Saudi investment bank Jadwa Investment has raised its growth forecast for Saudi Arabia this year after the kingdom's economy showed strong expansion in both oil and non-oil activities in the first half of 2022.
Gross domestic product of the Arab world's largest economy is now forecast at 8.7 per cent compared with a previous 7.7 per cent estimate after it expanded 3.2 per cent in 2021, Jadwa said in a new report.
The investment bank's estimate is higher than the International Monetary Fund's 7.6 per cent forecast for this year. The kingdom’s economy is set to grow at the quickest pace in a decade and could be one of the world’s fastest-growing economies this year, the IMF said in August.
Saudi Arabia’s economy grew 12.2 per cent in the second quarter, exceeding initial estimates and registering the fastest expansion since the third quarter of 2011. This was due to higher oil prices, data from the kingdom’s General Authority for Statistics showed earlier this month. The expansion followed the kingdom posting the strongest growth rate among the world's largest economies in the first quarter of this year.
Oil GDP is expected to rise by an annual 16.6 per cent in 2022 compared with a previous 15.5 per cent estimate, Jadwa said. Non-oil growth is forecast to rise by 4.3 per cent, primarily due to higher non-oil private sector growth of 4.4 per cent, compared with a previous 3.4 per cent forecast.
Oil GDP will continue to grow in the second half the year, due to higher annual Saudi oil output and continued growth in the petroleum refining sector. However, this growth would be at a slower rate than in the first six months of 2022, the investment bank said.
It projects government revenue will increase by an annual 38 per cent to about 1.338 trillion riyals ($357 billion) in 2022. Jadwa said there would also be a fiscal surplus totalling 335bn riyals, which is equivalent to 8.7 per cent of GDP.
Despite a surge in oil prices during the second quarter of this year, Jadwa maintained its forecast for Brent, the benchmark for two-thirds of the world's oil, at $102 per barrel for 2022. It said there would be a slight upward revision in the kingdom’s average oil output to 10.6 million barrels per day from 10.5m bpd.
"Looking forward, we expect this growth to continue in the second half of the year, which, in turn, has led us to upgrade our full year 2022 GDP forecast," Jadwa said. "More specifically, we see higher growth in three sectors: non-oil manufacturing, wholesale and retail trade, restaurants and hotels and transport, storage and communication."
The non-oil manufacturing’ sector grew by 8 per cent in the first half of the year from the same period a year earlier. This was due to an increase in the value of the kingdom’s non-oil exports.
The Index of Industrial Production surged an average of 23 per cent in the year to July. This was buttressed by more than 700 new industrial factories that started production, which are worth 21 billion riyals and created 31,000 new jobs over the same period.
Continued growth of non-oil exports combined with a rise in investments in manufacturing will provide additional support to the sector’s expansion, Jadwa said.
After growing by 8.6 per cent In the year to July 2022 from the same period in 2021, consumer spending rose is expected to remain strong in the second half of the year. More planned entertainment, leisure and sports events, in addition to the recently issued Hayya card that allows access to the kingdom for World Cup visitors in neighbouring Qatar, will spur growth.
Inflation in the kingdom rose by an average of 2.2 per cent during the year to August. This makes Saudi Arabia one of the G20 countries with the lowest levels of inflation. Inflation in the US and UK is at four-decade highs and at record levels in Europe.
The kingdom's transport, storage and communication sector expanded by 6.8 per cent year-on-year in the first of 2022 as most travel restrictions related to Covid-19 were lifted. This paved the way for a rebound across all of the sector's main segments.
Saudi Arabia Railways carried more than 2.3 million passengers in the first six months of the year. This was a 121 per cent increase from the same period last year, in addition to a 24 per cent jump in cargo transportation.
Growth of the sector is expected to continue in the second half of the year on higher inbound and outbound travel. Jadwa said this would also result from more programmes and projects being introduced under the National Transport and Logistics Strategy, which was announced in June 2021.
Company Profile
Company name: OneOrder
Started: October 2021
Founders: Tamer Amer and Karim Maurice
Based: Cairo, Egypt
Industry: technology, logistics
Investors: A15 and self-funded
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8 UAE companies helping families reduce their carbon footprint
Greenheart Organic Farms
This Dubai company was one of the country’s first organic farms, set up in 2012, and it now delivers a wide array of fruits and vegetables grown regionally or in the UAE, as well as other grocery items, to both Dubai and Abu Dhabi doorsteps.
www.greenheartuae.com
Modibodi
Founded in Australia, Modibodi is now in the UAE with waste-free, reusable underwear that eliminates the litter created by a woman’s monthly cycle, which adds up to approximately 136kgs of sanitary waste over a lifetime.
www.modibodi.ae
The Good Karma Co
From brushes made of plant fibres to eco-friendly storage solutions, this company has planet-friendly alternatives to almost everything we need, including tin foil and toothbrushes.
www.instagram.com/thegoodkarmaco
Re:told
One Dubai boutique, Re:told, is taking second-hand garments and selling them on at a fraction of the price, helping to cut back on the hundreds of thousands of tonnes of clothes thrown into landfills each year.
www.shopretold.com
Lush
Lush provides products such as shampoo and conditioner as package-free bars with reusable tins to store.
www.mena.lush.com
Bubble Bro
Offering filtered, still and sparkling water on tap, Bubble Bro is attempting to ensure we don’t produce plastic or glass waste. Founded in 2017 by Adel Abu-Aysha, the company is on track to exceeding its target of saving one million bottles by the end of the year.
www.bubble-bro.com
Coethical
This company offers refillable, eco-friendly home cleaning and hygiene products that are all biodegradable, free of chemicals and certifiably not tested on animals.
www.instagram.com/coethical
Eggs & Soldiers
This bricks-and-mortar shop and e-store, founded by a Dubai mum-of-four, is the place to go for all manner of family products – from reusable cloth diapers to organic skincare and sustainable toys.
www.eggsnsoldiers.com
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Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Juliot Vinolia’s checklist for adopting alternate-day fasting
- Don’t do it more than once in three days
- Don’t go under 700 calories on fasting days
- Ensure there is sufficient water intake, as the body can go in dehydration mode
- Ensure there is enough roughage (fibre) in the food on fasting days as well
- Do not binge on processed or fatty foods on non-fasting days
- Complement fasting with plant-based foods, fruits, vegetables, seafood. Cut out processed meats and processed carbohydrates
- Manage your sleep
- People with existing gastric or mental health issues should avoid fasting
- Do not fast for prolonged periods without supervision by a qualified expert
Match info
Premier League
Manchester United 2 (Martial 30', Lingard 69')
Arsenal 2 (Mustafi 26', Rojo 68' OG)
Company profile
Date started: 2015
Founder: John Tsioris and Ioanna Angelidaki
Based: Dubai
Sector: Online grocery delivery
Staff: 200
Funding: Undisclosed, but investors include the Jabbar Internet Group and Venture Friends
What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
COMPANY%20PROFILE
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Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
What is Diwali?
The Hindu festival is at once a celebration of the autumn harvest and the triumph of good over evil, as outlined in the Ramayana.
According to the Sanskrit epic, penned by the sage Valmiki, Diwali marks the time that the exiled king Rama – a mortal with superhuman powers – returned home to the city of Ayodhya with his wife Sita and brother Lakshman, after vanquishing the 10-headed demon Ravana and conquering his kingdom of Lanka. The people of Ayodhya are believed to have lit thousands of earthen lamps to illuminate the city and to guide the royal family home.
In its current iteration, Diwali is celebrated with a puja to welcome the goodness of prosperity Lakshmi (an incarnation of Sita) into the home, which is decorated with diyas (oil lamps) or fairy lights and rangoli designs with coloured powder. Fireworks light up the sky in some parts of the word, and sweetmeats are made (or bought) by most households. It is customary to get new clothes stitched, and visit friends and family to exchange gifts and greetings.
Islamophobia definition
A widely accepted definition was made by the All Party Parliamentary Group on British Muslims in 2019: “Islamophobia is rooted in racism and is a type of racism that targets expressions of Muslimness or perceived Muslimness.” It further defines it as “inciting hatred or violence against Muslims”.
Favourite book: ‘The Art of Learning’ by Josh Waitzkin
Favourite film: Marvel movies
Favourite parkour spot in Dubai: Residence towers in Jumeirah Beach Residence
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
