LONDON: Reversing Britain’s shock referendum to leave the EU would “significantly” boost the economy, the OECD said on Tuesday, while the government inisted there were no plans to cancel Brexit.
“In case Brexit gets reversed by political decision (change of majority, new referendum, etc) the positive impact on growth would be significant,” the Organization for Economic Co-operation and Development (OECD) said in a new report.
The Treasury responded saying: “We are leaving the EU and there will be no second referendum.”
A spokesman for British Prime Minister Theresa May also reiterated the government’s position that there should not be a second referendum, with Brexit due to take place in March 2019.
The OECD meanwhile left its economic growth forecasts for Britain unchanged at 1.6 percent in 2017 and one percent in 2018.
The OECD, which advises industrialized nations on economic policy, said Britain should seek to maintain close economic ties with the European Union to weather the impact of Brexit.
The Paris-based organization warned that a “disorderly Brexit,” one in which no trading relationship was arranged, would constitute a medium-term shock to Britain’s economic growth prospects.
“Business investment would seize up, and heightened price pressures would choke off private consumption,” the organization said.
“Negotiating the closest possible EU-UK economic relationship would limit the cost of exit.”
Britain voted to leave the EU in a shock referendum in June last year.
Speaking to MPs earlier, Bank of England governor Mark Carney blamed a pick-up in inflation to 3.0 percent on the tumbling value of the pound since the Brexit vote, and said that a transition agreement for Britain’s withdrawal from the EU was in “everyone’s interest.”
The country must now “stay calm and carry on,” said OECD Secretary-General Angel Gurria at the presentation of the report.
Asked whether the UK should pursue a longer transition period for exiting the EU, Gurria said: “Common sense was invented by the British — if you need more time then give it more time.”
The OECD also said that Brexit could exacerbate Britain’s existing productivity problem by increasing uncertainty and reducing business investment.
Reviving labor productivity growth was a challenge “compounded by Brexit,” it said, calculating that leaving the EU could reduce total factory productivity by about three percent after 10 years due to reduced trade.
The OECD recommended investment targeted at increasing productivity, such as “spending on repair and maintenance or soft investment” if growth weakens further ahead of Brexit.
British finance minister Philip Hammond said that weak productivity was one of the issues he would focus on when he presented his annual budget on November 22.
Reversing Brexit would give ‘significant’ boost to UK: OECD
Reversing Brexit would give ‘significant’ boost to UK: OECD
Saudi Fund for Development marks 50 years with efforts in emerging economies
RIYADH: As the world is being divided by geopolitical tensions and wars, Saudi Arabia’s development fund is extending a helping hand to emerging nations through soft loans and grants.
Established in 1974, the Saudi Fund for Development has supported more than 800 projects worth $20 billion in over 100 countries.
As it celebrates 50 years since it was founded, the fund’s offerings for developing nations show no signs of slowing down.
Here are the highlights of its activities in the first nine months of 2024.
Water project to Benin
In February, SFD signed a memorandum of understanding with Benin to allocate a $5 million grant to support the implementation of the fifth phase of the Saudi Program for Drilling of Wells and Rural Development.
According to a press statement, the water project is expected to overcome the effects of drought in 37 villages across the West African nation.
“The project will contribute to the growth and prosperity of the infrastructure sector, provide access to water and food security, maintain public health, and reduce environmental pollution, to help achieve the Sustainable Development Goals, specifically SDG 6, clean water and sanitation,” said SFD.
The fund’s development cooperation with Benin started in 2008, with it providing soft loans to finance six development projects and programs worth more than $145 million in the country over the past sixteen years.
Supporting Turkiye’s education sector
In February, SFD signed a $55 million loan agreement with Turkiye to rehabilitate five public schools covering an area of approximately 55,000 sq. meters.
The project will equip these schools with the necessary equipment and resources to protect them against earthquake damage, ensuring the continuity of their quality and efficiency, according to a statement.
Over the past four decades, SFD has financed nine development projects and programs in Turkiye, worth over $300 million, in multiple sectors including energy, health, agriculture, and education.
Empowering transport sector in Tunisia
Earlier this year, the fund signed a development loan agreement worth $55 million to renew and develop the railway network for phosphate transportation in Tunisia.
According to a press statement, the project will help renew approximately 190 km of the system, support increasing the capacity for transporting phosphate, and contribute toward Tunisia’s economic growth by creating direct and indirect job opportunities.
Loan to support clean energy growth in Pakistan
In March, SFD signed two development loan agreements totaling to $101 million to finance the establishment of the Shounter Hydropower and the the Jagran-IV Hydropower Projects in Pakistan.
A loan worth $66 million is intended to construct the 48-megawatt Shounter Hydropower station and connect it to the country’s national electricity grid.
This project also involves dam construction, water diversion and purification structures, powerhouse development and discharge tunnel construction.
The second loan, amounting to $35 million, will help establish the Jagran-IV Hydropower Project, which is set to have a capacity of 22 MW. This project entails the construction of dam, powerhouse, water diversion and purification building, as well as the provision of generators, transformers, necessary equipment, and transmission lines.
“These two agreements mark a continuation of efforts to boost clean energy projects in Pakistan, addressing challenges posed by conventional energy and its associated financial costs,” said SFD.
It added: “Additionally, they underscore the significance of clean energy and its contribution to fostering vital opportunities for sustainable development, aiming to support social development, stimulate economic growth, and meet population basic needs.”
In 2023, SFD financed oil derivatives worth $1 billion for Pakistan, when the South Asian nation was facing a tough economic situation amid dwindling forex reserves and rapidly depreciating national currency.
Supporting energy sector in Saint Kitts and Nevis
In April, SFD signed another development loan agreement worth $40 million to bolster the energy sector in Saint Kitts and Nevis.
According to a press statement, the loan centers on the financing of the expansion of the Needsmust Power Plant Project in the island nation. The project entails the establishment of a state-of-the-art dual-fuel power generation station with a capacity of 18 MW.
“This initiative is poised to significantly enhance the country’s energy production capabilities, contributing to a flexible hybrid power generation platform. It emphasizes efficiency improvements, utilization of clean fuel, and a pivotal step toward sustainable energy practices,” said SFD.
Aid to disaster-affected communities in Saint Vincent and the Grenadines
To support the disaster-affected communities in Saint Vincent and the Grenadines, the SFD in April signed a $50 million developmental loan agreement with the Caribbean nation.
According to a press statement, the agreement aims to finance the construction and rehabilitation of buildings and facilities affected by natural disasters in the country.
“The goal is to enhance the sustainability and resilience of these structures to withstand future disasters and climate change effects. The project encompasses furnishing and equipping buildings with necessary equipment, including the establishment of four health care facilities, construction of primary and secondary schools, government buildings, and rehabilitation of damaged houses by volcano, among other infrastructure works,” said SFD.
SFD enters El Salvador and Nicaragua
In June, SFD forayed into El Salvador and Nicaragua by signing developmental loan agreements with these nations.
The fund signed a $83 million deal with El Salvador to fund a water treatment and biogas power generation project in the Central American country.
“The project will treat wastewater that currently flows into the Acelhuate River, while also producing biogas for renewable electricity generation. Expected to benefit over 1.2 million people, it will significantly increase El Salvador’s renewable energy capacity, and contribute to environmental sustainability,” said SFD.
#Infographic | A first developmental step; for effective sustainable development #SFD Signed the first development loan agreement worth $103 million; to support the health sector in the Republic of #Nicaragua.#ProsperTogether pic.twitter.com/UqisoTrZPp
— الصندوق السعودي للتنمية (@SaudiFund_Dev) June 7, 2024
In the same month, the fund signed another developmental loan agreement worth $103 million with Nicaragua to finance the development of the Carlos Centeno Departmental Hospital in the Central American nation.
According to a press statement, the fund will be used to construct a 25,000-sq.-meter hospital with a capacity of 300 beds, serving the surrounding regions.
The facility will also include specialized clinics for surgery, comprehensive child immunization, training and qualification of medical personnel, emergency departments, and a full range of integrated health care services.
Supporting socio-economic growth in Dominica
In September, SFD signed a developmental loan agreement worth $41 million with Dominica to enhance socio-economic growth in the country.
The agreement aims to rehabilitate seven main streets in Roseau, which will help improve road connectivity, reduce congestion, enhance safety and access to basic services, as well as facilitate the smoother movement of people and goods, according to a press statement.
#Video | The signing ceremony for the first development loan agreement worth $41 million, provided by #SFD to finance the Infrastructure Rehabilitation project in the capital, Roseau, of the Commonwealth of #Dominica.#ProsperTogether#SFD50 pic.twitter.com/rxLkdQWMJ6
— الصندوق السعودي للتنمية (@SaudiFund_Dev) September 15, 2024
The loan will also contribute to commercial and residential development and create numerous job opportunities.
In the same month, SFD also signed a deal worth $25 million to co-finance the development of renewable energy infrastructure in the Solomon Islands.
The financing initiative aims to reduce dependency on fossil fuels and promote sustainable development in the Oceanian nation.
Startup Wrap — Proptech leads startup investment in region as sector sees funding drop
RIYADH: Saudi Arabia’s real estate tech platform Ejari secured the largest startup investment across the Middle East and North Africa in October as the region faced a funding slowdown.
The firm benefited from a $14.65 million seed financing round led by PFG and BECO Capital, underscoring the importance of early-stage investments.
This success came against a backdrop of a funding fall for the MENA region, which saw $134 million secured across 56 deals.
This represented a 52 percent month-on-month decline and a 13 percent decrease from the same period last year, indicating ongoing challenges in the region’s investment climate, according to Wamda’s monthly report.
Debt financing played a notable role, accounting for $28.4 million, or 21 percent of the total amount.
UAE-based startups led the region, raising $61.8 million across 15 deals, while Saudi Arabia followed closely with $50 million raised across 21 transactions.
Kuwait’s position was boosted by property technology firm Sakan’s $12 million round, contributing to a total of $13.5 million secured by Kuwaiti entrepreneurs.
The Egyptian startup scene struggled, with only eight startups raising a combined $1.6 million, highlighting a sharp downturn.
Meanwhile, Tunisian and Qatari startups performed comparatively well, securing $3 million and $2.7 million, respectively.
Fintech, which had dominated the region’s funding landscape earlier in the year, fell to second place in October.
Proptech took the lead, attracting $38 million over five deals.
The e-commerce sector raised $14.6 million, while education technology startups secured $11 million across seven deals.
Investor preference leaned toward early-stage startups, with seed funding accounting for $40 million, or 30 percent of the total raised.
Series A investments reached $20 million across three deals, and pre-seed funding contributed $15.5 million. Notably, nine startups secured $25.8 million without disclosing their stage.
The business-to-consumer model was the favored choice, garnering $83.8 million across 19 startups, while business-to-business ventures attracted $42.4 million over 27 deals.
Ten startups operating a hybrid model received nearly $8 million.
Female-founded firms saw an encouraging rise, collectively raising $10.5 million across four transactions.
However, male-founded startups continued to dominate, securing $115 million across 31 deals.
Saudi open banking startup Lean closes $67.5m in series B round
Lean Technologies, a Saudi-based open banking platform, has raised $67.5 million in a series B funding round led by US-based General Catalyst.
This round marks one of the largest equity investments by a US venture capital firm in Saudi Arabia’s fintech sector. Other participants included Bain Capital Ventures, Duquesne Family Office, and Arbor Ventures.
Founded in 2019 by Hisham Al-Falih, Ashu Gupta, and Aditya Sarkar, Lean provides businesses with access to bank data and payment solutions.
The company, regulated by the Abu Dhabi Global Market, claims it has processed over $2 billion in transactions through its account-to-account payment offerings, serving clients like e&, DAMAC, and Careem.
In Saudi Arabia, Lean’s launch of data services under the Saudi Central Bank’s regulatory sandbox has facilitated nearly 1 million bank account verifications, supporting clients in sectors such as insurance, lending, and e-commerce, including companies like Tawuniya, Abdul Latif Jameel Finance, and Salla, as well as Tabby, and Tamara.
Al-Falih, CEO of Lean Technologies, stated that the funding will be used to expand Lean’s product offerings and support its growth strategy across the Middle East.
“Our aim is to enhance the financial ecosystem by providing accessible solutions that meet the needs of businesses and consumers alike,” Al-Falih said.
Neeraj Arora, managing director at General Catalyst, said: “Lean has demonstrated a strong commitment to solving local market needs and has earned significant customer loyalty. We see Lean as a key player in building the infrastructure needed for the region’s fintech growth.”
The new funding is expected to bolster Lean’s pay-by-bank and open banking solutions, allowing the company to scale operations and deepen its market presence in the region.
UnifyApps secures $20m to fuel ME expansion
UAE-based Software-as-a-Service solutions provider UnifyApps has closed a $20 million series A funding round led by Iconiq Growth, with participation from Elevation Capital.
The round brings UnifyApps’ total funding to $31 million since its inception in 2023. The company, co-founded by Pavitar Singh, Abhishek Khurana, focuses on automating enterprise workflows across multiple applications.
“UnifyApps understands that you need a holistic approach to achieve trusted, effective AI agents,” said Matt Jacobson, general partner at Iconiq Growth.
“By aligning every data source and application to an enterprise use, they are enabling AI to actually understand and orchestrate work,” he added.
Pavitar Singh, CEO of UnifyApps, emphasized the strategic value of the new partnership: “UnifyApps is deeply grateful for the opportunity to work with Iconiq Growth. Their deep network and partnership will be instrumental in our next stage of growth as we bring our AI agent platform to enterprises everywhere.”
UAE’s Epik Foods raises $15.5m
Epik Foods, a UAE-based food and beverage group, has raised $15.5 million in private capital funding from Ruya Private Capital I, LP, a fund managed by Ruya Partners.
The funding will be used for acquisitions, working capital, and supporting the company’s expansion plans, particularly into Saudi Arabia, as well as strengthening its presence in the UAE.
Established by Khaled Fadly and Ranya Basyuni, Epik Foods was formed in 2023 following a merger of three F&B entities – KR&CO, Sweetheart Kitchen, and Happy Platters Kitchens – in partnership with Gulf Islamic Investments, a Shariah-compliant global investment firm which manages over $4.5 billion in assets.
Epik Foods currently oversees a portfolio of 60 food and beverage brands operating across 50 locations in the UAE and Saudi Arabia, with an additional 20 outlets slated to open as part of its ongoing expansion strategy.
Efreshli advances interior design tech with new funding round
Egyptian interior design startup Efreshli has raised an undisclosed amount in its latest seed round, led by Algebra Ventures.
The round also saw participation from 500 Startups, Dar Ventures, and various angel investors.
Founded in 2019 by Heba El-Gabaly, Efreshli leverages virtual decor tools to help customers visualize room setups before making purchases.
CEO El-Gabaly expressed optimism about the company’s growth trajectory, saying: “I’m excited about this significant milestone for Efreshli. With new funding and with Dina El-Haddad joining as co-founder and CPO (chief product officer), we can accelerate our tech-driven growth and take Efreshli to new heights.”
El-Haddad added: “I’m thrilled to be part of Efreshli’s journey to revolutionize the home furnishing experience. Efreshli’s future is more than just furniture; it’s about building an entire ecosystem. With innovations like Efreshli Pro, we’re connecting the dots for everyone, from customers to designers.”
The new funding will be directed toward enhancing Efreshli’s offerings and expanding its product line, reinforcing its mission to make interior design accessible across the region.
Yemen and Iraq lead call for more crisis finance
BAKU: A group of conflict-affected countries led by Iraq and Yemen is pushing at the COP29 climate talks to double financial aid to more than $20 billion a year to combat the natural disaster and security crises they face.
States mired in conflict or its aftermath have struggled to access private investment, because they are seen as too risky. That means UN funds are even more critical to their people, many of whom have been displaced by war and weather.
In response, the COP29 Azerbaijan presidency on Friday launched launch a new “Network of Climate-vulnerable Countries,” including Iraq, Yemen, Burundi, Chad, Sierra Leone, Somalia and Timor-Leste. They all belong to the g7+, an intergovernmental group of fragile countries that first sent the appeal.
The network aims to advocate as a group with climate finance institutions, build capacity in member states so they can absorb more finance, and create country platforms so investors can more easily find high-impact projects in which to invest, said think tank ODI Global, which helped the countries create the network.
“My hope is it will create a real platform for the countries in need,” said Abdullahi Khalif, chief climate negotiator for Somalia.
Half of UK businesses impacted by Middle East conflict
- British Chambers of Commerce survey shows companies faced increased costs, shipping disruption
LONDON: Half of British businesses say they have been affected by the conflict in the Middle East, according to a survey from the British Chambers of Commerce.
The findings show that on top of the devastating human impact of the fighting in Gaza and Lebanon, the economic repercussions are being felt around the world.
Houthi militants in Yemen began attacking shipping in the Red Sea shortly after the Oct. 7 Hamas attacks sparked Israel’s war on Gaza.
The militants claim they are targeting ships linked to Israel and its allies in solidarity with Palestinians. The result has been a huge reduction in traffic through one of the world’s busiest maritime trade routes.
The BCC said shipping container rates have risen sharply since the conflict began. The cost of shipping a 40-ft (12-meter) container from Shanghai to Rotterdam has risen from just over $1,000 at the start of the conflict to just under $4,000 now. Prices peaked at more than $8,000 in July.
Most shipping companies operating between Asia and Europe have opted to send vessels around the longer Cape Horn route rather than through the Red Sea and Suez Canal.
In the survey of about 650 businesses published this week by the BCC’s Insights Unit, UK firms said the conflict had led to increased costs, shipping disruption and delays, and uncertainty over oil prices.
Half of those asked said the conflict had affected them, compared to just over a quarter in a similar survey in October 2023. This suggests more businesses worldwide have been affected by the fighting the longer it has gone on.
William Bain, the BCC’s head of trade policy, said: “Alongside the grim human impact of the ongoing conflict in the Middle East, the situation continues to have economic reverberations around the world.
“The effect on businesses here in the UK has continued to ratchet up the longer the fighting has continued.
“If the current situation persists, then it becomes more likely that the cost pressures will build further.”
Economists have warned that while the effects on the global economy have so far been largely limited to shipping costs and delays, further escalation could have a much wider impact.
The biggest concern would be a disruption to oil and gas supplies that would lead to a surge in global energy prices, fueling inflation.
COP29 unveils Baku Call initiative to bridge climate finance and peace for vulnerable communities
- Elshad Iskandarov highlighted the 450 million people who live in regions simultaneously impacted by conflict and climate vulnerability
BAKU: The world’s most vulnerable communities stand at the heart of the newly launched “Baku Call on Climate Action for Peace, Relief, and Recovery,” unveiled on Friday at COP29.
The initiative addresses the urgent need to tackle the interconnected challenges of climate change, conflict and humanitarian crises.
Backed by key nations from both the Global North and South — including Egypt, Italy, Germany, Uganda, the UAE and the UK — it introduces the Baku Climate and Peace Action Hub as a platform for driving peace-sensitive climate actions and unlocking vital financial support for affected regions.
Speaking to Arab News, Ambassador Elshad Iskandarov of the COP29 Presidency articulated the stakes clearly, pointing to the 450 million people who live in regions simultaneously impacted by conflict and climate vulnerability.
“These compounded crises not only strain existing resources but also hinder the effective delivery of climate finance,” he said.
The Baku Call seeks to address this by providing a centralized mechanism to coordinate efforts across stakeholders — governments, UN agencies, think tanks and peace-building organizations. “The hub will serve as a unified entry point for vulnerable nations, ensuring streamlined access to climate finance and technical support,” he said.
The initiative builds on established frameworks such as COP27’s Climate Responses for Sustaining Peace and COP28’s Declaration on Climate, Relief, Recovery, and Peace, while adding practical innovations.
Iskandarov highlighted a digital portal in development that will provide a clear overview of existing climate finance mechanisms, application requirements and best practices.
“Imagine a country facing daily challenges of conflict, development and climate impact. Without proper guidance, navigating six to nine funding channels becomes nearly impossible,” he said. The portal aims to close this gap by strengthening national capacities and offering tools to access and manage climate funding effectively.
A central focus of the initiative lies in developing pilot projects tailored to conflict-affected areas, where conventional funding approaches often fall short. “In regions with strong non-state violent actors, we must ensure that funds reach the communities in need without falling into the wrong hands,” Iskandarov said.
To achieve this, the hub will facilitate close collaboration with UN agencies and local communities, designing projects that integrate peacebuilding goals and adhere to stringent oversight standards.
Partnerships have been instrumental in shaping the initiative. The ambassador commended the co-lead nations for their shared commitment to inclusivity and cooperation, noting how countries such as the UAE, Egypt and the UK brought their experiences as prior COP hosts to strengthen the effort.
“This is not about initiative nationalism,” he said. “We’ve drawn lessons from the pandemic, where global unity was key, and applied them to forge a collaborative approach to the climate and peace nexus.”
The Baku Call also seeks to shift the broader narrative around climate and peace. Iskandarov expressed a long-term vision where this intersection is no longer synonymous with crisis and destruction but instead embodies hope and development. “Our ultimate goal is to create a future where the nexus of climate and peace signifies resilience and harmony, not despair,” he said.
