Crypto News: Dubai is now a hedge fund hub

International hedge funds managers have become the latest group of investors to use Dubai as a business hub, lured by the emirate's tax-free lifestyle and less stringent approach to Covid.

The Museum of The Future in Dubai. Photographer: Christopher Pike/Bloomberg

Izzy Englander's Millennium Management, Michael Gelband's ExodusPoint Capital Management, All Blue Capital, and Michael Platt's private investment firm BlueCrest Capital Management have been hiring and moving staff to the Gulf region's pre-eminent finance center.

Besides lower taxes and year-round sunshine (albeit with temperatures soaring to 50° Celsius in the summer), Brexit has also spurred many funds to seek new bases outside the City of London, while some fled Hong Kong's strict Covid restrictions. Dubai offers them an array of incentives, including reduced licensing fees and capital requirements. A team from the business hub also recently completed a roadshow in San Francisco and New York to attract more firms.

"We are in a unique situation where the classic financial centers are disintegrating," said Tom Kirchmaier, professor at the Centre for Economic Performance at the London School of Economics.

It isn't the first time, however, that Dubai has attempted to attract hedge fund managers. In 2008, many predicted a regional hedge fund boom but that ultimately failed to materialize as the financial crisis took its toll on the industry.

The hedge funds' expansion in Dubai comes at a time the United Arab Emirates is set to attract a net inflow of 4,000 millionaires this year, the most of any country globally, and as higher oil prices lift the regional economies.

As a result, wealth managers have been recruiting aggressively to meet the rising demand for services catering to the ultra-rich in the region. At the same time, some bankers are moving the opposite direction, eyeing a pivot towards a career in digital assets.

Also Read: Dubai Becomes New Switzerland for Traders of Russian Commodities

Iran is being forced to discount its already cheap crude even more as Russia gains a bigger foothold in the key Chinese market.

Russian exports to China surged to a record in May, with the OPEC+ producer overtaking its cartel ally Saudi Arabia as the top supplier to the world's biggest importer. While Iran has cut its oil prices to remain competitive in the Chinese market, it's still maintaining robust flows.

Also Read: Now Egypt Emerges as Major Supplier of Fuel Oil to Saudi Arabia

Jordan's King Abdullah II said he would support the formation of a Middle Eastern version of the North Atlantic Treaty Organization. The Israelis are keen on such an alliance, and the Biden administration would likely approve. But it's not going to happen, Bobby Ghosh writes for Bloomberg Opinion.

Israel's parliament voted to dissolve itself and paved the way for the country's fifth election in less than four years. Foreign Minister Yair Lapid will become interim prime minister, until a new government is formed following elections on November 1.

The Iran nuclear talks aren't likely to resume until after US President Joe Biden's visit to the region this month. Gulf nations are being encouraged to play a more active role in the negotiations.

The OPEC+ coalition rubber-stamped plans to add 648,000 barrels a day in August, restoring the final tranche of the 9.7 million barrels a day that was halted during the pandemic. The 23-nation group however deferred discussions on its next move.

Libya's oil exports have fallen to about a third of last year's level. This after the worsening political crisis prompted the suspension of shipments from two of the OPEC member nation's biggest ports.

The United Arab Emirates hiked petrol prices for the fifth time this year. Gasoline now costs three times more in the UAE than in Kuwait, and prices are more than double the average cost in the six-member Gulf Cooperation Council.

Children living in the UAE born to Emirati women and foreign men will be granted the same health and education benefits as citizens.
Meanwhile, the country is forging a partnership with startup Deel to speed up the visa process for foreign workers.

Saudi Arabia has appointed two women to senior positions in government, the latest sign that the kingdom is looking to diversify a predominantly male workforce.

Turkey's inflation accelerated by a less-than-expected 78.62% in June as global shocks compounded domestic pressures. Producer prices rose by an annual 138.31%.

The New York Stock Exchange is trying to lure Middle Eastern tech companies to list in the US, promising access to a broader investor base and deeper capital markets. This comes even as Wall Street banks are pulling back from the region's special purpose acquisition companies amid new liability guidelines from US regulators.

Dubai business park operator Tecom's trading debut: July 5
Saudi stock exchange will be closed for Eid from July 7-12, while Dubai will be closed July 8 and July 11. Other regional bourses too will be shut.

A pandemic price controls experiment has gone seriously awry in one of the world's richest countries.

A vendor waits for customers at a food market in downtown Kuwait City. Photographer: Yasser Al-Zayyat/AFP/Getty Images

Kuwait's government decided to freeze all consumer food prices in March 2020 to shock-proof the economy during the coronavirus pandemic. Even as global food prices surge to an all-time high and supply shocks spread following Russia's invasion of Ukraine, the Gulf nation has continued to cling to limits on how much companies could charge for basic food items, driving away suppliers and raising the risk some staples will grow scarce.

The losers from the situation are many.

(Note to readers: The Middle East Newsletter will not be published on July 11 on account of Eid. It will return on July 18.)