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The total realty transactions of 60.6k, as reported by the Dubai Land Department, topped US$ 70. 6 billion last year – slightly down compared to 2015’s 63.7k valued at US$ 72.7 billion. The government agency expects further sustainable growth this year, as 134 new projects, totalling US$ 27.2 billion, have already been launched. UAE nationals, with 7k citizens spending US$ 6.0 billion, were the top investors, followed by Indians (6.2k investing US$ 3.3 billion), Pakistanis and Britons. The five top sales locations were Business Bay (3.5k investments totalling US$ 1.7 billion), Dubai Marina, Jebel Ali 1, Burj Khalifa and Warsan 1. (The DLD has reported an encouraging start to the year withproperty deals in the first 15 days totalling US$ 3.3 billion).

Cavendish Maxwell indicate that 16.4k new homes were handed over in 2016 and that a massive 61k, including 13k carried over from last year, are scheduled for completion over the next 12 months. The consultancy estimated that average apartment and villa rents fell, year on year, by 3.4% and 3.6% respectively, but the rate of decline flattened in Q4. CBRE put the annual rent increases at 4.6% and 6.5% respectively. The consultancy sees a more stable sales environment this year, as investor confidence improves.

In contrast, Al Masah Capital anticipates that over the next two years, 57k residential units will be handed over, 30k of which will take place this year. Both studies seem to indicate that there is some sort of equilibrium between supply and demand occurring, as the workforce expands ahead of 2020. CBRE expects that 70k units could be delivered over the next three years.

Following last year’s success of “Amaranta”, Dubai Properties has launched “La Quinta” at its Dubailand’s Villanova community. The development will cater for larger families, with unit sizes ranging from 2.2k sq ft to 3.9k sq ft.

Nakheel has released tender papers for its US$ 1.36 billion Deira Islands Boulevard project of sixteen 21-storey residential towers. Each tower will house 670 apartments, 65 townhouses and retail/recreational facilities. Located around the 6.5 million sq ft Deira Mall, the community will be home to 10k residents.

As the move to introduce more budget hotels gathers pace, AccorHotels is considering two new brands for the Dubai market, in addition to its existing Ibis and Mercure names; Mama Shelter and Jo&Joe are both scheduled to be rolled out in France next year. The latter is in competition with Airbnb, mixing the best of private-rental, hostel and hotel formats.

Despite a lackluster 2016 for the retail sector, it seems to be full steam ahead for new projects this year with a huge US$ 4 billion investment expected, compared to US$ 502 million and US$ 812 million in the previous two years. According to a recent MEED study, major developments will include Phase 1 of the World Mall (US$ 1.0 billion), Dubai Creek Harbour retail district (US$1.0 billion), Deira Island Mall (US$ 900 million) and Dubai Hills Mall (US$ 763 million). There is no doubt that the retail sector expects a major turnaround in business as Expo 2020 approaches.

The RTA and DP World have signed two transport agreements. The first relates to taxi services to and from the Hamdan bin Mohammed Cruise Terminal, whilst the other will see further cooperation to streamline road transport operations in and around Jebel Ali Port. The local cruise sector is booming, with an expected 30% hike in numbers to 650k (and a 16% rise in cruise ships to 134).

Phase 3 of the 800 MW MBR Solar Park will start by the end of the month, with the engineering, procurement and construction contract being awarded to an international consortium led by GranSolar of Spain. The first (200 MW) of three stages of this 16 sq km phase will be completed within 18 months, with the next two (600 MW) finalised by 2020.

DP World has signed yet another agreement in Kazakhstan – this time to develop an economic zone in Aktau on the Caspian Sea. It is hoped that shipping capacity can be expanded and a logistics area developed.

In a bid to generate extra revenue, Emirates will allow its Skywards Blue members to pay to use its premium lounges in Dubai. The fee for a maximum 4-hour stay will be US$ 200 in the first class lounge and US$ 100 in business class.

As part of its long term strategy, Expo 2020 Dubai has initiated a further phase of a US$ 100 million “Expo Live” programme to assist, finance, accelerate and promote creative projects from individuals, SMEs and other entities. The low-key introduction of this pillar is the first of four half yearly cycles to find suitable projects and it is hoped that it will be a catalyst for future innovation. An earlier program drew 575 applicants from 71 countries, with 29.2% of those projects now undergoing technical reviews.

Compareit4me.com estimate that UAE credit card applications jumped by 55% last year. Over 50% of cards were provided by American Express (22.5%), Citibank (15.0%) and ADCB (13.3%). Despite tough economic conditions, Visa has seen a 10% year-on-year regional growth in 2016 card transactions in the region. Quite often, credit cards prove more profitable to banking institutions, rather than their customers who often get caught up in a debt trap.

Having grown 2.7% last year, the Dubai economy is expected to improve to 3.1%, according to HH Sheikh Ahmed bin Saeed Al Maktoum. This is slightly less than the 3.3% expounded by the IMF. Late last year, the government announced its annual budget of US$ 12.9 billion (3% higher than in 2016) which included a 27% hike in infrastructure spending ahead of Expo 2020 – this and the uptick in the oil price will encourage further investment that makes the growth forecast achievable. The emirate expects a US$ 681 million deficit this year, equating to 0.6% of its GDP.

Meanwhile, the Minister of Economy, HE Sultan Al Mansoori, has reiterated that he expects UAE growth to remain steady at 3.0%, with non-oil contributions to GDP up 0.2% to 3.8%.

Still the region’s most attractive destination for foreign direct investments, the UAE saw US$ 10.0 billion flowing inro the country last year with an accumulated year end balance of US$ 119 billion. Outflows – at US$ 9.3 billion were 3.3% higher than in 2015.

Majid Al Futtaim was in the news this week on two fronts. The holding company, with a BBB Fitch and S&P rating, is reportedly in bank discussions for a US$ 1.5 billion revolving credit facility to be used for refinancing existing debt. Following reports that Amazon.com and India’s Flipkart Online Services are no longer interested in acquiring Dubai-based Souq.com, it seems that MAF is in negotiations to buy the site. The 12-year old e-commerce business could be worth in excess of US$ 1 billion.

Abraaj Group is planning to divest its 50% stake in The Entertainer which it acquired almost five years ago. The private equity firm expects that the local hailing app, Careem, will go public to raise the finance required to grow in regional markets. Currently the company has 4  million registered users and a fleet of 90k drivers.

It seems that some banks may be unhappy at the proposed pricing for the US$ 1.2 billion financing package for the Metro extension – the balance, US$ 1.6 billion, will be picked up by export credit agencies. Last year, the government set out its parameters for the loan that included a rate of no more than 200 basis points over Libor, with miscellaneous fees capped at 115 bps. For 10-year loan tenor, some banks consider a 250bps margin more appropriate. The government could be in the market for at least US$ 42 billion when projects like DWC (US$ 35 billion) and Expo 2020 (US$ 7 billion) are brought into the equation.

Despite a 3.0% fall in total income to US$ 4.0 billion, the first of the season’s earnings reports saw Emirates NBD posting a 2.0% rise in 2016 profit to US$ 1.97 billion: an improvement in impaired loans helped the cause and offset the 1.0% fall in non-interest income. Three major indicators headed north – total assets by 10% to US$ 12.2 billion, deposits (8% to US$ 8.5 billion) and loans by 7% to US$ 7.9 billion. During the year, the bank raised US$ 5.5 billion of term debt at competitive pricing. However, Q4 profit fell by 13.1% to US$ 504 million, compared to the same period in 2015.

Its sister bank, the Shariah-compliant Emirates Islamic, did not fare as well. Even with gross income remaining stable, profits sank by 76% to US$ 29 million on the back of a significant downturn in impairment provisions which jumped 66% to US$ 354 million.

Having gained over 5.0% (190 points) in the first two weeks of 2017 trading, the DFM opened Sunday at 3721 but lost some impetus losing 31 points (0.8%) to close Thursday (19 January 2017) on 3690. Volumes were lower, closing the last day of the week, at 903 million shares, valued at US$ 330 million, (cf 1.48 billion shares for US$ 414 million, the previous Thursday). Emaar Properties and Arabtec were both lower – by US$ 0.03, to US$ 2.06 and US$ 0.01 to US$ 0.40 respectively.

This week saw Brent Crude continue the previous week’s downward trend, trading US$ 1.85 lower at US$ 54.16. Having moved US$ 69 higher over the previous three weeks, gold nudged US$ 2 higher, closing at US$ 1,202 by Thursday (19 January 2017).

Hyundai / Kia expect to increase its US investment by 50% to US$ 3.1 billion over the next five year period including a new factory. Only three months ago the South Korean conglomerate opened a US$ 3 billion facility in Mexico that has an annual capacity of 300k vehicles.

The world’s largest eyewear manufacturer, Essilor International SA is set to acquire the leading global retailer, Luxottica Group SpA, in a US$ 24 billion deal which will see investors getting US$ 0.493 for each of the French lensmaker’s shares. News of the merger saw Essilor shares jumping 15% to US$ 125 whilst Luxottica rose 11% to US$ 60.

As expected, British American Tobacco has taken over Reynolds in a US$ 49.4 billion deal that has created the world’s largest listed tobacco firm. The company had already owned a 57.8% stake but had seen a US$ 47 billion offer rejected in November. The US company was the country’s second largest tobacco company, behind Altria, and last year had taken over Lorillard for US$ 25 billion.

US regulators have claimed that Qualcomm forced Apple to use its chips in return for lower fees as it studies whether the world’s biggest maker of mobile phone chips has abused its dominant marketing position. The Federal Trade Commission is looking at the process the San Diego firm collects royalties on its chip technology. This is not the first time that the company has faced antitrust rulings and investigations including having to pay a 2015 US$ 975 million penalty in China for similar charges.

It has taken almost 8 years for Moody’s to be fined US$ 864 million for their dubious role into credit ratings on sub-prime mortgage securities; it is estimated that the ratings agency earned US$ 2.5 billion in the four years prior to the GFC. This comes a year after S&P’s US$ 1.5 billion settlement with the US courts for similar offences. The agencies (and many “guilty” individuals) seem to have got off fairly lightly, considering that banks have already paid out US$ 162 billion in fines and penalties. Moody’s and S&P were apparently issuing top grade ratings to junk stock just so they could win business from the banks preparing the securities. At the time of the crisis, these two agencies, along with Fitch, had 96% of the market share.

Takata Corp is another entity to face the wrath of US courts. The company has settled for a US$ 1 billion fine for a fatal defect in its vehicle air bag inflators which has seen 11 killed in the US and 180 injured. The problem was so big that it involved the recall of 42 million vehicles and 69 million inflators in the country. (A day after this announcement, Toyota recalled a further 543k vehicles in the US).

To settle bribery and corruption cases, Rolls Royce, engine manufacturer, has agreed to pay US$ 817 million plus costs to the UK’s Serious Fraud Office and a further US$ 170 million to the Department of Justice in the US. Most of the offences involved “intermediaries” in China, Indonesia and other markets. A further US$ 26 million is expected to be paid to Brazilian regulators. It does seem odd that the SFO may be going after RR executives involved in the scandal when so many bankers seemed to have been let off the hook by the concerned authorities.

Unconfirmed reports indicate that Toshiba could be in a worse state than first thought. Its shares dived 25% on Thursday on fears that the blow-out from its US nuclear power business may see write-offs a lot higher than the US$ 6.1 billion first indicated.

The acting head of Samsung Electronics, Jay Y Lee has been indicted on bribery charges in a corruption scandal that threatens to embroil many of South Korea’s leading institutions. However, on Thursday, a judge ruled there was no reason, as yet, to detain the 48-year-old Samsung heir. This comes a month after the impeachment of President Geun-hye brought down by a cash-for-influence probe.

There were two major plane deals this week. Boeing has won a possible US$ 22 billion order with SpiceJet; this involves 205 Max 737s aircraft – a firm order for 100, a right to buy an additional 50 in the future and 55 jets from a previous order. India’s domestic air passengers surged by 21% last year and the country is expected to be the 3^rd biggest global aviation market within five years.

Saudi Arabia’s Flynas has reached a US$ 8.6 billion deal with Airbus for an unknown number of planes. Kingdom Holding Company owns 34% of the Riyadh-based budget carrier.

Privately owned conglomerate Kuang-Chi has acquired a substantial minority shareholding in Gilo Industries Group, a UK manufacturer of rotary engines for unmanned aeronautical vehicles. It seems that this deal is a forerunner of more to come as Chinese and other international companies target pioneering UK tech companies – a welcome sign that there is economic life after Brexit.

Morgan Stanley must be thanking Donald Trump after posting an 83.9% hike in Q4 profits to US$ 1.67 billion thanks to a boost in financial trading following the November presidential election. Over the past twelve months, the bank’s shares have climbed 68.2%, closing on Thursday at US$ 42.45.

For reported fees in excess of US$ 100k, David Cameron and George Osborne will give speeches in Davos for PwC and HSBC respectively. Both have been earning their bread around the world passing on their wisdom and experience, mainly to finance-related entities. Another politician on the gravy train is former Conservative leader and Foreign Secretary, William Hague. It is reported that the now Lord Hague has become a senior advisor to Citi, having already delivered nine speeches to the investment bank over the past year; he joins the former BoE Governor, Melvyn (now Lord) King who joined the bank in 2016.

Controversial Philippine President Rodrigo Duterte has had a successful overseas trip raising US$ 33 billion in foreign investment, including US$ 15 million overseas development assistance from China and Japan, along with a further US$ 18 billion from private companies. Most of the money will be spent on much needed infrastructure projects.

As it continues to support the floundering yuan, China saw its November balance of US government bonds and other paper fall again – this time by US$ 66.4 billion to US$ 1.05 trillion.

The 19-country eurozone produced positive economic news towards the end of 2016 with December industrial production rising 1.5% month on month, compared to forecast expansion of 0.5%; the main drivers were a 2.9% rise in the production of non-durable consumer goods and a 1.6% increase in intermediate goods. Meanwhile the EU28 saw industrial output jump 3.1% in November.

Meanwhile, the ECB has maintained its base interest rate at zero and its monthly US$ 85 billion bond buying exercise. However its head, Mario Draghi, admitted that the economy was still fragile with the 19-country bloc facing continuing sluggish growth amid worries of a buckling Italian banking system.

A lot can happen in three months! Not renowned for their forecasting abilities, the IMF has slashed Saudi Arabia’s 2017 growth forecast from its October 2016 figure of 2.0% to 0.4%. On a global scale, the organisation has maintained their outlook of 3.4% and 3.6% over the next two years.

Both the UK and US economies have been upgraded – the former by 0.4% to 1.5% and the latter by 0.1% to 2.3%: this despite the doom and gloom dire warnings of many, who should know better, following Brexit and the Trump electoral victory. China’s growth is now changed to 6.5% (from 6.2%) whilst India’s forecast has been downgraded 0.4% to 6.8%, following PM Modi’s December demonetisation drive. For what it is worth, the IMF considers that the Russian and Brazilian declines have flattened out with minor growth forecast in 2017. No doubt their next deliberations due in April will be changed again!

Prime Minister May confirmed that the UK would be going for a “hard Brexit” and anything like partial memebrship was not an option. Her government would aim for a “bold and ambitious” free trade agreement with the EU. There were the expected dire warnings from the IMF but these have to be taken with a pinch of salt; this was the body that forecast before the referendum that an exit would have consequences from “quite bad to very, very bad” – since then the opposite happened and the world body has had to admit that it had been too pessimistic.

Unsurprisingly, banks have jumped on the bandwagon – with the likes of HSBC, JP Morgan and UBS threatening to shift jobs out of London.

December’s UK CPI surged 25%, month on month, to 1.6% – its highest level in over 30 months – largely because of the falling pound that has seen producer prices head north as costs for imported materials and fuels spiral. The month’s RPI, which measures consumer inflation, rose to 2.5%, as factory prices for raw materials and energy increased by 15.8% over the year.  The CPI is still below the government’s 2% target but if the recent trend continues then expect the BoE may press the button for a rate hike.

Good news for the incoming Trump administration that Amazon expects to grow its US workforce by 55% (100k) over the next 18 months. The jobs – mainly in software development and warehouse logistics – will help the world’s largest on-line retailer to fulfil orders quicker and cheaper in the future. Disappointing December US retail sales posted a 0.6% rise, slightly lower than market expectations, with the standout performer being the rebound in auto sales at 2.4% (after a 0.2% dip the previous month).

It is about time that doubters got used to the new order – both Brexit and Trump are here to stay. Undoubtedly, the global economy will benefit from a more modern and equitable way to address its problems that has seen only eight people share the same amount of wealth as 50% of the global population. Despite biased and often unsubstantiated reports to the contrary, these economic Luddites should finally understand that the 45^th President of the USA is no Fool On The Hill!

It is expected that KOA’s first mixed-use development will be completed by the end of 2017. The 70-apartment project, located near Mohammed bin Rashid Gardens, will also include a multi-purpose ampitheatre and a gourmet market.

With an opening slated for early 2017, Dubai Motor City’s First Avenue has signed its initial main anchor tenant – ACE Hardware. The US$ 136 million development will house 70 retail outlets, 15 eateries and a 150-key Park Inn by Radisson.

Damac Properties has introduced a Dubai Shopping Festival offer to any purchaser of its units, valued at over US$ 163k, a brand new BMW or other luxury car. No doubt that the developer, having sold a total of 16.8k units to date, will see a mini sales boom up to 28 January 2017.

As has happened over recent months, Dubai’s hotels have seen occupancy levels nudging higher, whilst other indicators head south. November is no exception with occupancy up 4.7% to 89.5%, with the average daily rate and revenue per available room down 8.6% and 3.6% to US$ 250, compared to the same month in 2015.

Meydan Group announced that it had secured Islamic financing of US$ 272 million to be used for its new projects, including its residential District One Project in MBR City.

Dubai Municipality has indicated that it will be spending up to US$ 681 million on two new commercial facilities, as well as expanding and maintaining existing markets. The Central Fruits and Vegetables Market is expected to cost US$ 272 million whilst a multi-storey cold storage for vegetables and fruits for 56 stores comes in at US$ 44 million. It is also currently constructing a US$ 26 million facility specifically for building materials in Warsan-3 and a US$ 21 million market for furniture, electrical equipment and household appliances, located in Nad Al Sheba.

DM has also signed an agreement with the Mohammed bin Rashid Space Centre (MBRSC) in connection with the design and manufacture of the region’s first environmental nanometric satellite – DM SAT1. The project emanates from the Dubai Future Accelerators program, with the advanced satellite able to collect and analyse environmental data.

DEWA announced that it had completed 53% of its US$ 400 million M-Station power plant that will generate a further 700 megawatt – 34% – to 2,760 MW to Dubai’s capacity.

The second phase of the US$ 13.6 billion, 5k MW Mohammed bin Rashid Al Maktoum solar park is set to be completed by April 2017. Then the extra 213 MW solar PV power will provide for electricity to an additional 30k homes.

As part of HH Sheikh Mohammed bin Rashid Al Maktoum’s US$ 354 million Hatta development master plan, construction work will soon start on the Hatta Gate art project. Located in the Hatta heritage area, the building will reflect the area’s topography of mountains and cliffs. The RTA is also currently building a US$ 15 million link road from the town to Dubai, via Lehbab.

Following a directive from Sheikh Hamdan Bin Mohammad Bin Rashid Al Maktoum to boost the industrial sector in line with the Dubai Industrial Strategy 2030, it is expected that Dubai’s GDP could see a US$ 45 billion surge over the next 13 years. The Crown Prince is highlighting the need for an impetus in knowledge-based jobs and wants to see 27k new specialised positions, a marked increase in R&D and related exports to jump by US$ 4.4 billion.

Airbus announced that it was postponing the delivery of 12 A-380s to Emirates due over the next two years. Last month, the airline indicated that it was having some unspecified issues with the new RR engines for the jumbo.

Dubai New Year revelers will have to dig deeper this year, as a travel study has concluded that the emirate will be the most expensive location in the world. The average cost of a “package” covering all the accoutrements – such as drink, food and entertainment – has risen 11.2% to US$ 610 compared to the likes of New York, London, Paris and Sydney where the cost comes in at US$ 510, 391, 319 and US$ 259 respectively.

Local petrol prices nudged higher again with Special 95 up US$ 0.030 to US$ 0.490 from 01 January; over the year, the price has risen 6.5%. A further hit for UAE drivers came with the news that 35% will have to pay more for vehicle insurance in 2017, as new tariffs come into force with minimum premiums of US$ 354 and US$ 545 for saloon cars and SUVs respectively.

The 5-year old Emirates Development Bank has sanctioned a US$ 409 million budget – half of which will go to housing loans for Emiratis and the balance for the for the development of SMEs to help the private sector generate more job opportunities for citizens.

With imports at US$ 161.9 billion, reexports of US$ 67.8 billion and exports totalling US$ 29.7 billion, Dubai’s non-oil foreign trade for the first nine months of the year showed an YTD decrease of 1.4% to US$ 259.4 billion; imports were 0.5% lower from the previous year’s return of US$ 162.7 billion, with reexports down 7.4% from US$ 73.3 billion and exports 8.3% lower at US$ 27.2 billion. However, there was an 11.0% surge in the volume traded to 70.8 million tonnes.

Shuaa Capital has paid US$ 25 million for a 14% stake in Bahrain’s Khaleej Commercial Bank. The Dubai-listed investment bank bought the 147.1 million shares in a special auction from Alimtiaz Investment Group.

The Investment Corporation of Dubai posted a 23.2% dip in H1 profits to US$ 2.2 billion, as revenue fell 7.9% to US$ 22.5 billion. A leading driver was the fall in oil and gas earnings (accounting for 23.5% of ICD’s portfolio) sinking 30.6% to US$ 5.3 billion, with its investments in the likes of Enoc, Ducab and Emirates Global Aluminium being badly affected by a torrid 2016 in the energy sector. ICD has stakes in many of the emirate’s iconic companies including Dubai Islamic Bank, Emirates, flydubai, Jumeirah and Nasdaq Dubai. Its total assets have increased 2.3% to US$ 200.8 billion.

The DFM opened Sunday at 3517 and after a flat week’s trading closed 14 points higher on Thursday (29 December 2016) at 3531. Volumes were on the low side at 398 million shares, valued at US$ 89 million, (cf 210 million shares for US$ 169 million, the previous Thursday). Emaar Properties and Arabtec were both down for the week by US$ 0.04, to US$ 1.94 and US$ 0.01 US$ 0.36 respectively.

This week saw Brent Crude having another good week – US$ 1.80 higher to US$ 56.85. Finally, gold reversed its recent downward trend, closing US$ 27 higher at US$ 1,158 by Thursday (29 December 2016).  Over the year, both commodities traded upwards with Brent up US$ 18.42 to close 2016 at US$ 56.82, whilst the yellow metal was US$ 92 higher at US$ 1,152.

With OPEC’s 2-year strategy of slashing prices by pumping more oil, in a bid to cut out the shale producers, showing some success, the cartel has to ensure that rising oil prices do not encourage a comeback from these alternate oil suppliers. Now as prices nudge higher to the mid-US$ 50 range, shale rigs are being brought out again – an estimated 200 since May. It is estimated by the IMF that a US$ 62 breakeven point would cover most members’ shortfalls but the higher the price the higher the number of shale producers will re-enter the market.

Further to Boeing’s announcement last week that it had secured a US$ 16.6 billion deal with Iranair for 80 aircraft, the Iranian Deputy Transport Minister, Asghar Fakhrieh-Kashan, has indicated that the value of the order was only about 50% of that total. Likewise, it seems that Airbus has been touting a figure in the region of US$ 19 billion for its recent order of 100 planes, whereas the airline’s chief executive has indicated that the value was less than US$ 10 billion.

In Australia, the largest lotteries and betting company in the world has rejected a US$ 4.8 billion takeover bid from Pacific Consortium. The board of Tatts seems to prefer the bid from Tabcorp.

Shares in troubled Toshiba Corp took a 20.4% dive in one day, as news that it may be facing billions of US$ in losses, relating to a US nuclear power acquisition. The company is just recovering from a major accounting scandal that saw the electronics conglomerate inflating profits by US$ 1.25 billion over a 7-year period as well as last year’s write down of US$ 2.3 billion for its nuclear business.

Following its dubious role in mortgage-backed securities, some may consider that Deutsche Bank has got off lightly with a US$ 7.2 billion penalty from US authorities, when the initial September fine came to US$ 14.0 billion. In a similar deal, Credit Suisse has had its fine for similar misdeeds cut to US$ 5.3 billion. Furthermore, it seems that Barclays is now on the DoJ’s radar for alleged mortgage securities fraud involving US$ 31 billion in securities. The US authorities said it would seek compensation up to the amount that investors lost or that Barclays gained.

As expected, the Gentiloni government rubber-stamped a US$ 21 billion finance package to support Italy’s troubled banking sector. The first bank in the queue for funds will be the world’s oldest, Monte dei Paschi di Sienna, which failed in its attempts to raise US$ 5.5 billion from private investors. Now it is requesting a further US$ 4 billion as the shortfall is now bigger than first thought. Under updated EU rules, any bank applying for government assistance will have to convert any junior bonds to shares – a move that may cause problems for small investors, who traditionally own such paper, if and when the financial institution hits the buffers.

It has not been a good first year for the incoming Argentine President Mauricio Macri, as he sacks his finance minister, Alfonso Prat-Gay. He was responsible for ending foreign exchange controls, resulting in the peso losing 33% of its value and inflation jumping to 40%. During the year, with 6k companies having closed and 200k becoming unemployed, Latin America’s third-largest economy is expected to contract by a further 2%.

The US economy is progressing better than expected with Q3 growth rates revised upwards from 2.9% to 3.5% – well up on the 1.4% recorded in Q2. It will be interesting to see the new Trump administration continuing this trend which will have a positive impact on the global economy.

Likewise, the UK has updated its Q3 growth, albeit on a smaller scale, from 0.5% to 0.6%. The FTSE 100 closed on Wednesday at a record high of 7,106, beating the 27April 2015 previous best, and the year on 7,148.

Despite Brexit, the UK has jumped up five places to 5^th in the Forbes list of the best countries to do business. Sweden, New Zealand, Hong Kong and Ireland were in the top 4 whilst the US dropped one notch to 23^rd, mainly because of increasing bureaucracy.

China expects that 2016 foreign direct investment into the country will reach US$ 113 billion, as outbound direct investment topped US$ 161 billion, having risen 55.3% in the 11 months to November, and 76.5% in the month compared to November 2015. It is expected that the country will tighten up on ODI in 2017, as the yuan continues to wobble and forex reserves dip to their lowest levels in six years. On the other hand, the country will open up on inbound investment and reduce restrictions to “increase openness to the outside world”.

As noise levels in in the China Sea begin to rise, Japan has approved the country’s largest ever defence budget at US$ 43.6 billion, whilst its coastguard budget has jumped 11.9% to US$ 1.8 billion. This comes about because of increasing tension arising from China’s and North Korea’s nuclear and missile threats. The defence budget accounts for 5.3% of Japan’s US$ 828.6 billion for the financial year starting 01 April 2017. This could be a major problem area in 2017 and a global flashpoint.

It is interesting to note that many pundits have been eating humble pie, having got forecasts horribly wrong in 2016. Many predicted oil to be trading at US$ 20 by the end of the year and that sterling would be sinking to parity with the greenback, let alone massing up on Brexit and Donald Trump. Treat any predictions with caution!

Despite the general feeling that 2016 was not the best of years, all this blog’s indicators headed north, with the exception of the AUD, GBP and euro currencies (which failed to compete with the strong US$) and the CSI300 index. The best performers were iron ore, Brent, copper and silver – up 59.57%, 56.10%, 15.89% and 15.77% respectively – but note that all are still lower than at 31 December 2013!

Our June 2017 forecast is listed below, with a local businessman (2) taking on the blog (1) with their considered expectations.

2017 should be a better year than a lot of experts expect. On the local front, realty will move higher as the Expo momentum takes effect and oil prices stabilise. The emirate’s inflation rate will hover around 2.6%, direct foreign trade in H1 will top US$ 120 billion, its population will grow to 2.75 million and its economic growth will reach 3.0%. The hospitality and travel sectors will show improvement but worries remain in the retail field, particularly eateries.

On the global stage, 2017 will be a positive year. The stock markets will take a breather in H1, having hit record highs toward the end of 2016. As the US Trump led economy will defy general opinion by growing at around 3.5%, the dollar will continue to be the dominant global currency. Expect a major fall-out in the EU from Greece, Spain or even the Italian banks. India and China will lead the Asian economies, with 7% growth rates, but expect that the latter’s shadow banking sector and housing bubble to cause some concern for the Xi Jinping administration in H1.

In 2017, the economic cycle will continue to turn, with forecasts and predictions, as always, similar to looking and listening to Days of Future Passed.

Even though it already houses nine UN Humanitarian Agencies, and over fifty other related international entities, HH Sheikh Mohammed bin Rashid Al Maktoum has ordered further expansion to Dubai’s International Humanitarian City. In these days of socio-political regional tensions, Dubai’s ruler wants to enhance operations and improve the management of relief projects.

A study by Propertyfinder Group has concluded that apartment investors will be getting better returns – as high as 9.0% – from Dubai’s newer and more affordable freehold areas such as Discovery Gardens, Silicon Oasis and Sports City. This is higher on average than the 7.5% levels to be found in The Greens and JLT and the lesser 6% expected returns from Dubai Marina and Palm Jumeirah. Traditionally, villa returns are lower and can vary with the likes of Arabian Ranches and The Springs returning up to 6.4%, more than double that of Dubai Marina and Palm Jumeirah.

Already titleholder of the largest indoor theme park in the world, IMG Worlds of Adventure is to add a new centre – at 2 million sq ft, 33% larger than its existing facility. IMG World of Legends, with eight new attractions, will be built adjacent to the current park and be connected by a state-of-the-art sky bridge.

This month will see the launch of Al Futtaim’s immersive show, combining the three elements – water, fire and light. The entertainment forms part of a US$ 409 million redevelopment project, within Dubai Festival City, and will use 30 fountains, surround sound and giant aqua screens to spectacular effect.

Kleindienst, the developer of The Heart of Europe on Dubai’s The World, has awarded a US$ 1.3 billion contract to three companies – JK Bauen Building Contracting, Sino Great Wall International Engineering Co Ltd and Wuchang Ship Building Industry Group Co Ltd. The development encompasses a cluster of six islands.

This week, the second Rove hotel, a 270-key property, opened its doors in Deira City Centre. The hospitality brand – a JV between Emaar Properties and Meraas Holding – expects to add ten hotels, with 3.7k rooms, before Expo 2020.

There has been no letup for Dubai’s hospitality sector with another month of declining returns. October has witnessed falls across the board with occupancy down 2.0% to 78.0%, average daily rates (ADR) by 9.8% to US$ 208 and revenue per available room (RevPAR) by 11.6% to US$ 162. Over the first ten months of the year, the supply growth of 5.8% has trekked marginally above the 5.6% demand curve.

Dubai Investments is expanding its local realty portfolio, with two projects – the US$ 817 million Mirdif Hills project and phase 3 of Green Community West. It also has plans for a US$ 109 million business centre in Fujairah, an investment park in Saudi Arabia and mixed-use industrial and business parks in Africa.

Following a recent agreement, DP World will hold a 55% stake, with the balance being with Canadian pension fund manager, Caisse de dépôt et placement du Québec, in a US$ 3.7 billion investment vehicle. The fund will invest in ports and terminals worldwide, with 75% allocated for existing assets and the balance for greenfield sites. The Dubai firm has also opened Peru’s first smart logistics centre in DP World’s Callao Port that handles 1.4 million TEUs.

It was a busy week for Emaar Properties The developer has overseas operations in several locations, including Egypt and Saudi Arabia. Its current portfolio in the former is over US$ 2.9 billion and the company will be actively looking at expanding operations there. Meanwhile, Emaar Middle East has launched its third project in its Jeddah Gate – a community that will house 2k residential units and 230k sq mt of office space. It also plans several hotels under its homegrown Vida Hotels and Residences brand.

Emirates National Oil Co is planning to add a further 54 service stations prior to 2020, as part of its growth strategy. ENOC will also expand its Jebel Ali refinery that will see capacity up 50% to 210k bpd, along with a 19km jet fuel pipeline connecting it with Al Maktoum Airport.

It is reported that Emaar Properties has agreed a US$ 327 million settlement with Orient Insurance following the New Year’s Eve fire at its Address Downtown Hotel. The fire was caused by an electrical short circuit on a spotlight.

Dubai-based Gulf Navigation, along with two Chinese shipping companies, is looking at its expanding shipbuilding and repair operations in Khorfakkan and Fujairah. These eastern coast ports are the world’s second leader for ship refueling and bunkering.

There was a minor improvement in November’s Emirates NBD UAE Purchasing Managers’ Index with a 0.9 month on month hike to 54.2. Output growth in UAE’s non-oil private sector dipped 0.8 to 59.8, as output prices fell for the 13^th straight month, whilst growth in new orders jumped from 53.2 to 56.4.

According to the Minister of Economy, HE Sultan bin Saeed Al Mansouri, the country’s economy is expected to grow by 3.4% next year, compared to the 3.0% forecast for 2016. Over the past decade, UAE’s GDP has grown threefold from just US$ 139 billion to US$ 490 billion by year end. Inflation is expected to nudge slightly higher from 2.3% to 2.5%. Meanwhile the IMF sees the country’s current account surplus improving from 2015’s US$ 19 billion (equivalent to 5.4% of GDP) to US$ 29 billion (7.3%) this year.

Following October’s shareholders’ agreement to raise its capital by US$ 409 million, Emirates Islamic Bank has now listed and traded the rights issue at US$ 0.10 per share.

The DFM opened Sunday at 3361 and was 198 points higher to close the week at an impressive 3559 level by Thursday (08 December 2016). Volumes, on the last day of trading, were higher at 1.104 billion shares, valued at US$ 401 million, (cf 916 million shares for US$ 330 million, the previous Wednesday). Over the week, bellwether stocks, Emaar Properties traded higher by US$ 0.16 to US$ 2.02, whilst Arabtec was also US$ 0.02 higher at US$ 0.37.

After a 10.2% hike the previous seven days, this week saw Brent Crude holding on to recent gains nudging US$ 0.31 higher to US$ 53.89. Having shed 7.7% the previous week, gold continued its downward trend, just US$ 3 lower, to close on US$ 1,172 at Thursday’s (08 December 2016) close.

The Kremlin has agreed to a US$ 11.3 billion offer by Qatar and commodities trader Glencore to purchase 19.5% of oil giant Rosneft. Maybe the Trump presidential election has seen a lesser risk of such deals going sour, as commercial relations improve between Russia and the western world.

There was mixed October news for the regional airlines – with IATA reporting increased cargo traffic but a slowing down in the rate of passenger demand. ME air fright demand was up 9.2% (globally 8.2%) as capacity rose by less than half at 4.2%. On the flip side, ME carriers saw a 7.0% hike in passenger demand – its slowest pave in 18 months – as capacity grew at the higher level of 10.0%. Consequently, load factors dropped 2.0% to 70.1% – its lowest October level in a decade.

The Competition and Markets Authority has fined two pharmaceutical firms – Pfizer (US$ 106 million) and distributor Flynn Pharma (US$ 7 million) – for overcharging the NHS by a whopping 2,385%. The CMA indicated that an overnight price hike in September 2012 saw a100 mg pack of a drug known as Epanitin jump from US$ 3.56 to US$ 85.05, before dropping to US$ 68.04 in May 2014. Having spent US$ 2.5 million on the drug in 2012, the NHS forked out US$ 63 million a year later.

Reports indicate that the scandal-ridden Malaysian state investment fund, 1MDB, is planning to repay the US$ 6.5 billion owed to Abu Dhabi’s International Petroleum Investment Company (IPIC). It appears that the fund is to swap assets (perhaps land in Penang?) for financing by a Chinese source.

An increasing number of South Korean conglomerates are being pulled into the massive corruption scandal surrounding the President Park Geun-hye. Hyundai Motors, Samsung and six other entities have faced lawmakers who are investigating that millions of US$ have been “donated” to funds operated by Choi Soon-sil, a close presidential confidante, in exchange for favours.

With a 28% premium on Friday’s share price, Hong Kong-based Cheung Kong Infrastructure has made an unsolicited US$ 5.4 billion offer to acquire Australian energy firm Duet Group. CKI, owned by billionaire, Li Ka-shing, would have to obtain formal approval from Australia’s Foreign Investment Board Review. Earlier in the year, it had a joint US$ 7.4 billion bid, with China’s State Grid Corp, for Ausgrid rejected by the FIRB, citing security concerns.

Over the past four years, Sony has sold more than 50 million PlayStation 4 consoles, reaching a sales peak during the Black Friday week ending 27 November 2016. However, this figure is small fry when compared to past sales of PlayStation (157 million units), Nintendo (154 million) and Gameboy (118 million). However, the recently released PlayStation 4 Pro has already reached 370 million game sales.

The Canadian conglomerate, Brookfield, is reportedly buying a share in Greenergy – a fuel supplier that delivers 18 billion litres of fuel, equivalent to 25% of UK’s road usage. The company, 34% owned by Tesco’s pension fund‎ and 16% by co-founder, Andrew Owens, is believed to be worth about US$ 625 million.

Having being accused by some EU officials of avoiding almost US$ 1.1 billion in tax through the use of a Luxembourg loophole, McDonald’s is set to move its non-US tax base to the UK. The food giant dismisses such claims and has indicated that it has paid US$ 2.5 billion in EU tax over the past five years. The new international holding company will see the creation of 5k new jobs and its profits will be liable to UK corporation tax which is said to be cut by 3% to 17%.

The Royal Bank of Scotland, still 73% owned by the taxpayer, has settled with three of the five creditor groups suing it for compensation. The claims refer to the bank’s dubious actions in 2008, when it misled investors to buy into a US$ 15 billion fund raising scheme to shore up the bank after its US$ 61 billion acquisition attempt for ABN Amro failed.

Once again the worrying state of the European banking system has been highlighted because of high levels of non-performing loans, reduced profitabilities and continuing legal claims for past scandalous behaviour. The good news is that the average NPL (non-performing loan) ratio for assessed banks has improved from 6.5% to 5.4% by mid-2016. However, the results from some countries are of major concern with NPL ratios of Greece (47%), Portugal (20%), Italy (16.4%) and Spain (6%). The questions are how the Eurocrats have allowed this situation to arise in the first place and what can they do when the inevitable happens – banks go under?

There are indications that the Italian government may request US$ 16 billion from the European Stability Mechanism (ESM) to help prop up its rotting banking system. Furthermore, the faltering government may also pump in US$ 2.2 billion to take a major stake in Monte dei Paschi, one of many of the country’s struggling financial institutions.

Following news that the Italian Prime Minister, Matteo Renzi, was to resign after he had lost a constitutional referendum, the euro fell on Monday to its lowest level – 1.05 to the US$ – since March 2015. It later clawed its way back to 1.08 before closing on Thursday a tad over 1.06.

In a desperate move to prop up the ailing euro, ECB president Mario Draghi has extended his monthly QE programme a further six months beyond March 2017, but has reduced the stimulus package by US$ 21 billion to US$ 63.4 billion. To date, the ECB has pumped in a massive U$ 1.84 trillion and this, along with ultra low interest rates, has not worked – with the 19-country bloc still in the economic doldrums. There is no doubt that the next year is pivotal for the future of the euro currency (in its present state) and of the eurozone.

The latest Japanese PMI data shows that the Japanese service sector continues to improve in November with a 51.8 reading, compared to 50.5 a month earlier. Furthermore price inflation expanded to a two-year high as output at service firms grew at its fastest rate since January.

As new domestic orders are on the rise, along with a surge in exports (following sterling’s “devaluation”), the recent slump in UK manufacturing may have turned a corner – in the short-term at least. A hike in oil prices should see increased activity from that sector but if inflation levels begin to rise next year then this will have a negative impact on the economy.

The impact the financial service sector has on the UK finances can be gleaned from a City of London report that estimates that it contributes 11.5% of the country’s tax receipts, equivalent to US$ 89 billion. Furthermore it employs 3.4% of the UK workforce – 1.1 million – with an average remuneration of US$ 40k. Any move away from the City, post-Brexit, will have far-reaching consequences.

Ministers still have to sign off a second review of Greece’s bailout programme, before further funds can be released, but have gained some interim relief in the form of longer repayment periods and lower rates. There is some dispute between the eurozone and the IMF, with the latter preferring a “haircut” – an actual reduction in the balance owing – a move opposed by the likes of Germany.

Although there was a chance of the Reserve Bank of Australia cutting rates, it held back so as not to unsettle the patchy labour and housing markets. The September quarter’s inflation data – growing at an annual 1.7% rate – was better than expected but still down on the RBA’s target of 2 – 3% but would normally have been the catalyst for a rate cut. The September quarter saw a 0.5% contraction in the country’s GDP – its weakest reading since the GFC and ending five years of continuous growth. The main drag factors are a marked slowdown in business spending and government cutbacks.

Softbank, which this year has already acquired UK’s ARM Holdings for US$ 32 billion and Vodafone’s Japanese operations for US$ 20 billion, is to invest US$ 50 billion in US businesses. In a meeting with President-elect Trump, the Japanese tech firm’s chief executive, Masayoshi Son, added that this would result in 50k jobs in the USA. In October, the Japanese company announced the establishment of a new US$ 100 billion fund, SoftBank Vision Fund, 45% of which would be financed by Saudi Arabia’s Public Investment Fund. This is one major step for Japan – a country that once ruled the tech world but has been left far behind.

Improving economic data in November sees many US indicators heading north. The ISM’s non-manufacturing index rebounded, gaining 2.4 to 57.2, whilst its manufacturing PMI was 1.3 higher at 53.2. Latest US figures indicate that unemployment has dropped to a 9-year low with jobless rates falling 0.3% to 4.6%, with 178k new jobs being created in November. However, earnings have grown at less than expected, with the annual increase of 2.5% down 0.3% from the October return. With recent indicators pointing to a 3.2% 2016 growth, a rate hike next week is all but inevitable.

Friday’s 45^th National Day celebrations saw the UAE rulers gather for the opening of Dubai’s US$ 136 million museum on the Union House site of the original signing of the UAE charter in 1971. The other five rulers, Their Highnesses Sheikh Sultan bin Mohammed Al Qasimi (Sharjah), Sheikh Saud bin Saqr Al Qasimi (Ras Al Khaimah), Sheikh Humaid bin Rashid Al Nuami (Ajman), Sheikh Hamad bin Mohammed Al Sharqi (Fujairah) and Sheikh Saud bin Rashid Al Mualla (Umm Al Quwain) joined Abu Dhabi Crown Prince Sheikh Mohamed bin Zayed Al Nahyan and Dubai ruler, Sheikh Mohammed bin Rashid Al Maktoum, in the celebrations. Congratulations!

HH Sheikh Mohammed bin Rashid Al Maktoum has approved plans for a Dubai Street Museum that will showcase the history, cultural values and identity of the emirate. Both local and international artists, who will use many of Dubai’s buildings for their works, will carry out the five-year project.

Damac’s latest launch – the Italian-inspired Akoya Manarola – will comprise 3-bedroom villas, with starting prices of US$ 627k.

Nshama has announced that it expects to deliver 2k affordable housing units, equivalent to 40% of its current pipeline, in 2017. What impact this will have on the mid-tier market, from both a rental and buying perspective, remains to be seen.

Schon has launched a US$ 872 million development that will result in the introduction of 2.6k hotel rooms in Dubai Investment Park. It is expected that the 21 nine-storey buildings, including 52 restaurants and cafes along with a shopping mall, will be completed prior to Expo 2020. The developer has been beset with problems arising from its proposed 2005 Dubai Lagoon project which had been expected to see 4k apartments on a man-made lagoon. (To date, 200 apartments are awaiting utility connections and its first residents due to move in in Q1 2017).

Due to open in Q1 2017, near to Dubai Autodrome, First Avenue will have 70 retail and 15 dining outlets, along with a 4-star, 150 key Park Inn by Radisson. The developer, Saudi Arabia’s Al Tawfeeq for Development and Investment, has already signed up Carrefour as an anchor tenant for its US$ 136 million development.

Cayan Group is to introduce a Rotana-managed hotel apartment tower that will have more than 700 units comprising a range of studio – 3 bedroom residences. The Saudi-based group has established a US$ 272 million realty development fund, with Shuaa Capital, and has already developed Cayan Cantara tower, also located on Umm Suqeim Road. Construction will start next month, with Shapoorji Pallonji International appointed the main contractor.

Aswaaq, owned by the Investment Corporation of Dubai, is planning a further two supermarkets – in Nad al Sheba and Al Quoz2. Over the next five years, a further 50 supermarkets and stores are scheduled to open.

The new annual Dubai Land Department’s official 2017 rent index holds a few surprises with 1-bedroom rentals falling in Jumeirah Village (18.8%), Downtown (between 8.7% to 15.8%), Palm Jumeirah (3.3% to 16.7%), International City (7.9% to 11.0%) and Silicon Oasis (10.0%). It appears that the biggest “casualty” is Dubai Marina with rents down by as much as 22.0%, with Arjan bucking the trend with the biggest increase.

Its Chairman, Khalaf Ahmad Al Habtoor, has confirmed that Al Habtoor Holding has divested all of its shares in HLG Contracting. The company was established in 2007 when Al Habtoor Engineering, founded in 1970, merged with the Australian-controlled developer, Gulf Leighton.

Depa posted a US$ 8 million profit for the first nine months of 2016 (compared to a loss of US$ 2 million a year earlier) on flat revenue of US$ 322 million. The Dubai-based interiors contractor is slowly recovering from the regional slowdown in the construction industry.

Dubai International reported October passenger traffic, at 6.4 million, was 2.7% higher, compared to the same month in 2015, with the YTD figure of 69.4 million up 6.8%. Rather surprisingly, with the soft opening of DWC, cargo traffic still heads northwards with October recording a year on year hike of 9.5% to 236k tonnes, as YTD figures were up 2,8% to 2.1 million tonnes.

Flydubai launched its first double daily service outside of the GCC by opening up Bangkok. The budget airline, which operates the latest Boeing 737s, expects to tap into this burgeoning market with transit passengers from its current European routes and medical tourists – including the 150k from the UAE alone.

Dnata has bought 50% of a Toronto’s cargo and handling operations from GTA Aviation for an undisclosed price. Now the world’s fourth largest air services company, this was the Dubai’s company first foray into the Canadian market.

December petrol prices are heading south, after jumping 5.3% in November, with Special 95 now retailing 5.6% lower at US$ 0.460.

A new JV has been signed between Yoox Net-A-Porter Group, the luxury online fashion retailer, and the Mohamed Alabbar-controlled Symphony Investments which will hold a 40% stake. The JV will open a distribution centre in Dubai and will initially manage the group’s current regional on-line stores. This week, the Emaar chairman also announced that he will launch the first Arab social messaging app in Q1 2017 – as a potential competitor to WhatsApp.

It is reported that Saudi’s Public Investment Fund is to buy 50% in Adeptio, a Mohammed Alabbar company, which recently acquired a 67% stake in the Kuwait-based Americana for US$ 2.35 billion.

In a bid to tap into the “millenials” sector, the 47-year old Commercial Bank of Dubai is to launch a digital-only bank – CBD NOW. It aims to introduce simpler and more efficient practices for their customers who will be able to carry out all dealings via smartphone.

Takaful Emarat has seen its number of customers more than quadruple to 400k since 2013, with the main driver being the introduction of universal health cover in the emirate. Now the Dubai-listed Sharia-compliant insurer is planning local acquisitions to increase its market share, as intense competition between the country’s 61 insurance companies pushes profits southwards; indeed the 29 listed insurers moved into a loss scenario of US$ 29 million compared to a profit of US$ 234 million in 2014. This week, Union National Bank and Orient Insurance Company formed a Dubai-listed JV.

The DFM opened Sunday at 3324 and was 37 points higher to close the shortened week on 3361 by Wednesday (30 November 2016). Volumes, on the last day of trading, were marginally down at 916 million shares, valued at US$ 330 million, (cf 926 million shares for US$ 324 million, the previous Thursday). 30% of Wednesday’s trade was attributable to DXB Entertainments. Over the week, bellwether stocks, Emaar Properties regained the previous week’s loss, up US$ 0.05 to US$ 1.86, whilst Arabtec was down US$ 0.01 at US$ 0.35, despite the appointment of Australian, Hamish Tyrwhitt as its new Chief Executive.

After a 7% hike the previous seven days, this week saw even better news for Brent Crude, with a 10.2% surge to US$ 53.58. Gold headed in the other direction, down 7.7%, or US$ 98, to close on US$ 1,175 at Thursday’s (01 December 2016) close. For the month, Brent was up 10.2% (US$4.96) whilst the yellow metal shed US$ 98 to US$ 1,175 from its opening month balance of US$ 1,273.

The surge in oil prices was a direct result of OPEC’s Wednesday decision to cut the cartel’s daily supply by 1.2 million bpd, with a likely 600k bpd reduction by non-OPEC oil producers.

If gold is struggling, the same cannot be said of base metals, including zinc that has hit nine-year highs of US$ 2,970 per tonne (and 70% higher so far YTD) and lead up 9.8% in November and by 40% so far this year.

RBS, still 73% state-owned, was the main bank to fail a Bank of England stress test that sets to see whether the country’s top seven financial institutions would survive a global economic crash. The bank has subsequently submitted an updated version that sees it reducing many of its “higher-risk credit portfolios” and settling several lawsuits.

The WTO has given the US government just 90 days to stop a special tax exemption for Boeing that is being considered an illegal subsidy. The claim by the EU relates to a 2013 Washington state tax cut to the plane maker for manufacturing 777X wings locally; the world body considered this would distort global trade, as Boeing would be required to use local rather than imported materials.

The US trade deficit in October widened by US$ 5.5 billion to US$ 62.0 billion, month on month, as imports rose 1.1% to US$ 184.1 billion, with exports falling 2.7% to US$ 122.1 billion.

Despite the market’s apparent disdain of the Trump election, the US economy is on the rise with a Q3 growth rate of 3.2% – a welcome improvement on the 1.9% recorded in Q2. These figures for the world’s largest economy, together with inflation nudging higher and employment levels strengthening, point to an almost certain rate hike in mid-December. Two indicators to watch are consumer spending – up 2.8% – whilst business was down 4.8%.

With an economy that has contracted 25% since the GFC, Greece is still awaiting the final go ahead from the troika to release further bailout funds. It seems that the creditors are still not convinced that the Tsipras’ government – in relation to reforms to the labour markets and privatisation – is doing enough.

The Organisation for Economic Co-operation and Development has revised upwards its global economic growth forecasts to 3.3% next year and 3.6% in 2018. However, the 35-country OECD area will see less growth at 2.0% and 2.3% respectively – with the US growth at 2.3% and 3.0% and the faltering euro area at a modest 1.6% and 1.7%.

The latest voice raising concern about the property bubble in Australia is Bank of Queensland chairman, Roger Davis. In October, the Reserve Bank indicated that off plan sales were showing signs of over –supply on the back of tighter regulations for overseas purchasers and some valuations being lower than contract prices. Residential prices, especially in the eastern states, are in a bubble and when the economic climate changes then there could be major repercussions. Any increase in interest rates (which is inevitable) would be the main drag factor to start a housing meltdown but a further slowdown in economic growth, a fall in consumer confidence or a drop in disposable incomes will have adverse knock-on effects.

Two BRIC members came out with varying Q3 results. India’s economy expanded by 7.3% but this was slightly down on analysts’ 8% expectation. Meanwhile, Brazil slumped further into recession shedding 2.5% year on year with the good money on a third year of recession in 2017.

A leading indicator of Japan’s future economic prospects fell 0.6 to 100.3 in September. The country’s consumer prices fell for the eighth straight month in October to 0.4% year on year, on the back of sluggish consumer spending and low energy prices. For the past four years, Prime Minister Shinzo Abe has failed to pull his country out of a deflationary cycle spiraling downwards – and this despite an aggressive QE policy and negative interest rates. His 2.0% inflation target seems a distant pipedream and the days must be numbered for this Daydream Believer!

A case of déjà vu from the good old days before the GFC – with prices starting at US$ 76k, it was no wonder to witness buyers queuing in Dubai South overnight to acquire units in The Pulse cluster’s second release; the initial launch in October saw 300 units snapped up within minutes of release.

According to a recent Cluttons report, the Dubai realty sector slipped a further 2.6% in Q3 and 7.4% year on year; since its peak in Q4 2008, the market has slumped by 26.7%. The firm expects a further slowdown in the rate of decline, before stabilisation sets in within a year.

In contrast, a JLL / Dubizzle study reported that both average sales and rental prices, across a dozen popular communities, were stable in Q3 but had dropped 4%, year on year. The study concludes that the market has probably reached the bottom of its cycle and expects a recovery to start in 2017, on the provisos of an economic improvement and that a lid is kept on the supply pipeline.

Driven by activity in the affordable housing market sector, JLL estimates that 2017 residential price rises in 2017 could jump up by 5%. The consultancy indicated that Q3 prices were off by 2.6% (and 15% lower than at its 2014 peak) and that a further 1% decline in Q4 will happen before the market turnaround next year.

This week, Dubai Properties launched its Rahaba Residences in Dubailand – its first foray into the affordable housing market segment, targeting junior to mid-level employees of large entities. The concept is an entirely new approach to traditional staff housing.

The affordable house section received a further boost with Nshama announcing another phase of its Town Square project – Noor Townhouses. With prices starting at US$ 324k, the development – including 3/4-bedroom units – will be built in three separate communities.

There is no stopping Azizi Developments who have just launched their ninth development since June 2016! Located in Al Furjan, Azizi Farishta will contain 284 studio / 1-2 bedroom units and should be completed by 2018.

Nakheel have officially opened its impressive Boardwalk – an 11 km, 6 mt wide, walkway located on Palm Jumeirah’s protective breakwater. Access is via 14 separate points and attractions will include a wide range of food trucks.

It seems that Emirates are having last minute technical problems with the new RR engines for its upcoming delivery of A380 jets, five of which are scheduled to be here in December. Its current portfolio of 85 planes is powered by Engine Alliance, a joint venture of General Electric and Pratt & Whitney. RR won a US$ 9.2 billion deal to provide engines for the airline’s next fifty Airbus jumbos.

The new 62km Abu Dhabi-Dubai highway, which has cost US$ 572 million, is expected to open later this month. The 8-lane highway is a godsend for the inter-city commuters and should see improved travel time and reduced accidents.

Work has started on the US$ 8.1 billion Dubai Wholesale City project, with Saeed Transport & Building Contracting Company carrying out excavation work on the 135 million sq ft site. Due to become the largest global wholesale hub, the development will tap into the US$ 4.3 trillion sector, with the aim of increasing the country’s share in this burgeoning market.

In October, UAE gross bank assets increased by 5.1%, year on year, to US$ 693.2 billion. Other key indicators headed in the same direction with total deposits, at US$ 409.5 billion, up 4.7%, and loans and advances higher by 5.9% to US$ 428.8 billion.

Alibaba Cloud has announced that it plans to open four new global data centres, one of which will be in Dubai and the other three in Australia, Europe and Japan. The Chinese offshoot of the Alibaba Group becomes the first such provider of cloud services in the region.

Reportedly hoping to make its first ever profit, by 2018, Careem, the Dubai-based on-line car booking service, is in negotiations to raise a further US$ 300 million for expansion purposes; this follows a US$ 60 million funding last year. The company is facing increased competition from the likes of Uber and Indian start-up, Ola.

The Bank of Singapore has become the latest overseas financial institution to acquire a licence to open in the DIFC; until now, it has had a representative office in the emirate for the past 20 years.

The DFM opened Sunday at 3310 and nudged 14 points higher to close on 3324 by Thursday (24 November 2016). Volumes, on the last day of trading, were marginally down at 926 million shares, valued at US$ 324 million, (cf 1 billion shares for US$ 354 million, the previous Thursday). Over the week, bellwether stocks, Emaar Properties lost US$ 0.01 to US$ 1.81, whilst Arabtec was up US$ 0.02 at US$ 0.36.

After a turbulent three weeks, in which Brent shed over 10% of its value, this week it has moved back into positive territory, up 7.0% to US$ 48.61. Gold headed in the same direction, up 4.6%, or US$ 56, to close on US$ 1,273 at Thursday’s (24 November 2016) close.

Embattled Volkswagen has announced global job losses totalling 30k (or 4.9%) of which 23k (equivalent to 19.2% of its local base workforce) will be in Germany. The carmaker has indicated that there will be no enforced retrenchments and that a further 9k “new future proof” jobs would be created; the cuts are expected to save VW US$ 3.9 billion a year by 2020.

Australian building materials supplier, Boral, is set to pay US$ 2.6 billion in a cash deal to acquire Headwaters Incorporated. With the Utah-based company generating revenue US$ 1.1 billion (with profits at US$ 218 million), Boral is expecting to see a doubling of its present US business.

The extent the luxury goods sector is suffering from the global slowdown can be gauged from the disappointing Q3 results of two of the leading US chains. Abercrombie & Fitch’s shares plunged 13.9% on news of a 6% fall in revenue to US$ 822 million, with profits sinking 80.0% to a mere US$ 8 million. Gap saw revenue down 2.0% to US$ 3.8 billion, as profit slumped 17.7% to US$ 204 million; its shares dropped 13.1% on the day.

JP Morgan has been fined US$ 264 million by the Department of Justice for hiring the offspring of highly placed Chinese officials to gain business in that country. In many cases, the 100 children, so selected as interns, were unqualified but, because of their parents’ connections, managed to generate extra revenue for the bank of US$ 100 million.

Chinese video streaming service PPTV has agreed a 3-year, US$ 700 million deal with the EPL to broadcast English matches. Suning, the parent company of the Chinese video streaming service, already has a controlling interest in Inter Milan. China’s President Xi Jinping is keen for the country to become a major footballing nation within the next decade.

The Saudi government has released US$ 10.7 billion in outstanding payments owed to private companies; this represents 22.9% of the estimated total outstanding of US$ 46.7 billion and a further payment of US$ 26.7 billion is expected in the coming weeks. Any payment will free up companies’ cash flows, to an extent, and see payroll backlogs cleared. One company that may not benefit from the government’s initiative is the indebted Mohammad Al Mojil Group – a construction company that overextended itself and has not traded on the Saudi bourse since July 2012.

In October, Japan reported disappointing trade figures with a trade surplus of US$ 4.5 billion – lower than market expectations of US$ 5.5 billion. Both exports and imports headed downwards on an annual basis – by 10.3% and 16.5% respectively.

With the biggest gain since 1982, US October home construction shot up by 25.5% to a seasonally adjusted 1.3 million, whilst new construction is at its highest level in over nine years. The main drivers behind this boost are a 75% hike in apartment construction and a 10.7% increase in single-family homes.

It was no surprise to see President-elect Donald Trump quitting the Trans-Pacific Partnership trade deal – signed by 12 countries and encompassing 40% of the global economy. Many critics of the TPP – with aims of boosting growth and expanding economic ties – were not happy with the secret deal’s apparent bias towards big business. Maybe China will see an opportunity and step in to fill the gap?

China’s largest online travel firm, Ctrip, has acquired its Scottish equivalent, Skyscanner, in a US$ 1.75 billion deal. The travel search company allows travellers to compare different sites for their vacation requirements. Ironically, the news comes one day after the Chancellor’s promise of US$ 500 million to help local digital start-ups avoid being acquired by overseas predators.

On Monday, Wall Street closed on record highs with the Dow reaching 18,956, S&P at 2,198 and the tech-focused Nasdaq at 5,369. By Thursday, all three indices had moved upwards again to 19,083, 2,205 and 5,381 respectively.

It seems that corruption is rife everywhere. Swedish media has reported that Ericsson officials shelled out millions of US$ in bribes at the turn of the century. It is estimated that US$ 150 million and US$ 89 million payments were sent to Malaysian and Polish bank accounts, via Jersey. Details of these two and other kickbacks – to politicians and senior civil servants – have been forwarded to the US Securities and Exchange Commission by a former executive, turned whistleblower.

Early indications point to Australia’s GDP shrinking for a fourth straight quarter. If this trend were to continue, then undoubtedly the lucky country will have its first recession in nearly 30 years. Major concerns are that house prices have surged 40% over the past three years whilst commodity prices, although nudging higher, will not result in increased mining investment. There is every chance that whilst interest rates creep up elsewhere, Australia will buck the trend and see further cuts.

The EU meritocracy is beginning to run out of excuses for their dismal financial management of the bloc’s economies. Not happy with blaming Brexit, impending trade wars, possible interest rate hikes, increased inflation risks and a strong dollar, their latest effort is political uncertainty. Brussels need not look any further to understand why the populace is turning against them – if they cannot see now wait another nine months after the people in France, Germany, Italy, Spain have voted! Unfortunately, the time for much-needed fiscal and structural reforms has long passed.

Tomorrow sees Black Friday – a day when UK shoppers are expected to spend US$ 2.5 billion – followed by Cyber Monday, with on-line sales expected to reach US$ 4.8 billion. However, this year, several big names – Asda, Ikea and Next – will be noticeably absent. The fall in sterling will have a detrimental effect on this year’s returns.

With its latest sale, the UK government now holds less than 8% of Lloyds Banking Group Plc’s share – a bank that it bailed out, after the GFC, with a US$ 20.3 billion cash injection. Notwithstanding interest and inflation, the government is in front, having already received US$ 21 billion.

It comes as no surprise to see ex-Chancellor, George Osborne picking up over US$ 400k for delivering speeches in the US, including US$ 175k for JP Morgan two speeches and US$ 100k from Palmex Derivatives last month. To some, it may seem that the boys are looking after themselves yet again.

In the government’s first budget statement since Brexit, former Remain campaigner and now Chancellor, Philip Hammond, painted a gloomy picture of the UK economy. With such a weak economy, there were no major highlights, with little funds available for the public spending purse or tax cuts. Indeed, as the government will need to borrow more, (“only” US$ 151 billion) it is expected that the national debt will rise from March’s 81.3% to 90.2% by March 2018 whilst growth for the next two years is forecast to be 1.4% and 1.7%. There is every chance that Mr Hammond, who preached that the economy would take an immediate massive hit, if Brexit went through, and is presumably still utilising the same advisers, is again heading Down The Wrong Way!