Admin SAE
Policies to create jobs, promote entrepreneurship and growth are key priorities for many emerging economies. Designing and implementing reforms is particularly challenging as policy makers attempt to strike a balance across sectors, firm size and incentives that can sustain growth in a rapidly changing global economy. High-growth firms (HGFs)–accounting for approximately 3-20 percent of the manufacturing and service industries—are of particular interest as a growth model considering their contribution to more than 50 percent of new jobs and sales in in these sectors. (read more)
With climate change perceived as the most pressing risk for the world today, government officials and energy experts are emphasizing the importance of shifting toward a global green economy.
According to the Bank of America Merrill Lynch’s Thematic Investing report, the 17 warmest years on record occurred in the 21st century, and 2018 could be the 42nd consecutive year where global temperatures rise above the 20th-century average.
This year’s Intergovernmental Panel on Climate Change also warned that we are currently heading toward a 3C rise in temperature, with the 1.5C barrier potentially breached in 12 years, by 2030.
As extreme weather is recognized as the foremost global risk today, affecting 10 to 12 percent of the globe compared to 0.1 to 0.2 percent from 1951 to 1980, the frequency and severity of heatwaves, hurricanes, floods and droughts are intensifying. But green capital, digital transformation and social engagement can play a fundamental role in nations helping fight the cause by transitioning to a green economy.(read more)
There is absolutely no doubt about the social and economic impact education can have on humanity. On a personal level, the same is undeniably true. Up until the age of 18, we develop in very structured terms. Our formal education shapes the way we think and how we view the world. After that it’s on us. Whether you work at a large company where you collide with new ideas, skills, and technologies that you’re forced to use daily, or you’re a freelancer or entrepreneur and you’re the head of your own HR, marketing, and IT departments, continuous education is what collectively propels us forward. (read more)
Morocco plans to sell the five-star La Mamounia hotel in Marrakech and the Tahaddart power plant in a privatisation push Morocco plans to sell the five-star La Mamounia hotel in Marrakech and the Tahaddart power plant in a privatisation push to rein in the budget deficit in 2019, the government spokesman said on Thursday. The government approved a draft law allowing the sale of the two companies, Mustapha El Khalfi told a news conference. Morocco's 2019 draft budget aims to raise 5 billion to 6 billion dirhams ($527 million-$633 million) from selling state assets to cut the deficit to 3.3 percent of gross domestic product next year. (read more)
SoftBank has hired Deutsche Bank to advise on its power investment plans in Saudi Arabia, two sources familiar with the matter said.
The Japanese firm, which is planning to invest in a giant solar power plant in the kingdom, has also shown interest in electricity distribution in the world’s top oil exporter, they said.
One source said SoftBank could consider purchasing a minority stake in Saudi Electricity from the Public Investment Fund (PIF) sovereign wealth fund.
“They want to become a minority shareholder of influence,” the source told Reuters.
PIF owns a 74 percent stake in Saudi Electricity. The other major shareholder is state oil giant Aramco, which owns a nearly 7 percent stake.
A SoftBank spokeswoman declined to comment. PIF and Deutsche Bank also declined comment. Saudi Electricity did not respond to a Reuters request for comment. (read more)
Qatar has agreed to buy one of London's most famous hotels, the Grosvenor House, as energy revenue enables the wealthy Gulf state to go on a buying spree despite a blockade by its neighbors.
A source with knowledge of the deal said the acquisition of Grosvenor House - located on Park Lane in London's swanky Mayfair district - had been agreed on Tuesday with the vendor, private U.S. real estate investment firm Ashkenazy Acquisition Corp. The price was not disclosed.
Ashkenazy Acquisition did not respond to a request for comment and nor did the Qatar Investment Authority, which is buying the hotel via its Katara Hospitality holding.
Qatar has already bought of one of New York’s most iconic buildings, the Plaza Hotel, for around $600 million.
"There is another hotel acquisition in the works in Europe coming soon as well," the source said.
Qatar has been buying top hotels and luxury properties in the West over the past decade as part of a drive by its $300 billion-plus sovereign wealth fund to diversify the wealth it accumulates from gas and oil exports. (read more)
Bahrain's King Fahd Causeway Authority (KFCA) said it has invited bids from qualified transaction advisory services consultancies for implementing the transitional phase of King Hamad
Causeway, a 25-km-long strategic artery linking the kingdom with Saudi Arabia to be built at an investment of $4 billion. The transitional phase is likely to take up to three years, during which a consultant will be charged with developing a partnership framework between the public and private sectors, conducting a financial feasibility study and preparing the legal framework, preliminary designs and technical features, said a statement from KFCA. (read more)
Exclusive Interview for SA Entrepreneurs
Dr. Steen Ehlern, Managing Partner
Ferguson Partners Family Office
Nestled in the Arabian Gulf comprising a total of 33 islands, Bahrain is the smallest member of the Gulf Cooperation Council with a population of just 1.5 million. Despite being the smallest economy in the Arabian Gulf, the Kingdom has for years been able to attract a steady and growing flow of investment both from outside the region and from within.
Over the last year alone, foreign investment levels into the country increased dramatically off the back of new corporate legislation and favorable business environment. Bahrain Economic Development Board reported a record $810 million of foreign direct investment during the first nine months of the year. That compared to $733 million in all of 2017 and was over five times the amount of FDI in 2015.
In 2018 foreign direct investment more than doubled in the first nine months, with manufacturing and logistics accounting for the most part. The EDB attributes this growth to greater focus on marketing Bahrain as the gateway for companies looking to access the Gulf region, especially Saudi Arabia. Neighboring KSA has been introducing a sweeping wave of reforms – both economic, social and political – aimed at transforming the economy and turning it into a world-class hub for business, trade, mining, light manufacturing and tourism. Some companies have used the opportunity to set up operations in Bahrain and take advantage of the momentum.
“Setting up a business in Bahrain is extremely easy and cost-efficient, especially when you compare it with neighboring GCC countries,” says Dr. Steen Ehlern, Managing Partner/CEO of Ferguson Partners, Al Dana Partners and Co-Founder of Al Dana Ferguson.
“Investment into the country is also becoming more and more attractive, as there is so much being developed, with the new additional causeway parallel to the existing one [linking Saudi Arabia and Bahrain], the LNG shipping terminal, Bahrain metro and lots of infrastructure and hospitality projects but also many private investments and shared PPP (Public Private Partnerships) in the areas of renewable energy, sustainability, smart cities and mobility.”
Dr. Ehlern draws upon years of valuable experience derived from working in the region. British-Danish citizen who grew up and graduated from Switzerland, he lives between London, Zurich and Bahrain. He is quick to point out to the kingdom’s high ambitions of becoming a FinTech hub, and “being the banking and financial center with the longest track record and experience in the region,” Dr. Ehlern thinks it has a bright future ahead. Last year Bahrain created a “regulatory sandbox” allowing companies in the field to experiment without facing normal regulatory constraints.
Indeed, Bahrain’s rise to prominence as a key regional financial center dates back to the 1970s when the kingdom was the first GCC state to diversify its economy away from dependence on oil. Today, the financial sector accounts for as much as 17% of overall GDP, while reliance on oil dropped significantly from 43.6% of GDP in 2000 to about 19% currently. Still, oil and gas revenues continue to contribute a significant share of government revenues estimated at 75.7% in 2016.
Country of “firsts”
To spur growth and attract more investment into the country, the government allowed 100% foreign business ownership in various sectors, including residency, food, administrative services, arts, entertainment and leisure, health and social work, information and communications, manufacturing, mining and quarrying, water supplying and professional, scientific, technical and real estate activities.
As Dr. Ehlern highlights, Bahrain was the first GCC country to allow 100% foreign ownership to investors: “Bahrain is very often (if not always) the pioneer. For example, it built the first hospital in the region, first schools; it was the first to allow and support education for women, women to found and own businesses, first to discover oil, and then first to diversify the economy away from oil and gas into e.g. aluminum, banking and finance, etc.”
As a result, “a large number of foreign companies are opening up businesses in Bahrain,” says Dr. Ehlern. “It is geographically a great hub and remains a gateway to the region, and certainly also to Saudi Arabia as well as other GCC countries. It is cost-efficient, has considerably lower labor costs, utility costs and you have an abundance of well-trained, experienced local staff. You don’t have to rely on, sometimes expensive, expats.”
Empowering female entrepreneurs
Its focus on innovation, capability building, and youth has stimulated a vibrant entrepreneurial environment, with women being at the helm of new business start-ups and incubators. Entrepreneurship is most certainly on the rise, and women entrepreneurship is very much promoted in Bahrain, with women present in all sectors and jobs, up to the highest ranks and executive levels, as well as politics, says Dr. Ehlern.
“I see a much larger private sector and especially young entrepreneurs, start-ups and businesses founded and owned by women. I see many more women still in key business areas and businesses and Bahrain leading the FinTech arena in the Gulf. Some very smart minds are coming out of the region, studying locally or overseas and coming back. The pace of development and momentum are incredible.”
This year Bahrain established a $100 million fund to support technology start-ups across the region, which it hopes will attract venture capital firms to Bahrain. ‘Al Waha Fund of Funds’ will help start-ups in Bahrain and across the region get access to capital and expertise.
“The government also has a designated Labor Fund (Tamkeen) to support local businesses and start-ups, where also BDB (Bahrain Development Bank) steps in and supports SMEs,” Dr. Ehlern explains.
“There are several Bahraini Family Business and SME societies and organizations. Also worth mentioning are all the women in business, the universities especially designated for women, besides the usual universities and the Supreme Council for Women, initiated by Shaikha Sabekha, the wife of H.M. King Hamad bin Isa Al Khalifa,” he added.
Trust is key
For all the benefits it offers, Bahrain remains a popular destination for foreign investors from the East, Far East and the West. But doing business in the region is not always as straightforward as you might think. It’s about trust, relationships and even “chemistry” – things without which even the most astute businessman would struggle to succeed.
“People from the West are often too impatient and immediately want to ‘get down to business’, which – frankly speaking – is not going to get you very far. In the region of the Arabian Gulf, it is all about relationships, patience and timing, word of mouth, reputation, referrals, trust and respect,” Dr. Ehlern said.
“People want to get to know you, understand you, and see whether business with would be possible, regardless of the opportunity. It really is also about personal chemistry, whether a business has the potential to happen or not,” he added.
As the managing partner of a private partnership firm specialized in providing wealth and family office/business services to investors, over the years Dr. Steen Ehlern has helped many people succeed in business, finance and investment. On our final but nevertheless important question – what are some of the key things to keep in mind if you are looking to set up a business in Bahrain? Dr. Ehlern replied simply: “Like everywhere else in the world, be professional, respectful, tolerant, openhearted and open minded. Bahrain is a fabulous example of an open society, combining the best of two worlds, in fact many worlds.”
يوم الاثنين الخامس عشر من أيلول/سبتمبر عام 2008 يعلن أحد أكبر وأعرق المصارف الأمريكية "ليمان براذرز" إفلاسه.
هكذا بدأ الإعلان الرسمي عن دخول الاقتصاد الأمريكي ولاحقاً العالمي عهد أزمة مالية باثنين أسود على غرار الاثنين الأسود في أزمة الكساد الكبير في عام 1929، واضعاً الإدارة الأمريكية في موقف لا تُحسد عليه، وإن كانت الأزمة الاقتصادية لم تهبط من السماء في ذاك اليوم، إلا أن محاولات الإدارة الأمريكية منذ عام 2000، أي بعد انفجار فقاعة الدوت كوم، وأحداث الحادي عشر من أيلول/سبتمبر 2001 ، وما تبعها من انكماش اقتصادي، كانت قد باءت بالفشل ولم تحظى سوى بتأثير محدود لم يكن ليمنع انفجار أزمة الرهون العقارية في عام 2008 والتي جاء على أثرها إفلاس "ليمان براذرز" كتأكيد على أن الاقتصاد العالمي وقع في أزمة ركود لن تجدي معها السياسات الاقتصادية التقليدية للخروج منه إلى دورة اقتصادية جديدة، أي أن الاقتصاد الأمريكي بدى وكأنه عالقاً عند حلقة الركود، ونظراً لذلك شرعت المؤسسة النقدية في الولايات المتحدة الأمريكية متمثلة بالاحتياطي الفيدرالي الأمريكي، بإتباع سياسات نقدية وصفت بأنها غير تقليدية، وقد عُرفت هذه السياسات مجتمعة باسم " التيسير الكمي ".
فما هي إجراءات التيسير الكمي، وكيف يمكن لهذه الإجراءات التأثير في تبعات أزمة الرهون العقارية، ثم ماهي إجراءات التشديد الكمي التي يتردد اصداءها هذه الأيام في وسائل الاعلام؟ وما علاقة تلك الإجراءات بحركة رؤوس الأموال عالمياً؟ هذا ما سوف نحاول الإجابة عنه من خلال سلسلة من المقالات تتناول أثر تلك السياسات في حركة رؤوس الأموال، وكيف يمكن أن تؤثر هذه الحركات في عمليتي التمويل والاستثمار المباشر في الأسواق الناشئة.
الوقوع في المصيدة
عندما يمر أي اقتصاد بحالة من الانكماش في النمو فإن السلطات النقدية تعمد إلى تنفيذ إجراءات نقدية توسعية تتمثل في تخفيض أسعار الفائدة و التأثير بأسعار الصرف وشروط الائتمان بغية تحفيز النشاط الاقتصادي من خلال جعل كلفة الحصول على الأموال أرخص، ويزداد بذلك الطلب على الائتمان، إلا أن ما حدث خلال أزمة 2008 أن الاحتياطي الفيدرالي الأمريكي كان قد اتبع تلك السياسات النقدية التوسعية مسبقاً، لكن استجابة المصارف لتلك السياسات كانت ضعيفة بسبب الأوضاع غير المستقرة ومخاطر الائتمان بالإضافة الى حالة العسر المالي التي أصابت العديد من المصارف و المؤسسات المالية الأمريكية ، فأسعار الفائدة على احتياطيات البنوك في الفيدرالي الأمريكي وصلت إلى 2 % في نهاية شهر حزيران/ واستمر الفيدرالي الأمريكي بتخفيض أسعار الفائدة حتى وصلت ما بين (0-0.25%) وبدلاً من أن تعود البنوك إلى عملها الطبيعي، أي منحها الائتمان للقطاع الخاص، فإنها لجأت للاستثمار في أدوات مالية أكثر أماناً كسندات الدين الحكومية ذات التصنيف الائتماني المرتفع ( (AAA وعند هذه النقطة يمكن لنا القول بأن الاقتصاد الأمريكي قد وقع في المصيدة، مصيدة السيولة وهو مصطلح من ابتكار الاقتصادي البريطاني كينز، وهو يعبر عن الوضع الذي يصل فيه الطلب على النقود إلى مرحلة الإشباع، حيث يصبح ثابتاً عند وصول معدل الفائدة إلى مستويات قريبة من الصفر، ومع إصابة الاقتصاد الأمريكي بهذه الحالة وازدياد حالة عدم الثقة والنظرة التشاؤمية في الأسواق مع تكرار حالات الإفلاس والعسر المالي للآلاف من المقترضين في قطاع الإسكان، سارع الاحتياطي الفيدرالي الأمريكي للإعلان عن خطة إنقاذ طارئة.
خطة طارئة واستراتيجية
25 تشرين الأول 2008 يعلن الاحتياطي الفيدرالي عن خطة إنقاذ طارئة، عُرفت فيما بعد باسم "التيسير الكمي" ويُوصف التيسير الكمي بأنه أحد أشكال السياسات النقدية، التي تقوم بموجبها السلطات النقدية بشراء مروحة واسعة من الأصول المالية تهدف من خلالها لتسهيل عملية الائتمان عبر خلق النقود وتخليص السوق من الأوراق المالية السامة ( كالأوراق المالية عالية المخاطر المضمونة بعقارات سبق و انهارت أسعارها، بالإضافة الى القروض المعدومة) عبر دخول السلطات النقدية كمشتري لتلك الأصول من المصارف والمؤسسات المالية، وبذلك تنقذها من الانهيار وتجعلها قادرة على منح الائتمان من جديد وإعادة الثقة بوضع الأسواق. وهي سياسة طارئة من حيث أنها لا تُتبع في الحالات الطبيعية، وهي استراتيجية من حيث أنها تهدف الى إحداث تصحيحات اقتصادية طويلة الأجل من حيث الأثر والمدة.
على أرض الواقع
كما ذكرنا في السابق أن الفيدرالي الأمريكي لم يقف مكتوف الأيدي بل تدخل عبر خطة طارئة واستراتيجية، تهدف إلى تحفيز الاقتصاد الأمريكي عبر سياسات نقدية سُميت بالتيسير الكمي ولقد تم تنفيذ سياسة التيسير الكمي عبر ثلاث برامج وهي:
- برنامج التيسير الكمي الأول:
في 25 تشرين الأول 2008 أعلن عن خطة لشراء ما قيمته 100 مليار دولار من ديون الشركات المدعومة من قبل الحكومة، و500مليار أخرى من الأصول المدعومة برهون عقارية، ثم أعلن عن خطة شراء إضافية في آذار 2009، شملت 100 مليار دولار من ديون الشركات المدعومة من قبل الحكومة، و750 مليار دولار من الأصول المدعومة برهون عقارية، و300 مليار أخرى من سندات حكومية طويلة الأجل، وقد ضاعفت هذه المشتريات القاعدة النقدية في الولايات المتحدة الامريكية مرتين.
- برنامج التيسير الكمي الثاني
3 تشرين الثاني 2010 تم الإعلان عن خطة شراء بقيمة 600 مليار دولار تشمل سندات حكومية، وذلك بهدف إرساء دعائم تحفيز النمو وإعادة التضخم إلى مستوياته المعتادة عند معدل 2 % سنوياً. عُرفت هذه الإجراءات بالبرنامج الثاني من التيسير الكمي، وقد صُمم خصيصاً لتخفيض معدلات الفائدة الحقيقية على السندات الحكومية في الأجل الطويل، ورفع معدلات التضخم.
- برنامج التيسير الكمي الثالث
ظل النمو الاقتصادي بطيئاً على مدار السنوات الأربع التي امتد خلالها البرنامجين الأول والثاني، ولمواجهة ذلك أعلن الاحتياطي الفيدرالي في حزيران عام 2012، عن إجراء عملية ثانية لتبديل السندات، من خلال استبدال ما قيمته 267 مليار دولار من سندات الخزينة قصيرة الأجل بأخرى ذات أجل طويل. رغم ذلك استمرت بيانات سوق العمل في الولايات المتحدة بالتراجع، مما أقلق مسؤولي الاحتياطي الفيدرالي، ليعلن مجلس عمليات السوق المفتوحة في 13 أيلول 2012 عن برنامج جديد للتيسير الكمي، لكن بأسلوب مختلف هذه المرة، حيث سيتم الاستمرار بشراء الأصول لفترة طويلة عوضاً عن شراء كمية ضخمة منها دفعة واحدة، وبالفعل تم شراء 40 مليار دولار من السندات المدعومة برهون عقارية شهرياً، وفي 12 كانون الأول 2012، أعلن مجلس عمليات السوق المفتوحة عن إضافة 45 مليار دولار من السندات الحكومية طويلة الأجل إلى ال 40 مليار السابقة ليصبح إجمالي حجم المشتريات الشهرية من الأصول 85 مليار دولار شهرياً.
في كانون الأول عام 2013 أُبطئت عمليات الشراء بشكل تدريجي، و اُنهي البرنامج الثالث في تشرين الأول من عام 2014.
الى أين اتجهت تلك الأموال؟
ترتبط الإجابة عن هذا السؤال بمعرفة الآثار المحتملة لبرامج التيسير الكمي على المستوى الدولي، وللإجابة عن هذا السؤال لابد من إلقاء نظرة على ميزانية الاحتياطي الفيدرالي الأمريكي.
تشير ميزانية الاحتياطي الفيدرالي الأمريكي في بداية الأزمة عام 2008 بأن حجم الالتزامات المترتبة عليه قد بلغت 1 ترليون دولاراً، بينما وصلت حجم الالتزامات إلى 4.5 ترليون دولار بداية عام 2016!
يمكن تقسيم الزيادة في حجم الالتزامات الفيدرالي الأمريكي الى قسمين: 2.4 ترليون دولار وتتمثل بإجمالي حجم ودائع المؤسسات المالية، و1.4 ترليون دولار، كقيمة للأوراق النقدية المطروحة للتبادل. لكن ماذا تعني تلك الأرقام؟ بالنسبة للقسم الأولى تعني أن عمليات الشراء التي قام بها الفيدرالي الأمريكي قد تم تحويلها إلى ودائع للمؤسسات المالية التي اشترى منها الفيدرالي الأصول المالية، أي إن ما حدث فعلاً أن الفيدرالي الأمريكي قد حمل عبء الخسائر المحتملة والمحققة للبنوك والمؤسسات المالية على عاتقه منقذاً بذلك تلك المؤسسات ومعها القطاع المالي والاقتصاد الأمريكي من الانهيار، فالسيولة التي ضخمها الفيدرالي بقيمة 2.4 ترليون دولار بقيت حبيسة إدراجه، بينما انتقل 1.4 ترليون دولار إلى الأسواق المالية، كأوراق نقدية ، أي كدولارات قد طبعها الفيدرالي، وهو ما يفسر جزئياً حقيقة النسبة المنخفضة لمعدلات التضخم، التي لم تتجاوز في أعلى معدلاتها 5 % وذلك في عام 2009 ، وهي نسبة ضئيلة لاقتصاد يمر بأزمة مالية حادة، وتضاعفت فيه القاعدة النقدية مرتين !
الجزء الأهم الذي يفسر ذلك هو القيام العديد من الدول باستيراد سياسة التيسير الكمي (كالمركزي الأوروبي والبريطاني) من جهة ومن جهة أُخرى السياسات التي اتبعتها العديد من الدول الناشئة، كما حدث في الصين، حيث اتهمها بن برنانكي في عام 2010 بتقييم اليوان الصيني بأقل من قيمته الحقيقية، بهدف زيادة صادراتها الأمر الذي يمنح الصادرات الصينية ميزة تنافسية على حساب نظيرتها الأمريكية. بكلمات أخرى فإن سياسة المعاملة بالمثل قد جعلت من برامج التيسير الكمي التي تُحدث بشكل غير مباشر انخفاضاً في سعر صرف الدولار، غير ذات أهمية.
البداية لآثار بعيدة الأمد
من المؤكد أن سياسات التيسير الكمي لم تقتصر على الداخل الأمريكي، كما لم تقتصر على" حرب عملات" دولية، بل أن المتغير الأهم جرى في عمليات انتقال رؤوس الأموال، إذ تشير التقديرات إلى تدفقات خارجية كبيرة خرجت من الولايات المتحدة خلال فترة التيسير الكمي، وقد توجه قسم كبير من هذه الأموال نحو الأسواق الناشئة. فما هو أثر تلك التدفقات على الأسواق الناشئة، وما هي العلاقة بين حركة رؤوس الأموال هذه وإجراءات التشديد الكمي وحالة الانكماش الاقتصادي والعسر المالي التي تعيشها العديد من الدول الناشئة في الفترة الأخيرة.
هذا ما سوف نحاول الإجابة عنه في الأجزاء القادمة.... (الجزء الثاني)
Blockchain has likely been the single most trending word in recent years, creating an unprecedented buzz the world over. Initially viewed with skepticism and widespread mistrust, today the technology is making waves in virtually all sectors of the economy, attracting huge amount of investment from both governments and private industries, and creating the potential to revolutionize business, money and people’s lives.
In recent years Dubai has been making headlines for its plans to become the world’s first blockchain-powered government. The Dubai Blockchain Strategy was launched by His Highness Sheikh Hamdan Bin Mohammad Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of The Executive Council, in October 2016, envisioning that Dubai becomes the world’s first-ever government to execute all applicable transactions using blockchain technology by 2020.
In line with this strategy, the inaugural Future Blockchain Summit was officially hosted by Smart Dubai Office, the entity recognized as the global first-mover in blockchain adoption, in partnership with Dubai World Trade Centre on 2-3 May in Dubai.
The summit brought together over 7,000 industry and technology leaders from across the globe, showcasing pilot projects and innovations from over 60 government and private organizations. In more than 70 engaging sessions, 60+ speakers deep dived into real-world applications across a range of sectors such as retail and e-commerce, creative economy, healthcare, transportation, education, food, hospitality and tourism, energy, fintech and banking as well as safety and security.
Furthermore, the Summit played host the grand finale of the Smart Dubai Blockchain Challenge, a startup pitch competition for blockchain-powered entrepreneurs, as well as complimentary workshops, such as Blockchain 101, designed to demystify blockchain technology.
According to IDC, spending on Blockchain in the Middle East and Africa will more than double in 2018 to $80.8 million, up from $38.9 million in 2017. By 2020, the global market for digital transactions will amount to $9.5 billion, with the global investment in blockchain technology poised to reach a staggering $300 billion. Through the Dubai Blockchain Strategy, the government aims to eliminate 100 million annual paper transactions, saving $1.5 billion annually in document processing alone.
This, however, is an ambitious target that comes with its own set of challenges, which is why SAEntrepreneurs spoke exclusively to the real experts in the field, and this is what they had to say:
“The vision of Dubai’s leadership is clear – to build Dubai as the Blockchain capital of the world. This is a commendable vision which confirms just how serious Dubai is very when it comes to Blockchain based implementations,” commented Moazzam Kamran, Global Head of Marketing, Avanza Innovations.
Moazzam Kamran, Global Head of Marketing
With that vision in mind Avanza is helping build the technology of the future that will not only transform the city of Dubai but help it carry the flag of decentralization globally. The UAE-based Avanza Innovations describes itself as “a tech powerhouse” with key products and implementations across Blockchain, Artificial Intelligence, Smart City Enablement, RPA and Customer Engagement. The company is part of Avanza Group of Companies with 18 years of market experience and 300+ global customers.
Kamran reveals that the company’s objectives are aligned with the Dubai Strategy – to be ahead of the curve with respect to technology and help the city move past disruption and into the future. “We do this by employing the best talent and latest technology to build future-proof applications,” he explains.
But these are not just words. The company has already put its plans into action, and has already been achieving some tangible results. Avanza’s Blockchain Platform Cipher was selected by Smart Dubai Office to deliver a Pilot Project under the Dubai Future Accelerators (DFA) program in February 2017. Through Cipher, Avanza has successfully delivered an immutable, agile and instant reconciliation and settlement platform to Smart Dubai Office for DubaiPay payment platform. For its part, Smart Dubai Office plans to roll out Cipher across all its existing 38 partner government entities, partner financial institutions and Departments to set up the first blockchain based building block within its financial plumbing.
“Avanza is helping the Smart Dubai Office build a Recon and Settlement engine for the city of Dubai, said Kamran. “Dubai’s department of finance had a manual/legacy system that would reconcile and settle with all its internal entities in up to 45 days. With our help the city of Dubai now has a Recon and Settlement Engine that can do seamless reconciliation for DoF through the transformative power of blockchain,” he added.
Another interesting project that Avanza has undertaken is for a city-wide emergency nerve center for the Dubai Health Authority. With the help of AI and Blockchain technology, the platform is designed to assist route in-transit patients to hospitals that have the facilities available to cater to them. “This is a very small example of how the system will be saving lives. The entire concept is that minutes can save lives and through our tech and health based systems experience we can build a system that will achieve this mission,” Kamran explained.
He believes that Blockchain has the power to transform economies, with virtually all sectors poised to benefit from its transformative power. Avanza is currently engaged in projects in the following sectors – Banking and Financial, Governments, Healthcare, Transportation and Logistics, many of which were featured live at its booth during the Future Blockchain Summit.
Commenting on the challenges ahead, Kamran said with objective of Dubai’s Blockchain vision for both public and private organizations is to embrace the transformative power of blockchain and/or work with consortiums to get a better grip of the technology and evolve their operations to better cater to a much more receptive consumer.
“Every system that is being build is to raise the bar on what customers expect from service providers, be it Banking, Identity, Security etc. – there is a massive opportunity to reshape customer engagement through blockchain.” He added: “The risk/opportunity with the decentralized movement is that it will completely disrupt conventional processes and if organizations are not looking to evolve they will face massive growth challenges in the near future.”
Another blockchain trend setter and exhibitor at the Future Blockchain Summit weighed in the discussion, highlighting the enormous opportunities that the technology has to offer. “Blockchain creates a new concept that you may refer to as the internet of value and trust,” said Eng. Saud Alsehli, CEO and Founder, ArabianChain Technology.
Eng. Saud Alsehli, CEO and Founder
“Its main power comes from the decentralized ledger which holds an encrypted record of all transaction within that network, and that record is incorruptible, immutable, and transparent to all participant, thus removing the need for any trusted third parties to act as an intermediary for any kind of transaction.”
This elimination of the so called “Middle Man” is what enables the creation of a service that safeguards both value and trust. “By removing those third parties, we remove friction and cost and increase efficiency and trust of services provided in both public and private sectors,” Alsehli added.
On the back of this, he is confident of the great potential for adoption of blockchain in the MENA region, and is quickly to point out UAE’s 2021 Blockchain Strategy, which was only recently announced earlier this year, alongside Saudi Arabia’s adoption of blockchain as part of Saudi Vision 2030, and the innovative initiative by the Central Bank of Bahrain for a cryptocurrency exchange in the Arabian Gulf Kingdom.
“We believe that by adopting the technology in MENA we will be transforming the region to be able to provide better services for its citizens, create transparent environments to attract investment, generate new possibilities and jobs, and support the overall digital economy of the region,” Alsehli stated. The young entrepreneur is convinced that the technology is here to stay, and that its full potential is yet to be realized.
According to the young tech entrepreneur, “Blockchain is reshaping the way we approach digital services, trust, third party intermediaries, law, economy and many other things and that’s creating an uncharted field of innovation yet to be discovered, such discovery requires flexibility, agility and risk taking and those qualities are better positioned with startups more than it’s in established business. The opportunities are huge and we are at the infancy of this technologies adoption.”
ArabianChain was established out of the same aspiration – to drive blockchain adoption in the Arab economy, narrates Alsehli who founded the company in early 2017 with the mission to catalyze the blockchain revolution in MENA region. Considered the first public and decentralized blockchain in the Arabian Economy, the company offers a platform for smart-contracts development, tokenization and decentralized applications. But before ArabianChain opened its doors, Alsehli encountered some major challenges such as unclear regulations across the region, lack of technical resources, and lack of awareness from the public and business sectors alike.
He continues to identify the need for greater and more widely spread awareness and the availability of technical skills as some of the key gaps posing a threat to the larger scale adoption of blockchain in the region. “These need to be addressed by the relevant institutions, schools and universities to cater to this new technology and its future demand,” he explains.
Besides finding the right talent, Alsehli and his team are now focused on building their own proprietary technology like the ArabianChain Studio designed to allow for easy development of smart contracts. Another one is Galaxy wallet – the first multi-platform, multi-currency wallet in MENA, and Palmex – a Digital asset trading platform which is in the process to be one of the first regulated platforms for active trading in MENA. The company has also recently established an ArabianChain Academy which aims to increase awareness in both public and private sectors about blockchain and the opportunities it creates.
The next blockbuster markets for blockchain technology will be Saudi Arabia and UAE, according to Alsehli, who says the two neighboring countries have the biggest potential in terms of both application and value realization. The company’s market focus currently consists of UAE, Saudi Arabia, Bahrain and Jordan.
You can learn more about the Future Blockchain Summit on
