Mid­dle East na­tions turn to pri­vate sec­tor

Kuwait Times - - NEWS -

DUBAI: Oil-rich gov­ern­ments from Tripoli to Tehran are in­creas­ingly re­ly­ing on the pri­vate sec­tor in a key change across the Mid­dle East and North Africa, a re­port said yes­ter­day. The value of public-pri­vate part­ner­ship (PPP) projects across the re­gion, in­clud­ing those still in the pipe­line, has more than dou­bled to $185 bil­lion over the past year, the Dubai-based Mid­dle East Eco­nomic Di­gest wrote.

The sharp in­crease comes as gov­ern­ments have ramped up ef­forts to get the pri­vate sec­tor in­volved in fi­nanc­ing, build­ing and op­er­at­ing public in­fra­struc­ture projects in a bid to off­set shrink­ing in­come from oil since crude prices be­gan to fall in mid-2014. “The rise of PPP over the past few years is one of the most strate­gi­cally sig­nif­i­cant shifts in the busi­ness land­scape of the Mid­dle East since the na­tion­al­iza­tion of the oil in­dus­try in the early 1970s,” the re­port said.

Kuwait topped the list with joint projects worth $44.4 bil­lion, fol­lowed by Libya with $36 bil­lion, the United Arab Emi­rates with $27.6 bil­lion and Iran with $14.3 bil­lion worth of projects. The fig­ures ex­clude any in­vest­ments in the key en­ergy sec­tor. The re­port said that nearly two-thirds of the projects, worth around $100 bil­lion, are in the plan­ning stages and are ex­pected to be awarded in the next five to six years. Coun­tries across the re­gion, es­pe­cially those in the Gulf, have lost hun­dreds of bil­lions of dol­lars in oil in­come due to the slide of crude prices.

Sep­a­rately, Qatar Na­tional Bank, the Gulf emi­rate’s top lender, yes­ter­day re­ported a rise in its quar­terly prof­its de­spite a trade boy­cott against Doha by a Saudiled bloc of coun­tries. QNB, one of the largest banks in the Mid­dle East and North Africa, said its net profit for the third quar­ter of 2017 was up 5.3 per­cent on the same pe­riod last year, at 3.6 bil­lion riyals ($980 mil­lion).

The bank’s profit over the first nine months of 2017 also rose six per­cent on the same pe­riod last year, it said in a state­ment. The re­port came as a diplo­matic cri­sis that has seen Qatar iso­lated from its neigh­bors en­tered its fifth month. On June 5, Saudi Ara­bia, the United Arab Emi­rates, Bahrain and Egypt im­posed po­lit­i­cal and eco­nomic sanc­tions on Qatar, ac­cus­ing the gas-rich emi­rate of sup­port for rad­i­cal Is­lamists. Doha has cat­e­gor­i­cally de­nied the charges.

Moody’s In­vestors Ser­vice last month said that Qatar’s bank­ing, trade and tourism had been im­pacted by the sanc­tions. The credit rat­ings group es­ti­mated that Qatar had spent $38.5 bil­lion - some 23 per­cent of its GDP - on prop­ping up its econ­omy dur­ing the first two months of sanc­tions.

Moody’s said some $30 bil­lion had flowed out of Qatar’s bank­ing sys­tem in June and July, adding that a fur­ther de­cline was likely. QNB said it has main­tained a highly diver­si­fied in­ter­na­tional and lo­cal fund­ing base. The bank’s to­tal as­sets rose 11 per­cent to $216 bil­lion on Septem­ber 30, up from $194 bil­lion a year ago.

Newspapers in English

Newspapers from Kuwait

© PressReader. All rights reserved.