Egypt’s Orascom Development expects the tourism sector and foreign direct investments in the Middle East region to be affected by the Israel-Hamas war and the continuing geopolitical tensions in the region.
The Switzerland-listed company, with assets worth more than $2 billion, is involved in the development of integrated townships with residences, hotels, retail and other amenities in seven countries including Egypt, Switzerland, Oman, Morocco, England, Montenegro and the UAE.
“I think foreign direct investment in the region is going to probably take a hit (in the short term) because most people, most foreign investors, particularly Western investors, don't necessarily fully understand that the interlinkages between different parts of the region, where the real direct effect is, where the indirect effect is?,” Omar El Hamamsy, group chief executive of Orascom, told The National on the sidelines of the World Investment Forum 2023 in Abu Dhabi on Monday.
The tourism sector is also expected to suffer amid heightened tensions in the region.
“[Tourism] revenue will decrease because people will feel that there is a security concern,” he said.
“That will be another unfortunate hit on our business and more generally, on tourism in the region, which will hit the current accounts of many North African countries as well as some of the GCC countries.”
Capital accounts will also be negatively impacted in the short term as investors will be hesitant to invest in the region amid the continuing conflict.
In the long term, however, the war will “trigger serious conversations and a serious engagement and a serious solution that will ultimately bring peace to the entire region”, Mr El Hamamsy added.
“It may take a few months, a few years … and it helps everybody, helps both the human aspect of it, but also the business.”
Thousands of people have died in the war that began after Hamas broke through the border fence and stormed Israel's south last week. Israel responded by launching a barrage of air strikes on the Gaza Strip and has asked 1.1 million people in the northern half of the enclave to evacuate.
Last week, US Treasury Secretary Janet Yellen said Washington is monitoring the economic impact of the conflict but does not expect it to be a major driver of the global economic outlook.
JP Morgan chief executive Jamie Dimon has said the Israel-Gaza war could have serious geopolitical consequences for the global economy.
“The war in Ukraine, compounded by last week’s attacks on Israel, may have far-reaching impacts on energy and food markets, global trade, and geopolitical relationships,” Mr Dimon said in the third-quarter earnings statement on Friday.
Orascom is looking to expand its operations in the countries where it currently operates and enter new geographies, including Saudi Arabia, Mediterranean countries and Africa, despite the current challenges.
“The first expansion plan is of course on developing the existing land that we have … places like Salalah in Oman … like the Adriatic Sea in Montenegro … places on the Red Sea of Egypt,” Mr El Hamamsy said.
“The plan is to continue building both real estate and hospitality and other retail and marinas and ski slopes, among others.”
The company owns a land bank of more than 100 million square metres, with nearly 40 per cent developed or under development in different countries. Its hospitality portfolio includes 33 luxury hotels with more than 7,000 rooms across Europe, the Middle East and North Africa.
“We still have another 60 or so million square metres to develop on the existing land bank that we have and we are probably now running at a pace of roughly 2 million square metres every year,” Mr El Hamamsy said.
On the funding strategy, he said, the company has the “ability to self-fund … both directly from our own cash flows, but also with investors that we bring in together with us in those places, be they private investors, or in some instance public investors who want to have an ownership stake in certain types of assets like our hotels, or our other recurring revenue generating assets like our marinas or our schools or hospitals or airports”.
Orascom reported 265.9 million Swiss francs ($294.85 million) in revenue and a net profit of 17.7 million francs in the first half of the year, and the second half is looking “very good in terms of sales, revenue and profits”, he said.
Egypt, Switzerland, Oman and Montenegro are the biggest contributors to its revenue with 42 per cent coming from hospitality, marinas, schools and retail, while about 40 per cent to 45 per cent comes from property sales.
“I expect that Egypt will continue to grow very healthily,” Mr El Hamamsy said.
“Oman is on a very nice acceleration. We are doubling down on our focus there, our investments there. We are very excited about the potential of the country.”
In Montenegro and Switzerland, the company is recording 30 per cent and 10 per cent year-on-year growth, respectively.
“We are very optimistic across those four destinations, and we continue very aggressively investing,” Mr El Hamamsy said.
The company is also focusing on protecting the environment and “we want to develop responsibly and sustainably for the next hundreds and hundreds of years”, he said.
The specs: 2018 Honda City
Price, base: From Dh57,000
Engine: 1.5L, in-line four-cylinder
Transmission: Continuously variable transmission
Power: 118hp @ 6,600rpm
Torque: 146Nm @ 4,600rpm
Fuel economy, combined: 5.8L / 100km
Global state-owned investor ranking by size
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Tips on buying property during a pandemic
Islay Robinson, group chief executive of mortgage broker Enness Global, offers his advice on buying property in today's market.
While many have been quick to call a market collapse, this simply isn’t what we’re seeing on the ground. Many pockets of the global property market, including London and the UAE, continue to be compelling locations to invest in real estate.
While an air of uncertainty remains, the outlook is far better than anyone could have predicted. However, it is still important to consider the wider threat posed by Covid-19 when buying bricks and mortar.
Anything with outside space, gardens and private entrances is a must and these property features will see your investment keep its value should the pandemic drag on. In contrast, flats and particularly high-rise developments are falling in popularity and investors should avoid them at all costs.
Attractive investment property can be hard to find amid strong demand and heightened buyer activity. When you do find one, be prepared to move hard and fast to secure it. If you have your finances in order, this shouldn’t be an issue.
Lenders continue to lend and rates remain at an all-time low, so utilise this. There is no point in tying up cash when you can keep this liquidity to maximise other opportunities.
Keep your head and, as always when investing, take the long-term view. External factors such as coronavirus or Brexit will present challenges in the short-term, but the long-term outlook remains strong.
Finally, keep an eye on your currency. Whenever currency fluctuations favour foreign buyers, you can bet that demand will increase, as they act to secure what is essentially a discounted property.
Squads
Pakistan: Sarfaraz Ahmed (c), Babar Azam (vc), Abid Ali, Asif Ali, Fakhar Zaman, Haris Sohail, Mohammad Hasnain, Iftikhar Ahmed, Imad Wasim, Mohammad Amir, Mohammad Nawaz, Mohammad Rizwan, Shadab Khan, Usman Shinwari, Wahab Riaz
Sri Lanka: Lahiru Thirimanne (c), Danushka Gunathilaka, Sadeera Samarawickrama, Avishka Fernando, Oshada Fernando, Shehan Jayasuriya, Dasun Shanaka, Minod Bhanuka, Angelo Perera, Wanindu Hasaranga, Lakshan Sandakan, Nuwan Pradeep, Isuru Udana, Kasun Rajitha, Lahiru Kumara
Petrarch: Everywhere a Wanderer
Christopher Celenza,
Reaktion Books
MATCH INFO
BRIGHTON 0
MANCHESTER UNITED 3
McTominay 44'
Mata 73'
Pogba 80'
SPECS
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%202-litre%204-cylinder%20turbo%20and%203.6-litre%20V6%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ESeven-speed%20automatic%0D%3Cbr%3E%3Cstrong%3EPower%3A%3C%2Fstrong%3E%20235hp%20and%20310hp%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E258Nm%20and%20271Nm%0D%3Cbr%3E%3Cstrong%3EPrice%3A%3C%2Fstrong%3E%20From%20Dh185%2C100%0D%3Cbr%3E%3C%2Fp%3E%0A
UAE currency: the story behind the money in your pockets
More on Quran memorisation:
Greatest Royal Rumble results
John Cena pinned Triple H in a singles match
Cedric Alexander retained the WWE Cruiserweight title against Kalisto
Matt Hardy and Bray Wyatt win the Raw Tag Team titles against Cesaro and Sheamus
Jeff Hardy retained the United States title against Jinder Mahal
Bludgeon Brothers retain the SmackDown Tag Team titles against the Usos
Seth Rollins retains the Intercontinental title against The Miz, Finn Balor and Samoa Joe
AJ Styles remains WWE World Heavyweight champion after he and Shinsuke Nakamura are both counted out
The Undertaker beats Rusev in a casket match
Brock Lesnar retains the WWE Universal title against Roman Reigns in a steel cage match
Braun Strowman won the 50-man Royal Rumble by eliminating Big Cass last
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
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Sheikh Zayed's poem
When it is unveiled at Abu Dhabi Art, the Standing Tall exhibition will appear as an interplay of poetry and art. The 100 scarves are 100 fragments surrounding five, figurative, female sculptures, and both sculptures and scarves are hand-embroidered by a group of refugee women artisans, who used the Palestinian cross-stitch embroidery art of tatreez. Fragments of Sheikh Zayed’s poem Your Love is Ruling My Heart, written in Arabic as a love poem to his nation, are embroidered onto both the sculptures and the scarves. Here is the English translation.
Your love is ruling over my heart
Your love is ruling over my heart, even a mountain can’t bear all of it
Woe for my heart of such a love, if it befell it and made it its home
You came on me like a gleaming sun, you are the cure for my soul of its sickness
Be lenient on me, oh tender one, and have mercy on who because of you is in ruins
You are like the Ajeed Al-reem [leader of the gazelle herd] for my country, the source of all of its knowledge
You waddle even when you stand still, with feet white like the blooming of the dates of the palm
Oh, who wishes to deprive me of sleep, the night has ended and I still have not seen you
You are the cure for my sickness and my support, you dried my throat up let me go and damp it
Help me, oh children of mine, for in his love my life will pass me by.
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
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More on Yemen's civil war
THE BIO
Born: Mukalla, Yemen, 1979
Education: UAE University, Al Ain
Family: Married with two daughters: Asayel, 7, and Sara, 6
Favourite piece of music: Horse Dance by Naseer Shamma
Favourite book: Science and geology
Favourite place to travel to: Washington DC
Best advice you’ve ever been given: If you have a dream, you have to believe it, then you will see it.
Scoreline:
Everton 4
Richarlison 13'), Sigurdsson 28', Digne 56', Walcott 64'
Manchester United 0
Man of the match: Gylfi Sigurdsson (Everton)
THE BIO
Favourite place to go to in the UAE: The desert sand dunes, just after some rain
Who inspires you: Anybody with new and smart ideas, challenging questions, an open mind and a positive attitude
Where would you like to retire: Most probably in my home country, Hungary, but with frequent returns to the UAE
Favorite book: A book by Transilvanian author, Albert Wass, entitled ‘Sword and Reap’ (Kard es Kasza) - not really known internationally
Favourite subjects in school: Mathematics and science
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'I Want You Back'
Director:Jason Orley
Stars:Jenny Slate, Charlie Day
Rating:4/5
SPEC%20SHEET%3A%20NOTHING%20PHONE%20(2a)
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Crops that could be introduced to the UAE
1: Quinoa
2. Bathua
3. Amaranth
4. Pearl and finger millet
5. Sorghum
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