Blocked from selling Yemen’s oil, the Houthi-led government has slipped into a financial crisis after four months of conflict with a Saudi-led military coalition. A Houthi official said the country has not exported any oil since March due to damaged energy infrastructure and a blockade imposed by the Saudi coalition. Tax collection has also fallen dramatically. The lack of income has led to a significant budget shortfall. In March, the rebels sent delegations to Iran and Russia seeking fuel assistance and investment in energy projects. There have been no indications that any deals were reached. The central bank has been selling short-term debt to replace maturing debt and avoid a funding shortfall. Hasan al-Sa’adi, a Houthi political leader, said the central bank, finance ministry, and other government departments had saved money by stamping out corruption and adopting austerity measures. [WSJ, 8/4/2015]
New Libya oil chief considers resuming exports at eastern ports
The new head of the state oil company for eastern Libya is considering restarting exports from the region’s two largest ports and plans to boost crude output. “Among my priorities will be lifting force majeure at Es Sider and Ras Lanuf,” said Nagi al-Magrabi, chairman of the National Oil Corporation (NOC) for the eastern region. The NOC will seek to increase crude output from fields in the eastern region, he added. al-Magrabi said his appointment as chairman of NOC for the eastern region will take effect later this week. [Bloomberg, Libya Monitor (subscription), 8/4/2015]
IMF says UAE savings from fuel price reform to increase in coming years
The government of the United Arab Emirates (UAE) will save only a modest amount of money from reforms to its fuel price system in 2015, but the savings are likely to rise sharply in coming years, an International Monetary Fund (IMF) official said on Tuesday. Zeine Zeidane, adviser in the IMF’s Middle East and Central Asia Department, estimated the UAE’s reform would save it about $500 million by the end of this year, or a little over 0.1 percent of gross domestic product (GDP). But annual savings are expected to rise sharply over the medium term to around 0.6 percent of GDP, Zeidane said. He added that in addition to gasoline and diesel, there was huge potential for the UAE to save money by reducing natural gas subsidies and enacting spending cuts and taxation and structural reforms. [Reuters, 8/4/2015]
Egypt bank postpones issuance of international bonds
The National Bank of Egypt (NBE) has postponed issuing international bonds, which were to be issued at the end of July, according to an NBE source. The source said the postponement was due to current instability in the international stock markets. In August 2010, the NBE issued bonds valued at $600 million with interest rates of 5.25 percent. The source said the NBE aims to offer the new bonds at lower prices than the 2010 bonds. Last June, the NBE selected CitiBank, Deutsche Bank, HSBC, the National Bank of Abu Dhabi, and Standard Chartered to organize issuing the standard bonds. According to the source, the bank will repay on Wednesday the full $600 million in bonds from August 2010, and will withdraw these amounts from its external accounts. [DNE, 8/4/2015]
Also of interest
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UAE provides education, transportation projects in Egypt | Ahram Online
Egypt says foreign reserves fall to $18.534 billion at end-July | Reuters
Egypt prepares to inaugurate expanded Suez Canal | WSJ
Power shortages shut production at Libya’s biggest steel firm | Reuters
Libya’s non-oil revenues halve in 2014 | Libya Monitor (subscription)
Kurds cut oil transfers to Iraq’s SOMO by half in July | Reuters
Turkey’s troubles deal new blow to stumbling economy | AFP
Economists expect Moody’s to hold Turkey’s credit steady | Daily Sabah