GulfNews Business

GulfNews Business

UAE's Etisalat to pay out 40 fils a share as H1-2021 dividend, net profit totals impressive Dh4.7b

Markets|Companies|: Dubai: The UAE telecom giant Etisalat will distribute interim dividends of 40 fils per share for the first-half of this year. This will paid to the shareholders registered at the close of business day on August 8. The company, which had issued a record dividend for full-year 2020, recorded group-wide revenues of Dh26.4 billion, which is a 3.2 per cent year-on-year increase, while consolidated net profit - after the federal royalty payout – was Dh4.7 billion, which is a 3.9 per cent gain. Net profit margin came to an impressive 18 per cent. The Group's subscriber base is now at 156 million. Rating agencies S&P Global and Moodys recently affirmed Etisalat Group’s AA-/Aa3 ratings with a stable outlook. The telco also completed a bond issuance - of one billion euro - to refinance a maturing euro bond tranche. “Etisalat Group’s strong results in the first-half of 2021 is an outcome of our sincere efforts to drive growth and generate efficiencies," said Hatem Dowidar, CEO. [And] "with an unwavering commitment to key strategic priorities to enable a digital future and drive digital innovation across our operations. Despite the challenges in our key markets, our businesses delivered growth in revenue, net profit and operating free cashflow." In the UAE, the subscriber numbers were at 12.1 million, while the aggregate subscriber base was 156.1 million, from a year-on-year increase of 7 per cent. And it is gearing up for more - "With our success in deploying 5G as well as taking the global lead in fibre penetration, we ensured our networks are future-ready for the next generation of mobile networks and technologies," the CEO added. "We will focus on expanding our capabilities, maintaining industry leadership to achieve our long-term goals of enriching customer lives and empowering governments, businesses and societies across our footprint."

GulfNews Business

Abu Dhabi’s 5G experience among Top 3 in the world

Markets|: Dubai: Abu Dhabi ranks among the fastest capital cities in the 5G network index, powering the fastest median download speeds (421.26Mbps) in the first-half of 2021, according to the latest data from Ookla, the broadband and mobile network testing app. The emirate is also home to the fastest mobile network on earth on an overall basis. “5G is a powerful catalyst for digital transformation bringing new opportunities to various industries and the country,” said Majed Sultan Al Mesmar, Director-General of the Telecommunications and Digital Government Regulatory Authority (TDRA). “The availability and access to the super-fast speeds on 5G is a huge accomplishment that reflects the continuous efforts of both operators and their innovative approach during today’s extraordinary times. “With the UAE leading as the fastest fixed network in MEA and fastest mobile network globally, this further highlights the country’s readiness to attract the best in world-class talent and global conglomerates from across sectors showcasing the significance of an advanced state-of-the-art telecom infrastructure contributing to UAE’s economic growth and leadership on a global platform.” Another achievement recorded in the UAE was both Abu Dhabi (421.26Mbps) and Dubai (417.07 Mbps) median download speeds featuring in the special ‘Global 5G Benchmark Report’ that focused on major cities measuring 5G performance and availability in the first half of 2021. Future uptake depends on faster launches of 5G-enabled smartphones This ranking is attributed to the long-term planning and investment of Etisalat and du in the rapid deployment of 5G sites and jointly working with regulatory authorities to assign the needed spectrum to cater for the demand of high capacity. An end-to-end participation and preparation from both operators supported the early adoption as well as meeting requirements of international standards from the International Telecommunication Union (ITU)/ 3rd Generation Partnership Project (3GPP). Hatem Dowidar, CEO, Etisalat Group said, “This remarkable achievement for the UAE reflects the ongoing efforts of Etisalat and its investments to build one of the most advanced 5G networks in the region and the world. The deployment of 5G across industries and sectors leads the way to digital transformation in UAE, pushing it to the forefront with a network that is future ready for the next generation of mobile technologies.” With vertical and horizontal city expansion in the UAE, high mobile indoor penetration enhancement enabled the deployment of in-building solutions and small cells for better mobile availability anytime, everywhere. The 5G network also made it possible to experience and access data heavy applications in the country. Fahad Al Hassawi, CEO of Emirates Integrated Telecommunications Company (EITC or du), said: “5G technology, and its enormous potential, is key to pioneering the digital economy and keeping pace with the requirements of smart transformation, as it supports a variety of solutions, applications and other technologies that enable better services to residents and business communities. Our mission at du is to continue to harness all our resources to facilitate the business sector as well as individual customers in the UAE to benefit from 5G technology and contribute towards economic growth and prosperity.”

GulfNews Business

UAE preps up its credentials for another stint in International Maritime Organization’s Council

Business|: Dubai: The Maritime Department at UAE’s Ministry of Energy and Infrastructure is gearing up to present the country’s credentials to retain its role in the International Maritime Organization (IMO) Council. In 2017, the UAE for the first time won Category B for the Executive Council at the International Maritime Organization. The candidacy was renewed for a second term in 2019, and today the country is looking to playing a part for a third consecutive time, in elections scheduled to take place in December. “The Organization not only issues legislation, but also regulates the shipping industry and everything related to maritime security, safety, protection of the marine environment in addition to facilitating maritime transport,” said Suhail Al Mazrouei, the UAE Minister of Energy and Infrastructure. “Therefore, it is integral for the UAE to have a presence at the centre of decision-making.” The formal filing of the candidacy should happen soon. “Being a global maritime hub, the UAE owns the largest and some of the most competitive ports in the Middle East and the world,” said Sheikh Saeed bin Ahmed bin Khalifa Al Maktoum, Executive Director of Dubai Maritime City Authority. “Owing to this, the country’s presence in the Executive Councill constitutes a significant value to ensure its continued support for the maritime industry.” The UAE was the first country in the world that supported seafarers during the beginning of the pandemic, allowing crew changes for those stranded at sea for months. The country also contributed in protecting the marine environment and helping the shipping sector comply with IMO regulations in reducing sulfur dioxide emissions by providing new, low-sulfur fuels at an affordable price.

GulfNews Business

Abu Dhabi’s ADCB shows how to use size and scale to good effect

Analysis|: With a market capitalization of D H47.1 billion, Abu Dhabi Commercial Bank - one of the UAE’s banking behemoths - reported a record net profit of Dh2.54 billion for the first-half of 2021, a 76 per cent increase from same period last year. The earnings are equally attractive on a quarterly basis too, with a 25 per cent increase compared to Q1-2021. The growth can be attributed to the increase in the diversified revenue stream, disciplined cost control and a prudent approach to risk management. The bank was successful in adding 900,000 plus customers to its internet and mobile banking platform during these six months, which is, reassuring and takes it closer to being a leading digital banking platform in the region. Consolidation wins ADCB had merged with Union National bank and Al Hilal Bank in 2019, and it seems like the consolidation is paying off well, An impressive Dh661 million in cost synergies have been captured during the first-half of the year and on track to exceed the Dh1 billion target. Al Hilal Bank is on schedule to launch a new digital platform in the fourth quarter that will offer an extensive range of Islamic financial solutions to retail customers. In parallel, ADCB Egypt is growing rapidly, with second quarter net profit up 218 per cent year-on-year, as net loans and deposits increased 19 and 20 per cent, respectively. Bulking up mortgage The Bank has decent cash on hand and is utilizing the same in acquiring the mortgage portfolio of Abu Dhabi Finance, resulting in an increase of Dh1.07 billion in the mortgage loan book. Despite the pandemic setbacks, the bank has made efforts to maintain its 3.9 per cent dividend yield. The balance-sheet remained robust with improved asset quality metrics, a pick-up in loan growth and CASA [current and savings account] deposits continuing to rise. Rise in CASA and digital banking growth will help reduce fixed- as well as HR costs. Net loans of Dh237.8 billion were up 1 per cent sequentially and 0.5 per cent lower from year-end 2020. The cost-to-income ratio of 34.8 per cent improved 180 basis points from a year earlier, indicating the bank is navigating the many challenges presented by COVID-19 and emerge as an entity able to withstand the macro hiccups coming its way. ADCB’s liquidity coverage ratio (LCR) was 127.6 per cent at the close of the first-half of 2021. Capital adequacy (Basel III) and CET 1 [common equity tier 1] ratios were 16.32 per cent and 13.2 per cent respectively, indicating the bank has sufficient funds to meet any unforeseen events going forward. Even in a low interest rate environment, ADCB was able to deliver double-digit profit growth. With economic conditions improving and the branching out into the digital space to increase market share, the bank seems positioned to deliver a new phase of growth. Vijay Valecha null The writer is Chief Investment Officer at Century Financial.

GulfNews Business

India beauty-focussed portal Nykaa seeks $4b valuation for IPO

Markets|: Mumbai: India's Nykaa is preparing to file for an initial public offering (IPO) that could value the startup at more than $4 billion. The country's top e-commerce company for beauty, founded by Falguni Nayar, is aiming to file its draft red herring prospectus (or DRHP), within the next few days. It plans to sell just more than 10 per cent of the equity, which could raise $400 million or more. India's technology industry has turned white hot this year, with startups raising record amounts of venture capital and a flurry of IPO. The food-delivery app Zomato became the nation's first unicorn to make its stock-market debut this month, raising $1.3 billion. Its shares have soared more than 75 per cent, giving the money-losing business a valuation of $14 billion. The online insurance platform Policybazaar, backed by Japan's SoftBank Group, is also expected to file its draft red herring prospectus in the coming days, with a more than a dozen technology startups aiming for IPOs through next year. Nykaa, founded in 2012 by former investment banker Nayar, has grown into India's top destination for beauty products with its own chain of physical outlets and $250 million in revenue last year. Its investors include TPG and Fidelity. The company was last valued at $1.2 billion, according to CB Insights, but it's difficult to estimate its current worth given the rapidly changing market. The startup and its investors have discussed a valuation of $4 billion or more, and anticipate its fast-growing revenue will be appealing to investors. Nykaa had targeted a valuation of $3 billion or more.

GulfNews Business

Dubai Silicon Oasis: Fully smart and fully integrated one-stop destination

Business|: Dubai Silicon Oasis is well integrated as a neighborhood, but larger in size. Strategically located on the intersection of Al Ain Road and Sheikh Mohammad bin Zayed Road, it boasts a pleasant community that includes residential areas, lifestyle areas, retail spaces, F&B outlets, hotels, parks, leading educational institutions, a tennis hub, and four mosques, among many other offerings. Dubai Silicon Oasis has a population that exceeds 90,000 and houses a total of 890 retail shops throughout the community, with 85 of them located at the Dubai Digital Park (DDP), the first integrated smart city of its kind in Dubai, located in DSO. Smart City Dubai Digital Park, a holistic smart solution-enabled community spanning an area of 150,000 square meters, comprises 47,000sqm of office space, 17,000sqm of retail units, 235 smart residential apartments and more than 5,000sqm of ready-made and plug and play offices. Its host of value-added contemporary lifestyle facilities includes a 112-key Radisson RED hotel and 59 fully furnished apartments. DDP also includes a convention centre that can host up to 500 persons, restaurants, cafés, fitness centres, running tracks and cycling trails, a shopping centre and an underground parking garage that can accommodate more than 2,000 cars. DDP provides 60 smart city services, offered through a unified and secure platform that effectively integrates the operational requirements of enterprises with the needs of employees, residents, and visitors. The smart services, at an investment of Dh100 million, aim to promote smart city initiatives that are aligned with the vision of making Dubai the smartest and happiest city in the world. Some of the leading shopping malls and community centers located at DDP and the wider DSO community include Majid Al Futtaim’s Carrefour Hypermarket, Lootah Group’s Souq Extra, Spinneys, DSOA’s owned Cedre Shopping Centre, and Choithrams. Silicon Central Mall In addition, DSO comprises the two-level 2.3 million-square-foot Silicon Central Mall, built on a landbank of one million square feet, which offers world-class shopping, dining, and entertainment experiences to the DSO population. Counting more than 300 international and local branded stores and 12 anchor stores, the new shopping mall also houses the ever-popular LuLu Hypermarket and a department store on two levels. Other key attractions include the biggest family entertainment centre spread across 70,000 square feet, as well as more than 50 F&B outlets and diverse entertainment and leisure offerings. Community common areas Furthermore, there are several public community parks at DSO — North Park, Lake Park, and Central Park — which offer a diverse mix of amenities, including a 2.2km jogging path, an outdoor gym, a 90m x 45m football pitch, a tennis court, a volleyball court, a skatepark, and a multipurpose court, all set amidst landscaped areas with water fountains, kids’ play areas, sports facilities, and F&B options. Moreover, Dubai Silicon Oasis Authority recently opened Sheikha Ali Mosque at DSO. With a built-up area of 1,172 square meters, the mosque can accommodate up to 650 worshippers, serving the residential and business communities adjacent to Dubai Digital Park. It is part of a total area of 4,896 square meters, including 60 parking spaces and five retail outlets. Pioneering innovative healthcare As for healthcare, the Dh1.5 billion Fakeeh University Hospital at Dubai Silicon Oasis is the first-of-its-kind smart university hospital in the UAE, spanning one million square feet, combining integrated AI-robotic systems and medical competencies to take the sector to new heights. The hospital partnered with global technology companies including Siemens, Philips, and Cisco to develop innovative systems whose proof of concepts and applications in the healthcare field will further cement its position as the first truly smart hospital of the future in Dubai. The 350-bed smart facility provides primary, secondary, and tertiary care through leading medical practitioners across 55 specialties. Equipped with cutting-edge technology, its systems are set up to treat an estimated 700,000 patients a year, serving communities in the UAE and the wider region. Advanced technology education In the academic field, DSO is home to 28 educational, training and consulting institutions. Phase one of the Dh500 million new Rochester Institute of Technology — Dubai (RIT Dubai) campus at DSO has been completed. It spans 30,000 square meters, including academic classrooms and advanced laboratories, at an estimated cost of Dh200 million. Meanwhile, phase two is slated for handover in 2023 at a projected cost of Dh300 million, adding 116,000 square meters to the campus. With the capacity to accommodate 4,000 students, the new campus will comply with the latest sustainability, smart city, and connectivity standards. Additional education options Vernus International School (VIS), managed by Edu Hub, is the first American primary school to open its premises in Dubai Silicon Oasis, spanning an area of 65,000 square feet, with a total investment of Dh50 million. In its first phase, the primary school can accommodate up to 600 students, bringing the total number of educational seats available in DSO to 7,100. Phase two of VIS will include secondary classes, and phase three will be VIS Academy. Moreover, the GEMS Wellington Academy Silicon Oasis (GEMS WSO), a community school at the heart of DSO offering a fully inclusive British curriculum, also plays a key role in nurturing students to become world-class, world-ready citizens, preparing them for a world of accelerating change while focusing on the development of learning skills and competencies. DSOA recently completed a 10,000 square meters student accommodation complex, comprising four buildings with fully furnished units of varying sizes, which can accommodate more than 450 students from across the nation. The complex includes retail shops, F&B outlets, recreational common areas, and study halls for the students. The entire facility will offer free Wi-Fi access, in addition to providing complementary transportation for students between the complex and their universities and several shopping centres. Entrepreneurship and start-ups Dtec Image Credit: Supplied In a bid to promote and attract technology-focused start-ups, entrepreneurs, and innovators, the Dubai Technology Entrepreneur Campus (Dtec), the largest tech hub and co-working space in the MENA region wholly owned by DSOA, is committed to providing advanced facilities to start-ups and entrepreneurs that are engaged in developing innovative solutions for smart cities, such as overcoming congestion, and ensuring effective waste management and energy efficiency. Dtec, is currently home to more than 1,000 start-ups from 75 countries with many start-ups working on blockchain and AI technologies. Dubai Silicon Oasis has proved to be a preferred destination to thousands of multinational and national companies working in the high-tech industries such as Porsche, Schneider Electric, Jaguar Land Rover, Henkel, Mitsubishi Electric, W Motors, Western Digital, and many more. ■

GulfNews Business

Saudi Arabia’s fintech regulations can speed up Open Banking

Analysis|: For years, the Middle East and North Africa’s financial sector has been abuzz with the concept of ‘Open Banking’ – a practice that provides third-party financial service providers standardized access to consumer banking, transaction and other financial data through application programming interfaces, or APIs. Nowhere is this more true than in Saudi Arabia, where, while still in a stage of relative infancy, fintech innovations form a growing part of the Vision 2030 plans to diversify and transform the economy and lessen dependence on oil. All while at the same time creating a dynamic job market for Saudis and encouraging a high-tech, digitally focused knowledge economy. It should come as no surprise that fintech is set for take-off in Saudi Arabia. After all, 70 per cent of the population of 34 million people is under 30 and digitally-savvy. For fintech providers and start-ups alike, it’s a hugely lucrative market. Additionally, the Kingdom has launched initiatives to support fintech companies, such as the Fintech Regulatory Assessment Tool and FinTech Data and Research Initiative. The Saudi Central Bank (SAMA) and Capital Market Authority (CMA) continue to issue regulatory licenses and develop regulations to support fintech activities. A welcoming environment for fintech Even more impressive milestones are also just over the horizon in the form of the FinTech Saudi Hub in King Abdullah Financial District. A major drive of these initiatives is SAMA’s plans to go live with Open Banking in 2022 – a move that could open the market to numerous fintech services, spurring competition and increasing users’ options when it comes to managing their own finances. It will allow Saudi Arabia’s banks and fintechs to work together in developing innovative applications that analyze financial transactions data – with customer consent – to provide niche products and services that cater to their financial needs. At Fintech Galaxy, we obtained approvals from the Saudi Ministry of Investment (MISA) to open an office and will be applying for an AISP/PISP license for ‘FinX22’ with SAMA once the kingdom’s open banking framework requirements are ready. FinX22 is a unified open API infrastructure for seamless integration between fintechs and institutions with a vision to connect 22 Arab Markets on a single API. The platform aims to democratize financial services by providing secure interoperability channels between industry players for account aggregation, payment initiation, and cashflow management to lending/credit scoring. And to develop the technology necessary for banks to become compliant with Open Banking requirements. Spread financial literacy By opening itself up to Open Banking, Saudi Arabia is also contributing to increased financial awareness among consumers. This includes helping lower-income customers to reduce excessive expenditures, improving savings behaviors, and, in general, encouraging Saudis to have better control over their financials. The Saudi Central Bank (SAMA) is responsible for managing monetary policy and reserves and supervising the financial sector's institutions, the credit information sector, and the financial technology (fintech) sector. The Capital Market Authority (CMA) regulates the Saudi Arabian Capital Market by issuing required rules for implementing the provisions of the Capital Market Law. Both regulators are working on increasing the level of financial inclusion in the Kingdom, which in turn is a means of enhancing financial stability, deepening and diversifying financial systems and support structures. At present, there are 155 fintechs registered with Fintech Saudi. Currently under SAMA’s umbrella, there are 29 fintechs operating, including 14 licensed fintechs, and 15 permitted fintech’s in the Regulatory Sandbox. Under CMA, there are 114 authorized capital market institutions and 16 fintechs. Fintechs with the CMA FinTech Lab are permitted to operate in the market under an experimental environment with the Fintech Experimental Permit period, which has a term of two years to experiment before graduating to being fully licenced under CMA regulations. Not confined to banking Open Banking in Saudi Arabia will open up a wide variety of financial services for all industries. For example, it will allow a leasing and lending economy to exist by providing transparency to individuals and companies wishing to tailor their deals based on a customer’s financial health. For the wider banking system, Open Banking will also lead to greater efficiency. Customers will be able to instantly share their bank data with a third-party, which fosters the adoption of efficient ways to manage financial information and execute transactions. In the longer-run, new technologies will also likely reduce the cost of innovations by providing an easy way to partner with third-party providers. That isn’t to say that there aren’t challenges. For one, Saudi Arabia must continue to build on its human capital through skill development, beginning with the education system. While initiatives centered on creating a fintech-style curriculum, they are still in their infancy, as are fintech clubs and co-working spaces designed to encourage entrepreneurs and broaden the fintech talent pool. These challenges aren’t something to worry about – it’s up to us as an ecosystem to make them a reality. Mirna Sleiman null The writer is founder and CEO of Fintech Galaxy.

GulfNews Business

Rise of Petrochem CEO Yogesh Mehta: From a monthly salary of Dh2,000 to owning a billion dollar firm in Dubai

Dubai: From a salary of Dh2, 000 a month to owning a billion-dollar company, the rise of Yogesh Mehta, 61, CEO of Petrochem Middle East - the largest chemical distributor in the Middle East - has been phenomenal. Mehta, who came to UAE in 1990, runs this family-owned business along with his son Rohan, 32, and a team of dedicated professionals. When it all started Bitten by the entrepreneur bug right from a young age, Mehta started his first business when he was 19 years old. “I ventured into some trading business. Some of it worked some did not.” Yogesh Mehta got married to Falguni when he was 24. “By the time I was 28, I had lost all my money. My business had collapsed. I was educated but nothing was going right in my career. So, with practically no money in my pocket, I set foot in Dubai on March 15, 1990. “When I landed here, I was pretty much down and out. I thought I was done with life. Although I was married with a son who was almost a year old, I felt I had reached the end of my career. I needed a boost, another opportunity to start life anew. So I thought I must give it a shot at trying a job in Dubai,” said Mehta. Yogesh Mehta with this wife Image Credit: Supplied And Dubai did provide him with the opportunity. Dubai – the land of opportunity Back in the early 90s, Dubai was not as developed as it is today. “But there was promise in the air. The positive vibes were unmistakable.” “When I was contemplating a career change in my life, many people said that Dubai is a land of opportunity. I came to try my luck here, but I did not know the massive growth potential that was waiting for me.” “Back in the days, we had two-lane highways. Everyone knew everyone,” he said. Mehta started work almost immediately after landing in Dubai. He worked as a partner for a small business dealing with chemicals – similar to what Petrochem is doing today. As the business grew, he separated from his old partner in 1994 and formed Petrochem with a British expatriate living in Dubai. “My dream was to be a business magnate. I wanted to be rich.” “Last year, the turnover was $1.5 billion. We are the largest chemical distribution company here in the Middle East and are ranked number 12 in the world,” said Mehta. Petrochem has businesses worldwide including in London where Mehta owns a large home. Other branches are in Singapore, Taiwan, China, India, Egypt, London and Amsterdam. The company is headquartered in Dubai. The company has a staff of 230 worldwide of which 145 are working in the UAE. Making it big in the UAE "Petrochem grew big because back in the days it was easier to get agencies to distribute chemicals. We wanted to create state-of-the-art distribution terminals, so we formed a team of professionals. We hired the best chemical engineers. They made it happen for Petrochem. It was great teamwork, end of the day,” said Mehta. "One of the biggest challenges we faced was the 2007 economic crisis. That was one of the worst times we faced. From the height of the boom we enjoyed in 2001. The stock market crashed, then gold. We almost felt that the world was coming off. But, as professionals, it was not the time to give up. We knew a downturn had struck, but we also knew it was the time for some innovation.” Mehta said he and his team went down to the drawing board once again. “We sat down as a team and listed things we could do and not do. One critical outcome of the brainstorming was the decision not to change our line of business, but we decided to change the way we did our business. Our strategies were revamped,” Mehta said. Yogesh Mehta with members of the Abu Dhabi Hindu Mandir committee Image Credit: Supplied The pandemic: the ups and downs Mehta said that after Lehman Brothers' collapse and the subsequent economic recession faced by the world, the next big blow to the economy has been the recent pandemic. “It has been a severe blow. In 2020 when the pandemic struck, it was sad seeing lives lost. Work came to a halt. Lockdowns and closures added to the woes. Luckily for us, we are in the chemical industry business. For example, we have products that are used in sanitisers. Demand for our products has grown because sanitisers are in huge demand now.” Running a successful family-owned business Mehta said that as the Petrochem business grew in 2018, his erstwhile British partner offered to sell his share of the business. “David came up to me one day and said it is better to run the company as a family-owned one since my son was already in the business. So we parted as good friends.” “In 2018, he left, and my son acquired the shares in the company. Today, we own this company jointly.” Taking a risk at 29 Mehta was 29 when he landed in the UAE. “I had nothing to lose as I had already lost everything. I had a wife and son to look after. I knew I had to take the chance. I set foot in Dubai hoping my life would improve. Little did I know it would change 180 degrees for the better,” Mehta said. Once in Dubai, he did a whole lot of research on the chemical industry business here. “I studied about various chemicals – like which ones get imported into the UAE and which were exported from here. I made a business file to show the potential investors. I strongly felt it was important at that time to have a business case and know really what made sense to bring to the UAE market.” Yogesh Mehta in his office Days of struggle Mehta said the first six months of his arrival into the UAE was a period of struggle. He came on a salary of Dh2,000. He had a wife and son to take care of. Thanks to his hard work, Mehta was given a raise of Dh2,000 by his former boss. His total salary stood at Dh4,000. “My wife was a Montessori-trained teacher and so I asked her to go and find a job. I told her that I would look after my son while she works at the school. We had to have a good, steady income flowing as there were expenses to pay like rent, food and other day-to-day expenses.” “I had a burning desire to grow. There was blood in my eyes,” he said.  The right business partner Mehta said one of the key factors behind the success of Petrochem was having the right business partner. “David Lubbock was my business partner at Petrochem. Together we started the company. We parted as friends and today he is like a brother to me.” The duo shared great chemistry when it came to propelling their business to great success. “David took care of the European part of the business I did the rest of the world. Together, we created value. We did some good business, secured good agencies, pushed Petrotech to be the best company it is today. In 2018, he felt it was fair that he sells his share of the business. His children were not keen to take over the business. My son Rohan was already active so he said it was time to make it a family-owned business. He is such a good man.” Education, family Yogesh Mehta is a graduate in chemistry.  Yogesh Mehta, Founder and CEO, Petrochem Middle East Ltd., during an interview on 11th July, 2021. Photo Clint Egbert/Gulf News “My father was a Gujarati Brahmin and my mother a Sindhi. They met in 1954 fell in love with each other. It was a huge thing in those days. They got married in 1956 and my older sister arrived in 1957. I came two years later in 1959,” said Mehta who was born and brought up in Mumbai (formerly called Bombay). He said his father was a businessman of sorts, dealing in chemicals. He had a Ph.D. in polymer chemistry. "I am in the same line of business,” Mehta said.  Yogesh Mehta said he could not have reached this far without the love and support of his wife Falguni, 61. “She has been my source of strength. We share a long history. We fell in love when we were 15. We got married when we were 24 and till today bank on each other for support. She completes me.” Yogesh’s son Rohan is married to Roshni, a British national. The family spends their summers in London every year. Yogesh Mehta with his family: son Rohan, daughter in law Roshni, wife Falguni and grandchildren. Image Credit: Supplied About Rohan Mehta “Rohan is a very talented young man. He is a doting husband and father of three children. I call him a good guy,” said Mehta with much pride for his son. Rohan graduated from Northeastern University in Boston, USA in 2011. He worked in Texas for two years before joining Petrochem. Rohan Mehta “I asked my son to join me in the business and he happily agreed.” There was no second thoughts, Rohan says. “Being brought up in Dubai for over three decades, the UAE is certainly home now. I was raised in a humble environment. I was just like any other kid growing up in the desert, playing football in the sand. Our family weekends were spent picnicking in parks in Hatta and Al-Ain,” he said. After graduating, he had the opportunity to work at a large multi-national company producing petrochemicals. “I was excited and packed my bags for my new adventure in Dallas, Texas. After an incredible amount of learning and experience, I decided to head home to Dubai and join Petrochem.” Today, almost eight years into Petrochem, Rohan said he finally feels settled. “It wasn’t an easy journey to start with. I faced challenges despite being in the family business. It was not an easy ride for me at all,” he said. “I jumped on the horse and learned how to ride it. There was a lot of learning I did on my own but there was also a lot I learned from the invaluable talent around me. My father has been a great source of strength and inspiration to me,” he says. “I feel I am extremely lucky to be surrounded by such mentors and experts here at Petrochem, the learning never ends and is a daily process. As a father myself, I look at running this company in the future and further building on this legacy to make my mark not only in this company but also in this region. The best is yet to come,” Rohan concluded.

GulfNews Business

Double tax and bandits on the Pakistan-Afghan trade route

Pakistan|Business|: Chaman, Pakistan: The Taliban’s capture of a key Afghan-Pakistan border post has sent trucking costs soaring, with insurgents and government officials separately taxing traders, and bandits demanding bribes to allow safe passage of goods. Thousands of vehicles cross daily from Chaman in southwestern Pakistan to Spin Boldak on the other side, carrying goods destined for Kandahar, Afghanistan’s second-biggest city. On the way back they usually ferry agricultural produce bound for Pakistan’s markets or ports. The bilateral trade - worth hundreds of millions of dollars a year if not more - ground to a halt earlier this month after the Taliban seized the dusty border town, but resumed this week with the insurgents seemingly firmly in charge. They have captured a vast swath of the country since early May after launching a series of offensives to capitalise on the final stages of the withdrawal of foreign troops. While they have not yet taken any provincial capitals, they have captured a string of key border posts - with Iran, Tajikistan, Turkmenistan and Pakistan - which provide vital revenue from customs duties on goods arriving in the landlocked country. “We loaded grapes in Kandahar and on the way we have been extorted at least three times,” trucker Hidayatullah Khan said at Chaman. “Sometimes they charge 3,000 rupees ($20), somewhere else 2,000 rupees, and in some other place 1,000 rupees,” he said. That was on top of the taxes he had to pay Taliban officials in Spin Boldak and Afghan government customs officials who have opened shop in Kandahar. Stranded people wait for the reopening of border crossing point in the Pakistan's border town of Chaman on July 16, 2021, following clashes between Afghan forces and Taliban fighters in Spin Boldak to retake the key border crossing with Pakistan. Image Credit: AFP Chaos and confusion Truckers interviewed in Chaman this week told of chaos and confusion on the Afghan side of the border. Imran Kakar, vice-president of the Pak-Afghan Joint Chamber of Commerce, gave one example of a truck carrying fabric from Karachi destined for Kandahar. The Taliban charged the driver 150,000 rupees (about $1,000) as duty in Spin Boldak, but when the vehicle reached Kandahar government officials were also waiting. “We had to pay even higher customs duties as they don’t acknowledge the payments made to Taliban,” said Kakar. The scenes were reminiscent of Afghanistan during its brutal civil war in the 1990s, when a patchwork of militias held stretches of key trade routes and extorted truckers and residents using the roads at will. Hundreds of trucks were lined up Wednesday on the Pakistan side of the border, waiting for permission to cross. On a dusty plain this week, with rugged hillocks as a backdrop, drivers and “spanner boy” apprentices tinkered with their vehicles ahead of the journey. While the distance is just 100 kilometres, the journey is fraught with danger. Vehicles and roads are poorly maintained in Afghanistan, police and army checkpoints routinely demand “tea money” or more from every driver, and bandits also lie in wait - either to steal goods or demand further payment for safe passage. There is also the risk they could be caught in crossfire during fighting between the Taliban and government forces. Still, traders and drivers say they have little option but to keep on trucking. “War has been going on, we know that, but we don’t have any other choice,” said Abdul Razzaq, a driver carrying hatchling chicks to Kandahar. “Transportation of goods is the only means for us to feed our families,” he told AFP.

GulfNews Business

Dubai’s self-contained residential communities make for the right solution

Analysis|: What happens in Dubai to the art of building is bound up with what happens to the city as a place to live and work in if it ceases to be a place in which people can exist in reasonable contentment, it will be unprofitable to discuss its architectural achievements. As urban surface transportation becomes increasingly longer, the challenge is to develop communities that are self-contained, where work and play become intertwined. As technology continues to progress, these communities can develop independent of the upper income group stratas, where Courbousier’s vision of the “vertical garden city” is instead replaced by something less chaotic. City planning for various neighborhoods enter the narrative here, primarily to counter the statement of the late medieval poem: “Officers and all do seek their own gain, but for the wealth of the commons no one taketh pain”. From the centre Of course, the best way to understand what has to be done to make the city and its surrounding more livable and workable is to begin the exploration at the centre of the town and work outwards, to construct a framework that avoids pitfalls of high land values. What has been done in Dubai, apart from building city centers such as Downtown Dubai and Business Bay, has been to make better use of the land by re-planning residential neighborhoods into great superblocks of mixed communities, with fewer streets and fewer intersections. And all but purely local traffic confined to wider arteries that run past, but not through, these neighborhoods. We have seen this with the development of areas such as Jumeirah Village, where skyscrapers have coexisted with smaller developments in a self-contained framework, ideally situated between the traditional city centres and the Expo site. Adding aesthetic details In a post-pandemic scenario, capital has been pouring back into these areas, allowing for middle-income housing to flourish, as cookie-cutter developments co-exist with more bespoke ones. And where newer building efforts are concentrated towards increasing surface area and architectural improvements, thereby enhancing the value of the neighborhood. With capital values on the rise, developers have shifted their focus not on the rigid curtain-wall type structures, but a more intimate feel whereby space is afforded the care that it deserves for residents and workers alike. Areas such as these go a long way towards easing the pressure on the main arterial road networks that crisscross the city. As other areas prop up with similar characteristics, there is a sense of why mid-income areas are becoming attractive again. It avoids the typical pitfalls of providing for traffic relief by adding more parking garages and spaces, all of which serve the only function of attracting more traffic. People, it seems, find it hard to believe that the cure for congestion is not more facilities for congestion. What communities need are not “greedy” buildings that hog every cubic foot of space the law allows or flashy buildings with murals in the lobby, but rather a return to first principles of the traditional town center in the post-COVID-19 world. This is where large street ways and garden spaces give way for less traffic and more of a quieter neighborhood feel. Where life and art can express itself organically. Revitalizing the old In Dubai, the revitalization of areas such as Al Quoz give a glimpse of what a transformation can look like, but areas such as Jumeirah Village go further in accounting for qualities that distinguish the community from its surroundings in an overall economic framework that allows affordability. This has already started to transpire with developers no longer submitting proposals that maximize built-up areas, but rather allow for developments that are spacious, affordable, and co-mingle with its surroundings. In appraising its design, both aesthetic and functional demands are being met, stepping away from the frenzied development that was the norm during much of the first Dubai property boom. The error then was not of the architect’s or of the developer, it was rather a characteristic of the entire market. In the recent phase, municipally-sanctioned congestion of occupancy has given way to a more somber expression of practicality and serenity. Jumeirah Village perhaps best encapsulates the new middle-income hotspot ideal in the way Karama or Bur Dubai once was. A muted masterpiece, but a masterpiece nonetheless. Sameer Lakhani null The writer is Managing Director of Global Capital Partners.

GulfNews Business

Relief for Dubai's Marina 101 property owners as work restarts at long-delayed skyscraper

Property|: Dubai: Hundreds of investors in Dubai’s Marina 101 skyscraper project are finally getting some relief. The long-delayed Dh1 billion project could soon see the completion of the additional 3 per cent external work that will then allow property owners to get on with fitouts and then move in. Work was stalled in 2019 after the developer, Sheffield Real Estate, faced issues over loan repayments with its banks. The Marina 101 project was launched in 2005, and at the time was one of Dubai’s signature skyscrapers in the making. At the time when work was halted, the project had gone past the 97 per cent mark, according to the Dubai Land Department date. “We have just heard that DEWA connections have been restored and that the final stretch of work has started,” said an investor of a multi-million dirham apartment at the tower. “From now, all of the required work should only take a matter of weeks.” It is not clear whether the work has been launched by a new investor coming in and entering an agreement with RERA (Real Estate Regulatory Agency). Official word is awaited, but some sources say there are funds in escrow that could have been used for the final 3 per cent work. The Marina 101 was launched as a mixed-use development, with more than 30 storeys designated for hotel apartments. It occupies a central spot in Dubai Marina, ringed by other impressive structures. 425 metres Height of Marina 101, which places it among the pantheon of super-tall towers in Dubai. A huge break For Dubai Land Department and RERA, the relaunch of work will be a major win, showing Dubai’s intent to clear all of the legacy projects that had been stalled or much delayed for various reasons. In the recent past, the Dubai Government had made it clear that investors would be protected in future decisions taken on these projects. However, for some investors at Marina 101, the relaunch will not bring much cheer. These are the ones who could not get their apartments registered for the offplan ‘Oqood’ registrations. Some of these investments were in the Dh10 million and over range. The law of the land does not assign rights to those without these certificates.

GulfNews Business

It could a 'year or two' before UAE's gold and jewellery demand rises to pre-COVID-19 levels

Retail|: Dubai: It could be another year before gold and jewellery buying in the UAE returns anywhere close to pre-pandemic levels, according to senior industry sources, who cite the lack of Indian and Saudi visitors as the main reason. Since March 2020, demand for gold in Dubai’s Gold Souq and other jewellery shopping destinations in the UAE was primarily driven by resident shoppers. With COVID-19 still imposing limits on flights and road trips, buying remains subdued, with jewellery sales in the second quarter well below the five-year average, according to the latest numbers from London-based World Gold Council. Pre-COVID-19, tourist buying made up around 30-40 per cent of gold and jewellery sales in the UAE. Anil Dhanak of Kanz Jewels says the return of tourists from India and the Subcontinent will need time to rebuild, as well as of Saudi shoppers. “Their return will not happen overnight – vaccinations will need to do their bit to make flying a far easier experience than it is now in most countries,” said Dhanak. “This is why everyone is hesitant about making forecasts about when UAE gold demand will return to pre-Covid times. Even shopping by UAE residents is not that encouraging – every other household has had to deal with unexpected medical bills and other expenses. That need always depresses consumer sentiments, especially on jewellery purchases.” The gold price averaged $1,816.5 during the second quarter, which is incidentally what it is quoting at today (July 29). Anil Dhanak of Kanz Jewels: "The tourist-shopper will have to return for a full-scale revival of gold demand in the UAE." Image Credit: Gulf News A bit of dazzle But some improvements are still there. After selling a combined 5.1 tonnes of jewellery in the second and third quarters of 2020, this year, between April to end June, UAE sales were at 7.3 tonnes, according to World Gold Council. But in the January to March phase, sales totalled 8.3 tonnes. The five-year quarterly average for jewellery demand in the UAE is 8.8 tonnes. “We saw improvements in [local] demand because of the economic recovery,” said Krishan Gopaul, Senior Analyst for EMEA markets at WGC. It could have been better had not gold prices stuck to $1,800 an ounce plus levels for much of the first six months of 2021. Each time, prices slipped below that point, the weakening did not continue for long, as institutional investors kept piling back in given gold’s status as the safe haven asset to be. So, whenever worries about global economic recovery, COVID-19 second or third waves and higher upcoming inflation cropped up, gold was always the winner. Though not from a shopper’s perspective. The Dubai Gold Rate has held on the Dh200 a gram and over range. On Thursday morning, the Rate for 22K is Dh204.25. 4 % Gold price increased by this percentage during Q2-2021, following a 10% decline in Q1-2021. Comfort in bars and coins The second quarter showed UAE shoppers continue hoarding gold bars and coins whenever prices moved to levels they were comfortable with. In the first six months, 3.7 tonnes of gold were bought this way, whereas in the whole of 2020, it was at 5.2 tonnes, according to WGC data. If prices stick to $1,800 an ounce/Dh200 a gram plus range, expect more bar and coin demand. (In the UAE, gold bars are exempt from VAT.) Global demand If India didn’t have to deal with the second COVID-19 wave, the second quarter tally for global gold and jewellery could have been better. Even then, the final total of 390.7 tonnes of jewellery bought worldwide is still 60 per cent higher than for the same period in 2020. As for gold’s prospects in the second-half of this year, “We still see question marks over inflation and over global economic recovery,” said Gopaul.”There are still challenges and the potential for further disruption with new Covid variants.” Clearly, what will drive shopper sentiments for gold will not be decided on prices alone.

GulfNews Business

Google and Facebook to require vaccines for in-office employees, paving the way for rivals to follow

Technology|Business|: Google also followed Apple in pushing back its return to office to mid October from early September, and Twitter announced it was pausing all of its reopening plans indefinitely - moves that could trigger a flurry of copy cats across corporate America. In a note to employees announcing the changes, Google CEO Sundar Pichai said the company has seen high vaccination rates for Google employees so far, which is why it is comfortable bringing workers back into the office. Currently, there are some early volunteers who are already working at various Google campuses. Workers will have to start reporting back to the office on Oct. 18. "I hope these steps will give everyone greater peace of mind as offices reopen," said Pichai in the message. Any Google employee who doesn't wish to get vaccinated but doesn't have approval to work remote indefinitely will need to contact human resources and discuss their options, the company said. Google will announce expanded temporary work options for people with any special circumstances through the end of the year. In Washington state, where Google has thousands of employees, the company had previously allowed employees who weren't vaccinated or did not want to disclose their vaccination status to come into the office if they wore a mask and got weekly coronavirus tests, according to an internal memo obtained by The Washington Post. Facebook's Vice President of People Lori Goler said in a statement that the company will have a process for anyone who cannot be vaccinated for "medical or other reasons," but did not say if people who chose to be unvaccinated for nonmedical reasons could work remotely indefinitely. Twitter, one of the first tech companies to close its offices at the start of the pandemic, said Wednesday it is shutting down its San Francisco and New York offices immediately. It had been slowly reopening the spaces to some workers while switching to a remote-first policy for anyone who wanted to stay home. The company also said it is pausing all future reopening plans while it monitors the coronavirus situation. The announcements came after a flurry of activity around vaccine requirements, as the seriousness of the delta variant hit home for many including corporate America. On Thursday, President Biden is expected to announce that all federal employees and contractors must be either vaccinated or undergo regular coronavirus testing to continue working. State and local governments are issuing their own similar guidelines. The Centers for Disease Control and Prevention on Tuesday recommended people who are vaccinated start wearing masks in public indoor places in areas with high virus transmission. Some employees welcomed the move. One Google employee, who declined to be named, said he is happy with the company's announcement. Some of his colleagues had posted vaccine skeptical content on internal message boards, and he was nervous about being forced back into an office with unvaccinated people. "I'd rather not be sharing a buffet with them," the employee said. Google has more than 140,000 full-time employees around the world, as well as over 100,000 contractors. It was one of the first major companies to send employees home as the coronavirus was spreading throughout the U.S. in March 2020. The company has also outlined in detail its plan for returning to the office with a "hybrid model." Unlike some smaller tech companies like Twitter and Slack, Google will require most workers to physically come into offices but only for three days a week. Those who want to stay remote have been told to ask their managers, and will be notified whether they can continue working away from an office permanently in August. The company has said it is rebuilding the interiors of its buildings to accommodate more social distancing and make it easier to interact with colleagues who are still working from home. Outdoor spaces are being converted into work stations and special meeting pods are being built with big monitors to prevent video callers from feeling sidelined from in-person discussions. The company experimented with other ideas like self-inflating balloon walls. Google has a lot at stake. Its entire corporate ethos is built around the idea of pulling together smart people into one place and getting them to come up with ideas together. The company also has billions of dollars in real estate investments that have largely sat empty over the last 18 months. A giant new showpiece building on its Mountain View campus was in the final stages of construction right as the pandemic hit. Tech companies in Silicon Valley were some of the first to close their offices at the start of the pandemic in early 2020, and they are like a bellwether for what corporate America will do next when it comes to return to work policies. In the spring, Apple, Google, Facebook and Amazon started rolling out their return-to-office plans which largely involved a hybrid approach - three days of work in the office and two at home, starting for most employees in the fall. For the most part, wearing masks was not going to be a requirement for vaccinated in-office workers at most companies, and getting vaccines was not mandated. Now the companies' plans appear to be going through another round of revisions. Apple on Wednesday said it was reintroducing a face mask requirement in its retail stores to be in line with the new CDC guidance. Apple was the first company to change its fall 2021 return-to-office date, announcing in July that workers would not be required back until October instead of the previously announced date in September. It has not yet announced any vaccination policy. Amazon said it will not require its employees to get a vaccine to return to the office, but noted it strongly encourages employees and contractors to get vaccinated as soon as they are able. Like Google, office chat app Slack will have a vaccine requirement for all employees returning to the office, but its rule could have a much smaller impact as the company switches to fully remote work. "We are requiring vaccination to come into the office. Vaccination is not a requirement, nor is coming into the office, to maintain employment," said Brian Elliott, executive lead of Slack's Future Forum. Ride sharing-app Lyft also told employees on Wednesday that it would require proof of vaccination to return to the office. However, workers had more time to get the shots. Lyft said it was setting a new return-to-the-office date of Feb. 2, 2022 - a six month delay from its previous return date.

GulfNews Business

Boeing books its first profit since the pandemic on the back of 737 MAX deliveries

Aviation|: Dubai: US plane-maker Boeing posted its first quarterly profit in almost two years as deliveries of its 737 MAX aircraft accelerated. The company said it still expects global air passenger traffic to return to 2019 levels in 2023 to 2024. Boeing’s core operating profit in the second quarter stood at $755 million, compared to a loss of $3.32 billion, a year earlier. Boeing delivered 47 737 MAX airplanes in the second quarter, representing about 60 per cent of its total deliveries in the period. Since getting the regulatory go-ahead late last year from various governments, Boeing has delivered more than 130 737 MAX aircraft and airlines have returned more than 190 previously grounded airplanes to service. “We expect demand for narrow-body aircraft to recover faster, as evidenced by our year to date orders for 737 Max airplanes and demand for wide body aircraft to remain challenged for a longer period,” said Dave Calhoun, Boeing CEO, during a post-earnings call. UAE-based budget carrier flydubai is among the biggest customers of the MAX programme. The airline recently reached an agreement with Boeing to cut the number of Boeing 737 MAX aircraft it will take delivery of by 65. The move was announced after flydubai conducted a “review of its fleet plans… following the COVID-19 pandemic and the changing dynamics of the airline’s route structure” In June, aircraft leasing firm Dubai Aerospace Enterprise said it would acquire 15 Boeing 737 MAX 8 aircraft. The order was valued at about $1.8 billion (Dh6.6 billion) at aircraft list prices. Boeing also said it continues to expect first delivery of the 777x wide-body aircraft in late 2023 - it is currently progressing through a comprehensive flight test program. Dubai’s Emirates airline was scheduled to receive the first Boeing 777X aircraft deliveries in 2020 but was subsequently postponed to 2022 and later to 2023. During an online event in May, Emirates President Tim Clark expressed his annoyance with the delays and said the plane-maker should “get back to what they were really good at.”

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Sheikh Mohammed congratulates UAE based entrepreneur for establishing smart mass transport company in Dubai

Markets|: Dubai: His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of UAE and Ruler of Dubai, congratulated young Arab entrepreneur Mostafa Kandil whose brilliant vision led him to establish a $1.5 billion green-focussed mass transport company in Dubai. “Dubai-headquartered Swvl is the first Middle East $1.5 billion unicorn to list on Nasdaq US, founded by Mostafa Kandil, 28-year-old entrepreneur. Dubai's impact on the global start-up scene shows the vision and spirit of the region’s youth in shaping tomorrow’s businesses,” Sheikh Mohammed tweeted. The transportation company Swvl is going public through a merger with Queen’s Gambit Growth Capital. Founded in 2017, Swvl provides ridesharing services in emerging markets that don’t always have reliable public transportation. The company’s proprietary algorithm identifies the most efficient and cost-effective routes, thereby reducing emissions while lowering costs for riders. Earlier in the day, the Wall Street Journal reported about the deal being in the final stages. The mobility company is merging with Queen’s Gambit Growth Capital, a SPAC [special purposse acquistion company] created earlier this year by a team of female executives (which claims to be the first women-led SPAC). Its CEO Victoria Grace is the founder of New York-based VC fund Colle Capital. The two companies have entered into a definitive agreement for a business combination that would result in Swvl becoming a publicly listed company on NASDAQ after the completion of the proposed transaction, noted the statement adding that the company will trade under the ticker symbol ‘SWVL’. Swvl will be the second Middle Eastern company to take the SPAC route to public markets. Swvl, is a global tech startup that provides a semi-private alternative to public transportation for individuals who cannot afford or access private options. The company has built a parallel mass transit system offering intercity, intracity, B2B and B2G transportation in 10 megacities across Africa, Asia, and the Middle East. Swvl’s tech-enabled offerings make mobility safer, more efficient and environmentally friendly, while still ensuring that it is accessible and affordable for everyone. Customers can book their rides on an easy-to-use app with varied payment options and access high-quality private buses and vans that operate according to fixed routes, stations, times, and prices. Swvl was co-founded by Kandil, who began his career at Rocket Internet, where he launched the car sales platform Carmudi in the Philippines, which became the largest car classifieds company in the country in just six months. He then served as Rocket Internet’s Head of Operations. In 2016, Kandil joined Careem, a ride-sharing company and the first unicorn in the Middle East. He supported the platform’s expansion into multiple new markets. Careem is now a subsidiary of Uber, based in Dubai, with operations across 100 cities and 15 countries. “Mass transit systems in cities around the world are riddled with deficiencies, resulting in congestion, environmental concerns and reduced productivity. To address these problems, we founded Swvl with a simple but ambitious goal – to empower all people to go where they want to, when they want to, and to feel comfortable doing it,” said Kandil.

GulfNews Business

Pricing and capacity restrictions are hurting India’s domestic airlines: IATA’s Willie Walsh

Aviation|: Dubai: Capacity and pricing restrictions are hurting the recovery of Indian airlines, according to Willie Walsh, IATA’s (International Air Transport Association) Director General. “India’s domestic market is highly regulated at the moment with the governmental policy - both capacity and pricing restrictions … is slowing down the recovery,” said Walsh, during a media briefing. “Without those restrictions, I have no doubt that the domestic position in India would be significantly helped” After the pandemic, India placed limits on air fares and passenger capacity, a move that has not gone down well with airlines. Although India recently allowed airlines operating domestic routes to run at 65 per cent capacity (up from 50 per cent) – some like Indigo, the country’s largest carrier, have been pushing hard to make it a 100 per cent. IATA also announced passenger demand performance for June 2021 showing a very slight improvement in both international and domestic air travel markets. “Demand remains significantly below pre-COVID-19 levels owing to international travel restrictions,” said the industry body. Total demand for air travel in June 2021 (measured in revenue passenger kilometers or RPKs) was down 60.1 per cent compared to June 2019. That was a small improvement over the 62.9 per cent decline recorded in May 2021 versus May 2019. International passenger demand in June was 80.9 per cent below June 2019, an improvement from the 85.4 per cent decline recorded in May 2021 versus two years ago. All regions with the exception of Asia-Pacific contributed to the slightly higher demand. Total domestic demand was down 22.4 per cent versus pre-crisis levels (June 2019), a slight gain over the 23.7 per cent decline recorded in May 2021 versus the 2019 period. IATA said the performance across key domestic markets was “mixed” with Russia reporting robust expansion while China returned to negative territory. “We are seeing movement in the right direction, particularly in some key domestic markets. But the situation for international travel is nowhere near where we need to be,” said Walsh. Cargo breaks records Meanwhile, global air cargo markets for June showed a 9.9 per cent improvement on pre-COVID-19 performance (June 2019). This pushed first half-year air cargo growth to 8 per cent, its strongest first half performance since 2017. Global demand for June 2021, measured in cargo tonne-kilometers (CTKs), was up 9.9 per cent compared to June 2019.

GulfNews Business

Bank of Sharjah reports Dh120 million pre-provision Q2 net profit

Banking|: Dubai: Bank of Sharjah Group on Wednesday reported a pre-provision net profit of Dh120 million. Upon application of Dh587 million as hyperinflation effect, linked to the operations of its Lebanese subsidiary Emirates Lebanon Bank (ELBank) the Group recognized a net loss of Dh467 million and a total comprehensive loss of Dh447 million versus a positive equity component of Dh740 million. The Group’s balance sheet remains strong, with total assets standing at Dh37.70 billion, up 4 per cent compared to Dh36.14 billion t yearend 2020. The Group continues to enjoy a high asset quality and other robust metrics that remain healthy as a result of strict adherence to maintaining a disciplined and focused approach to lending, recovery and funding. The Group continues to also enjoy comfortable liquidity and a solid capital position with a customer deposit base of Dh23.94 billion with a loans-to-deposits ratio of 84 per cent compared to 82 per cent at the yearend 2020 and a cost-to-income ratio of 50 per cent compared to 32 per cent at the close of 2020. Hyper inflation provisions The Group’s operations in Lebanon continued to witness unprecedented events stemming from political and economic turmoil, since October 17 2019. The Group has complied with Banque du Liban (BDL) Circular No. 13129, dated 4 November 2019, calling for the increase by 20 per cent of the equity of Lebanese banks prior to 30 June 2020. The International Monetary Fund (IMF) published in December 2020 the inflation forecasts. Whereby, the Lebanese economy is considered a hyperinflationary for the purposes of applying IAS 29 and for the retranslation of foreign operations in accordance with IAS 21 and its effects on the condensed consolidated interim financial statements for the period ending 30 June 2021. Accordingly, the financial statements of Emirates Lebanon Bank SAL have been restated by applying a general price index to the historical cost, in order to reflect the changes in the purchasing power of the LBP, on the closing date of the financial statements.  The net effect of hyperinflation on the consolidated equity for the period ended 30 June 2021 was positive and amounted to Dh153 million, representing the difference between Dh587 million negative variation on the P&L figures and Dh740 million positive variation on total equity. This has pushed the net equity of the Group by Dh153 million to Dh3.44 billion as at June 30 2021 versus Dh3.16 billion as at December 31 2020. “Despite Covid-19 the Bank performed exceptionally well and delivered positive and eloquent results that under hyperinflation accounting moved from P&L directly to equity. From Board of Directors’ perspective protecting shareholders equity is the most important responsibility,” said Sheikh Mohammed Bin Saud Al Qasimi, Chairman of Bank of Sharjah.