Day: May 22, 2023

Dubai is at the heart of everything FinTech, providing one of the world’s best ecosystems to foster innovation, attracting record investments and growth at an accelerated pace.

With the success of Dubai Fintech Summit in providing a truly global platform for the world’s Fintech community, the Dubai International Financial Centre (DIFC) – home to the largest financial ecosystem in the Middle East, Africa and South Asia (MEASA) region – is reaffirming its position as one of the world’s top fintech hubs, attracting record investments and growing at an accelerated pace, with new company registrations surpassing 1,000 for the first time in history to reach total number of active registered companies of 4,377.

Organised on May 8 and 9, the DIFC’s Dubai Fintech Summit served as the platform for more than 5,000 experts, policymakers, industry leaders, thought leaders, and decisionmakers to come together and share ideas, knowledge and perspectives that can help unlock a new phase of exponential growth for the global financial sector. DIFC leveraged the Dubai Fintech Summit platform to bring together banks, fintech startups, and regulators from across the world to further stimulate the digital advancement of the financial sector and shape the future of finance.

“The financial centre has been expanding five-fold faster than the emirate’s average gross domestic product growth over the past 10 years, contributing about 6 per cent to its GDP,” said H.E. Essa Kazim, DIFC Governor, during his keynote address.

He further added that “a key growth driver over the past three years has been fintech and innovation companies contributing over 27 per cent to the centre’s overall client growth.” Proactive approach taken by policymakers and measures taken to provide the right ecosystem to enable innovation, investing, investment, and growth have all contributed to the rapid growth of the fintech sector, he added.

Fintech and innovation, in particular, has been a strong growth area for DIFC in 2022, with the hub now home to over 686 fintech companies that include startups and global unicorns. DIFC is also working towards identifying, enabling, and growing 10 high-calibre fintech startups, based in both India and the UAE, into unicorns by 2025, as part of the partnership it entered into with Federation of Indian Chambers of Commerce & Industry (FICCI) LEAD to launch the India-UAE Startup Corridor.

“There is no denying the fact that UAE is one of the most attractive countries for investment. The business environment here has always been conducive to the needs of major global companies. What’s most amazing is how the UAE and the Middle East have always stayed ahead of the curve and embraced the best of new and emerging technologies. With business-friendly environment, we believe that the region will see exponential growth when it comes to becoming a hub for startups and entrepreneurship,” Kush Mehra, President and Chief Business Officer of Indian fintech major Pine Labs told.

Earlier this year, leading merchant commerce omnichannel platform Pine Labs, which recently forayed into the UAE market, said it will partner with local banks and financial institutions in the UAE to help them serve their merchant partners better. Banks in the UAE will benefit from a simple and easy-to-use technology stack that Pine Labs offers to build innovative products into consumer journeys. Local incumbent banks in the UAE will get seamless tech integrations that Pine Labs is known to deliver the speed and scale.

Going forward too, experts believe the focus on tech and innovation, digital transformation, and foreign trade, among other transformational projects, will drive an increase in foreign direct investment to over 650 billion dirhams over the next decade and an annual 100 billion dirhams in contributions from digital transformation. This, in turn, will enable the emirate to cement its position among the top three global financial centres and meet its ambitious 10-year D33 economic targets by 2033.

Hydrocarbons will remain an integral part of energy mix for the foreseeable future, says Haitham Al Ghais.

Underinvestment in the oil and gas industry could lead to increased oil market volatility, Opec secretary general Haitham Al Ghais said on Monday as he urged the industry to ensure that the energy transition is inclusive.

“Investment is urgent to account for an annual decline rate in production … and despite the urgent need for investment, we have heard disheartening calls to divest from hydrocarbons,” Mr Al Ghais told attendees at the Middle East Petroleum and Gas Conference in Dubai.

The Opec chief said lack of investment in the sector would “endanger” energy security and economic growth.

The oil producers group estimates that the world needs $12.1 trillion in investment to meet rising oil demand by 2045.

Demand for oil as a primary fuel is expected to increase to 101 million barrels equivalent a day in 2045 from 88 million barrels equivalent a day in 2021, Opec said in its World Oil Outlook last year.

“The reality … is that oil and gas will continue to be an integral part of the energy mix for the foreseeable future,” said Mr Al Ghais.

With global oil demand growing at 8 million barrels per day, the world could face a supply crunch due to western sanctions on Russian crude exports, Fereidun Fesharaki, chairman of FGE Consultancy, told delegates.

Russia can maintain production at about 10 to 11 million bpd, but 2 million bpd of future growth is unlikely to materialize amid price caps, he said.

China, the world’s second-largest economy and top crude importer, reopened its borders in January after enforcing a strict zero-Covid policy for about three years.

The Asian country, which is aiming for gross domestic product growth of 5 per cent this year, is set to be a big driver of crude demand this year.

“China’s fundamentals are shaky, but strong enough to take us through … its oil demand will peak by 2027 or 2028,” said Mr Fesharaki.

Brent, the benchmark for two thirds of the world’s oil, has lost more than 12 per cent of its value since the beginning of the year amid demand concerns and a regional banking crisis in the US, which rattled financial markets

There are a lot of “negative signals” in the US, but unemployment is low, Mr Fesharaki said.

“Until the unemployment situation changes in a big way in the US, there is no signal that there is a recession.”

Brent was trading 0.34 per cent lower at $75.56 a barrel at 01.07pm UAE time on Monday. West Texas Intermediate, the benchmark for US crude, was down 0.66 per cent at $71.45 a barrel.

Last month, Opec+ members Saudi Arabia, the UAE, Iraq, Kuwait, Oman and Algeria announced voluntary output cuts of 1.16 million bpd.

The cuts, which will be in place from May until the end of the year, are meant to ensure oil market stability, the producers said at the time.

The oil market has been “more at ease” with the current supply and demand outlook, Mike Muller, head of Vitol Asia, said at the event.

This is in part due to the “elimination” of the risk premium arising from sanctions on Russian crude, he said.

“There was a real concern that Russian oil would not come into the market because players would not be able to cope with the impact of sanctions,” he said.

The Vitol executive said he expected crude demand to rise by 2 million bpd in the second half of the year, compared with current levels, thanks to higher consumption in Asia.

“This is primarily the winter effect in Asia … but also a strong view that we still have that pre-Covid demand yet to come,” said Mr Muller.