Interpreting Middle East Economic News and Analyzing Market Trends

Category: Qatar

US tells Iraq to stop allowing Iran supply flights to Syria over its airspace while it pushes ahead with arming rebels

It is no secret that the CIA has been helping the rebels in Syria.  Initially, the US gave the green light to Saudi Arabia and Qatar to send aid and military supplies to the rebels, but two years on and frustration growing, the US is becoming more aggressive.  As the US increases its support for the rebels, it is now asking Iraq to stop allowing Iranian supply planes to fly over Iraq in an attempt to halt Iran’s aid to Assad’s regime.  Will Iraq comply?  No.

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Qatar says no more aid to Egypt, IMF loan still on hold, expect pound to resume decline

Last December, Qatar injected $2.5 billion ($500 million of which was gifted) into Egypt to support the pound as foreign currency reserves dried up.  Qatar has been actively helping Egypt since the revolution in 2011.  To date, Qatar has given $5 billion in aid to the country.  According to Reuters, Qatar will not give Egypt any more aid for the time being.

With Egypt’s sugar-daddy taking time off for now, who will step in to help?  The IMF is eager to give Egypt $4.8 billion in aid (with many strings attached), who else will come to the rescue?

Chart forUSD/EGP (USDEGP=X)

 

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Qatar courting Sarkozy to run PE fund

Qatar looking to setup a private equity fund to be run by former French President, Nicolas Sarkozy.  The fund is not yet setup and Sarkozy is still not sure if he will join the new venture.  What’s in it for Sawkozy?  Well, a lot of money for starters.  What’s in it for the Qataris?  More global branding and a star asset… among other things.  Here’s more from CNBC:

 

Nicolas Sarkozy is being wooed by sovereign wealth funds including Qatar’s who are ready to back him to start a private equity fund.

Qatar’s sovereign wealth fund and other investors have offered to commit as much as €500m in total to a fund run by the former French president, people familiar with the matter said. Mr Sarkozy has sought advice from close advisers on the plan.

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Cash rich Qatar looks for distressed assets as cash poor countries line up

Today, Qatar announced the launch of a $12 billion fund to invest in distressed assets around the world.  The country has been investing in top luxury brands over the past couple of years.  It is currently the largest shareholder in Tiffany & Co. according to Reuters, owns Harrod’s department store and has a stakes in LVMH.  Going after distressed assets seems like a departure from the previous strategy.  Here’s more from Bloomberg:

Qatar said yesterday that the new fund, to be called Doha Global Investment, will receive about $3 billion in assets from Qatar Holding LLC, a unit of the country’s wealth fund, and seek to raise the same amount in a share sale to nationals. The Persian Gulf emirate is using wealth from the world’s third- largest gas reserves to acquire assets across the globe.

“Given current low global rates, tight spreads and low volatility, only terrible or European companies now fit in the distressed bracket with significant capital already chasing distressed assets,” said Emad Mostaque, a strategist at Noah Capital Markets in London. “It doesn’t look like an ideal area for investment in the near future.”

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Gulf banks go shopping in the MENA region

After four years of slow growth or no growth, banks in the Gulf are looking for ways to expand their market reach.  Banks in cash-rich Qatar can only grow so much in their tiny home market, whereas banks in the UAE have a larger customer base to work on.  However, banks in the UAE have been revering from the property bubble and per Central Bank statements, need to reduce their exposure to the government (see older post).

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