UBS Sees Sovereign Assets Shrinking by $1.2 Trillion — Central bank and sovereign wealth fund assets will shrink by $1.2 trillion, or almost 7 percent, by the end of the year as China and petro-states including Russia and Saudi Arabia dip into their savings amid slower growth and lower crude revenues. The fall in sovereign assets will likely continue into next year and also be driven by an expected drop in investment returns. Assets held by central banks and sovereign wealth funds amounted to more than $18 trillion at the end of 2014, according to UBS.

Commission to invest €16 billion in funding for research and innovation — The European Commission will boost competitiveness by investing almost €16 billion in research and innovation in the next two years under Horizon 2020, the EU's research and innovation funding scheme. Carlos Moedas, Commissioner for Research, Science and Innovation said: "Research and innovation are the engines of Europe's progress and vital to addressing today's new pressing challenges like immigration, climate change, clean energy and healthy societies. Over the next two years, €16 billion from Horizon 2020 will support Europe's top scientific efforts, making the difference to citizens' lives."

$50 Oil for 15 Years Isn't What Scares Bank of Russia Governor — The central bank forecasts the economy won’t return to annual growth until 2017, meaning Russia is on track for the longest recession in two decades. Gross domestic product will contract 3.9 percent to 4.4 percent this year and may shrink as much as 1 percent next year, according to a Bank of Russia forecast that projects oil staying at $50 in 2016-2018.

FDI to Africa increased by 64 percent to $87 billion — In total, 464 foreign companies invested in Africa in 2014 but this number only accounted for 13 percent of the global FDI capital in 2014 and just 5 per cent of the total projects registered. Coal, oil and gas, as well as manufacturing, were the most attractive sectors, accounting for 38 and 33 percent, respectively, of the total announced FDI last year.

Private equity into sub-Saharan Africa grows to $12 billion a year — International private equity has become the fastest growing source of investment in sub-Saharan Africa but better risk management tools and a way to develop whole sectors was needed to make sure benefits are spread more widely. Investments from international private equity has grown five-fold since 2008 across sub-Saharan Africa and now amounts to around $12 billion, or 20 percent, annually of cross-border investments, a working paper released on Tuesday by the Overseas Development Institute (ODI) said.

Zimbabwe gold production peaks — Gold output in Zimbabwe is expected to rise this year to 18.4 tonnes this year from 15.3 tonnes last year. The figure would be the highest since 2004 when Zimbabwe produced 21.3 tonnes. Gold is the second single largest mineral export earner after platinum in the Southern African nation.

AfDB and Egypt sign $50 million loan for Sharm El-Sheikh Airport — The $50 million loan agreement is part of the Africa Growing Together Fund (AGTF), a $2 billion ‘Special Fund’ provided by China and managed by the AfDB to co-finance Bank operations. This agreement complements earlier signed agreements of a $90 million loan from the Bank’s loan window and $1.8 million grant from the Middle Income Countries (MIC) Technical Assistance Fund, all earmarked for the Sharm El-Sheikh Airport Development Project.

Investments of Egyptian insurance firms rise — The total investments of Egyptian insurance firms increased 14.6 percent, recording 48.5 billion Egyptian pounds (US$6.1 billion) in 2014 versus 42.5 billion pounds in 2013

FDI inflow to Turkey up 36 percent — Turkey attracted $11.8 billion of foreign direct investment (FDI) during the first eight months of 2015, an increase of 36 percent compared to the same period for last year according to data released by the Central Bank of the Republic of Turkey.

UAE insurance sector to grow 15 per cent in 2015 — The UAE’s insurance sector, one of the few bright spots in financial services amid a slowing economy, is expected to grow 15 per cent this year. Insurance premiums were expected to rise to Dh38 billion this year from Dh33bn last year. Two years ago, the insurance industry introduced new regulations to protect consumers. Among other requirements, insurers’ paid-up capital was raised to Dh3 million from Dh1m.

Iran unveils $25B railway project plan — Iran has chalked up an ambitious plan to modernize and set up a railway corridor linking the Gulf and the Subcontinent to the Central Asia at an investment of $25 billion. "We have defined about $25 billion of rail projects for which we have prepared incentive packages to attract domestic and foreign investment,” said Mohsen Poursaeed-Aqaei, the managing director of Iran Railways.

France inks $11B deal with KSA — France announced a series of deals worth $11.4 billion with Saudi Arabia, reinforcing growing ties between the two countries.

The Briefing

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