With the Covid pandemic now firmly in the past, the Middle East has been enjoying a return to form, with activity levels up across the region and many law firms – both local and international – in expansion mode.
On top of all of the investment driven by last year’s World Cup in Qatar, the wider Middle East region has benefited in the wake of Russia’s invasion of Ukraine, with global oil prices soaring, boosting revenues in oil-rich nations such as the UAE, where oil exports account for around 30% of GDP. Continue reading “MENA focus: From the World Cup to the world stage”
As the world moves on from the pandemic and growth is firmly back on the agenda at law firms, the impact of the global geopolitical uncertainty triggered by Russia’s invasion of Ukraine and soaring energy prices is shifting firms’ focus when it comes to international expansion.
The Middle East, where rapid vaccine rollouts mean economies bounced back earlier than Europe and where construction is booming under ambitious state-backed investment plans, is inevitably a focus for many. Continue reading “Middle East and North Africa focus: The competitive edge”
Far from immune to the global crisis – but making concerted strides towards immunity in some instances – the Middle East and North Africa region (MENA) has fared similarly to the rest of the world over the last year. That is to say that the universal impact of the pandemic has been felt across MENA, although the paths that the various countries have taken have been disparate.
Early lockdowns in several countries helped to contain the number of coronavirus cases, and a number of success stories emerged from the region with Israel and the United Arab Emirates (UAE) – numbers one and two, respectively – frontrunners in rolling out their vaccine programmes. While distinct, both countries have adopted an agile approach to sourcing and distributing the vaccine. Continue reading “Middle East Focus: Light on the horizon”
The global economy is slowing and so too is the Middle East. In April, the International Monetary Fund (IMF)almost halved this year’s growth forecast for the MENA region to 1.3%, from its previous estimate of 2.5% in October 2018. Dragging everything down is the oil sector – particularly in Saudi Arabia – US sanctions in Iran, and geopolitical tensions in other economies such as Iraq, Syria and Yemen.
But such downgrades are no surprise for lawyers in the region. ‘There is no doubt the region is going through a downturn,’ says Richard Gimblett, resident managing partner of the Dubai arm of Holman Fenwick Willan (HFW), which has more than 50 lawyers across its offices in Riyadh, Dubai, Kuwait City and Abu Dhabi. ‘The volatile price of oil obviously hasn’t helped. These are still largely petro-economies, although they are trying to diversify.’ Continue reading “The Middle East: The rough with the crude”
‘The Middle East. We will try to make it better, but it is a troubled place’: the words of Donald Trump as he announced the recent military strikes targeting Syrian president Bashar Assad’s chemical weapons facilities. Although there is some truth to his sweeping statement, most of the over 400 million citizens in the 17 countries that comprise the Middle East region beg to differ. While the World Bank estimates that GDP growth in the region slowed from 5% in 2016 to 1.8% in 2017 – fuelled by oil production cuts and geopolitical tensions – this is projected to rebound to 3% in 2018 and 3.2% the following year.
The region’s lawyers point to the six Gulf Cooperation Council (GCC) economies as leading the way, supported by infrastructure investment. ‘It’s a very good time in the region,’ says Doug Peel at White & Case, head of the firm’s Middle East practice, which is spread across five regional offices: Cairo, Riyadh, Doha, Abu Dhabi and Dubai. ‘We are busy all the way around – there’s substantial activity in all the GCC countries and in Egypt.’ Last year White & Case – along with Latham & Watkins – advised JPMorgan, Citi and HSBC on Saudi Arabia’s debut 144A/Reg S Sukuk programme, including the issue of $9bn Sukuk. Continue reading “Middle East: Mission unaccomplished”
Emerging markets are by nature volatile, frequently impacted by events such as political instability, civil unrest, corruption and other economic forces. The extremes of growth and decline could hardly be more apparent than in the Middle East, where the collapse in oil prices has prompted a great deal of soul searching.
Saudi Arabia, for example, is going through the most radical social and economic reform programme in its history, and Iran is still subject to ongoing trade sanctions and uncertainty connected to US foreign policy. Added to this, these two nations share deep enmity, which demands high levels of diplomacy on the part of firms that target both jurisdictions. Continue reading “Holding steady – A turbulent Middle East market separates the committed from the faint-hearted”
Oil price volatility is a fact of life in the Middle East. At below or around $40 a barrel, the region has been dealt a hard dose of realism. Developing economic models that rely less on oil and gas revenues is now the order of the day, while national governments have had to rein in notoriously lavish spending programmes.
Law firms that rushed into the Middle East as it became a significant driver of global economic activity amid soaring oil prices a decade ago, now have to review their strategies. Continue reading “Running on empty – how to survive in the Middle East in the era of cheap oil”
Latham & Watkins doesn’t make strategic missteps. Or at least that appeared to be the case until March, when the firm announced that it will close both its Abu Dhabi and Qatar offices later this year, relocating staff to its Dubai operation. Bill Voge, chair and managing partner of the firm that has been by most yardsticks the standout success story of the last 20 years, said the firm had been wrong in assuming there were four distinct hubs that the firm needed to service clients in the Middle East – Abu Dhabi, Dubai, Qatar and Saudi Arabia – and so after seven years in the region, the firm was consolidating its Middle East presence into Dubai and Riyadh.
For international firms, finding the appropriate business model and strategy for the Middle East has been a puzzle. The region was never more alluring than at the height of the pre-financial crisis period of 2007 and 2008. Intoxicated by crude oil prices at nearly $150 a barrel in the summer of 2008, the Middle East could hardly have felt more prosperous. As ostentation gripped the region, Dubai powered ahead with ambitious projects such as the man-made archipelago Palm Jumeirah and the Burj Khalifa, the world’s tallest building. Naturally, the legal profession sought to capitalise.
Continue reading “The Middle East: After the gold rush”
‘You can’t be a credible financial centre without having a credible Islamic finance programme,’ says Qudeer Latif, head of Clifford Chance’s global Islamic practice. With studies expecting the Muslim population to grow twice as fast as the non-Muslim demographic over the next 20 years global financial institutions and governments are falling over themselves to offer Islamic finance products.
According to EY’s latest study of the global Islamic finance market, the total amount of Islamic assets held by commercial banks was expected to have grown by around 40% from 2011 to 2013, from $1.3trn to $1.8trn. 78% of international Islamic assets are held in Qatar, Indonesia, Saudi Arabia, Malaysia, UAE and Turkey. In Qatar, for example, Georges Racine, director of Swiss firm Lalive’s Doha operation, says that Islamic banking has grown quicker than the banking sector as a whole over the past few years as a result of its government’s supportive measures.
Continue reading “Behind the veil – Can Islamic finance live up to the sales pitch?”
Post-banking crisis, the world has generally divided fairly neatly into two camps with their clear economic narratives. On one hand there are the Western economies burdened by slow growth and creaking public finances. On the other, are emerging powers in Asia, Latin America and Africa – which have mostly surged ahead while Europe staggered.
Where the Middle East fits into this picture, however, remains undecided. As one of the most touted legal markets during the boom, the region’s resource-rich economy was driven by surging commodity prices, high inward investment and the growing status of Dubai as an international hub.
Continue reading “Gulf stream – the heat returns to the Middle East markets”