How satellite data is guiding investment decisions AN ITP MEDIA GROUP PUBLICATION AUGUST 2024 • VOL.1 • ISSUE 07 SPACE RETURNS FME_Aug2024_00_Cover_13336860.indd 1FME_Aug2024_00_Cover_13336860.indd 126/07/2024 11:1526/07/2024 11:15Join the #1 financial centre for accessing more growth opportunities When you join the number one global financial centre in the Middle East, Africa and South Asia, the growth opportunities are endless. 6,000 financial firms; FinTech and innovation businesses; family offices; institutions; and service providers use DIFC as their home to access the region. They employee more than 43,000 people in the Centre who are committed to driving the future of finance. Our world class laws, regulations, infrastructure and company structures enable companies to grow faster than the market, whilst providing the workforce with an unrivalled lifestyle and excellent career development. No wonder DIFC is the preferred catalyst for growth. Join the number one: difc.ae/business/make-an-enquiry Untitled-20 1Untitled-20 126/07/2024 11:5626/07/2024 11:56fi nancemiddleeast.comAugust 2024 | 3 EDITOR’S LETTER Welcome to the latest edition of Finance Middle East! In this issue, we explore how the Middle East’s growing number of Ultra High Net Worth Individuals (UHNWIs) and High Net Worth Individuals (HNWIs) are driving signifi cant investment opportunities across sectors such as real estate, technology and infrastructure. Personal wealth across the region is on the rise, with the number of UHNWIs expected to surge by 25% in the next fi ve years, making it the fourth-largest wealth hub in the world. The UAE alone anticipates a net infl ow of over 6,700 millionaires in 2024. What does this mean for the region? Our cover story sheds light on out of this world data collection methods that help investors make critical market-moving decisions. Satellite images have been capturing data on business activities for years. From the intensity of a city’s night lights to the amount of rainfall on a country’s crops, and even the number of cars in a mall’s parking lot, the view of a territory from above can speak volumes about its economy. With the right data analysis tools, these pictures can prove vital to researchers, civil servants, business leaders and stock traders, off ering a window into the Earth’s past and sometimes its future. You don’t want to miss this one! Additionally, we spoke to the Abu Dhabi Department of Economic Development to unpack the benefi ts of the newly launched Unifi ed Economic Licence for businesses and investors. Lastly, we look at how adopting AI technologies might lead companies, particularly fi nancial institutions, to value the human element more than ever. AI will allow humans to occupy spaces that no technology can reach. Happy reading! Nivetha Dayanand Editor FME_Aug2024_3_Editors letter_13349769.indd 3FME_Aug2024_3_Editors letter_13349769.indd 326/07/2024 11:2126/07/2024 11:21fi nancemiddleeast.com4 | August 2024 CO N TEN TS 16 10 20 30 NEW HEIGHTS Where is the aviation industry headed in 2024 and beyond? MONEY, MONEY, MONEY How are UHNWIs and HNWIs investing during the Middle East’s wealth boom? THE INVESTOR’S GUIDE TO THE GALAXY How satellite data can unveil the secrets to fi nancial success ABU DHABI SIMPLIFIES BUSINESS SETUP WITH NEW LICENCE Unpacking the benefi ts of the newly launched Unifi ed Economic Licence 10 20 30 16 FME_Aug2024_4-5_Contents_13349738.indd 4FME_Aug2024_4-5_Contents_13349738.indd 426/07/2024 13:4126/07/2024 13:41fi nancemiddleeast.comAugust 2024 | 5 44 38 49 52 NAVIGATING MARKET SHIFTS Investment opportunities amid interest rate cuts BLOCKCHAIN MEETS THE ART MARKET Raza Beig and Aly Raza Beig on art investments, technology and starting a business ARE WE HEADING TOWARDS A GLOBAL DEBT CRISES? Global debt crisis demands urgent and multifaceted solutions WILL AI REPLACE FINANCE JOBS? AI is forever transforming the skills that will be demanded of the sector’s professionals 44 3852 49 FME_Aug2024_4-5_Contents_13349738.indd 5FME_Aug2024_4-5_Contents_13349738.indd 526/07/2024 13:4226/07/2024 13:42fi nancemiddleeast.com6 | August 2024 PO Box 500024, Dubai, UAE Tel: +971 4 444 3000 Web: www.itp.com Offices in Abu Dhabi, Dubai, London, Mumbai, Riyadh & Geneva ITP MEDIA GROUP CEO: Ali Akawi Managing Director: Martin Chambers Head of Digital Media: Thomas Shambler EDITORIAL Editor: Nivetha Dayanand Tel: +971 4 444 3887 email: nivetha.dayanand@itp.com Deputy Editor: Beatriz Valero Tel: +971 4 444 3413 email: beatriz.valero@itp.com Commercial Editor: Angitha Pradeep Tel: +971 4 444 3278 email: angitha.pradeep@itp.com ART Art Director: Amjad Ayche Art Editor: Tofi q Memon ADVERTISING Group Commercial Director: Anup Nagpurkar Tel: +971 4 444 3573 email: anup.nagpurkar@itp.com Senior Commercial Manager: Ines Ben Rejeb Tel: +971 4 444 3223 email: ines.benrejeb@itp.com PHOTOGRAPHY Senior Video Editor: Liju Cheruvathur MARKETING Senior Events & Marketing Manager: Ellie Ashton Senior Events Manager: Karishma Vithalani Events & Marketing Manager: Olivia Keen Smith Events & Marketing Manager: Dmitry Lazarenko Associate Events Manage: Kate Galaktionova Events Administrative Assistant: Aronn Pureza PRODUCTION Production Manager: Balasubramanian P DISTRIBUTION Distribution Coordinator: Avinash Pereira Circulation Executive: Rajesh Pillai ITP GROUP CEO: Ali Akawi CFO: Toby Jay Spencer-Davies The publishers regret that they cannot accept liability for error or omissions contained in this publication, however caused. The opinions and views contained in this publication are not necessarily those of the publishers. Readers are advised to seek specialist advice before acting on information contained in this publication which is provided for general use and may not be appropriate for the reader’s particular circumstances. The ownership of trademarks is acknowledged. No part of this publication or any part of the contents thereof may be reproduced, stored in a retrieval system or transmitted in any form without the permission of the publishers in writing. An exemption is hereby granted for extracts used for the purpose of fair review. PUBLISHED BY AND © 2024 ITP MEDIA GROUP FZ-LLC. FME_Aug2024_6_Flannel_13334107.indd 6FME_Aug2024_6_Flannel_13334107.indd 626/07/2024 11:2426/07/2024 11:24TUNE IN EVERY TUESDAY FOR A NEW EPISODE ChequePoint_AD_205x275_B1_Approved.indd 1ChequePoint_AD_205x275_B1_Approved.indd 127/06/2024 10:2327/06/2024 10:23NEWS fi nancemiddleeast.com8 | August 2024 UAE investors maintain a robust appetite for initial public off erings (IPO), with 84% expressing their readiness to invest in future IPOs. The data is part of the fi ndings from the UAE Investor Pulse Survey 2024 by Edelman Smithfi eld. The survey reveals that 73% of investors believe fi rms that have gone public in the past three years are fairly valued. Additionally, 71% of investors trust the bookbuilding process, indicating satisfaction with its transparency and eff ectiveness. The survey indicated that two-thirds of investors expect transparency and eff ective IPO communication from issuers to make informed decisions. Moreover, 82% emphasise the importance of quality earnings. Overall, the key metrics included profi tability (41%), a strong balance sheet (31%) and brand awareness (27%). A majority of investors surveyed (71%) preferred new issuers with organic growth plans, with the top sectors of interest including real estate (51%), technology (41%) and healthcare (33%). Approximately 67% of respondents also agreed that having two distinct exchanges benefi ts the UAE capital markets, off ering more investment opportunities. “It’s encouraging to witness the growing investor confi dence in the UAE markets and their strong appetite for UAE IPOs,” said Simon Hailes, Managing Director and Head of Middle East at Edelman Smithfi eld. OVER 80% OF UAE INVESTORS LIKELY TO PARTICIPATE IN IPOS Real estate, tech and healthcare were named the top sectors for UAE IPO investors “However, to maintain this IPO momentum, it’s crucial for potential and existing issuers to prioritise transparent and consistent communication eff orts.” GCC IPOs raised a combined $22.9 billion through 48 listings in 2022, a time when global IPO proceeds plummeted by more than 60%. Despite the slower growth rate the global economy witnessed in 2023, the Middle East has seen a strong IPO momentum. That year, the region saw 45 listings, albeit smaller ones, raising a total of $10.6 billion, according to Markaz data. The UAE alone contributed 58% of the 2023 IPO proceeds. This rush to the market is expected to remain strong, continuing well beyond the 2024 and 2025 fi nancial years. FME_Aug2024_8-9_News_13349761.indd 8FME_Aug2024_8-9_News_13349761.indd 826/07/2024 11:2426/07/2024 11:24NEWS fi nancemiddleeast.comAugust 2024 | 9 Dubai’s economy expanded by 3.2% in the fi rst quarter of 2024, increasing the emirate’s GDP to AED 115 billion ($31.3 billion). This growth was primarily driven by several key sectors. The transportation and storage sector grew by 5.6%, contributing AED 15.4 billion ($4.19 billion) and accounting for 13.4% of the GDP. Similarly, the fi nancial and insurance activities sector also saw a 5.6% increase, reaching AED 15.1 billion ($4.11 billion) and contributing 13.1% to the GDP. GCC INFLATION COOLS IN THE FIRST HALF OF 2024 DUBAI’S ECONOMY GROWS 3.2% IN Q1 2024 Infl ation in the GCC countries remained low during H1 2024 The wholesale and retail trade sector recorded a 3% growth, contributing AED 26.3 billion ($7.16 billion), or 22.9% of the GDP. The information and communications sector experienced a 3.9% grow th, adding AED 5.1 billion ($1.39 billion) to the GDP, which constituted 4.4% of the total. The accommodation and food services sector posted a 3.8% growth, contributing AED 4.7 billion ($1.28 billion) and accounting for 4.1% of the GDP. Meanwhile, the real estate sector achieved a 3.7% growth, contributing AED 8.4 billion ($2.29 billion) and making up 7.3% of the GDP. The manufacturing sector registered a 1.6% growth, contributing AED 8.4 billion ($2.29 billion) and accounting for 7.3% of the GDP. A strong US dollar, subdued import prices, and continued subsidy policies have kept infl ation rates low in the GCC region during the fi rst half of the year. In 2024, the consumer price index (CPI) in the GCC hovered around 3.0% year-on-year, as noted by Kamco Investment in a recent research report. Oman reported the lowest year-on-year infl ation growth among the GCC, with a rate of 0.9% in May 2024, which further decreased to 0.7% in June 2024. In contrast, Dubai reported 3.8% year-on-year infl ation growth in May 2024, slightly down from 3.9% in April 2024. Kuwait reported a 3.2% infl ation rate in May 2024. Other GCC countries reported infl ation rates below 2.5%, with Saudi Arabia at 1.6%, Bahrain at 2.5% and Qatar at 0.9%. Globally, infl ation is declining faster than expected. The IMF projects the global infl ation rate to drop to 5.8% in 2024, down from 6.8% in 2023. It forecasts GCC infl ation to average 2.2% in 2024 and 2.1% in 2025. In 2023, Dubai’s GDP grew by 3.3%, reaching AED 429 billion ($116.8 billion) FME_Aug2024_8-9_News_13349761.indd 9FME_Aug2024_8-9_News_13349761.indd 926/07/2024 11:2526/07/2024 11:25Next >