Abu Dhabi Outperforms Gulf Bourses In Early Trade

On Monday, Abu Dhabi surged ahead of other Gulf stock markets as investor confidence was strengthened by strong Chinese economic data and an increase in crude prices. China’s factory output and retail sales for January–February surpassed expectations, signalling a strong start to 2024.

Abu Dhabi’s main stock index, .FTFADGI, soared by 6.2%, marking its highest intraday surge in almost four years. First Abu Dhabi BankFAB.AD, led the charge with a 1.4% increase, while E7 E7.AD and National Marine Dredging NMDC.AD rose by 4.6% and 1.5%, respectively.

Mazen Salhab, BDSwiss’s chief market strategist for MENA, attributed ADX’s growth to gains in commodities and also emphasised Abu Dhabi’s appeal to affluent and permanent-residence investors.

In Qatar, the benchmark index .QSI rose by 0.3%, supported by Qatar Gas Transport QGTS.QA climbing 2% and Industries Qatar IQCD.QA gaining 0.5%. Oil prices, crucial for Gulf markets, rose, with Brent LCOc1 reaching $85.8 a barrel by 0740 GMT.

However, SA’s benchmark index .TASI dipped by 0.2%, dragged down by Saudi Arabian Mining 1211.SE and Riyad Bank 1010.SE. Meanwhile, Dubai’s main index .DFMGI fell by 0.4%, with Salik Company SALIK.DU dropped 3.2%, and Emirates NBD ENBD.DU slipping by 0.6%.

The EU Commits 7.7 Billion Euros Towards Global Needs In 2024

On Monday, the European Union (EU) committed to 7.7 billion euros (US$8.39 billion) in humanitarian aid in 2024. This initial investment marks a decrease from the previous year’s total.

Despite escalating needs in places like Gaza, the initial investment fell short of last year’s 8.4 billion euros. The EU’s humanitarian aid and crisis management chief, Janez Lenarcic, expressed some satisfaction with the amount but expects betterment.

Meanwhile, the reasons for the reduction were not specified. The United Nations reports a record 300 million people requiring humanitarian assistance, primarily due to conflicts and climate change, with a funding gap of nearly US$50 billion worldwide.

Josep Borrell, the head of foreign policy for the European Union, condemned the dangerous situation in Gaza, claiming that it is close to famine and that Israel is using starvation as a strategic tool. Since Israel conflicted with Hamas in retaliation for an October att ack, aid delivery into Gaza has been restricted. The ongoing two-day conference in Brussels focuses on facilitating aid delivery to Gaza.

EU foreign ministers will discuss initiatives to increase aid access to Gaza, whether by land, sea, or air. Israel denies obstructing aid, attributing delays to aid agencies, and accusing Hamas of diverting assistance.

Rishi Sunak Plans Tax Cuts Ahead Of Autumn Election

The UK Prime Minister, Rishi Sunak, is preparing a strategy to avert a Conservative Party defeat in the upcoming election. His strategy calls for the announcement of an additional tax-cutting budget proposal in September, followed by elections in October or November.

However, implementing this strategy could present difficulties. Sunak’s political advisors anticipate this difficulty, especially after he definitively ruled out a snap election on May 2, ending weeks of speculation. Although the exact date of the election is still uncertain, the Prime Minister’s team is confident that they can leverage the anticipated reductions in interest rates, declining inflation, and available fiscal space to implement additional pre-election incentives.

Despite Britain’s strained finances, advisors have proposed significant income tax reductions, cuts to property stamp duty aimed at first-time buyers, and potentially revolutionary changes to council tax.

The goal is to corner the opposition Labour Party by proposing tax cuts to a degree where Labour would have to oppose them, creating a point of contention in the campaign.

Jeremy Hunt, the Chancellor of the Exchequer, reduced the national insurance payroll tax by two percentage points in two fiscal statements. Labour had pledged to do the same, although it has reservations about further reductions due to concerns about the deterioration of the public service.

EU To Fund Egypt With Billions of Euros To Strengthen Ties

EU leaders are set to announce a €7.4 billion funding package in Cairo to strengthen ties with Egypt, aiming to address migrant flows across the Mediterranean. This agreement elevates the EU-Egypt relationship to a “strategic partnership,” focusing on renewable energy, trade, and security cooperation.

There will be €5 billion in macro-financial assistance, €1.8 billion in investments, and €600 million in grants over the next three years. Immediate emergency funding of €1 billion will be provided, with the remaining €4 billion subject to European Parliament approval.

The initiative, developed closely with the IMF, aims to alleviate Egypt’s economic challenges, exacerbated by high inflation and financial strain. Conflicts in neighbouring Sudan and Gaza highlight Egypt’s strategic importance. A delegation of prime ministers from Italy, Greece, Austria, Belgium, and Cyprus is led by European Commission President Ursula von der Leyen.

Egypt has secured $20 billion in multilateral support and has largely curbed irregular migration since 2016. However, there’s a rise in Egyptians attempting to cross via Libya, prompting EU funding to address migration. Critics question Western support for President Abdel Fattah al-Sisi, citing human rights concerns and mass incarcerations. The Human Rights Watch organization criticises the plan for being flawed and neglectful of abuses.

India Allows RBI To Import Gold Without Paying Import Levies

India’s central bank is now able to import gold without incurring import taxes due to a recent substantial change in the country’s policies. The move represents a significant shift in the environment around the nation’s gold trade.

India is one of the world’s largest consumers of gold, and importers of the metal have historically had to pay both the Agriculture Infrastructure and Development Cess (AIDC) and a basic customs charge. But this new ruling eliminates these taxes from the Reserve Bank of India (RBI), simplifying the importation of gold.

According to data from September 2023, the RBI has 800.79 metric tonnes of gold reserves in total, which includes both domestic and foreign deposits. In particular, 388.06 metric tonnes are held abroad and 372.84 metric tonnes are kept domestically, according to the RBI’s reserve management report.

The price of gold fluctuated a little bit on the world market. Following a significant decline the previous day, gold prices stabilised on Wednesday. This was partially due to an American inflation report that increased bond yields and decreased expectations of a Federal Reserve interest rate cut in June. Following Tuesday’s 1.1% decline—the biggest one-day decrease since February 13th—spot gold experienced a slight gain of 0.1%, reaching $2,158.26 per ounce.

US Companies To Invest $1 Billion In The Philippines

US Commerce Secretary Gina Raimondo announced investments worth more than $1 billion in the Philippines during her official visit to Manila. Her visit is part of a two-day trade and investment mission representing President Joe Biden’s administration.

Raimondo highlighted that investments from US companies would span various sectors such as solar energy, electric vehicles, and digitisation. Additionally, she emphasised the eagerness of US companies to engage in business ventures within the Southeast Asian nation. She was accompanied by high-ranking officials from prominent companies, including Google Asia Pacific, GreenFire Energy, Inc., Visa, United Airlines, and KKR.

In January, the White House announced plans for a trade mission to enhance US companies’ contributions to key sectors in the Philippines. These included infrastructure, clean energy, critical minerals, agriculture, and the innovation economy.

Philippine-US relations are deeply rooted in a 73-year-old mutual defence treaty, which illustrates the depth of their alliances. Philippine President Ferdinand Marcos Jr. has expressed interest in broadening ties beyond defence cooperation to encompass economic partnerships. In a joint briefing with Philippine officials, Raimondo described the U.S.-Philippine alliance as “ironclad.” She stressed the endurance of the alliance over 72 years and highlighted the evolving nature of their friendship, which increasingly emphasises cooperation for mutual prosperity.

India-EFTA Commits Deal Worth $100 Billion Over a 15-Year Deal

India and the European Free Trade Association (EFTA) have sealed a $100 billion, 15-year deal, marking the end of nearly 16 years of negotiations. Under the agreement, India will slash import tariffs on industrial goods from Switzerland, Norway, Iceland, and Liechtenstein, in exchange for a $100 billion investment from EFTA over 15 years.

This follows recent trade pacts with Australia and the UAE, with negotiations with Britain in the final stages. PM Modi aims for $1 trillion in annual exports by 2030.

EFTA’s investment is targeted at India’s massive market of 1.4 billion people. The nation will eliminate or reduce customs duties on 95.3% of industrial imports from Switzerland, except for gold. The deal includes provisions for intellectual rights and gender equity.

The agreement needs to be approved by all five parties, and Switzerland is anticipated to do so by 2025. India has decided to lower its 40% bound tariff rate on gold to 39%, but as Swiss imports were valued at $16 billion in the previous fiscal year, this is unlikely to have a major effect.

While the agreement may not immediately address India’s trade gap with EFTA, analysts believe it will attract investment in key sectors like medical devices and clean energy, and facilitate exports using Swiss and Norwegian technologies.

PM Modi Launches 52 Tourism Sector Projects Worth Over Rs 1400 Crore

On March 7, Prime Minister Narendra Modi launched 52 tourism projects valued at over Rs 1,400 crore.

PM Modi dedicated nine infrastructure projects worth Rs 469 crore and inaugurated 43 others totalling Rs 963 crore under the Swadesh Darshan and PRASHAD schemes through video conferencing from Srinagar. Among these projects were developments in Hazratbal, Jogulamba, and Amarkantak, costing Rs 129.35 crore, enhancing pilgrim facilities and heritage sites.

An additional 14 projects across various states amounting to Rs 320.8 crore were also launched. He introduced three initiatives: the ‘Dekho Apna Desh People’s Choice 2024’ poll to identify top tourist destinations; the Chalo India Global Diaspora Campaign to engage the Indian diaspora as tourism ambassadors; and the Challenge Based Destination Development programme for sustainable tourism.

The Ministry of Tourism introduced Swadesh Darshan 2.0 to collaboratively develop tourist spots with states and local governments, earmarking 57 destinations from 32 states and UTs. Under this scheme, 29 experiences in 17 regions have received Rs 644.44 crore in funding to date. The efforts aim to foster sustainable and responsible tourism across the country, aligning with the government’s vision for holistic tourism development.

India, Four-Nation European Bloc To Sign Trade Deal

India and a European bloc comprising Norway, Iceland, Liechtenstein, and Switzerland are set to finalise a trade pact on March 10, with India aiming for a $100 billion investment commitment from the group.

This pact consists of goods, services, and investment promotion, with a groundbreaking provision for targeted investment from the European Free Trade Association (EFTA) in India, aiming to create employment opportunities.

India is considering duty reductions on specific gold imports from Switzerland. The agreement targets a $50 billion investment commitment over the first decade post-implementation and an additional $50 billion over the subsequent five years to generate 1 million direct jobs in India.

Sectors, like processed agricultural products, pharmaceuticals, medical devices, and processed food, are expected to gain greater access to EFTA markets. However, products like soya and dairy will remain excluded from duty concessions.

The pact, named the Trade and Economic Partnership Agreement (TEPA), encompasses 14 chapters, including provisions on intellectual property rights and government procurement. The signing ceremony may include ministers such as Guy Parmelin, Bjarni Benediktsson, Dominique Hasler, and Jan Christian Vestre, representing the EFTA bloc.

Negotiations between India and EFTA have been ongoing since January 2008, aiming to strengthen economic ties between the parties.

UK Government Announces 10 Billion-Pound Tax Cut For Workers

The UK Conservative government announced a £10 billion ($13 billion) labour tax cut, drawing from emergency reserves, possibly the last budget before an anticipated election defeat. To combat rising living expenses, the £13.9 billion package also includes frozen gasoline levies and expanded access to child benefits.

The election is anticipated later this year, with PM Rishi Sunak trailing Labour by 20%. Experts warn against rash expenditure plans even as forecasters predict £9 billion in fiscal space.

Financial markets remained stable, unlike the 2022 bond market turmoil from Liz Truss’s tax cuts. The budget includes extensions to energy levies, e-cigarette taxes, and duties on tobacco and non-economy flights. Tax adjustments target non-domiciled residents and foresee a rising tax burden until 2028–29, the highest since 1948. The Institute for Fiscal Studies discourages relying on hazy borrowing projections.

Many regions face financial crises, court backlogs soar, and public service quality declines. Hunt and Sunak pledged an accelerated economic recovery post-recession, with modest growth forecasts of 0.8% in 2024, rising to 2.0% by 2026, and inflation expected to drop below 2%. The government hopes these measures will address economic challenges and bolster public confidence.