The International Monetary Fund’s Executive Board approved the disbursement of $301.6 million to Tunisia as it held its final evaluation of its standby agreement with the North African country. The disbursement is the last of the agreement’s three tranches, worth a total of $1.74 billion. A statement released by the IMF said that although “all quantitative performance criteria under the Fund-supported program have been met” by Tunisia, “progress on structural reforms, including in the banking and fiscal areas, has been challenging.” The statement added that the “successful completion of [Tunisia’s] political transition represents a good opportunity to press ahead with reform implementation and complete the unfinished agenda within the program timeline.” The IMF called for faster implementation of Tunisia’s structural agenda to strengthen the investment climate and labor markets. Meanwhile, Trade Minister Ridha Lahouel said on Wednesday that negotiations on a Deep and Comprehensive Free Trade Agreement with the European Union will begin on October 13. [TAP, ANSAmed, The Financial, 10/1/2015]

Egypt receives second floating LNG import terminal
A second liquefied natural gas (LNG) import terminal arrived in Egypt on Wednesday and will start operating in the third week of October, said EGAS head Khaled Abdel Badie. The floating storage and regasification unit (FSRU), provided by Singapore-based Norwegian group BW Gas, has a capacity of 600 to 700 million cubic feet per day, Egypt’s Oil Ministry said. FSRUs allow Egypt to import LNG and convert it to natural gas to feed into its energy-starved power grid. Egypt received its first FSRU from Norway’s Hoegh LNG in April. The BW Gas terminal will remain at the Gulf of Suez port of Ain al-Sokhna port where the Heogh terminal is also moored. In other news, Egypt’s EFG Hermes, one of the Middle East’s largest investment banks, said it will reduce its capital by 184.782 million Egyptian pounds ($23.61 million) by terminating treasury stocks. [Reuters, 9/30/2015]

S&P says Gulf banks’ profits set to slide over low oil income
Net earnings of Gulf banks are expected to slide as government spending slows due to a dive in oil revenues, Standard and Poor’s (S&P) ratings agency said Thursday. Growth in net income declined to 4 percent in the second quarter, compared with 7 percent in the first three months of the year and more than 10 percent in the previous three quarters, S&P said in a report based on a survey of twenty-six major Gulf banks. “We expect Gulf banks’ net income growth to decline below 10 percent in 2015 and potentially slow further in 2016,” S&P said. Customer deposits also lost momentum in the first half. Gulf banks increased customer deposits by 6 percent in the first and second quarters of 2015, compared with more than 10 percent in the previous eight quarters, S&P said. Six of the twenty-six banks reported negative deposit growth in the second quarter. [AFP, Bloomberg, 10/1/2015]

Citigroup, Ashmore approved to buy Saudi stocks directly
US bank Citigroup Inc. and investment manager Ashmore Group have won permission from Saudi Arabia’s Capital Market Authority to invest directly in the local stock market, industry sources said on Wednesday. The kingdom opened its $442 billion equity market, the largest in the Arab world, to direct investment by foreigners on June 15 as part of efforts to create jobs and diversify its economy beyond oil. Citigroup’s licence marks a step towards rebuilding its presence in Saudi Arabia. After operating there for five decades, it pulled out in 2004 when it sold its 20 percent stake in Samba Financial Group, saying it was reallocating capital to core investments. It is not clear whether Citigroup will now seek to develop major Saudi operations by, for example, seeking a banking licence. A Saudi official said earlier in September that there may be new opportunities for foreign banks to enter the kingdom, as most banks already operating there are nearing maximum credit limits imposed by the central bank. [Reuters, Bloomberg, 9/30/2015]

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