Don’t Worry, Be Happy!                                                 14 February 2025

The new year saw Dubai real estate sector continuing to bubble, following a highly successful 2024, as it posted a record 180.9k transactions, valued at US$ 142.1 billion. January witnessed impressive annual increases, for both transactions and values – 23% to 14.24k and 24% to US$ 12.09 billion. January statistics from Property Finder found that 15%, 31% and 37% of people were seeking to own or invest in studios, 1 B/R and 2 B/R apartments; in the villa sector, 37% and 50% were searching for villas with 3 B/R and 4 B/R or more. The most popular areas for apartments were Dubai Marina, Jumeirah Village Circle, Downtown Dubai, Business Bay and Palm Jumeirah, whilst for villas/townhouses, Dubai Hills Estate, Palm Jumeirah, Dubai Land, Al Furjan and Damac Hills 2 were the leading five locations.

In the month, the off-plan sector accounted for 52% of total transactions – 15.0% higher compared to January 2024 – but 1.3% lower on the year, with a value of US$ 4.14 billion. Meanwhile, the existing market moved much higher, registering an annual 33.4% surge to 6.92k, and jumping 41.0% higher in value. Palm Jebel Ali continued to be the leader, with ninety-five transactions, worth US$ 463 million, with Al Yelayiss 1 a surprise second, with sales of US$ 463 million – from just US$ 28 million in January 2024.

When analysing rental trends, it was estimated that when looking at apartments 59% preferred furnished, with 39% going for unfurnished; 21% were looking for studios, 33% of tenants were searching for 1 B/R units and 33% for 2 B/R. For villas/townhouses, it was 52:42, furnished: unfurnished, with 42% of tenants looking for 3 B/R and 35% for 4 B/R+. The top areas to rent apartments in Dubai included Jumeirah Village Circle, Dubai Marina, Downtown Dubai, Business Bay and Deira, and renting villas/townhouses, Jumeirah, Dubai Hills Estate, Damac Hills 2, Al Barsha and Al Furjan were the five most popular locations.

Although the month saw a 4% dip in sq ft prices, to US$ 422, Dubai property values have soared by 81.2%, post Covid. January commercial property sales rose 17.9% on the year, with three hundred and sixty-three deals, valued at US$ 327 million. Land sales soared 151.2% higher, with eight hundred and eleven transactions, worth US$ 2.3 billion.

With a twenty million sq ft area available to it, one of the biggest of Asian developers, Karachi-based Bahria Town, has launched its first project in Dubai. The developer has plans to recreate a version of the fabled Blue Mosque in Istanbul, as well having, as its centrepiece, the Eiffel Tower, in Dubai South. The first off plan releases at Bahria Town should happen in Q1, with Phase 1 likely to take four years to complete. Early releases will have prime views of the two landmarks.

Dubai South is the emirate’s largest master development, encompassing an area of one hundred and forty-five sq km, focusing on the aviation and logistics sectors, with mixed-use and residential communities. It is expected that its ecosystem could offer up to 500k job opportunities, with a triple transport infrastructure connecting air, land, and sea. With the new terminal taking shape, there will be a surge in population from its current base of 25k residents and will become home to over a million people, once the airport becomes fully operational. It is expected that by 2032, the US$ 35.0 billion passenger terminal at Dubai World Central – Al Maktoum International – will fully absorb the current Dubai airport (DXB) which will be redeveloped for probably residential purposes. Dubai South will become an aerotropolis — an airport city.

Dubai’s Vantage Developments and Vittoria Group announced a strategic alliance with Venere Group, that, in April, will launch a new US$ 50 million residential tower in Jumeirah Village Circle, with the unveiling of Venere Group’s prototype Italian supercar. The one-hundred-and-forty-unit tower will have a range from apartments to penthouses, and all completely furnished with Venere Group’s Italian-made furniture; the residential tower has been designed by Milan-based architects Gandolfi e Mura.

Abdullah bin Touq Al Marri, the UAE’s Minister of Economy, has forecast a 5% to 6% growth for the national economy this year, driven by strong performance in key sectors such as technology, renewable energy, trade, financial services and infrastructure. He noted that the split between oil and non-oil is 25:75 and that in the four post-Covid years to 2024, the country’s GDP had grown by an annual average of 4.8%, with non-oil GDP growth averaging 6.2%.

At this week’s World Governments Summit 2025, Elon Musk announced the Dubai Loop project, with Dubai’s Crown Prince, Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, revealing further details of the Dubai Loop project. He commented that this is “set to revolutionise transportation,” and that a Memorandum of Understanding had been signed between Dubai’s Roads and Transport Authority and Musk’s The Boring Company. The Crown Prince also added that under the MoU, “Dubai will explore the development of the seventeen-kilometre project,” and that there will be eleven stations for the tunnel which will have a capacity to transport over 20k passengers per hour”. He also concluded by saying that “Dubai’s spirit of innovation thrives on strong partnerships with global industry leaders. Under the leadership of @HHShkMohd, the city continues to redefine the future of transportation, both above and below ground, setting new benchmarks for sustainability, efficiency, and urban connectivity.”

Also at the World Government Summit, the RTA unveiled a new ‘Rail Bus’ vehicle, shaped like a capsule – 11.5 mt long and 2.65 mt wide – which will carry forty passengers per trip; it will travel at one hundred kph, with twin benefits being its cost-effectiveness and helping to smooth traffic flow.

This Sunday, 16 February, will see the Roads and Transport Authority holding its seventy-eighth public auction to offer three hundred exclusive two, three, four, and five-digit license plates for private and vintage vehicles, as well as motorcycles. The selection includes premium numbers across codes A, B, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, V, W, X, Y, Z and the code (2) for motorcycles.   Registration opened last Monday and closed today, 14 February, with bidders having to pay a US$ 1.36k security deposit, and a non-refundable US$ 33 subscription fee. Successful bidders will need to settle their payments within ten working days after the auction concludes.

The General Civil Aviation Authority posted that the country’s civil aviation sector achieved traffic growth of 10.3%, in 2024, to 147.8 million, with air cargo growing 17.8% to 4.36 million tons. These results reflect the fact that the country is a major global hub for air transport, trade, tourism, and investment. Last year, the UAE welcomed 41.6 million inbound passengers, while 41.7 million departed, and 64.4 million transited through its airports. There was a marked increase in manpower, being 9.6k registered pilots, 35.9k cabin crew members, 4.5k engineers, 0.46k air traffic controllers, and 0.42k dispatchers. The country is home to thirty-six registered air operators, nine hundred and twenty-nine registered aircraft, including light sports aircraft. Air traffic movements reached a record of 1.03 million flights last year.

2024 proved to be a record year for DP World’s ports and terminals, as they handled 88.3 million twenty-foot equivalent units (TEUs), 8.3% higher on the year. Its global logistics have the capacity to handle more than one hundred million TEUs in seventy-eight countries. Group Chairman, Sultan Ahmed bin Sulayem, commented that, “during the last ten years we have invested more than US$ 11 billion in world-class ports and logistics infrastructure to make trade flow.”, and “we are confident that the container market will continue to grow and that we have the capacity to service it. Whatever the short-term challenges, we remain bullish on the outlook for world trade.” The global company saw impressive double digit returns from Posorja terminal in Ecuador, which posted a remarkable 87% uplift in volume, to nearly one million TEUs, with double-digit growth seen at San Antonio in Chile, Yarimca in Türkiye, Chennai in India, Callao in Peru, Antwerp in Belgium and London Gateway. DP World’s flagship Jebel Ali Port posted a 7% increase from 2023. New ports and terminals added nearly one million TEUs to the total volume, including the DP World-Evyap merger in Turkey, new operations at Dar Es Salaam Port in Tanzania and the Belawan New Container Terminal in Indonesia.

DP World’s latest US$ 80 million development in Egypt will not only enhance the country’s infrastructure but also position it as a key regional trade hub; it is scheduled for completion this June.  Its Sokhna Logistics Park, a state-of-the-art logistics hub, spans 300k sq mt, and is located in the Suez Canal Economic Zone, some ten km from Sokhna Port; it offers direct access to Greater Cairo’s key markets and major industrial zones. The park will drive efficiency, reduce logistics costs, and strengthen connectivity between Egypt, the ME, Africa, and beyond. Featuring both bonded/non-bonded warehouses, as well as office space and open cargo and container yards, it will support a range of industries, such as agriculture, pharmaceuticals, retail, automotive and textile.

The UAE tech-telco giant e& posted a 10.2% rise in 2024 revenue to US$ 16.13 billion, with strong growth across its telco and digital verticals; consolidated profit came in 4.3% higher to US$ 2.92 billion, driven by continuing growth from its UAE operations and its investments in overseas markets – its latest being a US$ 865 million deal to acquire a Serbian broadband and cable TV services provider.

Another record year for Emaar Properties, with revenues and property sales skyrocketing by 33.0% to US$ 9.67 billion and 72.0% to US$ 19.07 billion; 2024 net profit, (before tax), was up 25.0% to US$ 5.15 billion. On top of all this, Dubai’s leading developer registered a 55.0% surge in revenue backlog from property sales of US$ 29.97 billion. Over the year, it acquired 141 million sq ft of development land in a prime area in Dubai,  with a total development value of US$ 26.16 billion. In December, it announced a new 100% increase in its dividend policy, with its highest-ever proposed dividend of 100% of share capital for 2024, amounting to US$ 2.40 billion. It launched sixty-two new projects across all master plans in the UAE,  with its property development business achieving  property sales of US$ 17.8 billion – an annual 75.0% growth.

Last year Emaar Development posted a 61.0% hike in revenue to US$ 5.20 billion, with net profit before tax 20.0% higher at US$ 2.78 billion. The consolidated revenue of Emaar Properties from its property development business in the UAE, during 2024, reached US$ 6.40 billion, including Dubai Creek Harbour. Its shopping malls, retail, and leasing businesses generated US$ 1.53 billion in revenue, with an EBITDA of US$ 1.28 billion. Once again, Dubai Mall was the most visited destination worldwide, with one hundred and eleven million visitors. It also plans to add a further two hundred and forty luxury stores and dining outlets, for Dubai Mall, in a US$ 409 million investment. Emaar’s international sales, which contributed 8.0% of the Group’s revenue, topped US$ 1.12 billion, up 40.0% on the year, driven by strong performance in Egypt and India. Meanwhile, its hospitality, leisure, and entertainment division posted US1.00 billion in revenue, with Emaar’s UAE hotels averaging 79% occupancy while adding four new properties with five hundred rooms.

Although 2024 revenue nudged 1.7% higher to US$ 322 million, Al Ansari Financial Services posted an 18.1% decline in net profit, to US$ 111 million; as the remittance business market becomes even more competitive; it registered an EBITDA margin of 44.4%.  Although remittance volumes continue to grow, with expat residents making gains from a dollar surge, so do the number of competitive platforms that offer opportunities to send money. Rashed Al Ansari, Group CEO of Al Financial Services, noted that “we remain confident in our ability to navigate challenges, capitalise on emerging trends, and drive long-term value for all our stakeholders”. He is also concerned about “the disruptive practices of certain fintechs that undermine fair competition and create an uneven playing field for all industry participants” and has taken this complaint up with the regulators.

Another good year for Salik, with both revenue and net profit showing 6.1% annual increases  to US$ 697 million and US$ 316 million; the profit figure includes the extra 9.0% corporate tax, offset by the triple whammy of the introduction of two new gates, introduced in November, more cars on the road, (revenue generating trips 8.0% higher to 498.1 million),  and a 2.5% cut to 22.5%, in the concession fee being paid to the parent entity RTA which became effective on 01 April  2024. Salik operates toll locations in the city and this year introduced variable rates for users passing through depending on the time of the day.

The Dubai-listed parking services operator Parkin recorded a 7.5% hike in profits to US$ 115 million, as revenue jumped 18.6% to US$ 252 million in 2024. There is confidence that there will be even higher growth levels in 2025, when the utility initiates new premium tariffs in Q2, which will see variable rates for peak hours of 8am-10am  and from 4pm to 8pm.  

Dubai Electricity and Water Authority registered a record revenue of US$ 8.44 billion in 2024, with EBITDA, 6.2% higher at US$ 4.28 billion, and net profit after tax of US$ 1.97 billion. Q4 figures included revenue, EBITDA and net profit after tax of US$ 2.03 billion, US$ 1.08 billion and US$ 480 million. As per DEWA’s dividend policy, the utility expects to pay a minimum annual dividend of US$ 1.69 billion, in the first five years starting October 2022, with it being paid semi-annually in April and October. By year end, 17.8% of installed generation capacity was clean, with 6.62 TWh of clean power generated during the year – 7.47% higher compared to 2023 – as the clean power accounted for 11.2% of the total power generated in 2024. There was an annual 3.4% increase in its annual peak demand, compared to 2023, reaching 10.76 GW. During the year, customer accounts rose by 4.8% to 1.270 million

With 2024 revenues and profit coming in at US$ 3.98 billion, (up to 7% higher than expectations), and at US$ 681 million, (49.1% higher on the year), du will be paying out its highest ever dividend of US$ 0.147 a share, 58.8% higher compared to a year earlier. The combined fixed-line and mobile subscribers, (rising 600k to 8.9 million) now come close to ten million. There were increases recorded for both postpaid subscribers, up 10% to 1.8 million, and prepaid users, 2.9% higher at 7.1 million.

The DFM opened the week, on Monday 10 February, fifty-nine points, (1.1%), higher the previous week, gained one hundred and twenty-three points (2.3%), to close the trading week on 5,362 points by Friday 14 February 2025. Emaar Properties, US$ 0.23 higher the previous three weeks, gained US$ 0.01, closing on US$ 3.73 by the end of the week. DEWA, Emirates NBD, DIB and DFM started the previous week on US$ 0.72, US$ 5.78, US$ 2.10 and US$ 0.37 and closed on US$ 0.74, US$ 5.80, US$ 2.08 and US$ 0.38. On 14 February, trading was at three hundred and one million shares, with a value of US$ one hundred and eighty-five million dollars, compared to one hundred and thirty-nine million shares, with a value of US$ one hundred and one million dollars on 07 February.

By Friday, 14 February 2025, Brent, US$ 4.06 lower (5.0%) the previous fortnight, gained US$ 0.07 to close on US$ 74.78. Gold, US$ 247 (9.4%) higher the previous four weeks, shed  US$ 17 (1.0%) to end the week’s trading at US$ 2,884 on 14 February 2025. 2,884 74.78

Speaking at the World Governments Summit, Haitham Al Ghais, Secretary-General of OPEC, estimated that the required investment, to meet the expected growth in demand over the next twenty-five years, equates to US$ 17.4 trillion, or in the region of an annual US$ 640 billion. He noted that the biggest line items, exploration and production sectors, will absorb the largest share of investments, with investments of US$ 14.2 trillion, or around US$ 525 billion annually. Lesser capital expenditure items – in refining/manufacturing and transportation/storage – are expected to see spends of US$ 1.9 trillion and US$ 1.3 trillion. According to OPEC’s World Oil Outlook (WOO) 2024, global oil demand is expected to exceed 120.1 mbd by the end 2050, an increase of 18.0 mbd from 2023’s 102.1 mbd. The split will see developing countries requiring an extra 28.0 mbd, (driven by population growth, urbanisation, and economic expansion), with demand falling 10.0 mbd in developed countries.

On the back of similar moves from rivals including Shell and Equinor, allied with a sharp 35.5% slump in 2024 profit levels, to US$ 8.9 billion, BP posted that it will “fundamentally reset” its strategy by scaling back renewable projects and increasing oil and gas production; it is expected that next week, it will scrap its 2020 target of achieving 50GW of renewables generation capacity by 2030 and half its previous US$ 10.0 billion in renewables until 2030. Even before this latest news, the energy giant had been scaling back by putting the majority of its offshore wind assets into a JV, with Japan’s Jera, to separate them from the company’s core fossil fuel business; last July, it also froze new wind projects. Human rights campaign group Global Witness noted that BP invested US$ 11.3 billion of its total annual balance of US$ 12.9 billion, in oil/gas, and the balance of US$ 1.6 billion on renewables and low carbon energy – a ratio of 87.4:12.6.

In a major cost-cutting exercise, and in a bid to simplify its structure and enable it to act faster, Chevron plans to slash its 45k workforce by as much as 20%, by the end of next year. Last month, the petro-giant indicated that it was looking to sell some of its assets and expand the use of robots in its operations, with resultant savings of up to US$ 3.0 billion. Even though it expects overall production to be 6.0% higher, over the next two years, it has slashed capex. Mark Nelson, vice chairman of Chevron Corp, said the company believed changes to the organisational structure would “improve standardisation, centralisation, efficiency and results”.

Troubled Boeing has posted that it will issue sixty-day notices of involuntary layoffs to about four hundred staff working on its Space Launch System moon rocket program, in line with revisions to NASA’s Artemis program and cost expectations. This program, which will have expensed US$ 93 billion by the end of the year, and set up during Donald Trump’s first presidential administration, represents the flagship American effort to return astronauts to the moon for the first time since the 1972 termination of NASA’s Apollo 17 mission. The latest program has had its share of setbacks, with Artemis 2 being delayed for almost a year, now planned for this September and the first planned manned moon landing delayed for some nine months to September 2026.

The original plan was to see a merger between Honda and Nissan, along with junior partner, Mitsubishi,  to take up the fight with global competitors, including those from China; the Japanese trinity would have resulted in an industry  powerhouse, valued at US$ 60.0 billion, and the world’s fourth-largest by vehicle sales after Toyota, Volkswagen and Hyundai. However, the plan has not materialised but the three companies did agree to continue their partnership on EVs. Honda was the number one in the vehicle triumvirate, followed by Nissan, still reeling from slowing sales and turmoil involving its top executives, including Carl Ghosn. The companies eventually disagreed on what role Nissan would play in the merger – equal partner or subsidiary.

Founded by Jeff Bezos in 2000, Blue Origin is planning to shelve 1.4k jobs, equating to some 10% of its current workforce; the rocket company, which has just completed the first test flight of its new Glenn rocket, has indicated that the job cuts are part of a plan to trim managerial ranks and focus resources on ramping up rocket launches. Once a leader in the field, it seems that it is now lagging behind some of its competitors, mainly Elon Musk’s SpaceX. On top of some management roles, the company will also be eliminating jobs in R&D and engineering. However, its new powerful New Glen does have some advantages over its main rival. One is  its ability to carry large and heavy payloads including satellites into space, and the other is that it is more powerful than Space X’s Falcon 9.

January saw the Food and Agriculture Organisation Food Price Index, the benchmark for world food commodity prices, dip 1.9 on the month in January, averaging 124.9 points; this was still 6.2 points higher on the year but 22.0 lower from its March 2022 peak. The index tracks monthly changes in the international prices of a set of globally traded food commodities, with an analysis of the major indices below:

Sugar Price Index      6.8 lower on the month and 18.5 on the year

                                    down to favourable weather and India resuming exports    

Oil Price Index           5.6 lower on the month and up 24.9 on the year

down to lower world prices of palm and rapeseed oils, while those for soy and sunflower oils remained stable

Meat Price Index       1.4 lower on the month

down to lower international ovine, pig and poultry meat prices outweighing an increase in bovine meat quotations

Cereal Price Index     0.3 higher on the month but 6.9 down on the year

down to a slight drop in wheat export prices while maize prices increased, partly due to lower US production and stock forecasts

All Rice Price Index   4.7 lower on the month

down to ample exportable supplies

Dairy Price Index       2.4 higher on the month and 20.4 on the year

Down to a 7.6% monthly surge in international cheese quotations, which outweighed declines in butter and milk powder prices

The latest International Monterey Fund global growth forecast remains at 3.3% this year and in 2026, before dipping to just below 3.0% for the following five years to 2031. However, its Managing Director, Kristalina Georgieva, speaking at the ninth Arab Fiscal Forum, part of the World Governments Summit 2025 preliminary day in Dubai, said that growth in the Mena will bounce back to 3.6% this year, because of a recovery in oil production and a hopeful easing of regional tensions/conflicts. She was bullish on UAE’s GDP growth indicating that “digital innovation, with AI technologies, is expected to raise UAE’s GDP significantly by 2030, and that more R&D spending will further enhance productivity.” On a global scale, it seems that inflation is decreasing to acceptable government target levels but in some countries, it seems to be nudging higher; that being the case, there could be a divergence in interest rates across countries and higher borrowing costs for emerging market and developing economies. She was also concerned about the level of global public debt, which the IMF expects to top 100% of global GDP by 2030. There is also the danger that some countries will be snared within a low-growth, high-debt scenario and that will have an impact on growth rates between emerging economies and middle-income countries, with some facing significant slowdowns, due to not only financial but also geopolitical pressures.

There is no doubt that Australia is in the middle of a severe housing crisis and one of the main reasons is affordability – in the 1990s, it took six years to afford a deposit for a mid-price house on an average income. Years ago, it was a given that a middle-class job could almost guarantee a life in middle suburbia. After years of trying to solve the affordability conundrum, the answer may be found across the Tasman. Fifteen years ago, Auckland was beset by a similar problem – housing was as unaffordable as is the current Sydney. However, a major planning turnabout saw the pace of building more than double, with a boom in townhouses and clamping spiralling rents and house prices.  It does seem that something similar could well benefit Australia.

However, the roots of the Australian problem go back to the 1980s. In the last two decades of the last century, the country’s standards of living grew enormously, side by side with surging demand for housing. Entering the housing market was made easier by government initiatives, including generous allowances for new buyers, tax relief and low interest rates. Almost simultaneously, house prices began to grow faster than incomes, so much so that from 2001 to today, house prices quadrupled while wages only doubled. What happened is that homeowners have become wealthy, and it is estimated that a sixty-year old home owner, on average, was twice as wealthy on their fiftieth birthday as on their fortieth and are wealthier again today. Home ownership rates have fallen sharply, and the portion of income spent on housing has increased. The current scenario for young Australians is that they have to start off with a large deposit, to help with a longer mortgage period, high repayments relative to income, and having to live in an increasingly more expensive rentals, whilst trying to pull in the deposit money. If all goes to plan, the move will be into a much smaller abode, further away from what would be preferred. In simple words, the problem could be solved – increase the supply; if that had happened, prices would have more than likely kept in tandem with pay rates. The slump, having started in the early 2000s, recovered a little in the 2010s but is now at historic lows.

Many consider that there is not enough land available to build more homes, especially medium-density housing in places where most people want to live, within reasonable distance from inner-city suburbs. Australia is definitely not the only country in the world where the planning system is notoriously complicated, time consuming, corrupt (in certain cases), and bureaucratic, beset by reams of rules and regulations. This is best summed up by Susan Lloyd Hurwitz, chair of the government’s housing supply and affordability council, commenting “our planning approval systems are too complex and too slow. Arrangements vary across states and territories and across the more than five hundred local governments that provide planning consent authority.”

With Japanese Prime Minister, Shigeru Ishiba, standing beside him at the White House, the US President confirmed that Nippon Steel will drop its US$ 14.9 billion bid to acquire US Steel, and that it would instead “invest heavily” in the company, without taking a majority stake. In his last days as President, Joe Biden had blocked the proposed takeover on national security grounds and that domestic ownership was important, with the Japanese calling his decision “incomprehensible”. Trump – who mistakenly referred to the firm as “Nissan” – said he would meet Nippon’s head next week to “mediate and arbitrate” the deal.  In the US, Japanese companies are the largest job creators in ten states and the second largest in another six – and the country.

The French Ministry of Economy has amended its earlier 2026 projected public debt, at 4.6%, now expecting a marginal increase to see it remain just under its 5.0% threshold. Last October, a financial plan, indicating its commitment to reduce the public debt to under 2.8% was submitted  to the EC. Late last week, the French Parliament approved the 2025 state budget in a final vote in the Senate; it included austerity measures, worth US$ 52 billion, in a bid to reduce the public deficit to 5.4% of GDP in 2025, down from the 6.0% deficit expected for 2024. The Ministry of Economy stressed that achieving this target is “essential”, noting that budget implementation will be closely monitored to ensure compliance with ministerial allocations and to take any necessary corrective measures. Additionally, the French government has revised this year’s economic growth forecast down 0.2%, to 0.9%.

Last year, Spain received a record ninety-four million visitors and is fast catching up with France’s latest one hundred million total, which makes it the world’s biggest foreign tourist hub. Spain’s surprising recent tourism spurt has also helped the national economy, (the eurozone’s fourth biggest), post the highest growth in 2024, at 3.2%, compared to Germany, France and Italy with a 0.2% contraction, 1.1% and 0.5% growth. UK’s figure was 0.9%. No wonder that ‘The Economist’ has ranked Spain as the world’s best performing economy, with the country responsible for 40% of eurozone growth last year. It is truly amazing to see Spain bounce back from the pandemic when its GDP shrank by 11% in one year. It is estimated that public spending has accounted for about 50% of Spain’s recent growth and that the modernisation process is being aided by post-pandemic recovery funds from the EU’s Next Generation programme. Spain is due to receive up to US$ 169.0 billion by 2026, making it the biggest recipient of these funds, alongside Italy. Spain is investing the money in the national rail system, low-emissions zones in towns and cities, as well as in the electric vehicle industry and subsidies for small businesses. The rise in tourism has been a major boost but other factors – including financial services, technology, and investment – have played their part.

The Spanish flea in the ointment is that the country continues to have the highest jobless rate in the EU, being almost double the bloc’s average. However, the pendulum may have begun to swing, with Q4 showing the rate fall to 10.6% – its lowest level since 2008 – whilst the number of people in employment, now stands at twenty-two million, a record high. A labour reform, encouraging job stability, is seen as a key reason for this. However, other obstacles are in the way with a possible triple whammy of Spain’s mega public debt, which is higher than the country’s annual economic output,  a mushrooming housing crisis across the nation, (with millions struggling to find affordable accommodation), and the top-heavy reliance on tourism, allied with a growing backlash from disenchanted nationals.

Critics argue that the Trump administration’s decision, to slash billions of dollars from overheads in grants for biomedical research, will stifle scientific advancements. The National Institute of Health confirmed it would cut grants for “indirect costs” related to research – such as buildings, utilities and equipment – and that “as many funds as possible go towards direct scientific research costs rather than administrative overhead.” It is hoped that the agency’s estimate that the cuts – which came into effect last Monday – would save US$ 4.0 billion, with the agency posting that it would impose a 15% cap, (half of the current average rate of 30%), the rates grant pay for indirect research. As leader of Doge, (the Department of Government Efficiency), Elon Musk has claimed that some universities were spending above that 30%, commenting “can you believe that universities, with tens of billions in endowments, were siphoning off 60% of research award money for ‘overhead’? What a rip-off!”

In January, US posted lower growth in the month, despite the unemployment rate dipping 0.1% to 4.0%, indicating a solid, if more subdued, economy with employers adding 143k jobs last month. The news comes in the same month that Donald Trump returned to a major shake-up, including cuts to government spending and the federal workforce, mass migrant deportations and higher tariffs on many goods coming into the US. Federal Reserve chairman, Jerome Powell, also said the bank’s concerns about the job market had subsided.

Mainly because of higher egg, (15% higher because of avian flu), and energy prices, along with car insurance, airfare, medicine and other basics, January US inflation, pushed up to 3.0% –  its highest rate for six months, with the news coming a week after the US central bank maintained rates, pointing to  economic uncertainty. Prices for clothing, by contrast, declined, while rents and other housing related costs increased 4.4% over the last year, marking the smallest twelve month increase since January 2022. The Fed has still not come to grips with putting inflation back into its box and now has to consider what impact other factors, such as a squeeze on labour supply growth, will have in it trying to hit their long-held 2.0% target.

President Donald Trump has said he will announce a 25% import tax on all steel and aluminium entering the US, a move that will have the biggest impact in Canada, commenting that “any steel coming into the United States is going to have a 25% tariff.”  Canada and Mexico are two of the US’s biggest steel trading partners, and Canada is the biggest supplier of aluminium metal into the US. In another announcement later in the week, he indicated that there will be reciprocal tariffs on all countries that tax imports from the US, commenting “if they charge us, we charge them.” During his first term,  (2016 – 2020), Trump put tariffs of 25% on steel imports and 10% on aluminium imports from Canada, Mexico and the EU.; within a year, an agreement with his two nearest neighbours saw tariffs ended, although the EU import taxes remained in place until 2021. China has also imposed export controls on twenty-five rare metals, some of which are key components for many electrical products and military equipment. This move by China is because of the US preventing Chinese access to semiconductor chips and many other AI developments.

There has been a lot of interest in potential buyers for The Original Factory Shop, including Mike Ashley’s Frasers Group and Poundstretcher, which is owned by the investment group Fortress. The latest is that Modella Capital, the owner of Hobbycraft, is the inside runner to buy TOFS, after discussions with Baaj Capital broke down; Modella has also been in the mix to acquire WH Smith’s high street stores. The private equity firm, Duke Street, has owned the independent discount retail chain, with some one hundred and eighty stores in the UK, since 2007. Established in 1969, TOFS sells beauty brands such as L’Oréal, the sportswear brand Adidas and DIY tools made by Black & Decker.

In true British style, Trade minister Douglas Alexander said the UK would not have “a knee-jerk reaction” but “a cool and clear-headed” response to Donald Trump’s latest renewal of steel and aluminium tariffs, at 25%, set to start on 12 March. The US is the world’s largest importer of steel, with Canada, Brazil and Mexico, as its top three suppliers, and Trump sees imposing tariffs, which will be paid by companies bringing the metal into the US, as a way of shifting away from foreign imports and boosting domestic steel production. The US is the third largest customer for UK steel, with exports totalling US$ 483 million, behind Ireland (US$ 610 million) and The Netherlands (US$ 576 million), but ahead of Sweden (US$ 476 million) and Belgium (US$ 456 million). With the US accounting for about 10% of UK’s steel market, probably the main concern would be the possibility of other steel-making countries, which refuse to trade with the US, may start dumping their excess steel in the UK. In a MAGA bid, it seems that the US president is keen to ‘level the trade playing field’ and aiming at countries and trading blocs, such as the EU, which export more to the US than they import.

Research consultancy, Indeed, has listed the ten most in-demand jobs in the UK, with the highest being for paediatricians, as vacancies increased 91% and offering a salary of around US$ 131k. Last year, listings for teachers surged 245%, with positions offering US$ 48.6k. Meanwhile, property solicitor roles have jumped by 111%, coming with an average salary of US$ 65.4k. Doctors were the seventh most in-demand profession, with job postings rising by 95%, followed by AI engineers also increasing by 86%.

Despite the UK economy being in almost negative territory, website Hitched indicates that last year, the average cost of a wedding rose 11.0% to US$ 29k, with more than 67% of couples saying their families helped pay for their weddings; only 10.0% took out loans or got new credit cards to cover costs. The knock-on effect of inflation pushed 61% of couples to increase their budgets at least once. Two of the major costs were the venue, at US$ 11k, and catering – US$ 8k.

Only a politician could answer the following question, when the Prime Minister was asked about Rachel Reeves’ CV. He replied that she has “dealt with any issues that arise”, and when asked in an interview whether he was “comfortable that she exaggerated her relevant experience”,

he replied the issues were from “many years ago” but that he and the chancellor “get up every day to… make sure that the economy in our country, which was badly damaged under the last government, is revived and we have growth, and that is felt in the pockets of working people across the country”. Rachel Reeves has frequently cited her time at the Bank of England as part of the reason that voters can trust her with the public finances and has repeatedly claimed to have spent up to 10 years there. The Chancellor left the financial institution nine months earlier than she stated in her LinkedIn profile. This means she spent five and a half years working at the bank – including nearly a year studying – despite publicly claiming to have spent a decade there. She joined HBOS in 2006 and initially claimed that she worked there as an economist but changed her profile to Retail Banking, with The Times reporting that er actual role was “running a customer relations department dealing with complaints and mortgage retention”.

In a cry for help, Chancellor Rachel Reeves met some of the leaders of UK’s high street banks, including Georges Elhedery, Debbie Crosbie, Charlie Nunn, Paul Thwaite, (of HSBC, Nationwide, Lloyds Banking Group and NatWest) plus senior representatives of Barclays and Santander UK. The main item on the agenda was to discuss Labour’s financial services growth strategy – one of the pillars of the wider industrial strategy being drawn up by ministers. She will be asking for fresh ideas from them on how best to kick start the faltering economy. The Chancellor has had so much negative press from her October budget and has been trying to kickstart economic growth since then. More bad news came her way recently, with the BoE downgrading the country’s growth forecast and there are some who think it is inevitable that she will have to raise taxes sometime this year.

With a Q4 GDP growth of 0.1%, the UK economy will not go into a technical recession until mid-year, at the earliest; a technical recession occurs following two consecutive quarters of ‘negative growth’. It appears that the Q4 ‘improvement’ only arose because of growth in Christmas spending and manufacturing during December, and follows a contraction of 0.1% in the previous quarter. Overall, last year the economy grew by 0.9%. There is no doubt that the dynamic duo of Starmer and Reeves has scored at least two own goals in their attempt to grow the economy. The first was after trash talking the economy ahead of its October budget and the second by hikes to employer National Insurance contributions from April 2025 that have impacted investment, forced job cuts, and hit pay rises. The fact is that the UK economy is in a rut and faces potential obstacles in the coming months, including the possibility of Trump tariffs, slowing growth forecast, the distinct possibility of rising inflation and the population facing water, energy and council tax rising sharply in April. Don’t Worry, Be Happy!