EconSource: Iraq to Endorse New Investment Law Next Week

Iraq’s parliament is expected to endorse a new investment law in the coming week in an effort to support the private sector, attract more foreign investments, and curb corruption. “The old law was not enough and it did not handle problems that the investment sector is facing in Iraq,” said Member of Parliament Najeeba Najeeb, member of the Parliamentary Finance Committee. She pointed out that the old investment law afforded more power to the central government and set obstacles for foreign investors to acquire land in the country. She said the new law would decentralize decision making and streamline procedures to allow investors to acquire land within fifteen days. Head of the Baghdad Investment Commission Shaker al-Zameli noted that the new law will give investors the right to refer to international arbitration, a provision that was not included in the old law. [Zawya, 8/13/2015]

Moody’s says Suez Canal extension will take time to affect positive credit
Ratings agency Moody’s said Thursday that Egypt Suez Canal expansion will support the country’s credit quality through increased current account receipts and government revenue.  However, Moody’s said the degree of support to Egypt’s economy will depend on the acceleration in global trade growth, “which seems unlikely to materialize quickly.” The agency said it expects the canal expansion to have limited positive effects on Egypt’s credit during the current fiscal year. In a July report, Moody’s projected a FY2016 budget of 9.9 percent of gross domestic product (GDP), compared to the government’s estimate of 9.6 percent. [DNE, Cairo Post, 8/13/2015]

Oil rout saps UAE deposits, stokes bank borrowing costs
The cost of borrowing between banks in the United Arab Emirates (UAE) has jumped to the highest rate in more than sixteen months as deposit growth has slowed. The increased borrowing costs underscore how liquidity has dropped as a slump in global oil prices weighs on state finances. “Liquidity in the banking system continues to tighten with solid credit growth outstripping deposit growth,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank. “Banking sector results for the second quarter suggest that lower government deposits, probably as a result of lower oil prices, are likely a key driver of the overall weakening in deposit growth.” [Bloomberg, 8/13/2015]

Also of interest
Gulf markets consolidate after oil steadies | Reuters
UAE draws up sales and corporation tax plans | The National
Saudi July inflation flat at 2.2 percent yr/yr | Reuters
Saudi, Egypt stocks edge up as fears ease over China | Reuters
Egypt to seek bids for solar and wind-power projects | The National
Egypt approves Siemens offer to establish high-voltage plants | Cairo Post
Iraq decides to stop the pensions of senior officials | Shafaq News
Bahrain subsidy talks persist | Zawya