Fortnightly, 26 June 2019

Fortnightly, 26 June 2019

June 26, 2019


26 June 2019
23 Sivan 5779
23 Shawwal 1440




1.1  Meuhedet Health Fund to Establish an Independent Medical Cannabis Unit


2.1  Simpo Raises $4.5 Million Seed Investment to Help Drive Software Adoption
2.2  Nym Closes $6 Million Seed Round Led by Bessemer Venture Partners
2.3  J.P. Morgan & AccessFintech Extend Partnership with Real-Time Transaction Status Solutions
2.4  Nano Dimension and HENSOLDT Enter Strategic Collaboration
2.5  Sunbit Raises $26 Million in Series B Equity Funding
2.6  World’s Largest Beer Company AB InBev Sets Up Tel Aviv Cybersecurity Hub
2.7  Intel Announces Program for Israeli Startups Targeting Tech Inflections
2.8  Elbit Systems to Supply Structural Parts from Composite Materials for a North American Customer
2.9  Israel Growth Partners Together with Its Major LPs Invest $110 Million in Cellebrite
2.10  AnyVision Closes $74 Million Series A with New Participation from M12 and DFJ Growth
2.11  Foresight Signs First Commercial Agreement with Elbit Systems
2.12  Brodmann17 Expands US Reach With New Detroit Office
2.13  DouxMatok Raises $22 Million Series B Round from Leading Financial & Strategic Investors
2.14  Ford Opens Israel Research Center in the Heart of Tel Aviv’s Technology Community
2.15  Maor Raises Close to $100 Million for its first Fund – MAOR 1
2.16  Yehuda Was the Leading Israeli Matzah in the US this Passover
2.17  Israeli-founded Businesses Contribute Significantly to New York State Economy
2.18  Venn Raises $40 Million to Re-invent Neighborhoods for Better Urban Living


3.1  BSynchro Raises $1 Million to Transition Insurance Related Companies Into the Digital World
3.2  King Abdullah II Inaugurates Agricultural Project by Del Monte in Mafraq
3.3 Raises $8.5 Million to Accelerate its Expansion Across the Middle East
3.4  Etihad Airways to Launch AI Powered Crowd Sourcing Platform for Their Employees
3.5  IBM Skills Collaborates with RIT Dubai for an Academy Program
3.6  Dubai Startup Zbooni Raises $1.1 Million in Funding
3.7  Indian Fitness Brand Picks Dubai for First Overseas Foray
3.8  Russian Centre for Digital Innovation Opens in DIC-Dubai Internet City
3.9  Tenderd Launches with Seed Round of $5.8 Million and an “All-Star” Cast of Investors
3.10  Xponential Fitness Signs Multi-Brand Master Franchise Agreement in Saudi Arabia
3.11  Averos Raises a Pre-Series A round from Saudi Aramco’s Wa’ed Ventures
3.12  L3 Technologies and Saudi Arabian Military Industries Enter Into Joint Venture
3.13  Saudi Arabia HVAC Market Growth and Demand Forecast, 2014-2024
3.14  Car Imports to Saudi Arabia Decline by Over 20%
3.15  ExxonMobil & SABIC to Proceed with Gulf Coast Growth Ventures Project
3.16  Orcas Raises $500,000 in pre-Series A Round led by Algebra Ventures
3.17  Swvl Raises $42 Million for African Expansion


4.1  Kfar Saba to Install 500 Electric Car Charging Points
4.2  DEWA Launches Tender for Fifth Phase of Giant Dubai Solar Park
4.3  Rooftop Solar Panels to be Installed on 5,000 Emirati Homes
4.4  Egypt’s NREA Plans 200 MW Red Sea Wind Farm
4.5  Morocco to Inaugurate World’s Largest Seawater Desalination Station in 2021


5.1  Lebanese Average Annual Inflation Rate at 3.58% for May 2019
5.2  Beirut Monthly Occupancy Rate at 85.4% in April 2019
5.3  World Bank Approves $200 Million Project to Support Jordanian Health Services
5.4  Jordan to Secure €20 Million EU Grant
5.5  IMF Mission in Jordan to Follow up on Reforms and Discuss Future Cooperation
5.6  Jordan’s Budget Deficit Falls During First Third of 2019
5.7  Amman to Issue $300 Million in Bonds to Cover Eurobond Costs
5.8  Jordanian Building Permits Drop 54% During First Quarter of 2019

♦♦Arabian Gulf

5.9  UAE’s First Nuclear Power Plant Set to Begin Operation by Early 2020
5.10  New UAE Law to Protect Public from Genetically Modified Food Risks
5.11  How UAE Traffic Congestion Compares Globally
5.12  Dubai Private Sector Business Activity Rises to Record High
5.13  Saudi Arabia Becomes the First Arab State to Receive FATF Membership
5.14  Unemployment Rate Continues to Decline in Saudi Arabia
5.15  Saudi Arabia Offers Permanent Residency to Expats for $213,000

♦♦North Africa

5.16  Egypt’s New Budget and Development Plan Approved by Parliament
5.17  Egypt Reaches $500 Million Settlement with Israel Electric Corp
5.18  Egypt’s Ministry of Petroleum to Implement $15 Billion Investments for 11 New Projects
5.19  Egypt’s Oil, Gas Production Hits Record Level at 1.9 Million boe/d
5.20  US Market Represents 3% of Tourist Arrivals to Egypt
5.21  Morocco Unveils Its Study on Ditching Clock Change, Sticking to GMT+1
5.22  Over 50,000 Israeli Tourists Visit Morocco Every Year


6.1  Cyprus Incoming Tourist Arrivals Fall for Second Time This Year
6.2  Cyprus House Prices Fell by 8% Between 2010 – 2018



7.1  Weizmann Institute Ranks 3rd Among World’s Academic Institutions‎
7.2  Largest Pride Parade in Middle East Draws 250,000 People to Attend in Tel Aviv


7.3  Dubai Tourists to Get Free SIM Card
7.4  Why Many Saudi Women Are Not Getting Behind the Wheel
7.5  New National Anti-FGM Committee Launches Awareness Campaign
7.6  New Cypriot Driving Licenses to Provide Organ Donor Option


8.1  Transseptal Solutions Announces First Clinical Use of TSP Crosser in the United States
8.2  O.Vine Varietal Wine-Essence Water
8.3  Together Pharma Purchases Cannabliss for NIS 14 Million
8.4  Third FDA Clearance for Zebra-Med’s AI Solution for Brain Bleeds Alerts
8.5  Third FDA Clearance for Zebra-Med’s AI Solution for Brain Bleeds Alerts
8.6  GlucoMe Now has CE Mark for Diabetes Decision Support Technology
8.7  Syqe Medical Drug Delivery Device for Precise Dosing of Cannabis Approved


9.1  Vayyar Imaging Launches its Walabot DIY “All-in-One Stud Finder” at Walmart
9.2  CyberArk Named a Leader in 2019 Fortress Cyber Security Awards
9.3  RADWIN Technology Allows Luminet to Create London’s ‘Network in the Sky’
9.4  Guardio Discovers Major Vulnerability in Evernote’s Chrome Extension
9.5  Sapiens Expands Its Partner Ecosystem With Kovrr, a Predictive Cyber Risk Modeling Firm
9.6  Tactile Mobility Wins ‘Best Connected Product for the Commercial Vehicle Market’ at the TU- Awards
9.7  IAI Elta Unveils Next Generation Radar
9.8  Rafael Unveils Unique SAR Features in Litening and Reccelite Upgrades
9.9  CyberArk Marketplace Delivers Deepest Set of Privileged Access Security Solutions
9.10  FiberHome Selects Ethernity Network’s ACE-NIC100 to Power New FitBNG
9.11  Mellanox HDR 200G InfiniBand Accelerates New Generation of Supercomputerss
9.12  Reduxio Debuts Focus on Container-Native for Kubernetes and Clouds
9.13  Ottopia Announces Collaboration with Global Automotive Supplier DENSO
9.14  Beijing Daxing International Airport Selects Xsight Systems’ FOD Detection Solution
9.15  Elbit Systems to Supply J-MUSIC DIRCM Systems for the German Air Force
9.16  Walabot HOME Expands Product Line to Further Protect Aging Adults in the Event of a Fall
9.17  Octopai’s New Version Introduces Advanced Metadata Analysis & 3rd Party Vendor Integration
9.18  GE & ECI Join Forces to Enhance Support of Modern Utility Networks
9.19  Syte-Powered Visual Search Boosts Home Design Product Discovery for Conforama


10.1  Israel’s CPI Rises by 0.7% in May
10.2  Israel’s First Quarter Growth Figure Revised Downwards
10.3  Composite State of the Economy Index for May 2019 Increases by 0.1%
10.4  Israeli Housing Prices Continue to Rise
10.5  Israeli Homes Sales Rise in April
10.6  Hotel Revenue Up From Foreign Tourists, Down From Israelis


11.1  ISRAEL: Israel’s Foreign Trade in Goods and by Country – May 2019
11.2  ISRAEL: Israel’s Kibbutzim Are Ahead of the Trend on Cannabis
11.3  ISRAEL: Israel’s Kibbutzim Are Ahead of the Trend on Cannabis
11.4  ARAB MIDDLE EAST: Shooting for the Stars – the Arab Space Club
11.5  JORDAN: Fitch Publishes Jordan’s ‘BB-‘ Rating; Outlook Stable
11.6  EGYPT: Egypt’s Electricity Deal With Cyprus & Greece Brightens Energy Outlook
11.7  TUNISIA: IMF Completes Fifth Review Under the Extended Fund Facility (EFF) Arrangement
11.8  MOROCCO: Coding Academy Opens New Opportunities for Moroccan Youth
11.9  TURKEY: Moody’s Downgrades Turkey’s Ratings to B1 and Maintains Negative Outlook
11.10  TURKEY: Turkey’s Car Manufacturing Sector Sputters Amid Economic Downturn
11.11  TURKEY: Opposition Candidate Wins Istanbul Mayor’s Race in Blow to AKP


1.1  Meuhedet Health Fund to Establish an Independent Medical Cannabis Unit

The Meuhedet Health Fund is establishing an independent medical cannabis unit that will replace the medical cannabis unit of the Ministry of Health.  The unit is already in the process of being set up and designated doctors and managers have been placed in it.  In the framework of the independent unit, the family doctor will transfer the request of Meuhedet’s insured with a recommendation to the unit within the fund, which will approve the request.  The process will shorten the long wait that characterizes the unit of the Ministry of Health.  As a result, other health funds are considering the possibility of establishing similar units in their fields.  The Ministry of Health approved the establishment.  (CAN 12.06)

Back to Table of Contents


2.1  Simpo Raises $4.5 Million Seed Investment to Help Drive Software Adoption

Simpo announced a $4.5 million seed investment.  The round was led by Redpoint Ventures with participation from Janvest, UpWest, Seedcamp, Elad Gil and other unnamed investors.  The idea behind Simpo is to offer a no-code platform for distributing software and educating end users on how to use it.  Any friction in this process can reduce adoption and Simpo created a platform for product managers without a lot of technical know-how to set up software distribution workflows with the goal of driving greater adoption.

There is an element of Robotic Process Automation (RPA) here too, by letting product managers build logical workflows, and then as users interact with the software, it can learn and offer next steps to help further drive usage.  The company counts Walmart, DuPont and Jet as customers.

Tel Aviv’s Simpo is a zero-configuration onboarding and support platform built for the digital enterprise.  Non-software enterprises are increasingly building software.  For their investment to pay off, their employees need to be able to effectively use that software.  Simpo provides an onboarding and support layer made specifically for that use case, and it works out of the box.  (Simpo 13.06)

Back to Table of Contents

2.2  Nym Closes $6 Million Seed Round Led by Bessemer Venture Partners

Nym has secured a $6 million seed round of financing, led by Bessemer Venture Partners.  The investment signals the company’s initial success in providing automatic, accurate, and real-time medical coding, enabling healthcare facilities to optimize their revenue cycle processes.

There are over 250,000 medical coders in the United States today manually reviewing patient charts and assigning the applicable medical codes required for billing.  Nym’s fundamentally different approach to AI and natural language understanding not only enables codes to be assigned in real-time with zero human interaction, but it also addresses the AI black box problem by generating a clear and transparent audit trail explaining how each code was chosen.  Revenue cycle management companies and healthcare providers throughout the United States are currently adopting Nym’s autonomous medical coding solution.

Tel Aviv’s Nym, founded in 2018, develops a unique medical NLU software and services that helps streamline medical coding.  Nym’s engine understands the logical relations between different linguistic components in the text, creating a model that captures the narrative of each patient report and offers quick and accurate medical coding.  (Nym 13.06)

Back to Table of Contents

2.3  J.P. Morgan & AccessFintech Extend Partnership with Real-Time Transaction Status Solutions

AccessFintech which delivers collaboration, transparency and control to the financial services industry, announces today that it has extended its partnership with J.P. Morgan to go live with a trade processing solution to provide real-time transparency and workflow to the firm’s buyside clients.

J.P. Morgan’s Securities Services business is the first custodian to collaborate with AccessFintech on the solution which provides real-time transparency into trade lifecycle statuses, standardized commentary and shared bi-directional workflow for buy-side clients.  These real time transaction statuses will significantly reduce the time needed to be spent by buy-side operations teams to monitor multiple internal tools and custodian portals.  It reduces the need for calling brokers and custodians to get updates.  The solution has been in bilateral testing with select buy-side clients and is now in process of a global deployment.  Following the collaboration with J.P. Morgan’s Securities Services business, AccessFintech will be extending the service to other custodians.

In order to use the product, clients can either leverage the AccessFintech front end or integrate via APIs into their system of choice.  This integration therefore removes the traditionally difficult task of connecting to numerous third-party portals.  This partnership is aimed at bringing together all the elements of the post trade process in one consolidated view, in a timely and efficient manner.  It will enable clients to have an accurate view of their portfolio including enriched and real time commentary on the status of their transactions.  This will ultimately drive risk management in their settlement process.

AccessFintech came through J.P. Morgan’s In-Residence Program which incubates emerging technology companies to develop production-ready solutions solving for critical wholesale banking problems.  Through this early collaboration, AccessFintech was able to test at scale with a number of J.P. Morgan’s businesses which has laid the groundwork for this deeper collaboration.

Rehovot AccessFintech is a leading financial technology company which is the industry ‘exception’ portal, delivering control, transparency and collaboration into the operating models of financial institutions.  AccessFintech’s system agnostic Global Exception Network service provides intelligence through analysis of exceptions, association of risks and enabling collaboration on resolution.  Linking together in-house technology, incumbent providers and fintech innovation enables customers to view a full lifecycle of actions in a compressed, prioritized and mutualized dashboard.  The technology is designed in such a way that clients can quickly and easily adopt the service without significant resource allocation, enabling firms to control their risk management practices while increasing the number of services consumed.  (AccessFintech 12.06)

Back to Table of Contents

2.4  Nano Dimension and HENSOLDT Enter Strategic Collaboration

Nano Dimension announced a strategic collaboration with Germany’s HENSOLDT, a leading global security and defense electronics firm.  Under this collaboration, HENSOLDT’s engineers will work closely with Nano Dimension’s engineering team to develop innovative applications for HENSOLDT’s security and defense business.

HENSOLDT, which was one of the first companies in Europe to test and then purchase Nano Dimension’s ground-breaking DragonFly Pro printer for printed electronics, already has printed hundreds of complex circuit boards using the DragonFly.  Now, HENSOLDT will expand its use of the award-winning additive manufacturing solution with the aim of accelerating accessibility and adoption of electronics manufacturing, paving the way for the manufacture of products and components with integrated functionality – better known as 3D structural electronics.  The push for new products and components is largely being driven by the need for miniaturization and modularity in design.

The collaboration leverages Nano Dimension’s market leadership in additive manufacturing of printed electronics and Hensoldt’s advanced defense and security technologies.  HENSOLDT currently uses the DragonFly Pro system at its company headquarters in Taufkirchen near Munich.

Ness Ziona’s Nano Dimension is a leading electronics provider that is disrupting, reshaping, and defining the future of how cognitive connected products are made.  With its unique 3D printing technologies, Nano Dimension is targeting the growing demand for electronic devices that require increasingly sophisticated features.  Demand for circuitry, including PCBs – which are the heart of every electronic device – covers a diverse range of industries, including consumer electronics, medical devices, defense, aerospace, automotive, IoT and telecom.  These sectors can all benefit greatly from Nano Dimension’s products and services for rapid prototyping and short-run manufacturing.  (Nano Dimension 12.06)

Back to Table of Contents

2.5  Sunbit Raises $26 Million in Series B Equity Funding

Sunbit will target a range of new retail markets following a $26 million Series B equity funding round.  The round was led by Oren Zeev, founding partner of Zeev Ventures.  An early investor in innovative companies such as Audible and Houzz, Oren will join Sunbit’s board of directors.

Sunbit was launched to disrupt the process of financing in-store purchases for customers across the credit spectrum, including the unbanked or underbanked.  The 30-second application process uses best-of-breed, proprietary machine learning technology to offer personalized payment solutions and avoid embarrassing rejections in-store.  Sunbit will use the new funds – which brings the total raised to date to $54 million – to accelerate adoption in retail markets such as dental, eyewear, automotive and veterinary businesses.  Consumers can apply with just a state-issued ID, a phone number and an email address. Sunbit offers credit of up to $5,000, to be repaid in three, six or 12 instalments.  The technology is offered in over 1,500 retail operations across 40 US states.

Sunbit is a fundamentally new way to pay, that eliminates financial waste while providing the best possible experience for retailers and customers.  Sunbit is the simplest and quickest way for retailers to split a purchase into multiple payments, increasing sales and extending the buying power of customers so that retailers earn more while customers pay less.  (FinTech Futures 12.06)

Back to Table of Contents

2.6  World’s Largest Beer Company AB InBev Sets Up Tel Aviv Cybersecurity Hub

Belgium’s Anheuser-Busch InBev SA/NV, which provides 25% of all beer consumed globally, announced it is setting up a new technology hub in Tel Aviv called The Beer Tech.  Though the center will initially focus on cybersecurity, the company intends to expand operations in the future to domains including foodtech, agtech and industry 4.0.

Headquartered in Leuven, Belgium, AB InBev owns around 500 brands, including Beck’s, Budweiser, Corona, Stella, and Leffe.  The company employs over 100,000 people worldwide and reported revenues of almost $55 billion for 2018.

AB InBev already has an Israeli research and development center, employing around 100 people based on its 2018 acquisition of Tel Aviv-based beverage analytics startup WeissBeerger.  WeissBeerger develops tools for monitoring bar operations and consumer behavior.

AB InBev currently operates several global research and development centers.  The new Tel Aviv hub will be its third cyber-focused center, following Silicon Valley and Bangalore.  AB InBev has been partnering with Israeli companies for several years now.  AB InBev currently sources services from five Israeli cybersecurity companies, and is in talks with eight more.  AB InBev started recruiting for the new center in March and while the company currently aims for 20 employees it is not putting a cap on the number.  It is possible the hub will reach 100 employees in the future, depending on the technologies scouted or developed here.  (AB InBev 13.06)

Back to Table of Contents

2.7  Intel Announces Program for Israeli Startups Targeting Tech Inflections

On 16 June, Intel Corporation announced a program to advance open innovation and accelerate early-stage startup companies in Israel targeting key industry inflection points, including artificial intelligence (AI), autonomous systems and other data-centric technologies and business models.  Based in Tel Aviv, the program called Ignite will leverage Intel’s global market access and business and technology leadership to provide early-stage startups with unique advantages on their paths to disrupt the future.  Following a rigorous selection process, Intel will host 10 to 15 top pre-seed to seed startups through a 20-week program where they will receive hands-on mentorship from Intel and industry experts in a variety of product, business, management and technical areas.  Intel is committed to accelerate their growth and scale their ideas for greater impact.

The Ignite program will begin operations in Israel this year, with plans to scale to additional countries over time.  Diversity will be an important guiding principle of Ignite, with startups established, owned and run by different representatives of Israel’s diversified social mix.  Intel has no plans to seek equity in or rights to intellectual property from these companies.  (Intel 16.06)

Back to Table of Contents

2.8  Elbit Systems to Supply Structural Parts from Composite Materials for a North American Customer

Elbit Systems announced that its wholly-owned subsidiary, Elbit Systems – Cyclone, was awarded an approximately $50 million contract for the supply of structural parts from composite materials for an aircraft of a customer in North America.  The contract will be performed over six years.  The contract calls for the supply of a variety of structural parts from composite materials for all the models of one of the customers’ leading aircraft platforms.

Haifa’s Elbit Systems is an international high technology company engaged in a wide range of defense, homeland security and commercial programs throughout the world.  The Company, which includes Elbit Systems and its subsidiaries, operates in the areas of aerospace, land, and naval systems, command, control, communications, computers, intelligence surveillance and reconnaissance (C4ISR), unmanned aircraft systems, advanced electro-optics, electro-optic space systems, EW suites, signal intelligence systems, data links and communications systems, radios and cyber-based systems and munitions.  (Elbit Systems 16.06)

Back to Table of Contents

2.9  Israel Growth Partners Together with Its Major LPs Invest $110 Million in Cellebrite

Cellebrite Mobile Synchronization announced that IGP Capital signed a definitive agreement to invest $110 million in the company.  Since 2015, Cellebrite has been moving beyond its core mobile forensics offering and has redefined its strategy to make the company the leading vendor and consolidation platform in the Digital Intelligence space for Law Enforcement, Government and Enterprise investigations.  The company has focused on expanding its offering with analytics, advanced software tools and services to accelerate investigations and help customers achieve operational readiness to overcome the challenges in an ever-changing and complex digital data environment.

Petah Tikva’s Cellebrite is committed to offering Digital Intelligence solutions for a safer world. It is the undisputed global leader in the emerging market of software solutions, AI and analytic tools that allow Law Enforcement agencies, Government and Enterprises to accelerate criminal investigations and address the challenges of crime and security in a digital world.

Tel Aviv’s IGP is an investment fund focused on Israeli-related technology companies, seeking to partner with established growth companies that have strong product differentiation, a proven business strategy at scale, a technological advantage and top-tier management teams with a passion to build large independent companies and category leadership.  (Cellebrite 17.06)

Back to Table of Contents

2.10  AnyVision Closes $74 Million Series A with New Participation from M12 and DFJ Growth

AnyVision announced the close of its $74 million Series A financing round.  New investment comes from M12, Microsoft’s venture fund, DFJ Growth and OG Technology Partners.  As part of the Series A, AnyVision previously announced investment from LightSpeed Venture Partners, Robert Bosch GmbH, Qualcomm Ventures, and Eldridge Industries.

AnyVision, founded in 2015, is a leading computer vision company specializing in face, body, and object-recognition software. AnyVision develops core software solutions that make all cameras smart.  These solutions are agnostic to all cameras, computing frameworks, and use-cases

Holon’s AnyVision currently develops technology for security and surveillance, mobile authentication, access control and real-world analytics.  These core solutions are being utilized today across various industries including banks, stadiums, casinos and retail to improve safety, realize cost savings, and increase customer satisfaction.  The new funding will be used to continue growing the company’s existing geographies and industry verticals.  (AnyVision 18.06)

Back to Table of Contents

2.11  Foresight Signs First Commercial Agreement with Elbit Systems

Foresight Autonomous Holdings signed a commercial agreement with Elbit Systems Land, a subsidiary of Elbit Systems, for exclusive marketing of its proprietary image processing software for the defense, paramilitary and homeland security markets.  Elbit, a $6.7-billion leading defense electronics company based in Israel, intends to integrate Foresight’s image processing software into its products, systems and solutions, and to market it globally.  The software will be implemented in wheeled military and security ground vehicles, including unmanned vehicles.

This commercial agreement follows a successful evaluation of the QuadSight four-camera vision system prototype purchased by Elbit, as reported by Foresight in March 2019.  Elbit thoroughly tested the QuadSight system in comparison with other solutions and chose it for its outstanding performance.  The system was evaluated over a period of two months in both controlled and uncontrolled environments, including testing in off-road driving conditions.

According to the agreement, Foresight will sell the current version of its proprietary image processing software in the form of a software license to both Elbit and Elbit’s customers for several thousand U.S. dollars per license.  Foresight will also provide support and maintenance services to Elbit for an additional fee.  Furthermore, Foresight expects to receive a more substantial consideration in return for future development agreements in order to accommodate changes to its current software version, as required by Elbit or Elbit’s customers, on a case-by-case basis.  Elbit will have exclusive rights to market and sell Foresight’s image processing software in Israel for a period of several years.  In order to maintain exclusive rights in Israel, Elbit committed to issue minimum annual orders for the exclusivity period, with an initial purchase order in the amount of approximately $50,000 due after the execution of the agreement.

Ness Ziona’s Foresight Autonomous Holdings is a technology company engaged in the design, development and commercialization of sensors systems for the automotive industry.  Foresight develops both “in-line-of-sight” vision systems and “beyond-line-of-sight” cellular-based applications.  Foresight’s vision sensor is a four-camera system based on 3D video analysis, advanced algorithms for image processing, and sensor fusion.  Eye-Net Mobile’s cellular-based application is a V2X (vehicle-to-everything) accident prevention solution based on real-time spatial analysis of clients’ movement.  (Foresight Autonomous Holdings 19.06)

Back to Table of Contents

2.12  Brodmann17 Expands US Reach With New Detroit Office

Brodmann17 announced the opening of a Detroit office to support the company’s growing client base in the US.  The company already has a presence in Japan and South Korea and has plans to establish itself in Germany as part of its mission to put efficient, powerful automated driving capabilities in every vehicle.

While there is growing consumer demand for ADAS and automated driving technology, there is a large gap between the amount people are realistically willing to pay for the technology and the cost to produce it.  While most companies rely on hardware that is bulky, costly and power-inefficient to meet this demand, Brodmann17 focuses on software.  Brodmann17’s deep learning perception solution allows for a 95% cost reduction and a massive reduction in the calculations needed to produce accurate computer vision capabilities.  The company’s game-changing deep learning perception technology offers 20x performance improvement on any hardware, including low-power processors.

Founded in 2016, Tel Aviv’s Brodmann17 provides software-only perception technology for ADAS and automated driving.  Brodmann17’s patent-pending software architecture delivers state-of-the-art accuracy while consuming only a fraction of compute power, bringing automated driving from the premium to the mass market.  The solution is built from the ground up and designed against the industry’s toughest standards for the world’s largest OEMs and Tier 1 automotive suppliers.  (Brodmann17 19.06)

Back to Table of Contents

2.13  DouxMatok Raises $22 Million Series B Round from Leading Financial & Strategic Investors

DouxMatok raised $22 million in a series B funding round.  This funding enables large scale production and sales of its game changing sugar reduction solution to the food industry, as it commercializes in Europe and North America.  The company also plans to expand its technology platform to include next generation products and flavors, such as salt.  The round, led by BlueRed Partners from Singapore, includes strategic investors: Südzucker, the largest European sugar company; Royal DSM, a global leader in science-based nutrition, health and sustainable living; and Singha Ventures, a corporate venture fund of Singha Corporation, one of Thailand’s largest food & beverage conglomerates.  Additional participants in the round included existing shareholders: Pitango Venture Capital, Jerusalem Venture Partners (JVP), Food Lab Capital, as well as new financial investors, including btov Partners, OurCrowd and La Maison.

The first product developed under DouxMatok’s proprietary platform is a sugar-based sugar reduction solution.  Food products made with this solution of 40% less sugar than when made with the original recipes, are proven to be the same quality without compromising taste, mouthfeel, or texture.  DouxMatok provides an answer to the growing concern from consumers around too much added sugar in their diets and the global call, including from regulators, for reduced sugar in food products.  The sugar reduction solution works by maximizing the efficiency of sugar delivery to the mouth’s sweet taste receptors, enhancing the perception of sweetness.  DouxMatok’s technology platform is backed by 20 granted patents, and has been developed for over 6 years by a leading multidisciplinary team of scientists with specializations in: material sciences, organic and green chemistry, sensory sciences, drug delivery, and food science.

Petah Tikva’s DouxMatok is pioneering the development of efficient flavor delivery technologies while improving the nutritional profile of food products.  Independent consumer and expert sensory panel tests, conducted by a Nielsen subsidiary, have confirmed that, when using DouxMatok sugar, it is possible to reduce more than 40% of the sugar content in a wide range of food products while retaining the same taste profile.  DouxMatok was awarded the Prime Minister of Israel Innovation Prize for 2018.  (DouxMatok 19.06)

Back to Table of Contents

2.14  Ford Opens Israel Research Center in the Heart of Tel Aviv’s Technology Community

Ford Motor Co. recently opened its Ford Research Center, Israel, in Tel Aviv’s burgeoning technology community.  The new center will serve as a research hub augmenting Ford’s global Research and Advanced Engineering team.  It also will support Ford’s automotive and mobility businesses by identifying technologies and start-up companies in the fields of connectivity, sensors, automated-systems research, in-vehicle monitoring and cyber security.

The Research Center, opened by Bill Ford, executive chairman, Ford Motor Co., will play a significant role as Ford pursues its vision to become the world’s most trusted company, designing smart vehicles for a smart world.  The center will include a vehicle lab to support proof of concept efforts and AI work conducted by the SAIPS team.  Ford has been working with local companies and partners in Israel’s tech community for many years.  Through this strong presence, Ford has been able to work with the best technology talent and specialized companies helping to push its research and engineering efforts forward.

Ford Research Center, Israel, will operate closely with Ford’s subsidiary, SAIPS.  SAIPS is Israel’s leading computer vision and machine learning company, which Ford acquired over nearly three years ago.

Ford has had a presence in Israel for nearly a decade working with local tech scouts to identify innovative emerging technologies.  In 2015, Ford was among the first major automakers to host a developer challenge in Israel, returning last year to Tel Aviv with its fourth annual MakeItDriveable start-up event, which originated in Israel and spread to other tech hotspots like Berlin, Dublin and Paris over recent years.  The Ford Research Center, Israel, is located in Tel Aviv.  The center joins Ford’s global network of research centers, including Aachen, Germany, Nanjing, China and Dearborn, Michigan, USA.  (aftermarketNews 18.06)

Back to Table of Contents

2.15  Maor Raises Close to $100 Million for its first Fund – MAOR 1

Maor GP, a Luxembourg based co-investment fund dedicated to Israeli-related technology, announced the final closing of its first fund, Maor 1, at its target close to $100 million.  Maor 1 is the first Luxembourg-based Israeli tech fund created to facilitate access of European investors and in particular European Family offices to the Israeli Technology ecosystem and opportunities.  Rothschild & Co is a cornerstone investor in the fund, comprising mainly European Family offices.

Maor is a Hebrew name and the informal translation of it is Explorer.  Maor’s mission is to explore and invest in the leading technology ecosystem of Israel while bridging the gap between Europe and Israel.  With a very strong local team in Israel and a very strong corporate network in Europe, Maor can directly source the best Israeli startups and help them grow in Europe, find partners, clients or acquisition targets and eventually create value for our investors.  (MAOR GP 21.06)

Back to Table of Contents

2.16  Yehuda Was the Leading Israeli Matzah in the US this Passover

Although most machine-made Matzah for Passover sold in the US is manufactured in Israel, with the exception of Streit’s, the leading Israeli selling brand was Yehuda, which also led all sales in the 5 lb. box category, according to Nielsen data.  Imported by Kayco (Kedem), the sales growth of Israeli matzah is noteworthy.  Streit’s remains the only domestic manufacturer of Passover matzah.  Even leader Manischewitz no longer manufactures in Newark but in Israel with its special method of baking the matzahs.  Despite some demographic shifts, matzah sales have soared in the US, topping $100 million a year.  Handmade shmurah matzah have also made huge strides growing by as much as 15%.  Yehuda Matzos are produced by Moshe Ludmir & Sons.  The Ludmir family began baking in Tzfat in 1921, moving to Jerusalem in 1949.  Yehuda has emerged as the leading bakery for machine-made matzahs with some of the best kosher certifications in Israel.  (KN 25.06)

Back to Table of Contents

2.17  Israeli-founded Businesses Contribute Significantly to New York State Economy

Israeli-founded companies are making a substantial impact on the New York State economy by generating significant revenue and hiring New Yorkers, according to the findings of a study released by the New York – Israel Business Alliance.  The independent study determined that Israeli-founded companies in New York directly contributed $18.6 billion in revenue in 2018.  The economic benefit to New York jumped to $33.8 billion when factoring in additional spending on goods and services in the local economy, representing 2.02% of the state’s Gross Domestic Product.  The 506 Israel-founded companies in New York State directly employed 24,850 New Yorkers and indirectly employed 27,502 when accounting for the additional demand for local goods and services.

The study focused on recent growth trends and found that from 2014 to 2016, Israeli companies secured $3.5 billion in venture capital funding and, in 2016 alone, were responsible for more than 20% of the total capital raised in New York State.  From 2016 to 2018, the growth continued. During those years, Israeli-founded businesses had a 9.5% year-over-year growth for direct revenue generated, while the rest of the state grew by 4.2%.  Further, Israeli-founded businesses added new jobs at double the state’s rate: Israeli companies saw 2.5% job growth while the rest of the state had 1.2%.

The report also identified industries ripe for development and growth, based on compatibility between key New York State economic development initiatives and Israeli expertise: agriculture, artificial intelligence, cybersecurity, drones, life sciences, and renewable energy.  (NYIBA 25.06)

Back to Table of Contents

2.18  Venn Raises $40 Million to Re-invent Neighborhoods for Better Urban Living

Venn announced the completion of its Series A round with a total funding to date of $40 million.  Investors include Pitango Venture Capital, Hamilton Lane, on behalf of the New York State Common Retirement Fund, and Bridges Israel.  Venn plans to use the investment to enhance R&D capabilities, refine Venn’s replicable and scalable model for urban revitalization, and increase operations from three cities to multiple cities across the U.S. and Europe, with the goal of bringing Venn to millions of people in 100 cities by 2030.

Currently operating in New York, Berlin and Tel Aviv, Venn is reimagining community life in a world where more people than ever are living in cities.  Housing shortages and soaring real-estate prices have led 35% of American urbanites to opt for developing neighborhoods.  Venn is pioneering a unique community revitalization model by managing homes and shared spaces on a neighborhood-scale, supporting local businesses, and facilitating resident-led events through a digital platform and ‘personal assistant’ app.  Through its investment and community-building in these areas, Venn aims to create urban neighborhoods that are more affordable but with no less vitality than the downtown core.

Tel Aviv’s Venn creates a new way of urban neighboring by managing homes, creating shared spaces, supporting hyperlocal business initiatives and services, programs, events, and facilitating community engagement – all on a neighborhood-wide level.  (Venn 25.06)

Back to Table of Contents


3.1  BSynchro Raises $1 Million to Transition Insurance Related Companies Into The Digital World

Beirut’s BSynchro Holding announced that it has raised $1 million of additional capital from its current shareholders Berytech Fund II and Phoenician Funds I.  BSynchro is a Beirut based regional software development and consulting company, currently operating in GCC, Levant, and Africa.  It also has a majority stake in a Bahraini based company, Arima, specialized in Core insurance and Reinsurance solutions.

The group specializes in the digitization processes of insurance related companies, offering state of the art front end solutions, and has a wide and diverse customer base of more than 80 clients across 25 countries.  BSynchro Holding received its first funds from Berytech Fund II and Phoenician Fund in 2016 to complete the development of its products.  It plans on going even further in its sales reach and innovation with this new round of investment.

The newly received funds will be invested in developing BSynchro’s multi-purpose suite of products dedicated to transitioning insurance related companies into the digital world in a speedy and affordable way, notably with an extensive use of new technologies such as Artificial Intelligence, Machine learning and Robotic Process Automation.  (BSynchro 23.06)

Back to Table of Contents

3.2  King Abdullah II Inaugurates Agricultural Project by Del Monte in Mafraq

King Abdullah inaugurated a leading agricultural project implemented by international food company Del Monte in partnership with the Hashemite Fund for the Development of Jordan Badia, at a total investment of JOD12 million, as part of the Sabha Development Project in Mafraq.  The project, which provides around 200 jobs for local residents and utilizes the latest agricultural technologies within the highest international standards, aims to develop the Jordanian agricultural product and increase agricultural exports to international markets.  King Abdullah toured the facility, which includes a nursery and greenhouses, and was briefed on the technology used to control the climate through an automated system.

The project extends over an area of 100 dunams from the Hashemite Fund for the Development of Jordan Badia in Sabha, producing mainly tomatoes in addition to lettuce, pepper and herbs.  Del Monte, one of the world’s leading producers of fruits and vegetables, started working on the Mafraq project in 2018.  According to Del Monte’s regional director, the project consists of 10 greenhouses with an area of 10 dunams each, in addition to an advanced nursery that supplies the project with seedlings, and a vegetable canning facility, as well as other facilities.

The Sabha Development Project, implemented by the Hashemite Fund for the Development of Jordan Badia, includes several agricultural projects such as pomegranate and olive cultivation, as well as fodder cultivation.  (Petra 12.06)

Back to Table of Contents

3.3 Raises $8.5 Million to Accelerate its Expansion Across the Middle East

E-commerce platform has raised a further $8.5 million in funding, as it accelerates its expansion across the Middle East and invests in new technology and recruitment to further enhance their customers’ experience.  Dubai’s Sprii is an online marketplace which connects mums to global brands.  The fund raising follows the company’s successful debut into Saudi Arabia earlier this year, with the latest injection of funds earmarked to support further expansion into Kuwait, Oman and Bahrain.  The technology platform is currently delivering 20% month-on-month growth, earning them a reputation as one of the most dominant forces within the regional e-commerce mum and baby market.  Sales in 2019 are on track to be triple those of 2018.  To date, Sprii has raised over $13 million of investment, which has enabled them to recruit tech and marketing talent to fuel this regional expansion.  Expert hires within the fields of big data and analytics, combined with a renewed focus on strategic business development, are expected as a result of this latest funding round.  (MAGNITT 24.06)

Back to Table of Contents

3.4  Etihad Airways to Launch AI Powered Crowd Sourcing Platform for Their Employees

UAE’s national airline, the Etihad Airways, has partnered with Vancouver based award-winning startup Swae, to launch an artificial intelligence based platform named iFikra.  This platform will aim to unlock the full potential of the Etihad workforce by making the employees capable of contributing to innovation.

iFikra is specifically designed to boost the collective creativity of the workforce by allowing every single employee to propose innovate solutions to the business challenges Etihad face, as well as untapped opportunities.  Through this new platform, AI will support and augment written business proposals submitted by the staff with an open feedback and collaboration loop.  The metrics would be transparency and meritocracy, to help escalating the most promising ideas forward.

For the first time ever, all the Etihad employees are getting some power to shape their organizational strategies through providing feedback and voting the best ideas.  Everyone gets to play a direct role in the decision making process this way.  The ideas which will graduate from iFikra will be given seed funding and support through Etihad’s Innovation Lab.  The lab gives the promising ideas and projects rapid trial and iteration to accelerate the delivery of prototypes, proof of concepts, pilots and minimum viable products.

Etihad launched the Etihad AI Academy back in January, in association with Microsoft.  The global airways giant is taking AI adoption very seriously and making strategic investments to make sure AI helps the company to remain competitive and distinctive in the digital age.  (Etihad Airways 13.06)

Back to Table of Contents

3.5  IBM Skills Collaborates with RIT Dubai for an Academy Program

Rochester Institute of Technology Dubai (RIT Dubai) has formed a partnership with IBM, in order to make the regional workforce more skillful in the upcoming days.  IBM is going to bring their IBM Skills Academy Program to the students of RIT Dubai to make them future-ready with skills in the fields of analytics and data science.

The IBM Skills Academy is the flagship training and certification program designed to reduce the skill gap between the market industry and the university.  Through this program, the students will not only be able to develop their skill sets, but also they will enhance their employability to fulfill the updated demands of the modern day job market.  IBM’s program will mainly help the students who are pursuing this Master’s degree, by formulating and teaching the introductory courses. Mentorship opportunities will also be available to these students.

Such collaborations are not new to RIT Dubai.  In 2017, an agreement was signed between RIT and Smart Dubai to create a specialized Master’s degree in Data science and Analytics.  (RIT 09.06)

Back to Table of Contents

3.6  Dubai Startup Zbooni Raises $1.1 Million in Funding

Dubai startup Zbooni, a tech app, closed its latest funding round of $1.1 million raised from Chalhoub Group and B&Y Venture Partners.  The amount raised will be used to expand operations.

Founded in 2017, the connected chat commerce app assists companies to boost sales via WhatsApp, Instagram and Facebook.  Zbooni connects merchants with customers while providing an easy way to make payments.  There is strong demand from businesses in the UAE for this service, with the transaction volumes consistently growing at above 30% month-on-month.  Transacting millions of dirhams of sales every month was a key milestone for the business to expand.

Zbooni was one of eight companies across the world, and the only one from the Middle East, to take part in a six-month incubator program at Facebook.  The app was entirely developed by an in-house team, and paired to payment gateway Payfort.  Recently, Stripe was also added as a payment gateway option.  Along with traditional businesses, Zbooni also works with those who may have side businesses or influencers to help them sell items and services directly through chat.  There are currently a range of businesses selling on Zbooni, including cake shops, artists, basketball clubs, fashion outlets and medical clinics.

At any stage, the merchant or customer can discuss additions or amendments to the order.  Both receive automated invoices as soon as a payment is made.  (Gulf Business 19.06)

Back to Table of Contents

3.7  Indian Fitness Brand Picks Dubai for First Overseas Foray

India-based integrated healthcare platform has entered the lucrative Dubai market, its first foray into the international market.  The Indian fitness chain has made a soft launch in Dubai by opening in first fitness center, in Dubai at Palm Strip Mall.  The company said it was hopeful of making its brand a big success in Dubai and elsewhere in UAE because of its USP of offering access to multiple formats through one subscription.

The Bengaluru-headquartered company was founded in 2016 with the aim to address preventive healthcare. has 160 centers spread across six cities in India and has plans to open 800 centers across 50 Indian cities by 2020.  The start-up, grown through its acquisitions of Fitness First, cult and tribe, is funded by leading investors including Accel Partners, Kalari Capital, Ratan Tata and IDG Venture. has so far raised over $200 million in funding.  (AB 24.06)

Back to Table of Contents

3.8  Russian Centre for Digital Innovation Opens in DIC-Dubai Internet City

The Russian Centre for Digital Innovation and Information and Communication Technologies, a new hub for Russian entrepreneurs, has recently opened at DIC- Dubai Internet City.  The objective of the new facility is to aid Russian businesses to launch and spread their operations across the MENA region.  The hub is facilitated by the Russian Export Centre (REC) and aims to feature as the premium business support platform for Russian tech firms in the region.  This is one of the largest projects taken by REC outside Russia and follows a MoU signed with DIC during last year’s GITEX.

Russian small and medium-sized companies will find a new home in the Russian Centre for Digital Innovations and ICT, and work with large Russian tech companies that operate on a global level.  The center will offer products and services in the fields of AI, Augmented Reality, VR and cloud hosting among many others.  (AB 24.06)

Back to Table of Contents

3.9  Tenderd Launches with Seed Round of $5.8 Million and an “All-Star” Cast of Investors

Dubai’s Tenderd, a heavy equipment rental marketplace for the construction industry in the MENA region, announced its seed funding round of $5.8 million from a spectrum of high profile San Francisco and international investors.  Leading the funding round is Y Combinator and BECO and also includes Paul Graham, Peter Thiel, Paul Buchheit, Justin Mateen, Matt Mickiewicz, VentureSouq, SOMA, Dynamo, and Global Founders Capital.

The $635 billion MEA construction market is the fastest growing at 9% CAGR, and Asia-Pac is the largest globally, at $5.1 trillion, growing at 6.3% CAGR.  Leveraging local knowledge with digital expertise, Tenderd aims to use their seed capital to streamline the equipment rental process and expand into neighboring strategic markets.  Once a contractor hires equipment from Tenderd, they have access to Tenderd’s unique tracking system powered by Artificial Intelligence to increase overall equipment productivity.  It also enables them to track and regulate emissions to run equipment more sustainably.  Equally, contractors with idle equipment can rent their equipment through Tenderd and maximize fleet utilization.  (MAGNiTT 11.06)

Back to Table of Contents

3.10  Xponential Fitness Signs Multi-Brand Master Franchise Agreement in Saudi Arabia

In its first-ever, multi-brand international agreement, Irvine, California’s Xponential Fitness, the largest curator of boutique fitness brands in the world, will now have an extensive presence in the Middle East.  The company announced the signing of a Master Franchise Agreement for Saudi Arabia – a development which will bring more than 50 Xponential Fitness studios to the country over the next three years.  Brands included in the development agreement are Club Pilates, Pure Barre, CycleBar, YogaSix and AKT.  With the boutique fitness industry rapidly gaining popularity across the globe, now is the perfect time to introduce niche fitness concepts to the Middle East.  The Xponential Fitness studios slated to open in Saudi Arabia will be female-only, in order to serve the growing population of women seeking fitness options in the wake of the country’s recent reforms.

The Saudi Arabian development will be led by the newly-established First Agility Company.  Part of the Fawaz Abdulaziz Alhokair Company (also known as Fawaz Alhokair Fashion Retail), it is the largest franchise retail operator in the Middle East with more than 1,750 stores across 13 countries.  Brands within their portfolio include Zara, Banana Republic, Mango and Nine West, among many others.  The Xponential Fitness expansion will begin with a five-brand flagship location in Riyadh, expected to open in October 2019.  (Xponential Fitness 18.06)

Back to Table of Contents

3.11  Averos Raises a Pre-Series A round from Saudi Aramco’s Wa’ed Ventures

Averos, a Saudi Arabian startup based out of Mecca, raised an undisclosed Pre-Series A funding round from Saudi Aramco’s Wa’ed Ventures.  This funding round came almost 3 years after its seed round, which it raised from UAE-based MultiLinks in August 2016.  Wa’ed Ventures was the only participating investor in the recent funding round.

Founded in 2015, Averos is a B2B startup that provides innovative tracking and analytics solutions to its customers, among which companies in logistics, travel, retail, and security.  With its unique technological solutions, Averos provides companies and their customers with full and real-time situation awareness of their environment, their customers, their staff and their valuable assets. Its products include sensors, scanners, and its software platform, improving its customers’ operational efficiency and their market positioning.

Besides expanding further into the Real-Time Location System (RTLS) and Location Based Systems (LBS) market globally, Averos aims to enter the Internet of Things (IoT) market, where it can leverage its core technology in providing sensor-based computing and communication solutions.  (MAGNITT 18.06)

Back to Table of Contents

3.12  L3 Technologies and Saudi Arabian Military Industries Enter Into Joint Venture

L3 Technologies signed a joint venture agreement with Saudi Arabian Military Industries (SAMI) to collaborate on electro-optical and infrared (EO/IR) and special mission systems projects within the Kingdom of Saudi Arabia (KSA).  The contract was signed during the Paris Air Show.  In February 2019, L3 and SAMI announced the signing of a Memorandum of Understanding (MoU) relating to the joint venture.

L3 Technologies designs and manufactures industry-leading multi-spectral and multi-sensor EO/IR imaging and targeting sensor systems in addition to fully customizable mission systems for air, land and maritime vessels.  Together, L3 and SAMI will indigenously design and implement these advanced technologies and solutions for a variety of customer-specific applications from a Center of Excellence that will be established in the Kingdom.

Launched in May 2017, Saudi Arabian Military Industries (SAMI) is a state-owned military industries company working under the directives outlined in the Saudi Vision 2030.  Aiming to be among the top 25 military industries companies in the world by 2030, SAMI is expected to play a key role in localizing 50% of the Kingdom’s total government military spending.  SAMI is combining the latest technologies and the best national talent to develop military products and services at par with international standards across four business divisions – Aeronautics, Land Systems, Weapons and Missiles, and Defense Electronics.  (L3 Technologies 18.06)

Back to Table of Contents

3.13  Saudi Arabia HVAC Market Growth and Demand Forecast, 2014-2024

The “Saudi Arabia HVAC Market by HVAC Type, by End-User, By region – Market Size, Share, Development, Growth and Demand Forecast, 2014-2024” report has been added to‘s offering.

The Saudi Arabian HVAC market is predicted to generate a revenue of $2.4 billion by 2024, advancing at a CAGR of 4.5% during the forecast period (2019-2024).  Rising investments in tourism-specific projects and commercial infrastructure and expansion in the hospitality sector are driving the growth of the market.

On the basis of ventilation type, the Saudi HVAC market is classified into humidifiers/dehumidifiers, air cleaners, air handling units, fan coil units, and ventilation fans.  Out of these, in 2018, ventilation fans held the largest revenue share in the market due to their broad range of applications, such as general ventilation for air circulation and for collecting dust particles in manufacturing units to prevent wear and tear of the machinery.

Based on fan coil units (FCU), the Saudi Arabian HVAC market is bifurcated into two-pipe and four-pipe FCUs.  Out of these, in 2018, the four-pipe FCU type contributed the higher revenue to the market.  This is attributed to the rising number of skyscrapers and commercial offices, big hospitals and airport development projects.  However, two pipe FCUs are increasingly being installing in residential settings.  In 2018, the Saudi Ministry of Housing ordered contracts for 19,000 housing units to be built in cities such as Al Khobar, Jeddah and Riyadh. Hence, residential units’ construction is anticipated to escalate the demand for two pipe FCUs in the 2019-2024 period.

On account of the growing hospital industry, Saudi Arabia is witnessing an increase in the HVAC system demand.  Owing to its religious significance, Saudi Arabia has become one of the most prominent tourist destinations across the globe, which is reflected in the growth of its hospitality industry.  In 2017, the number of rooms in the country rose by around 14.0% as compared to 2016.  Further, in 2018, nearly 40,000 guestrooms were under construction as part of 89 projects.  Looking at the surging demand for tourist accommodation, many international hotel chains are working to increase their presence in the country.

For example, in 2018, Marriott International planned to start nearly 29 new hotels, consisting of around 6,000 guestrooms, in accordance with Saudi Vision 2030.  As of 2019, Hilton Worldwide Holdings is planning to build approximately 35 new hotels in the coming three to five years.  Also, Radisson Hospitality publicized that it would, by 2020, open two new hotels in the country.  HVAC systems provide comfort as they have the ability to maintain the room temperature as per the need of guests.  Thus, the necessity of HVAC systems in modern hotels is resulting in the growth of the Saudi HVAC market.

Some of the key players existing in the market are Johnson Controls International, Ingersoll-Rand, Danfoss, Mitsubishi Electric Corporation, LG Electronics and Gree Electric Appliances of Zhuhai.  (R&M 21.06)

Back to Table of Contents

3.14  Car Imports to Saudi Arabia Decline by Over 20%

Saudi Arabia’s car imports dropped by more than a fifth in 2018 to 440,992, compared to 554,581 for the previous year.  Car imports last year were the lowest in 14 years, while it was the third consecutive year that the industry had witnessed a drop.  The value of car imports also dropped by 18.4% to SR35.6 billion in 2018, as opposed to SR43.6 billion in 2017.

According to official statistics, the Kingdom imported 113,659 sedan cars in 2018 – down 88,501 cars compared to the previous year when the imports were 475,722.  The number of imported trucks in 2018 were 44,464 against 67,247 in 2017, a drop of about 18.6%.  Meanwhile, the imports of trucks went down by 22,783 vehicles (about 33.9%) to reach 44,464 compared to 67,247 cars in 2017.  The imports of buses dropped by 2,333 cars (about 22.2%) to reach 8,169 from 10,502 the previous year.  (AB 16.06)

Back to Table of Contents

3.15  ExxonMobil & SABIC to Proceed with Gulf Coast Growth Ventures Project

ExxonMobil and SABIC decided to proceed with the construction of a chemical facility and a 1.8 million metric ton ethane steam cracker in San Patricio County, Texas.  The joint-venture between ExxonMobil and SABIC, called Gulf Coast Growth Ventures, received final environmental regulatory approval in June 2019 to build an ethane steam cracker, two polyethylene units and a monoethylene glycol unit.  Construction will begin in the third quarter of 2019 and startup is anticipated by 2022.

The project is expected to create more than 600 permanent jobs with average annual salaries of $90,000 per year.  An additional 6,000 high-paying jobs will be created during construction.  A preliminary independent study, conducted by Impact DataSource, estimates the project will generate more than $22 billion in economic output during construction and $50 billion in economic benefits during the first six years of operation.  The facility will produce materials used in the manufacturing of various consumer products including automotive coolants, packaging, agricultural film and building, construction materials and clothing.

Project construction will be led by four primary engineering, procurement and construction companies: The Wood Group, McDermott & Turner Industries Group, Chiyoda & Kiewit and Mitsubishi Heavy Industries & Zachry Group.  Gulf Coast Growth Ventures is a unique opportunity created by the abundance of low cost U.S. natural gas, and is part of ExxonMobil’s Growing the Gulf initiative, which outlined plans to build and expand manufacturing facilities along the U.S. Gulf Coast, creating more than 45,000 high-paying jobs across the region.

Ownership interests in the Gulf Coast Growth Ventures project is 50% ExxonMobil and 50% SABIC, with ExxonMobil as site operator.  ExxonMobil and SABIC bring unmatched expertise to this project, having worked together in petrochemical ventures for more than 35 years.  The Gulf Coast Growth Ventures project expands that successful international relationship.  (ExxonMobil 13.06)

Back to Table of Contents

3.16  Orcas Raises $500,000 in pre-Series A Round led by Algebra Ventures

Cairo’s Orcas, the mobile application that connects parents and students with tutors and babysitters, announced that it has raised $500,000 in a pre-Series A funding round led by Algebra Ventures, Egypt’s leading VC fund, with participation from NFX Capital.

Orcas’ marketplace addresses an enormous pain-point in a deeply fragmented market; providing a platform that connects thousands of students of all educational stages and systems with verified, user-rated and specialized tutors in a country where over 50% of its 22 million students receive private tutoring every year.  With over 20,000 students on the application, Orcas currently operates in Cairo, Alexandria, El Gouna and the North Coast.

This summer, Orcas is going to launch a new feature, called Discoveries.  Designed with school summer vacations in mind, Orcas Discoveries are events that allow children to expand their horizons and explore a range of exciting activities.  Offering everything from cooking and coding workshops to art, culture, and music trips in a variety of languages – they’re designed to safely engage children while developing their skills and enriching their experiences.  (Orcas 12.06)

Back to Table of Contents

3.17  Swvl Raises $42 Million for African Expansion

Swvl, an Egyptian app for booking buses, has raised $42 million as it looks to expand into other parts of Africa, including Nigeria.  The two-year-old company, which started in Cairo and also operates in Alexandria and Nairobi in Kenya, received funds from venture-capital firms including Sweden’s Vostok, Dubai-based BECO Capital, otf Jasoor Ventures, Sawari Ventures, DASH Ventures, China’s MSA and Endeavor Catalyst, based in New York.

Swvl carries hundreds of thousands of customers each month.  Uber and Careem have both launched bus services in Cairo in the past year.  Along with Swvl, they’re exploiting growing demand among the city’s 20 million people for transport options that are cheaper than taxis but more convenient than public buses, which are often perceived as unreliable and dangerous.  (Swvl 20.06)

Back to Table of Contents


4.1  Kfar Saba to Install 500 Electric Car Charging Points

Israel’s Kfar Saba municipality will deploy a network of 500 charging points for electric cars on the city streets, sources inform “Globes.”  In contrast to other cities, Kfar Saba is deploying its network throughout the city, not in a limited area.  The charging points will use alternating current (AC) with a 22 kilowatt-hour capacity, except for two speedier stations with 50 kilowatt-hour capacity.  The points will be in municipal parking lots and on sidewalks, and are designed to encourage residents without their own parking spaces to buy electric cars.  The municipality’s NIS 15 million tender was jointly won by charging point importer EV Edge, a subsidiary of George Horesh’s Union Motors group, and Milgam, owner of advanced parking services company Pango.  Some 40 stations will be installed in all parts of the city in the first stage. According to the municipality’s forecast, 40% of usage time will be by Kfar Saba residents through permanent arrangements, 20% by companies through permanent arrangements, 10% by the municipality’s vehicles, and 20% by occasional customers.

The Kfar Saba municipality says that deployment of the points follows a comprehensive analysis of the demand for charging.  This is why Kfar Saba is starting with full, albeit gradual, deployment of the points without a pilot.  The charging plan is part of a large-scale plan for a transition to cleaner transportation and reducing the use of cars.  Rental electric cars will later be offered, and measures will be taken to encourage the use of light transportation, such as e-scooters, while public transportation will be made more efficient.

Tel Aviv and Kfar Saba are the only two cities planning a municipal charging network without help from the Ministry of National Infrastructure, Energy and Water Resources.  The ministry recently published the winners in three tenders for installing charging stations in cities, shopping and leisure centers, and companies.  The winners will receive grants totaling NIS 12 million.  (Globes 20.06)

Back to Table of Contents

4.2  DEWA Launches Tender for Fifth Phase of Giant Dubai Solar Park

Dubai Electricity and Water Authority (DEWA) on 15 June said it has issued a tender for the fifth phase of the Mohammed bin Rashid Al Maktoum Solar Park.  Under the tender, the fifth phase will provide 900 megawatts (MW) of electricity using photovoltaic solar panels, based on the independent power project (IPP) model.  The move supports the objectives of the Dubai Clean Energy Strategy 2050 to provide 75% of Dubai’s total power output from clean energy by 2050.  The deadline to submit the tenders is 22 August, with the winning bid owning 40% of the company operating the project, and DEWA owning the remaining 60%.  The winning bidder will sign an agreement with DEWA to purchase the generated power for 25 years.

DEWA said it received letters of intent for the tender from 64 companies, adding that the fifth phase of the solar park will be commissioned in stages starting from the second quarter of 2021.  The Mohammed bin Rashid Al Maktoum Solar Park is the largest single-site solar park of its kind in the world. It will have a capacity of 5,000MW by 2030 with investments of AED50 billion.  The 13MW first phase became operational in 2013 using photovoltaic solar panels while the 200MW photovoltaic second phase of the solar park was operational in March 2017.  The 800MW photovoltaic third phase will be operational by 2020 while the fourth phase will feature the tallest solar tower in the world.  (AB 15.06)

Back to Table of Contents

4.3  Rooftop Solar Panels to be Installed on 5,000 Emirati Homes

Etihad Energy Services Company (Etihad ESCO) has announced plans to install photovoltaic solar panels on the roofs of 5,000 Emirati-owned homes in Dubai.  With all contractors on board, site surveys have been completed and material procurement, mock-ups and outreach activities are currently in progress, the company said in a statement.  The project will see Etihad ESCO install 65,000 PV panels, 295,000 LED lights and 50,000 water savers at Emirati villas.

It said the light and water retrofit is expected to generate energy and water savings upon completion, with the installation of solar PVs alone set to save 31,102,500 kWh energy.  It added that the initiative, scheduled to be completed by November, will lead to the reduction of CO2 emissions by 21,139 tons annually.  (AB 21.06)

Back to Table of Contents

4.4  Egypt’s NREA Plans 200 MW Red Sea Wind Farm

Egypt’s New and Renewable Energy Authority (NREA) plans to build a 200-megawatt (MW) wind farm plant near the Gulf of Suez.  Feasibility studies are being conducted for the new project, in cooperation with international institutions to identify bird migration seasons and ensure environmental protection.  Investments in the project are expected to reach EGP 4 billion, according to the NREA, which also revealed that wind farm will be built by private-sector companies through international loans, but will belong the authority.  Egypt targets generating 20% of its energy mix from renewable sources by 2022, and raise this share to 42% by 2035, in line with NREA’s strategic goals.  (EOG 19.06)

Back to Table of Contents

4.5  Morocco to Inaugurate World’s Largest Seawater Desalination Station in 2021

Construction work on the world’s largest seawater desalination plant is well on track.  Located in Morocco’s southern coastal city of Agadir, the Douira seawater desalination station project has a MAD 3 billion budget and a treatment capacity of around 75 million cubic meters of desalinated water per year.  The plant is expected to produce nearly 275.000 cubic meters of desalinated water daily before reaching its maximum capacity of 450.000 cubic meters per day.  The station will supply the region’s population with drinking water and irrigate a perimeter of 15.000 hectares in the region of Chtouka Ait Baha.

Farmers have also contributed MAD 10.000 to the financing of the station.  The government has promised them desalinated water for irrigation at a low price of MAD 5 per cubic meters in exchange for the investment in construction.  Spanish company, Abengoa, is in charge of construction which will be functional in 2021.  (MWN 17.06)

Back to Table of Contents


5.1  Lebanese Average Annual Inflation Rate at 3.58% for May 2019

Lebanon’s average consumer prices rose by 3.58% year-on-year (y-o-y) by May 2019 compared to an annual uptick of 5.68% recorded in the same period of 2018, according to the Central Administration of Statistics (CAS).  The rise in the first 5 months of the year mainly came on the back of annual upticks registered across the major components.  The average costs of “Housing and utilities” (including: water, electricity, gas and other fuels), which grasped a combined 28.4% of the Consumer Price Index (CPI), rose by 3.72% y-o-y by May 2019.  Average “Owner-occupied” rental costs (constituted 13.6% of this category) grew by a yearly 2.76%.  In turn, the average prices of “water, electricity, gas, and other fuels” (11.8% of housing & utilities) recorded a yearly uptick of 4.93% over the same period. In addition, the average prices for “Food and non-alcoholic beverages” (20% of the CPI) and “Education” costs (6.6% of CPI) registered yearly upticks of 6.21% and 5.17%, respectively, by May 2019.  Average prices of “Clothing and Footwear” (5.2% of the CPI) also rose by an annual 14.05% in the first five months of the year.  Meanwhile, the average consumer prices of “Health” (7.7% of the CPI) and “Transportation” (13.1% of the CPI) recorded the respective marginal declines of 0.47% and 0.75% y-o-y.  The latter slipped as a result of the lower average oil prices which retreated from $70.22/barrel by May 2018 to $66.75/barrel in the same period this year.  (CAS 24.06)

Back to Table of Contents

5.2  Beirut Monthly Occupancy Rate at 85.4% in April 2019

Tourism in Lebanon has been slowly getting back on its feet since the beginning of 2019, partly thanks to a diversification of tourist nationalities, but also to some promising political and economic developments which included plans to set a budget and reforms to kick start the economy.  According to the EY Middle East Benchmark Survey, Beirut’s hospitality market witnessed a growth in all KPIs.

In details, occupancy recorded a significant increase, adding 13.2% to 73.7% by April 2019.  The Average Daily Rate (ADR) also rose from $174 by April 2018 to $193 by April 2019.  This resulted in significant growth in revenue per available room (RevPAR) from $105 to $142.  In fact, the number of European tourists alone rose by 5.7% annually to 80,226 tourists by February 2019, while the number of passengers added an annual 2.73% to 1.75M over the same period.  The improvement across the KPIs may also be linked to the KSA lifting its travel ban against Lebanon in February of this year.  By February 2019, tourists from the KSA actually climbed from 6,009 to 10,041, knowing that they are the largest spenders.  Regionally, Cairo’s hospitality market also recorded upticks across the board.  It saw an increase in Occupancy by 4.5%age points to 79.1% by April 2019.  Similarly, ADR also increased by 6.1% to $111, resulting in an increase in RevPar by 12.5% to $87.  The strong performance of tourism in Egypt may be attributed to several tourism campaigns and stable macroeconomic conditions.  In turn, Dubai’s hospitality market witnessed a drop in all KPIs by April 2019.  It saw a decrease in occupancy by 2.1% to 79.1% by April 2019 year-to-date.  ADR also decreased by 12.9% to $282 resulting in a 15% decline in RevPar to $240.  The drop can partly be explained by the opening of new luxury properties and hotels, resulting in an oversupply of hotels and lower ADRs.  (E&Y 18.06)

Back to Table of Contents

5.3  World Bank Approves $200 Million Project to Support Jordanian Health Services

On 25 June, the World Bank approved a $200 million project to support the Government of Jordan maintaining the delivery of critical primary and secondary health services to poor uninsured Jordanians and Syrian refugees at Ministry of Health facilities.  The project represents an additional financing to the Jordan Emergency Health Project ($50 million) approved back in June 2017, which was also part of a larger $150 million project financed in parallel by the Islamic Development Bank.  Over the past year, the project provided vital health care services to target populations, 2.1 million primary health care services and 2.9 million secondary health care services.

The additional financing includes a contribution of $58.9 million from the Global Concessional Financing Facility (GCFF) and will help the Ministry of Health continue to provide critical health care services to target populations at a time when the influx of Syrian refugees to the country continues to put severe strains on the delivery of vital basic services.  The project will reimburse the Ministry of Health through results-based financing for primary and secondary health care inpatient and outpatient services provided at health care facilities nationwide.  (Petra  25.06)

Back to Table of Contents

5.4  Jordan to Secure €20 Million EU Grant

Jordanian Minister of Planning and International Cooperation Ississ and EU Commissioner for Neighborhood Policy and Enlargement Hahn signed a €20 million EU grant to Jordan as part of the EU’s aid to Jordan in 2018 for a new project titled “Innovation for Institutional Growth and Job Opportunities” that is aimed at contributing to the governmental efforts exerted in development and reform.  The minister highlighted the importance of the visit in creating the atmosphere to develop shared point of views between the EU and the European financial institutions on the economic situation in Jordan and the reality of reforms that have been carried out and on emphasizing international support to Jordan.

He said that the EU has followed through on its commitment to offering Jordan with some €183 million worth of grants to support implementing programs in the fields of social security, developing the private sector, encouraging innovation for institutional growth, creating job opportunities offering education opportunities and supporting the youth and economic reforms.  He added that around €23 million worth of contracts have been signed and negotiations between the two parties are underway to sign the rest before the end of the year.  The EU will also offer around €71 million to the treasury before the end of the year in grants targeting microfinance, renewable energy, solid waste, employing and social integration skills, supporting the rule of law and developing the private sector.  (Petra 24.06)

Back to Table of Contents

5.5  IMF Mission in Jordan to Follow up on Reforms and Discuss Future Cooperation

On 16 June, an International Monetary Fund (IMF) mission began its visit to the Hashemite Kingdom as part of efforts to support and follow up on the implementation of financial and structural reforms.  Jordan’s Finance Ministry said that the visit came after the global lending institution concluded its second review of the national economy’s performance and issued its report.  The members of the mission met with Finance Minister Kanakrieh, Planning Minister Al-Ississ, Central Bank of Jordan (CBJ) Governor Fariz and other officials in relevant public departments.

Earlier this year, an IMF mission visited Jordan to conduct the second review of the national economy’s performance under the Extended Fund Facility (EFF) and, after its completion of the review, it issued a statement concluding that its outlook “brings renewed momentum despite persistent challenges”.  The IMF mission is expected to discuss during the current visit the remaining reviews as well as future cooperation between the Kingdom and the fund.

Jordan and the IMF signed a 36 month, $700 million Extended Fund Facility (EFF) program in 2016, under which the two sides agreed on six conditions that aim at reducing public debt to safe levels and stimulating the economy.  The controversial Income Tax Law, which went into effect at the beginning of this year, is part of fiscal reforms under the program and its endorsement was a necessary step for conducting the second review of the economy under the EFF program.  Last month, the government said it is in discussions with the international lending institution to start a new program for development purposes.  (JT 16.06)

Back to Table of Contents

5.6  Jordan’s Budget Deficit Falls During First Third of 2019

Jordan’s public budget deficit after grants has dropped to JOD303.7 million by the end of April, compared with JOD377.8 million during the same period of last year.  The Finance Ministry added that after grants, the budget deficit is expected to amount to JOD645.6 million by the end of the year, according to the Budget Law’s estimations.  Meanwhile, domestic revenues increased by JOD93 million by the end of April, reaching JOD2.4826 billion, compared with JOD2.3896 billion last year.  External grants amounted to JOD84.6 million by the end of April, compared with 2018’s JOD74.1 million for the same period.  Expenditure stood at around JOD2.871 billion by the end of April, 2019, compared with some JOD2.842 billion during the same period of 2018.  Meanwhile, the public debt stood at 28,956 billion, which constitutes 94.4% of the estimated GDP for the end of April, compared with JOD28,308 billion that constituted the same value of the GDP during the same period of 2018.  (JT 18.06)

Back to Table of Contents

5.7  Amman to Issue $300 Million in Bonds to Cover Eurobond Costs

Amman issued US-dollar bonds to the local market on 18 June at an estimated value of $300 million.  The bonds will be used, along with a number of other funding sources, to finance budgetary expenses and contribute to covering the payment of a $1-billion Eurobond, which was due on 23 June.  Minister of Planning and International Cooperation and State Minister for Economic Affairs Al-Ississ noted a $725-million instalment from the World Bank’s $1.45 billion loan to Jordan, received earlier, as the funding source to cover the remainder of the Eurobond payment.  The World Bank Group had agreed to provide Jordan with the loan at a 4% interest rate and with a four-year grace period.  The terms of the loan are concessional, and the maturity of the loan is for 34 years.

The government had announced the financial commitments due this year in the Budget Law, in addition to the means of meeting them, the sources said, explaining that with the issuance of the dollar bonds, the required sum will be exceeded.  Paying back the costs of the bonds on time will not impact the Kingdom’s credit in foreign currency, which exceeds $13 billion.  (JT 14.06)

Back to Table of Contents

5.8  Jordanian Building Permits Drop 54% During First Quarter of 2019

Jordanian building permits fell by 54.7% in the first quarter of 2019 compared with the same months of last year, according to a Department of Statistics’ (DoS) monthly report.  According to figures, buildings licensed in the first quarter of this year accounted for 2,222 thousand square meters, compared with 4,908 thousand square meters during the same period of 2018.  Residential buildings accounted for 1,707 square meters of the total licensed areas, compared with 3,576 thousand square meters during the same period of 2018, a 52.3% decline.  Licenses for non-residential buildings dropped by 61.3% to 515,000 square meters in the first quarter of 2019, compared to 1,332 square meters licensed in the same period of 2018, revealed the to DoS figures.  (Petra 19.06)

Back to Table of Contents

►►Arabian Gulf

5.9  UAE’s First Nuclear Power Plant Set to Begin Operation by Early 2020

The UAE’s first nuclear power station is set to start operating by early 2020, Nawah Energy Company said on 24 June.  Nawah said it is preparing to commence operations of the first unit between the end of 2019 and early 2020, pending regulatory approval.  Nawah added it has signed a long term maintenance services agreement with Korea Hydro & Nuclear Power (KHNP), supported by KEPCO Plant Service & Engineering (KPS).  Nawah, the subsidiary created by JV partners Emirates Nuclear Energy Corporation (ENEC) and Korea Electric Power Corporation(KEPCO) to operate and maintain the Barakah Nuclear Energy Plant, said construction of the four reactors was 93% completed.

Under the scope of the contract, KHNP and KPS will provide maintenance services to support routine and outage maintenance activities of the four units of the Barakah Nuclear Energy Plant, located in the Al Dhafra region of Abu Dhabi emirate.  KHNP and KPS will also provide manpower in the form of supervisory and management experts, as well as maintenance leadership.  KHNP, which operates and maintains the Shin Kori 3 and 4 nuclear energy plants in South Korea, will conduct testing, diagnostics, inspections, maintenance and replacement services for both the nuclear and non-nuclear components of the Barakah plant.  Nawah, as the future holder of the Operating License from the UAE’s independent regulator, the Federal Authority for Nuclear Regulation (FANR), will hold all regulatory responsibilities for operations and maintenance of the Barakah plant.

Construction of Barakah unit 1 began in 2012 and was completed in 2018. In parallel, construction of units 2, 3 and 4 is progressing and the overall completion of the Barakah plant is now more than 93%.  (AB 24.06)

Back to Table of Contents

5.10  New UAE Law to Protect Public from Genetically Modified Food Risks

The UAE recently announced that it is introducing a Federal Law on Biosafety of Genetically Modified Organisms.  The Cabinet-approved law is designed to safeguard public health from risks linked to GMOs or their products.  The new law in the UAE comes a year after it was announced that Dubai Central Laboratory was carrying out screening of foods to ensure that GMOs were labelled correctly.

In 2011, a study by scientists at Abu Dhabi Food Control Authority confirmed that GMO foods were being sold in the Emirates, with 16 out of 128 food samples tested containing GMO material, mostly soya or corn.  The authors noted at the time that there was no legislation on GM labelling and the cultivation of GM crops in the UAE.  Currently, about one in three countries worldwide has mandatory GMO labelling.

At a discussion at the UAE’s Federal National Council in 2014, members were told that the concerns linked to GMOs were about their potential environmental and biodiversity effects, not food safety.  More recently, a technique known as gene editing was developed.  This involves using specialized proteins that can make precise changes to an organism’s genetic material, which can include adding or removing a section of DNA.  (The National 16.06)

Back to Table of Contents

5.11  How UAE Traffic Congestion Compares Globally

Traffic congestion in Dubai is improving, according to new research, but motorists are still spending an average of an extra 23% time sitting in jams.  The TomTom Traffic Index, a global report detailing the traffic situation in 403 cities in 56 countries around the world, said that motorists spent 4% less time in congestion last year compared to 2017 (27% extra time).  The research showed that congestion levels in morning rush hour added an average 34% to travel times while evening travel peak added 48%.

Dubai ranked 202nd in the list while in Abu Dhabi, which ranked 396th, motorists add an extra 11% travel time stuck in traffic, unchanged compared to 2017.  Congestion levels in morning rush hour in the UAE capital added an extra 19% in travel time and 18% in the evenings.

Globally, Mumbai took the top spot in the list this year with drivers in the Indian city expecting to spend an average of 65% extra travel time stuck in traffic, followed by Bogota (63%), Lima in Peru (58%), New Delhi in India (58%) and Moscow (56%).  (AB 17.06)

Back to Table of Contents

5.12  Dubai Private Sector Business Activity Rises to Record High

Total business activity in Dubai’s private sector non-oil economy increased at its strongest rate for nine years in May, according to new research by Emirates NBD.  The seasonally adjusted Emirates NBD Dubai Economy Tracker Index said activity growth remained partly driven by competitive pricing, notably in the construction and wholesale and retail sectors.  The index rose to a 52-month high of 58.5 in May, from 57.9 in April, reflecting sharper growth of total activity and new business, while the contribution from employment was almost neutral.

Wholesale and retail remained the best-performing of the three key monitored sectors in May (61.9), mainly reflecting a comparatively strong increase in new business and some employment growth.  Travel and tourism registered the second-strongest overall improvement in business conditions on record (59.5) despite a slight fall in jobs, while construction (54.6) was in line with its long-run trend.

The rate of growth in total non-oil private sector business activity in Dubai accelerated for the fourth time in the first five months of 2019, to a new series-record high.  Growth rates were at new peaks in travel and tourism and wholesale and retail, while construction posted the second-fastest increase on record.  In contrast, employment in the non-oil private sector rose only fractionally in May. Although the strongest since July 2018, the rate of job creation remained much weaker than the long-run trend.  (AB 17.06)

Back to Table of Contents

5.13  Saudi Arabia Becomes the First Arab State to Receive FATF Membership

Saudi Arabia has become the first Arab country to be granted full membership of the Financial Action Task Force (FATF) following the group’s annual general meeting in the US.  The kingdom’s accession came as the global money laundering watchdog celebrated the 30th anniversary of its first meeting held in Paris in 1989.  Saudi Arabia which had received an invitation from the FATF at the beginning of 2015 to join as an “observer member”, was admitted into the organization after the group’s meeting in Orlando, Florida, on 21 June.

Saudi Arabia had been a founding member of the MENA arm of the group since November 2004, and its full membership came after it was reported the kingdom had made “tangible progress” and for its efforts in implementing the FATF’s guidelines.  The group is responsible for issuing international standards, policies and best practices to combat money laundering, terrorist financing and proliferation.  With the kingdom becoming a FATF member, the number of permanent members in the group is now 39.  (IANS 22.06)

Back to Table of Contents

5.14  Unemployment Rate Continues to Decline in Saudi Arabia

The unemployment rate in Saudi Arabia has reduced to 12.5%, the lowest since the last quarter of 2016, according to the General Authority for Statistics (GaStat).  There have been impressive changes in the Saudi labor market over the last two years.

Probably the most optimistic thing is the decline in youth unemployment.  Youth (ages 20 to 24 years) are receiving more employment opportunities compared to the past few years.  Youth unemployment declined from 36.6% in Q4/18 to 36.3% in Q1/19.  In addition, female participation in the labor force has continued to increase. In the previous quarter it was 20.2 compared to this quarter’s 20.5%.  More female engagement in the workforce has contributed heavily in declining the overall unemployment rate.

There was also a decline in the total number of foreign workers in the Saudi labor market.  As almost 185,000 workers have left the market during Q1, the number of foreign workers has declined by almost 1.8 million since 2017.  The Saudi Ministry of Labor announced employment of over 64,000 Saudi citizens via quite few agreements with both private and public entities.  This number consists of 8% of the total amount of unemployed persons in the Kingdom.  (AB 19.06)

Back to Table of Contents

5.15  Saudi Arabia Offers Permanent Residency to Expats for $213,000

Saudi Arabia has opened applications for a permanent residency program designed to attract foreign investment to the kingdom, but it will cost a hefty 800,000 riyals ($213,000).  There’s also a cheaper option, with a one-year renewable residency costing 100,000 riyals.  The so-called premium residencies will allow foreigners to buy property and do business without a Saudi sponsor, switch jobs and exit the kingdom easily and sponsor visas for family members, according to the website for registrations.  As well as the paying the high fee, applicants must be at least 21 years old, prove financial solvency and have a clean criminal record and bill of health.

The program approved in May is the latest sign of how the quest for non-oil revenue is prompting Gulf nations to rethink the role of foreigners in their societies.  It’s a landmark move in a region where many overseas workers are subject to some of the world’s most restrictive residency rules.  The United Arab Emirates approved a plan this year to allow wealthy foreigners to apply for a 10-year stay.

While Saudi Arabia is seeking to encourage the affluent to stay, monthly fees imposed on foreign workers and their families, along with sluggish economic growth, have prompted hundreds of thousands of expatriates to leave.  The levy is designed to spur private businesses to hire Saudi nationals.  The new permanent residency system could prove controversial among Saudis at a time when unemployment is at 12.5%, nationalism is surging and xenophobia is not uncommon.  Slogans like “Saudi is for Saudis” are common on social media, and a recent opinion piece in a newspaper argued that the kingdom could deport all its Lebanese residents without consequence.  (AB 23.06)

Back to Table of Contents

►►North Africa

5.16  Egypt’s New Budget and Development Plan Approved by Parliament

In a plenary session held on 24 June, Egyptian MPs voted in favor of approving the country’s new budget and sustainable development plan for 2019/20.  The budget is estimated at EGP 1.979 trillion (32.1% of GDP), expenditures are valued at EGP 1. 574 trillion (25.6%), and revenues are estimated at EGP 1.424 trillion (10.6%).  As a result, a monetary deficit of EGP 440,134 billion is expected.

A parliamentary report said that EGP 301.1 billion (4.9% of GDP) has been earmarked for salaries and wages.  The budget allocated EGP 569 billion (9.2%) to serve interest rate payments on local and foreign loans.  On the other hand, allocations earmarked for social protection measures are estimated at EGP 327.7 billion (5.3% of GDP) compared to EGP 328.2 billion last year, or a drop of EGP 592 million (0.2%).

The report also says that fuel subsidies will be cut from EGP 89.75 billion last year to EGP 52.963 billion this year; a drop of EGP 36.112 billion (40.5%).  Electricity subsidies will be also cut by EGP 12 billion (75%), from EGP 16 billion last year to EGP 4 billion in the new fiscal year.

The report said that the budget aims to push the economic growth rate to 6% in the coming year and reduce the budget deficit to 7.2% of GDP (compared to 8.4% last year).  It also aims to boost government investments by 30%, or EGP 130 billion from last year, reduce public debts to 89% of GDP and to 80% in 2021/22.  (Al Ahram 25.06)

Back to Table of Contents

5.17  Egypt Reaches $500 Million Settlement with Israel Electric Corp

Egypt has signed a $500 million settlement with state-owned Israel Electric Corp over a defunct natural gas deal, the Egyptian General Petroleum Corporation and Egyptian Natural Gas announced on 16 June.  Under the agreement, Egypt will pay the amount over a period of eight-and-a-half years in exchange for the Israeli company dropping all other claims resulting from a 2015 arbitration decision.

The International Chamber of Commerce in 2015 ordered Egypt to pay Israel Electric about $1.8 billion in compensation after a deal to export gas to Israel via pipeline collapsed in 2012 after attacks by terrorists in Egypt’s Sinai peninsula.  Egypt appealed the decision and began settlement discussions.  The EGPC and EGAS statement said the agreement was reached with government support and as part of efforts to ensure a “conducive investment environment.”

Israel’s Delek Drilling and its partner Noble Energy signed a landmark deal early last year to export $15 billion in natural gas from Israeli offshore fields Tamar and Leviathan to a customer in Egypt.  Delek Drilling said on 2 June that the company hopes to begin commercial sales of natural gas to Egypt by the end of this month.  Israeli officials called it the most significant deal to emerge since the neighbors made peace in 1979.  (IH 17.06)

Back to Table of Contents

5.18  Egypt’s Ministry of Petroleum to Implement $15 Billion Investments for 11 New Projects

Egypt’s Ministry of Petroleum and Mineral Resources announced that it aims to implement 11 new projects for the development of new gas fields with investments of about $15 billion until mid-2022.  According to the ministry, this comes as result of achieving self-sufficiency and increasing natural gas production after the implementation of 27 projects to develop natural gas fields, especially in Zohr, west of the Nile Delta, Norse and Atoll, with total investments of $ 21 billion and production of about 6.8 billion cubic feet of gas per day (bcf/d) and 41.3 thousands condensates barrels per day (b/d).  Hence, natural gas production increased by 50% in 2018 compared to 2016, and then doubled the following year by 100% in the same period.  (EOG 12.06)

Back to Table of Contents

5.19  Egypt’s Oil, Gas Production Hits Record Level at 1.9 Million boe/d

The Egyptian petroleum sector has achieved the highest production rate of crude oil and natural gas in its history, as it amounted to about 1.9 million barrel of oil equivalent per day (boe/d) of oil, gas, and condensates.  Minister of Petroleum El Molla announced this during his visit to Paris to attend an international conference organized by the Observatoire Mediterranien de l’Energie (OME) to discuss the role of natural gas in the Mediterranean Region.  The Minister said that this comes as Egypt aims to boost its production, which is a result of recent new gas discoveries.  According to the Ministry of Petroleum and Mineral Resources, the oil sector recently achieved self-sufficiency of natural gas at the end of September 2018, which enables Egypt to convert from being a liquefied natural gas (LNG) importer in 2015 to an exporter and achieve a surplus in production.  (EOG 12.06)

Back to Table of Contents

5.20  US Market Represents 3% of Tourist Arrivals to Egypt

The United States market represents 3% of incoming tourism to Egypt, Egyptian Minister of Tourism Rania Al-Mashat said during her meeting with the US delegation participating in the 110th session of the Executive Council of the World Tourism Organization (UNWTO) held in June in Baku, Azerbaijan.  Al-Mashat asserted that her ministry is working to increase the number of American tourists in Egypt.

According to the State Information Service (SIS), the year 2010 was the best year for American tourist arrivals to Egypt, where more than half a million tourists visited the North African country, representing 3.8% of the total tourist arrivals in Egypt in the same year.  The number of American tourists declined after 2010.  In 2015, only 294,000 Americans visited Egypt, representing only 3.2% of total tourist arrivals to the country in the same year.  (Al Ahram 19.06)

Back to Table of Contents

5.21  Morocco Unveils Its Study on Ditching Clock Change, Sticking to GMT+1

The Moroccan government has finally released its much-awaited study on the government decision to remain on Daylight Savings Time.  The 24-page study shows several sections, including the economic and social impacts.

The Ministry of Administration Reform published the study, claiming that it shows an “overall” positive impact.  The study claims that the adoption of the DST year-round contributes to maintaining the stability of the population’s health as it stops the clock change several times.  However, the study acknowledges that citizens would face some difficulties during the first days of the change, especially for children and elderly people.  The study reported that the effects during the first days are not a source of concern.

The study also emphasized that citizens don’t experience increased stress due to lack of public transportation as the companies concerned fixed their schedule to provide services throughout the day.  However, the study emphasized that the government should reinforce public transportation in rural areas.  Airlines are not affected unless an unexpected change in the schedule is not reported in a timely manner.

According to the document, the study examined several aspects, particularly the impact of adhering to GMT during winter.  The study also stipulated that the DST will contribute to saving more energy.  The study claims that Morocco would achieve additional energy savings during the winter period estimated at 37.6 GWh, in addition to saving hydrocarbons with a financial profit of MAD 33.9 million during the same period.  The study also claimed that Morocco managed to reduce carbon dioxide emissions of 11,444 tonnes.

Despite the outrage among parents, who strongly condemned the change after decision, the study found no negative impacts due to the implementation of DST year-round.  The study said that there is a weak link between school performance and change in the hour, emphasizing that there has been improvement in grades instead of weak education performance speculated by some news outlets after the adoption of the change.  The comparison did not show any difference of absenteeism among students after the change, adding that absenteeism increased during the first weeks after the decision as some students accompanied their parents to protests against the change.

On 26 October 2018 the government council adopted Draft Decree 2.18.855, adding 60 minutes to the standard time in the country year round.  The decision angered many Moroccan people who condemned the decision.  The government released the study after several months of promises to disclose the findings.  Previously, Morocco switched the clock every summer to DST, GMT+1, and returned to the old standard time, GMT, for a period when Ramadan fell in the summer.  After the adoption of Decree 2.18.855, Moroccans reset their clocks now only twice before and after Ramadan.  (MWN 16.06)

Back to Table of Contents

5.22  Over 50,000 Israeli Tourists Visit Morocco Every Year

In the absence of diplomatic relations between Israel and Morocco, a notable number of Israeli tourists visit the North African country annually.  Statistics show that over 50,000 Israelis visit Morocco every year.

Once a year, Jewish Moroccans from Morocco and around the world flock to Essaouira to celebrate the Hiloula of Saint Abbi Nessim Ben Nessim.  In addition to the Hiloula, Morocco’s tourism assets have been attracting travelers from across the globe.  Tourism is one of Morocco’s strongest industries and is a driving force for the country’s Gross Domestic Products (GDP).

In addition to Israelis visiting Morocco, a notable number of Moroccans also visited Israel in 2018.  In May 2019, the Population and Immigration Authority announced that 2,108 Moroccans visited Israel in 2018.  The statistics revealed that nearly 55,000 tourists from countries which share no diplomatic ties with Israel, visited the country in 2018.

In 2018 Morocco welcomed 1 million tourists on average per month.  The Moroccan National Tourist Office (ONMT) said in January 2019 that Morocco received 12.3 million tourists last year.  In 2018, tourism generated revenues totaling MAD 70 billion.  (MWN 19.06)

Back to Table of Contents


6.1  Cyprus Incoming Tourist Arrivals Fall for Second Time This Year

Tourist arrivals to Cyprus in May dropped for the second time this year, after an unbroken run since 2015, mainly due to a fall from the island’s main holiday markets Britain, Russia and Germany.  Officials said that uncertainty over Brexit, a weaker Russian ruble and a sluggish German economy are reasons for the downturn in the island’s tourism.

Tourist arrivals in May fell 3.5% to 434,578, from 450,495 a year ago.  The disappointing May figures follow on from negative March arrivals, the first decline since June 2015.  For the five-month period of January – May 2019, tourist arrivals reversed 1.1% to 1.12 million from 1.13 million in the same period of 2018.

Tourist arrivals from the United Kingdom – the island’s biggest market – decreased 2.6% in March, while a 5.4% dip was recorded from second largest market Russia.  Arrivals from key markets Germany and Greece were also down 25.9% and 10.3% respectively.  On the upside, there was a 9.6% increase in tourist arrivals from Israel – the island’s fourth biggest holiday market – and a 7.8% surge from Sweden.

The UK still constitutes the main source of tourism for Cyprus, with a 36.1% share of total arrivals in May, followed by Russia with 21.7%, Sweden and Israel both on 5% and Germany 3.7%.  Cyprus annual tourist arrivals spiked 7.8% in 2018 reaching a record 3.93 million as revenue touched a historic high of €2.71 billion.

A tourism boom has helped Cyprus return to robust 4% GDP economic growth following a €10-billion bailout to rescue its crumbling economy and insolvent banks in March 2013.  During 2018 Cyprus broke new records for tourism almost on a monthly basis.  Income from tourism accounts for more than 15% of the country’s gross domestic product and is credited with underpinning a speedy recovery.  (CyStat 18.06)

Back to Table of Contents

6.2  Cyprus House Prices Fell by 8% Between 2010 – 2018

Cyprus registered the third biggest fall in house prices in the EU from 2010 to 2018 with a decline of 8%, while elsewhere property values in Europe went up an average 15%.  Overall, between 2010 and 2018, house prices grew in total by 15% in the EU and by 11 % in the euro area.

Among the Member States, the highest increases during this period were observed in Estonia (+83%), Latvia (+61%), Austria (+56%), Sweden (+55%) and Luxembourg (+50%).  The largest decreases were witnessed in Italy (-17%), Spain (-12%) and Cyprus (-8%), countries that have suffered a prolonged economic downturn.  (Eurostat 19.06)

Back to Table of Contents



7.1  Weizmann Institute Ranks 3rd Among World’s Academic Institutions

The Weizmann Institute of Science in Rehovot has been ranked third among the world’s academic institutions for research quality in natural science, by the British scientific journal, Nature.  Cold Spring Harbor Laboratory in New York and the Institute of Science and Technology Austria came in first and second place in the ranking, respectively.  This year’s ranking was different since it took into account the number of “quality” articles published by an academic institution in leading journals in the natural sciences in regard to its overall output.

The standardized ranking, in which Weizmann ranked 65, draws on both the article count (AC), which measures the number of articles published by an institution and the fractional count, which measures the contribution an institution makes to an article.  The data is drawn from 82 high-quality natural science journals, chosen by an independent group of researchers. In contrast, the normalized ranking allows smaller institutions to be ranked alongside larger ones as it shows “what share of an institution’s research output in the natural sciences has been judged high quality,” according to Nature.

Among the other Israeli institutions in the standard tables, the Hebrew University of Jerusalem ranked 115, the Technion-Israel Institute of Technology (IIT) came in 119, Tel Aviv University ranked 181, Ben-Gurion University of the Negev ranked 311, and Bar-Ilan University was 388.  (Various 20.06)

Back to Table of Contents

7.2  Largest Pride Parade in Middle East Draws 250,000 People to Attend in Tel Aviv

Some 250,000 people from around the world gathered in Tel Aviv on 16 June to march in the largest pride parade in the Middle East.  This year’s event marked 21 years to the City’s first pride parade.  Voted the world’s “Best Gay City” by and “The Most Gay-Friendly City in the World” by Wow Travel, Tel Aviv’s Pride Parade is widely recognized as one of the world’s leading LGBTQ events, attracting thousands of visitors from around the globe.  The American actor, writer, producer, magician, and singer, Neil Patrick Harris was selected to act as this year’s “International Pride Ambassador”.

The parade marked the end of a month-long festival which included TLVFest – the City’s international gay film festival; a LGBTQ cultural line-up of events; a special show by the Israeli Opera honoring the famous Eurovision hits which took place at NYX – the official Tel Aviv pride hotel; and tributes to key historical figures in the LGBTQ community.  (16.06)

Back to Table of Contents


7.3  Dubai Tourists to Get Free SIM Card

Tourists visiting Dubai are to be given a pre-paid mobile SIM card, absolutely free of charge.  The complimentary tourist SIM pack will be handed to all tourists who are over the age of 18 at the immigration counter.  The SIM comes with three minutes of talk time and 20 MB of mobile data.  The initiative has been launched by Du, the General Directorate of Residency and Foreign Affairs (GDRFA) and Smart Dubai.  Tourists can top up the SIM for three packages – small medium and large.  It will be deactivated once they leave the country.  (AB 16.06)

Back to Table of Contents

7.4  Why Many Saudi Women Are Not Getting Behind the Wheel

A year after women were first allowed to get driving licenses in Saudi Arabia, new research reveals that a lack of driving knowledge is the biggest reason stopping Saudi women from getting behind the wheel.  The YouGov research comes as around 70,000 licenses have been issued to women in Saudi Arabia, with several driving schools opening since the ban was lifted last year.

On the first year anniversary of this milestone, YouGov asked Saudi women who have not applied for a license what the biggest barriers are to them in doing so.  Not knowing how to drive is the biggest problem.  A higher proportion of women now state this as a factor (35%) compared to 24% last year when they were first interviewed.  Other reasons included a fear of car accidents (23% compared to 27% last year) and low confidence among women in their driving skills (21% compared to 20%).  There has also been a notable fall in the proportion of women saying that their husbands’ or family members’ objection is stopping them from driving (from 23% in 2018 to 16%).

The number of women saying they don’t need to drive because they have drivers is almost the same, while those saying the same due to fear of harassment by male drivers declined from 10% to 6%.  Those women who said they fear being judged by the Saudi society also fell from 4% to 1% over the past year.  Data for the survey was collected online by YouGov Omnibus among 400 female respondents in Saudi Arabia in August 2018 and June 2019.  (AB 24.06)

Back to Table of Contents

7.5  New National Anti-FGM Committee Launches Awareness Campaign

Egypt’s national anti-female genital mutilation committee has launched the first phase of a campaign called “Protect Her from Circumcision.”  The awareness-raising campaign comes a month after the formation of the national committee.  It is led by the head of the National Council for Women (NCW) Maya Morsi and the secretary-general of the National Council for Childhood and Motherhood (NCCM) Azza Ashmawi.

Egypt has a 2030 national strategy on women’s empowerment, which also covers FGM.  The campaign is timed around the national anti-FGM day, which fell on 14 June, to mark the death of an 11 year-old girl who died of complications of FGM surgery in Minya governorate on that date in 2007.  Morsi said the national committee is committed to mobilizing all efforts and expertise to achieve the best interest of girls.  The campaign will include radio messages, including on religious stations, and convoys deployed to different areas.  (MENA 13.06)

Back to Table of Contents

7.6  New Cypriot Driving Licenses to Provide Organ Donor Option

Cyprus MPs have voted in legislation to promote organ donation by allowing future motorists to become organ donors when they apply for a driving license.  Parliament has passed an amendment to legislation governing the issuance of driving licenses, with which applicants will have the option to state whether they would be willing to allow for their organs to be donated in the event of their death.  A similar bill was considered in back in May 2017 but was deemed to be incomplete and efforts were abandoned until now, when a new bill was passed.

According to the legislation, applicants for a driver’s license will be informed about organ donation and transplants and will be asked on their application form whether they would like to become an organ donor. Applicants will have the right to refuse.  Applicants that answer positively will have their names added to the national database of organ donors to tackle a shortage.  (FM 14.06)

Back to Table of Contents


8.1  Transseptal Solutions Announces First Clinical Use of TSP Crosser in the United States

Transseptal Solutions announced the completion of the first TSP Crosser transseptal puncture procedure in the US.  The procedure was successfully performed by Dr. Latib, the New Medical Director of Structural Heart Interventions and Heart Valve Program at Montefiore-Einstein Center for Heart and Vascular Care in patient undergoing Percutaneous Balloon Mitral Valvuloplasty (PBMV) treatment.

The TSP Crosser Transseptal Access System combines a sheath, dilator and a flexible puncturing needle in a single integrated system for controlled LA access and enhanced performance during transseptal catheterization procedures.  A radiopaque loop wire is positioned at the distal end of the steerable sheath to aid in the localization of the fossa ovalis.  The flexible puncturing needle and the steerable sheath allows pre-puncture deflection and orientation, positioning the needle in the desired puncturing location of the fossa ovalis for transseptal access.  The sheath is steerable up to 180° bi-directionally after crossing the fossa ovalis.  The TSP Crosser has an FDA clearance and CE mark.

Netanya’s Transseptal Solutions, founded in 2013, brings to the market a new steerable sheath with a novel approach of transseptal puncture and left atrial navigation.  By addressing significant unmet market needs, Transseptal Solutions seeks to improve the LA access procedure and generate a novel approach to serve the expanding indications of left heart treatment.  (Transseptal Solutions 12.06)

Back to Table of Contents

8.2  O.Vine Varietal Wine-Essence Water

Rosh Pina’s Wine Water, parent company of O.Vine, Inc., launched Chardonnay- and Cabernet Sauvignon-essence water to refresh the “infused water” landscape.  The two alcohol-free beverages are comprised of a unique concert of purified water and hidden nutritional benefits of upcycled wine grape residue.

O.Vine Wine Essence Water is a line of all-natural, non-alcoholic beverages that expresses the spirit of wine and sets new standards for sustainable sourcing as well as innovation.  Free of preservatives and synthetic colors, its natural blush color and healthful ingredients are derived from the essence extracted from red or white wine grape skins and seeds.  The two innovative beverages are composed of the skins and seeds of single grape varieties (either Cabernet Sauvignon or Chardonnay), bringing the distinct essence of these renowned much-loved wines to refreshing water, without intoxicating effects.  The pomace that forms the waste product from the wine making process is a valuable source of phenolic antioxidants.  The reuse of this pomace effectively transforms the treasures inherent in leftovers from the winemaking process into aromatic, indulgent essence waters.

The grapes are sourced from select vineyards located across the Galilee hills in Israel.  The Galilee is one of the most ancient wine grape-growing regions on Earth.  O.Vine’s beverages come to the market as the company marks one year since it debuted the award-winning wine grape water infusions.  The line consists of red, white, still, and sparkling, non-alcoholic beverages sourced from a variety of grapes and continues to spark growing global interest.  (Wine Water 12.06)

Back to Table of Contents

8.3  Together Pharma Purchases Cannabliss for NIS 14 Million

Together Pharma reported the acquisition of Cannabliss.  Under the terms of the deal, Together will pay Cannabliss’ shareholders NIS 4 million in cash and an allocation of 5% of Together’s shares worth about NIS 10 million as well as options to buy 3% of Together’s shares subject to meeting targets.

Cannabliss has ten years knowhow and experience in treating thousands of customers, managing a medical cannabis products factory and R&D activities.  In addition, over the past decade Cannabliss has conducted unique cooperation with the Hadassah Medical Center at Ein Kerem, Jerusalem, in which the hospital has operated a distribution center providing diagnosis, treatment and training for patients by qualified nurses for users of medical cannabis.

Cannabliss specializes in creating and producing medical cannabis products for non-smokers, led by cannabis oil and cookies.  The company works under the license of the Ministry of Health.  Cannabliss seeks to help patients who are unable or not interested in smoking medical cannabis, including patients who for religious reasons are unable to smoke on the Sabbath.  Accordingly, Cannabliss Company distributes the different products to patients who have received a Health Ministry license for holding and using medical cannabis.  Cannabliss works in cooperation with doctors in different hospitals in Israel.

Together Pharma is a public company traded on the Tel Aviv Stock Exchange (TASE).  The company has a subsidiary Globus Pharma, which holds the franchise, (both directly and through subsidiaries), to grow, produce, and distribute medical cannabis products.  The company is currently setting up one of the world’s most advanced agricultural cultivation systems, which will allow the control and supervision of cannabis plants using the latest technologies, developing them into quality plants suitable for supervised medical use according to the strict IMC-GAP standards of Israel’s Ministry of Health.  The company is also in the process of adapting a pharmaceutical factory, which will meet all the required strict conditions for manufacturing medical products according to the IMC-GAP standard.  (Various 13.06)

Back to Table of Contents

8.4  Third FDA Clearance for Zebra-Med’s AI Solution for Brain Bleeds Alerts

Zebra Medical Vision announced that it has received its third FDA 510(k) clearance for the company’s HealthICH product – an AI alert for intracranial hemorrhage (ICH), based on head CT scans.  The latest cleared product automatically identifies suspected internal brain bleeds based on non-contrast head CTs for triaging, significantly reduces turnaround time, and increases the radiologists’ confidence in their diagnosis.  The overall Multi-Modality AI Triage Solution by Zebra-med, is a first of its kind in the market that provide alerts for both CT scans and X-rays, and currently addresses two acute conditions: intracranial hemorrhages (head CTs), and pneumothorax (chest X-rays), which also received FDA clearance in the past month.  Both Triage solutions and others, such as the FDA cleared calcium scoring product, are part of the AI1 “all-in-one” bundle that provides hospitals with a growing amount of AI tools at a fixed annual price and consistent service and support.

Zebra-Med’s intracranial hemorrhage triage solution can provide early detection of people who may have experienced a brain bleed. The algorithm is comprised of a unique, tailor-made neural network architecture designed to identify intracranial hemorrhage while tackling several challenges, such as relatively small bleed sizes and common artifacts (metal, motion artifacts) seen within the brain.

This is the second FDA clearance for Zebra’s Multi-Modality AI Triage Solutions, which was received in May 2019 and focused on HealthPNX – an AI alert for pneumothorax (PNX), based on chest X-rays, enabling it to be the world’s first AI chest x-ray triage product.  Zebra Medical’s first FDA clearance, received in July of 2018, focuses on coronary calcium scoring, which can be an early sign for coronary artery disease (CAD).  The growing number of FDA approvals within Zebra-Med’s AI portfolio allows the company to expand its presence in the US market.

Kibbutz Shefayim’s Zebra Medical Vision’s Imaging Analytics Platform allows healthcare institutions to identify patients at risk of disease and offer improved, preventative treatment pathways to improve patient care.  Zebra-Med was founded in 2014 and funded by Khosla Ventures, Marc Benioff, Intermountain Investment Fund, OurCrowd Qure, Aurum, aMoon, Nvidia, J&J, and Dolby Ventures.  Zebra Medical Vision has raised $50 million in funding to date, and was named a Fast Company Top-5 AI and Machine Learning company.  (ZMV 17.06)

Back to Table of Contents

8.5  Teva Announces Launch of a Generic Version of Tracleer Tablets in the United States

Teva Pharmaceutical Industries announced the launch of a generic version of Tracleer®1 (bosentan) tablets, 62.5 mg and 125 mg, in the U.S.  Bosentan Tablets are an endothelin receptor antagonist indicated for the treatment of pulmonary arterial hypertension in adults to improve exercise ability and to decrease worsening of the condition.  PAH is high blood pressure in the blood vessels of the lungs.

With nearly 500 generic medicines available, Teva has the largest portfolio of FDA-approved generic products on the market and holds the leading position in first-to-file opportunities, with over 100 pending first-to-files in the U.S.  Currently, one in nine generic prescriptions dispensed in the U.S. is filled with a Teva generic product.

Israel’s Teva Pharmaceutical Industries has been developing and producing medicines to improve people’s lives for more than a century.  They are a global leader in generic and specialty medicines with a portfolio consisting of over 35,000 products in nearly every therapeutic area.  Around 200 million people around the world take a Teva medicine every day, and are served by one of the largest and most complex supply chains in the pharmaceutical industry.  (Teva 19.06)

Back to Table of Contents

8.6  GlucoMe Now has CE Mark for Diabetes Decision Support Technology

Digital Diabetes Management provider GlucoMe announced that its new Decision Support System (DSS) has CE Mark.  The DSS is a reliable, algorithm-based, clinical decision support software that assists physicians to ensure optimal oral drug intensification for patients with Type 2 Diabetes Mellitus (T2DM).

Diabetes is a progressive disorder and despite guidelines mandating drug intensification within 3-6 months of initial treatment, it is often delayed.  This can lead to poor diabetes control and associated health complications.  GlucoMe’s DSS uses a proprietary advanced algorithm that enables real-time analysis of patient-specific data to provide physicians with treatment recommendations.  The algorithm is 100% compliant with internationally-recognized medication guidelines (ADA and EASD guidelines consensus, 2018). GlucoMe’s solution helps bridge the gap in upholding proper drug intensification timelines, empowering physicians to personalize management of T2DM and improve care.

GlucoMe’s cloud-based/SaaS solution achieved similar medication recommendations in pilot studies to that of endocrinologists and exceeded that of General Practitioners (GP), the primary care giver.  The algorithm generated medication recommendations that were 98% in agreement with endocrinologists versus 82% agreement with GPs.  The GlucoMe DSS can be either integrated into a third party EHR – EMR software or can be directly operated from GlucoMe’s Digital Diabetes Management platform.

Yarkona’s GlucoMe is a digital health company innovating and marketing a comprehensive digital solution for diabetes management.   With its new algorithm-based Decision Support System analyzing relevant diabetes data and providing medical teams with treatment recommendations, GlucoMe is on track to realize its vision of offering an autonomous diabetes heath care platform.  The GlucoMe solution enables smart and cost-effective remote care and monitoring, streamlining and simplifying diabetes care for patients, caregivers and medical professionals.  (GlucoMe 19.06)

Back to Table of Contents

8.7  Syqe Medical Drug Delivery Device for Precise Dosing of Cannabis Approved

Syqe Medical announced the launch of the world’s first pharmaceutical-grade metered-dose cannabis inhaler in Israel, empowering physicians to prescribe precise dosages meeting pharmaceutical standards.  The debut of this drug delivery device reflects Syqe’s mission to transform medical cannabis into a mainstream medical treatment.

This benchmark news is the culmination of eight years of research and development – including rigorous testing through multiple clinical trials – including four years of paving a novel regulatory path.  The Syqe Inhaler and supporting clinical research is poised to unlock the global medical cannabis market by eliminating uncertainty surrounding dosage administration and alleviating physician concerns with regards to adverse events and psychoactivity.  In turn, this will enable greater physician adoption of medical cannabis.  Syqe’s breakthrough drug delivery technology introduces complex respiration technique automation, electronic selective dosing and remote clinical monitoring and dose control, significantly expanding the applicability of this platform well beyond cannabis.

The Syqe Inhaler, a non-combustion drug delivery device, has received the world’s first ever regulatory approval from the Israeli Ministry of Health as a medical device combined with cannabis, and will be available for purchase by licensed patients in Israel.  The devices will be marketed and distributed by Teva Israel.  The cannabis in the Syqe inhaler is produced under controlled pharmaceutical conditions, complying with good manufacturing practices (GMP).

Tel Aviv’s Syqe Medical is an Israeli pharma-tech company developing technologies for the administration of raw plants and pharmaceuticals by inhalation.  The company has developed the world’s first drug delivery platform, the Syqe Inhaler, capable of administering metered-doses of plants at pharmaceutical standards.  The first plant implemented in this platform is medical cannabis.  The company has completed multiple clinical trials demonstrating the precision and efficacy of the platform, while adhering to stringent regulatory standards.  (Syqe Medical 20.06)

Back to Table of Contents


9.1  Vayyar Imaging Launches its Walabot DIY “All-in-One Stud Finder” at Walmart

Vayyar Imaging announced its award-winning Walabot DIY wall scanner is now available for purchase at  Walabot DIY uses Vayyar’s powerful radio wave sensor technology to actually show you the studs, pipes, wires, beams and more behind drywall and concrete walls.  Walabot DIY is a must have next generation stud finder for both professionals and DIYers as it can easily tackle all kinds of home renovation projects, including helping to detect the center of a stud, figuring out the location of load bearing walls, avoiding pipes and wires and more.

The Walabot DIY wall scanner attaches to Android smartphones and has three different view modes: expert, images and pan.  Expert Mode shows the raw radio wave signals from the Walabot sensor, ideal for tracing the path of wires or pipes or detecting the center of a stud. Images mode interprets the raw signals and provides a visual classification of metallic and wooden studs, pipes and wires.  Pan mode enables users to scan an entire wall and see a full map of what’s behind their walls.  The launch of Walabot DIY on enables Vayyar to provide more professionals and home improvement enthusiasts with the power tools they need to safely and quickly tackle projects with ease.

Yehud’s Vayyar Imaging is a global leader in 4D imaging technology, providing highly advanced sensors to a wide variety of industries including automotive, smart home, robotics, retail and medical.  The company’s sensors can see through walls and objects and track and map everything happening in an environment in real-time, all while maintaining privacy.  Utilizing a state-of-the-art embedded chip and advanced imaging algorithms, Vayyar’s mission is to help people worldwide improve their health, safety and quality of life using mobile, low-cost 4D imaging sensors.  (Vayyar Imaging 12.06)

Back to Table of Contents

9.2  CyberArk Named a Leader in 2019 Fortress Cyber Security Awards

CyberArk announced it was named a 2019 Fortress Cyber Security Awards winner in the Leadership category.  The Fortress Cyber Security Awards recognize the world’s leading companies and products that are working to keep data and critical assets safe among growing threats from attackers.  CyberArk is the only privileged access security vendor recognized in this year’s program.

The award comes on the heels of strong industry accolades this year including the 2019 SC Awards, Cybersecurity Excellence Awards, Cyber Defense Magazine InfoSec Awards and Info Security Products Guide Global Excellence Awards.  CyberArk was also recently recognized as a top security solution for government agencies in the Government Security News Homeland Security Awards.

Petah Tikva’s CyberArk is the global leader in privileged access security, a critical layer of IT security to protect data, infrastructure and assets across the enterprise, in the cloud and throughout the DevOps pipeline.  CyberArk delivers the industry’s most complete solution to reduce risk created by privileged credentials and secrets.  The company is trusted by the world’s leading organizations, including more than 50% of the Fortune 500, to protect against external attackers and malicious insiders.  (CyberArk 12.06)

Back to Table of Contents

9.3  RADWIN Technology Allows Luminet to Create London’s ‘Network in the Sky’

RADWIN announced that Luminet, a major Service Provider in London and an ISPA Winner (Internet Service Provider Association), has deployed RADWIN’s wireless JET Beam-forming Point-to-Multipoint solutions in 5GHz to drive high-speed wireless broadband to hundreds of businesses in London.  Luminet delivers bandwidth of up to 100Mbps with SLAs to some of the country’s biggest brands and heaviest data users.

London businesses are fighting for high quality connectivity but they have to wait months for new connections.  This is what drove Luminet’s decision to build a wireless network.  They considered various technologies and ultimately chose RADWIN’s JET, a carrier-grade solution that delivers higher bandwidth than what other manufacturers offered. JET’s powerful beam-forming technology obliterates interference, and the systems work smoothly even when there are serious obstructions to line-of-sight.

Tel Aviv’s RADWIN is a leading provider of Point-to-Multipoint and Point-to-Point broadband wireless solutions deployed in over 170 countries.  (RADWIN 13.06)

Back to Table of Contents

9.4  Guardio Discovers Major Vulnerability in Evernote’s Chrome Extension

Israel’s Guardio, a leading browser-centric and cloud security company, discovered a major flaw in Evernote’s Web Clipper Chrome extension’s code that left it vulnerable, potentially allowing threat actors to access personal information from users’ online services.  The vulnerability, a Universal XSS marked CVE-2019-12592, was discovered as part of Guardio’s ongoing security analysis efforts using a combination of internal technology and researchers.  Guardio disclosed the vulnerabilities to Evernote during the last week of May, which prompted Evernote to address them and roll out a complete fix – within less than a week.  Due to Evernote’s widespread popularity, this issue had the potential of affecting its consumers and companies who use the extension – about 4,600,000 users at the time of discovery.

As the trend to move to the cloud continues, the browser is becoming the users de-facto OS – replacing where users use their applications and access their data.  While app authors strive to provide faster, smoother user experiences, extensions usually have permissions to access a trove of sensitive resources, inadvertently posing a much greater security risk than traditional websites.  Guardio’s protection comes into play in these new potentially vulnerable threat areas.

Tel Aviv’s Guardio is a new breed of cyber security product designed to tackle threats and security concerns within the browser.  Mitigating threats from malicious or unwanted extensions is an integral part of how Guardio protects its users, able to neutralize harmful extensions in real-time.  Combined with strong anti-phishing capabilities, malicious ad blocking and information leak monitoring.  Guardio bundles a complete online protection suite where it matters most – your browser.  (Guardio 12.06)

Back to Table of Contents

9.5  Sapiens Expands Its Partner Ecosystem With Kovrr, a Predictive Cyber Risk Modeling Firm

Sapiens International Corporation has expanded its growing ecosystem by partnering with Kovrr as part of Sapiens’ strategy to maximize its open-API architecture and make innovative third-party and insuretech solutions available to its customers.  Kovrr’s predictive cyber risk modeling platform delivers transparent, real-time, data-driven insights to global insurers and reinsurers regarding their affirmative and non-affirmative single, accumulated and catastrophic cyber risk exposures.

To help its clients meet cybersecurity requirements and develop action plans, Sapiens will offer its relevant solutions, including Sapiens IDITSuite for Property & Casualty, with Kovrr’s industry-leading cyber risk modeling platform.  This will empower (re)insurer underwriters, exposure managers and catastrophe modelers to meet the PRA’s new standards.  The platform provides insurance professionals with loss predictions based on diverse cyber risk scenarios that can affect businesses within an insurer’s portfolio, or companies they wish to insure. Insurers can make decisions about coverages and pricing, and ensure decisions are aligned with their risk appetite, via tools to manage their cyber risk accumulations.

Tel Aviv’s Kovrr is a predictive cyber risk modeling company whose platform delivers transparent, real-time data-driven insights to global (re)insurers regarding their affirmative and non-affirmative single, accumulated and catastrophic cyber risk exposures.  The Kovrr platform is designed to help underwriters, exposure managers and catastrophe modelers understand, quantify and manage cyber risk at scale, by utilizing AI-powered predictive risk models that evolve in real-time to continuously reflect new cyber threats.

Holon’s Sapiens International Corporation empowers insurers to succeed in an evolving industry.  The company offers digital software platforms, solutions and services for the property and casualty, life, pension and annuity, reinsurance, financial and compliance, workers’ compensation and financial markets.  (Sapiens 12.06)

Back to Table of Contents

9.6  Tactile Mobility Wins ‘Best Connected Product for the Commercial Vehicle Market’ at the TU- Awards

Tactile Mobility was selected as ‘Best Connected Product/Service for the Commercial Vehicle Market’ at the TU-Automotive Awards, the most prestigious awards ceremony for the connected car industry.  Tactile Mobility was also shortlisted at the event for the ‘Best ADAS or Autonomous Product/Service’ category as well as ‘Best Data/AI Product/Service.’

Tactile Mobility provides smart and autonomous vehicles with a tactile sense by collecting ‘first principle,’ real-time data generated by existing, non-visual vehicle sensors and turning it into actionable insights.  The company’s technology enables OEMs to improve safety, user experience and energy efficiency, and municipalities to monitor the state of infrastructure and address potential hazards.  In addition, it allows fleet managers to derive better insights related to preventative maintenance and road conditions, and insurance companies to have a better understanding of a specific vehicle’s risk factors, offering a more comprehensive view of the driving experience.

Haifa’s Tactile Mobility is the world’s leading tactile sensing technology and data provider, enabling actionable insights for autonomous vehicles, municipalities, insurers and fleet managers.  Tactile Mobility’s unique technology collects ‘first principle,’ crucial, real-time data generated from cars’ sensors and turns it into actionable insights such as road quality, tire grip, vehicle weight and other vehicle- and road-specific models.  (Tactile Mobility 12.06)

Back to Table of Contents

9.7  IAI Elta Unveils Next Generation Radar

Israel Aerospace Industries unit ELTA Systems has introduced the next generation of ELM-2084 Multi-Mission Radar (MMR).  The operational and combat proven MMR provides air defense capabilities to customers around the world as well as being the radar of “Iron Dome”, “David’s Sling” and IAI’s land-based “Barak” weapon systems.  The new version, named MS-MMR (Multi-Sensor MMR), fuses additional ELTA sensors to the main MMR system thereby providing an active, passive, and combined Air Situational Picture (ASP).

Operating in S-Band frequency, the MMR provides long-range air defense, air surveillance and fire control capabilities.  By fusing the MMR with an additional higher band radar and active IFF and ADS-B sensors and passive SIGINT, EO/IR and LDS (Launch Detector Sensor) sensors, the MS-MMR now provides enhanced classification, identification and discrimination between very close targets even in dense areas and background clutter.  The MS-MMR significantly improves the reliability of the ASP and Situational Awareness, and can efficiently handle new types of small, low, slow and hovering RCS threats as well as handling rockets and missiles of varying ranges.  Since all the sensors are co-located and integrated at the system level, the MS-MMR provides a single output for all the fused data.  This greatly simplifies the delivery of the combined target data into C2 ASP networks.  (IAI Elta 13.06)

Back to Table of Contents

9.8  Rafael Unveils Unique SAR Features in Litening and Reccelite Upgrades

Haifa’s Rafael Advanced Defense Systems upgraded its fifth generation Litening and Reccelite systems, effectively transforming them from traditional EO pods into EO+, with the addition of a unique SAR feature and the optional application of additional EO+ features, such as (EW, Comm, IRST).  This constitutes a revolutionary quantum leap in all-weather, stand-off targeting and reconnaissance pods.  Litening + SAR – Rafael teamed with Israel Aircraft’s Ashdod based ELTA Systems to equip Litening with a powerful SAR (Synthetic Aperture Radar), adding significant capabilities to the Litenings’ EO, multi-spectral, stand-off pod, significantly expanded wide area coverage and true day/night, all-weather operation.  This first-ever addition of SAR to an EO pod solves the EO challenge of target identification when flying above clouds.

Reccelite + SAR – This is one of Rafael’s latest game-changers, with the addition of ELTA’s powerful SAR (Synthetic Aperture Radar) to the, stand-off Reccelite ISR pod.  Overcoming the EO reconnaissance challenge when flying above clouds, the SAR-optimized pod delivers true all-weather, day/night, all-terrain, long-range capabilities, providing a full aerial intelligence picture – with high-resolution images.  (Rafael 17.06)

Back to Table of Contents

9.9  CyberArk Marketplace Delivers Deepest Set of Privileged Access Security Solutions

CyberArk is expanding the CyberArk Marketplace with new capabilities that support community-based contributions to further extend the industry’s only portfolio of trusted integrations with the leading privileged access security solution.  With more than 13,000 downloads to date across 25 technology categories, CyberArk Marketplace is the broadest and deepest inventory of privileged access-related technology integrations.

CyberArk’s global ecosystem of CyberArk C3 Alliance, strategic partners, customers and other community contributors can now submit their own integrations with the CyberArk Privileged Access Security Solution, dramatically expanding the number of available integrations.  CyberArk Marketplace is an industry destination for collaboration and identifying integrated solutions that advance privileged access security.  CyberArk Marketplace users can search for effective solutions for mitigating emerging risk in their own environments, build upon existing integrations to develop customized solutions and collaborate with other contributors to address evolving security challenges.

Petah Tikva’s CyberArk is the global leader in privileged access security, a critical layer of IT security to protect data, infrastructure and assets across the enterprise, in the cloud and throughout the DevOps pipeline.  CyberArk delivers the industry’s most complete solution to reduce risk created by privileged credentials and secrets.  The company is trusted by the world’s leading organizations, including more than 50% of the Fortune 500, to protect against external attackers and malicious insiders.  (CyberArk 17.06)

Back to Table of Contents

9.10  FiberHome Selects Ethernity Network’s ACE-NIC100 to Power New FitBNG

Ethernity Networks announced that its ACE-NIC100 FPGA SmartNIC has been selected for implementation within the FitBNG, the latest Broadband Network Gateway (BNG) product by FiberHome Telecommunication Technologies, a major Chinese networking and telecommunication equipment provider.

The accelerated platform will integrate FiberHome’s BNG software and Ethernity’s SmartNIC hardware using standard DPDK (data plane development kit) to fully offload up to 80Gbps of data processing to the ACE-NIC100’s onboard FPGA.  This will minimize CPU intervention, saving CPU cycles and significantly reducing CPU power and cost.  Moreover, the ACE-NIC100 will support tens of thousands of subscribers with PPPoE (Point-to-Point Protocol over Ethernet) termination, performance monitoring counters per subscriber, and hierarchical quality of service (H-QoS), which is impractical for implementation in software-only BNG.  The resulting product will be promoted to FiberHome’s core Chinese telecom operator clients, including China Unicom, China Telecom, and others that serve tens of millions of households.

Lod’s Ethernity Networks provides innovative comprehensive networking and security solutions on programmable hardware for accelerating telco/cloud networks.  Ported onto any FPGA, Ethernity’s software offers complete data plane processing with a rich set of networking features, robust security, and a wide range of virtual functions to optimize your network. Our ACE-NIC smart network adapters, ENET SoCs, and turnkey network appliances offer best-in-class all-programmable platforms for the telecom, cloud service provider, and enterprise markets.  (Ethernity Networks 17.06)

Back to Table of Contents

9.11  Mellanox HDR 200G InfiniBand Accelerates New Generation of Supercomputers

Mellanox Technologies announced that HDR 200G InfiniBand accelerates the next generation of supercomputers world-wide, enabling higher levels of research and scientific discovery.  HDR 200G InfiniBand solutions include the ConnectX-6 adapters, Mellanox Quantum switches, LinkX cables and transceivers and software packages.  With its highest data throughput, extremely low latency, and smart In-Network Computing acceleration engines, HDR InfiniBand provides world leading performance and scalability for the most demanding compute and data applications.

HDR 200G InfiniBand introduces new offload and acceleration engines, for delivering leading performance and scalability for high-performance computing, artificial intelligence, cloud, storage, and other applications.  InfiniBand, a standards-based interconnect technology, enjoys the continuous development of new capabilities, while maintaining backward and forward software compatibility.  InfiniBand is the preferred choice for world leading supercomputers, replacing lower performance or proprietary interconnect options.

Yokneam’s Mellanox Technologies is a leading supplier of end-to-end Ethernet and InfiniBand smart interconnect solutions and services for servers and storage.  Mellanox interconnect solutions increase data center efficiency by providing the highest throughput and lowest latency, delivering data faster to applications, unlocking system performance and improving data security.  (Mellanox Technologies 17.06)

Back to Table of Contents

9.12  Reduxio Debuts Focus on Container-Native for Kubernetes and Clouds

Reduxio announced the start of customer evaluations of their container-native cloud storage and data management platform with its breakthrough micro-services architecture that provides enterprises deploying stateful container applications never-before-available capability and flexibility for Kubernetes-based private, hybrid, and multi-cloud infrastructure.

To meet the growing demand for robust cloud-native enterprise cloud solutions, Reduxio’s Magellan Cloud Data Platform will be generally available in the fall of 2019.  Magellan combines new patent-pending IP for data mobility with proven data management capabilities in a micro-services-based platform.  Magellan will help organizations overcome limitations in data and application portability and mobility to get more from multi-cloud strategies while accelerating application modernization and digital transformation.  Reduxio is supported by leading investors including Intel Capital, JVP and C5 Capital.

The continuing adoption of multi-cloud IT strategies is being accelerated by the deployment of containers.  Cloud-native applications like Cassandra and MongoDB, data processing applications like Apache Hadoop and Spark, continuous deployment/continuous integration (CI/CD) methodologies and the shift to GPU computing for AI/ML workloads are further driving growth of the container-native storage market.  Today, however, many of these containerized applications are being run on storage systems originally created for on-premise workloads and retrofitted to support containers and clouds, resulting in a siloed and inflexible infrastructure.

With its unique capabilities to accelerate data access for GPUs in AI/ML workloads, Reduxio also has joined the NVIDIA Inception program, a virtual accelerator program designed to nurture startups revolutionizing industries with advancements in AI and data sciences. Inception members get a custom set of ongoing benefits, from hardware grants and marketing support to training with deep learning experts.

Since 2012, Tel Aviv’s Reduxio has redefined data management and data protection, and the company has evolved its mission to deliver the first micro-services-based container-native storage and data platform for stateful applications.  Reduxio’s cloud data platform for Kubernetes pairs high performance software-defined container-native storage and data management with data mobility to enable customers to build a single data cloud for their applications across all their infrastructure, anywhere. Reduxio is backed by Intel Capital, C5 Capital Cloud Partners and Jerusalem Venture Partners (JVP).  (Reduxio 17.06)

Back to Table of Contents

9.13  Ottopia Announces Collaboration with Global Automotive Supplier DENSO

Ottopia announced a collaboration with DENSO Corporation, the world’s second largest automotive Tier 1 supplier.  Ottopia also announced the launch of its Advanced Teleoperation (ATO) platform, providing both direct and indirect remote control of autonomous vehicles.  Ottopia’s ATO platform offers a unique integration of human operators with patent pending Artificial Intelligence software to set a new safety standard for teleoperation in the automotive industry.

Ottopia is working with some of the biggest automotive corporations in the world.  One such customer is DENSO Corporation.  DENSO is interested in a teleoperation solution focused on safety and scalability. These are exactly the values Ottopia is committed to while building the world’s first automotive-grade teleoperation platform.  Teleoperation is necessary to assist autonomous vehicles through complex situations.  Industry consensus is that there will always be cases when human intervention is required.  The Ottopia ATO platform provides this human assistance, offering the safest, most scalable and cyber-secure solution available on the market.  Ottopia’s ATO platform utilizes proprietary network bonding and ultra-low latency video compression to reliably deliver real-time remote operation of vehicles over existing public cellular networks.

Ottopia’s unique technology focuses on safety and scale.  By employing advanced AI and indirect methods of control, the operator is able to efficiently support multiple autonomous vehicles.  The platform also introduces an active safety layer of vehicle-side software that ensures safe operation even in harsh conditions such as lost cellular connection or extreme weather.

Tel Aviv’s Ottopia builds and provides a platform that enables remote humans to guide vehicles in a way that is safe, scalable and cybersecure. Ottopia is founded by leading autonomous vehicle, network and cybersecurity experts and backed by top-tier investors.  (Ottopia 18.06)

Back to Table of Contents

9.14  Beijing Daxing International Airport Selects Xsight Systems’ FOD Detection Solution

Beijing Daxing International Airport (BDIA), the new major airport to serve the Chinese capital, has selected Xsight Systems’ FOD Detection solution for installation on its East and North runways.  This win joins another project that Xsight System was awarded in China, as earlier this year Beijing Capital International Airport (the second busiest in the world in terms of passenger traffic) has also selected Xsight Systems’ FOD Detection solution for installation on its East Runway.

Beijing Daxing International Airport will become one of the world’s largest airports upon its opening, which is scheduled for the end of September 2019.  It will use Xsight Systems’ RunWize to improve runway safety and capacity by continuously monitoring and detecting any forms of debris or hazards.

Foreign Object Debris (FOD) and environmental threats on the runway cost the global aviation industry nearly $12 billion each year.  RunWize, Xsight Systems’ runway threat detection solution, prevents many of the FOD incidents, bird strikes and runway excursions, thus increasing runway safety, capacity and efficiency.  RunWize significantly improves safety during take-off and landing by using sophisticated image and radar processing algorithms based on Artificial Intelligence (AI) to detect and assess threats on the runway.  It complies and exceeds regulatory requirements worldwide (ICAO, FAA, CAAC, EASA), while also providing tools to comply with the upcoming Global Reporting Format (GRF) set by ICAO (based on TALPA).

Rosh HaAyin’s Xsight Systems is the global provider of advanced runway sensor-based solutions, chosen by leading airports worldwide.  Xsight Systems’ innovative threat detection solutions allow for constant command over airport runways and their surroundings, enabling airports to manage runways more efficiently and feel confident that runways are safe, secure and clear for operations.  Solutions from Xsight Systems exceed FAA regulatory requirements and have been adopted by major airports around the world, and by top-tier integrators.  (XSight Systems 19.06)

Back to Table of Contents

9.15  Elbit Systems to Supply J-MUSIC DIRCM Systems for the German Air Force

Elbit Systems was awarded an approximately $73 million contract from Diehl Defence to provide J-MUSIC Directed Infrared Counter Measure (DIRCM) systems for the German Air Forces’ Airbus A400M aircraft.  The contract will be performed over a four-year period.  Elbit Systems will work closely with DIEHL Defence and Airbus Defence and Space for the integration of the J-MUSIC DIRCM systems inside the A400M Defence Aid Support Systems (DASS) protection suite.

Haifa’s Elbit Systems is an international high technology company engaged in a wide range of defense, homeland security and commercial programs throughout the world.  The Company, which includes Elbit Systems and its subsidiaries, operates in the areas of aerospace, land, and naval systems, command, control, communications, computers, intelligence surveillance and reconnaissance (C4ISR), unmanned aircraft systems, advanced electro-optics, electro-optic space systems, EW suites, signal intelligence systems, data links and communications systems, radios and cyber-based systems and munitions.  (Elbit Systems 19.06)

Back to Table of Contents

9.16  Walabot HOME Expands Product Line to Further Protect Aging Adults in the Event of a Fall

Vayyar Imaging, the leader in 4D imaging technology, announced sweeping advancements to Walabot HOME, the company’s fall detection and health monitoring smart home device.  Walabot HOME’s reach has expanded to cover more rooms, such as bedrooms, kitchens and living rooms, and is available in several new and affordable bundles.  Its new machine-learning AI adapts to the changing patterns of a home, creating an unprecedented level of accuracy when detecting falls and further eliminating the need for wearables and pendants that are often forced on today’s aging adults.  In the case of a fall, Walabot HOME now calls up to four emergency contacts and will shortly provide the option of alerting emergency services.

Unlike Personal Emergency Response (PERS) bracelets wearables, Walabot HOME requires no action on the part of the user in the event of an emergency, which is especially important if the user is rendered unconscious.  In the event of a fall, the device automatically calls a list of predetermined emergency contacts, calling and texting up to four caregivers to ensure help arrives.  With no cameras or pendants, Walabot HOME maintains privacy while truly enabling seniors to age in place and maintain dignity and comfort in their own home.

Walabot HOME utilizes Vayyar’s industry-leading sensor technology, meaning no optical data is ever collected and users do not have to worry about the prying eyes of cameras or about their pets triggering the system.  Walabot HOME is powered by an ultra-wide band 4D radio imaging chip and detects falls via a proprietary machine learning-based fall tracking system.  The device simply attaches to the interior wall of any room in the house, including the bathroom, bedroom or kitchen, and continuously scans and monitors for falls to call for help when needed.

Yehud’s Vayyar Imaging is a global leader in 4D imaging technology, providing highly advanced sensors to a wide variety of industries including automotive, smart home, robotics, retail and medical.  The company’s sensors can see through walls and objects and track and map everything happening in an environment in real-time, all while maintaining privacy.  Utilizing a state-of-the-art embedded chip and advanced imaging algorithms, Vayyar’s mission is to help people worldwide improve their health, safety and quality of life using mobile, low-cost 4D imaging sensors.  (Vayyar Imaging 20.06)

Back to Table of Contents

9.17  Octopai’s New Version Introduces Advanced Metadata Analysis & 3rd Party Vendor Integration

Octopai launched the newest version of its platform, featuring more advanced metadata analysis as well as an Automated Business Glossary and integration capabilities that enable collaboration with leading data governance and data catalog players.  Well-known for its advanced data lineage, Octopai continues to introduce more capabilities to empower Business Intelligence teams and business users to work more quickly, accurately, and efficiently with their data.

Octopai’s sophisticated cloud-based metadata analysis platform includes modules for data discovery, horizontal (system-to-system) and vertical (column-to-column) data lineage, and an automated Business Glossary that can be implemented in less than 24 hours.  After speaking with hundreds of Octopai users, the message was clear: Business Intelligence teams need to automate the way they work together, both for their delivery needs as well as to enable business users to trust and control their data from across their multi-vendor environments.  Users also have asked Octopai to enable integration with other platforms such as Data Governance and Data Catalog so that organizations can further leverage Octopai’s sophisticated metadata analysis.

Rosh HaAyin’s Octopai was founded in 2015 by BI professionals who realized the need for dynamic solutions in a stagnant market.  Octopai’s SaaS solution automates metadata management and analysis, enabling enterprise BI groups to quickly, easily and accurately find and understand their data for improved operations, data quality and data governance.  The company was recognized as a Gartner Cool Vendor for Data Science and Machine Learning in 2018 and their investors include North First Ventures, Gefen Capital and iAngels.  (Octopai 20.06)

Back to Table of Contents

9.18  GE & ECI Join Forces to Enhance Support of Modern Utility Networks

ECI and GE Renewable Energy’s Grid Solutions business, one of the leaders in advanced power system solutions, announced their global collaboration of tailored offerings and extensive expertise to better serve the critical infrastructure industry.  This combination of products and services will provide customers with a more robust, end-to-end solution for their networking needs while allowing both parties to extend their already substantial industry footprints.

The joint ECI and GE offering will provide customers with an end-to-end, unified networking solution for whichever technology they require: optical, MPLS-TP or IP/MPLS, or TDM.  Through this collaboration, GE can scale its solutions with ECI’s Apollo optical family or Neptune family with Elastic MPLS, which supports both MPLS-TP and IP/MPLS on the same network element.  As part of a joint solution, ECI also will offer GE’s JunglePAX MPLS-TP solution to its global customers to address areas of critical communications requiring industrial hardened, fanless and optimized packet transport modes to critical OT application performance.  Interoperability between the two product lines is already under way, with future differentiation planned.  Moreover, customers will be able to combine ECI and GE maintenance agreements under one entity for first line support.

Petah Tikva’s ECI is a global provider of ELASTIC network solutions to CSPs, critical industries, and data center operators.  With the advent of 5G, IoT and smart everything, traffic demands are increasing dramatically, and network operators must make smart choices as they evolve their infrastructures.  ECI’s Elastic Services Platform employs our programmable packet and optical networking solutions, along with our service-driven software suite and virtualization capabilities, to provide a robust yet flexible solution for any application.  (ECI Telecom 20.06)

Back to Table of Contents

9.19  Syte-Powered Visual Search Boosts Home Design Product Discovery for Conforama

Syte announced that its technology is now powering Conforama’s online visual search, making the French home equipment retail chain which operates in Europe, one of the first retailers within the global home decor and furnishings industry to offer this technology.  The feature is now live on Conforama’s desktop and mobile websites allowing shoppers to upload any image and find similar products within Conforama’s catalog.

Bridging the gap between product discovery and purchase, the visual search tool delivers a more intuitive and seamless shopping experience for customers.  By simply uploading a photo from a catalog, screenshot, or real-world image through the camera app, customers can easily be directed to the products they are interested in, without the need for textual search or filtering.  With customer experience at the core of Conforama, visual search allows the French retailer to better connect with customers at the moment of highest intent—when they see something they want.  The technology enables Conforama to make products of interest easily discoverable and shoppable, leveraging customer inspiration from the real-world, social media, catalog stylings, and more to create a holistic, omni-channel experience.

Tel Aviv’s Syte is a visual AI technology provider that improves retailers’ site navigation, product discovery, and user experience by powering solutions that engage and convert shoppers.  With Syte, retailers can leverage shoppers’ inspiration and existing product interest to ensure they present the right products at the right time.  Syte has experienced rapid growth since its founding in 2015 and product launch in late 2017.  The company has raised $10 million to date from investors including NHN Ventures, Magma, Naver Corporation, Line Corporation, Reimage Ventures, North Base Media, and KDC Ventures.  (Syte 24.06)

Back to Table of Contents


10.1  Israel’s CPI Rises by 0.7% in May

The Central Bureau of Statistics announced that Israel’s Consumer Price Index (CPI) rose by 0.7% during May to 101.7 points.  This was above the analysts’ expectations.  The index excluding housing rose by 0.9%.  There were notable rises last month in prices of fresh fruit (up 10.2%), and of clothing and footwear (up 7.8%).

Since the beginning of 2019, the CPI has risen 1.5%, and the index excluding housing has risen 1.8%.  In the twelve months to the end of May, the CPI rose 1.5%, and the index excluding housing rose 1.2%.  Seasonally adjusted, the CPI rose 0.4% in May.  Trend figures for February 2019 to May 2019 show the current annual rate of inflation to be 2.1%.  This puts the rate within the government’s target range of 1-3%.  (CBS 16.06)

Back to Table of Contents

10.2  Israel’s First Quarter Growth Figure Revised Downwards

The Central Bureau of Statistics downwardly revised the annualized 5.2% estimate it issued in May for first quarter 2019 economic growth to an annualized level of 4.8%.  The growth figures were greatly affected by car imports ahead of an increase in taxes.  Excluding car imports, estimated economic growth in the first quarter was 3.3%, down from the 3.7% estimate issued in May.  The economic growth rate in the fourth quarter of 2018 was 2.9%.  An analysis of the elements of growth shows that business product rose 3.9% in the first quarter, compared with the 5.8% May estimate.  Exports grew by an estimated 3.9% (4.9% in the May estimate), private consumption was up by an estimated 6.6% (7.6% in the previous estimate), and imports jumped 14.6% (compared with 6.7% in the May estimate).  (CBS 16.06)

Back to Table of Contents

10.3  Composite State of the Economy Index for May 2019 Increases by 0.1%

The Bank of Israel’s Composite State of the Economy Index for May increased by 0.13%.  The Index’s average rate of growth from the beginning of the year is similar to its average pace for 2018, but the pace of expansion moderated in May due to declines in consumer goods imports and in exports, and because of a decline in building starts in March.  The moderation may reflect fluctuations in data: the decline in consumer goods imports occurred, among other things, because of vehicle purchases being brought forward to the first quarter (in view of the expected change in the green taxation regulations) and, based on past experience, building starts data may be revised upward.  The Index was positively impacted by increases in the industrial production index and in revenue indices for April.  The Index reading for recent months was revised slightly downward.  (BoI 24.06)

Back to Table of Contents

10.4  Israeli Housing Prices Continue to Rise

Home prices in Israel rose by 0.5% in March-April 2019 and are up 1% over the past year, the Central Bureau of Statistics announced on 16 June.  By region, prices in March-April 2019 compared with February-March 2019 rose 1.5% in Jerusalem, 2.9% in the north, 0.1% in Haifa, and 0.2% in Tel Aviv. Prices fell 0.1% in central Israel and 0.3% in the south.  Over the past year, prices have risen 3.5% in the north, 2% in the south, and 1.7% in Haifa but have fallen 0.6% in Tel Aviv and 0.3% in central Israel.  The Housing Price Index for March-April 2019 showed that the price of the average deal for new homes fell 0.9% from February-March 2019, the Central Bureau of statistics report.  Some 42.8% of deals for new homes involved government support such as the Buyers Fixed Price program.  (CBS 16.06)

Back to Table of Contents

10.5  Israeli Homes Sales Rise in April

Indications are increasing that the impending election is heating up the real estate market.  After figures published by the Central Bureau of Statistics showed a 1.5% increase in prices this year before the elections in April, the Ministry of Finance chief economist’s department today reported that sales of homes grew 37% in April, compared with April 2018.  Young couples continue to dominate the market, accounting for over half of the homes purchased in April, mostly on the free market.  Some 8,300 homes were purchased in April, even though the Passover holiday fell during this month.  The number was less than in March, but larger than the number in April in most of the past 13 years – only in April 2013 and April 2016 were more deals made.

Of the 4,500 homes purchased by young couples, only 1,100 were under the Buyer Fixed Price Plan.  A survey of the fourth quarter of 2018 found that the Buyer Fixed Price Plan had boosted not only purchases of new discounted apartments, but also the secondhand housing market, at the expense of free market purchases of new homes.  Purchases by young couples on the free market grew by no less than 52% in April, compared with April 2018.  The central district stood out with an increase of over 70%, although a fifth of the buyers in this district were not eligible for discounted apartments under the Buyer Fixed Price Plan.  Among those who were eligible, most of the purchases were concentrated in cities where apartments subsidized by the government were scarce.

Petah Tikva and Holon, two cities with no available Buyer Fixed Price Plan housing, accounted for nearly half of all the purchases by eligible young couples in the central region.  Rosh HaAyin, which has a large supply of apartments subsidized by the government, accounted for 10% of the purchases by young couples on the free market in the central region.  (Globes 17.06)

Back to Table of Contents

10.6  Hotel Revenue Up From Foreign Tourists, Down From Israelis

Israeli hotel proceeds totaled NIS 2.4 billion in current prices in Q1/19, the Central Bureau of Statistics announced, 3% more than in Q1/18.  Proceeds from Israelis were down 1%, while proceeds from foreign tourists rose 7%.  Foreign tourists accounted for 49% of the total proceeds, of which 63% came from hotels in Tel Aviv and Jerusalem.  Proceeds rose 7% in Tel Aviv and 10% in Jerusalem.  Hotel stays in Eilat and the Dead Sea provided 42% of the proceeds from Israeli vacationers.

Proceeds totaled NIS 524 million from hotels in Jerusalem and NIS 520 million from hotels in Tel Aviv, of which NIS 361 million came from foreign tourists.  Proceeds from hotels in Eilat totaled NIS 435 million, of which NIS 361 million came from Israeli tourists.  Proceeds from hotels at the Dead Sea totaled NIS 210 million, and proceeds from hotels in Tiberias totaled NIS 153 million.

Israel had 420 hotels in the first quarter with an aggregate 55,000 rooms, compared with 411 hotels in the first quarter of 2018.  Occupancy averaged 64%, the same as in the corresponding quarter last year. Foreign tourists’ overnights grew by 9%.

The number of jobs in tourist hotels averaged 38,000 a month, down 2.6%, compared with the corresponding period last year.11% of the workers were employed through personnel agencies.  The average salary per job for hotel workers was NIS 8,000, NIS 1,000 more on the average than those employed through personnel agencies.  The figures also show that the proceeds per tourist totaled $113 per night. The Central Bureau of Statistics also said that the first quarter of the year usually has the lowest proceeds per night of any time of year.

Although most of the foreign tourists stayed in Tel Aviv and Jerusalem, Tiberias also had 22% more foreign tourists in the first quarter than in the first quarter of last year.  More Israelis went to Tiberias: proceeds from Israelis at hotels in Tiberias grew 12% in Q1/19.  Proceeds from Israelis rose 4% in Eilat, but fell 11% at the Dead Sea.  (CBS 16.06)

Back to Table of Contents


11.1  ISRAEL:  Israel’s Foreign Trade in Goods and by Country – May 2019

The Central Bureau of Statistics announced that in May 2019, Israel’s imports of goods (gross, excluding diamonds) totaled NIS 19.9 billion.  While 41% were imports from the EU countries, 23% were from the Asian countries, 14% from the US and 22% from the “Other Countries”.

Exports of goods (gross, excluding diamonds) totaled NIS 12.7 billion and the trade deficit of goods (excluding diamonds) totaled NIS 7.2 billion.  Of these, 30% of the exports were to the EU countries, 24% to the USA, 23% to the Asian countries and 23% to the “Other Countries”.

Trade Balance from January – May 2019

The trade deficit of goods (excl. diamonds) with the EU countries totaled NIS 15.6 billion in January – May 2019 compared with NIS 22.0 billion in January – May 2018.

The trade deficit of goods (excl. diamonds) with the Asian countries totaled NIS 11.1 billion in January – May 2019 compared with NIS 8.0 billion in January – May 2018.

The trade deficit of goods (excl. diamonds) with the “Other Countries” totaled NIS 8.6 billion in January – May 2019 compared with NIS 3.2 billion in January – May 2018.

In contrast the trade surplus of goods (excl. diamonds) with the USA totaled NIS 1.6 billion in January – May 2019, a 37% decrease compared with January – May 2018.

Main Trading Country Groups in NIS million Import

January – May 2019


January – May 2018


January – May 2019


January – May 2018

Trade Balance

January – May 2019

Trade Balance

January – May 2018

Total (gross, 108,286.7 102,789.9 74,495.8 72,069.1 -33,790.9 -30,720.8
European Union 43,724.8 45,620.8 28,108.2 23,642.3 -15,616.6 -21,978.5
USA 15,917.1 13,030.1 17,500.1 15,531.5 1,583.0 2,501.4
Asia 24,627.5 24,640.0 13,513.8 16,642.8 -11,113.7 -7,997.2
Other Countries 24,017.3 19,499.0 15,373.7 16,252.5 -8,643.6 -3,246.5

Imports of Goods from March – May 2019

The trend data calculated by the Central Bureau of Statistics show that imports of goods (excluding ships, aircrafts, diamonds and fuels) increased by 1.3% at an annual rate in March – May 2019, following an increase of 9.1% in December 2018 -February 2019.

Trend data indicate that imports (excluding diamonds) from the USA decreased by 6.2% at an annual rate in March – May 2019, following an increase of 22.7% in December 2018 -February 2019 (1.7% monthly average).

Trend data indicate that imports (excluding diamonds) from the EU countries decreased by 0.7%, at an annual rate, in March – May 2019, following a decrease of 1.9% in December 2018 -February 2019.  Since the beginning of 2019, imports (excluding diamonds) from Netherlands, United Kingdom and Ireland decreased significantly compared with the same period in 2018.

Trend data indicate that imports (excluding diamonds) from the Asian Countries decreased in the last three months by 17.1% at an annual rate, following a decrease of 8.3% in December 2018 -February 2019.  Since the beginning of 2019, imports (excluding diamonds) from Indonesia, Japan and Singapore decreased significantly compared with the same period in 2018.

Trend data indicate that imports (excluding diamonds) from the “Other Countries” decreased by 12.1% at an annual rate in the last three months, following an increase of 8.4% in December 2018 -February 2019.  Since the beginning of 2019, imports (excluding diamonds) from Norway, Uruguay and Mexico decreased significantly compared with the same period in 2018.

Exports of Goods from March – May 2019

The trend data show that exports of goods (excluding ships, aircrafts and diamonds) increased by 1.3% at an annual rate in March – May 2019, following an increase of 7.0% in December 2018 -February 2019.

Trend data indicate that exports (excluding diamonds) to the EU countries increased by 0.9%, at an annual rate, in March – May 2019, following an increase of 27.3% in December 2018 -February 2019 (2% monthly average).  Since the beginning of 2019, exports (excluding diamonds) to Spain, Poland and United Kingdom increased significantly compared with the same period in 2018.

Trend data indicate that exports (excluding diamonds) to the US increased by 2.8%, at an annual rate in March – May 2019, following an increase of 4.0% in December 2018 -February 2019.

According to trend data, exports (excluding diamonds) to the Asian Countries increased by 23.5% in the last three months (1.8% monthly average), at an annual rate, following a decrease of 8.2% in December 2018 -February 2019.  Since the beginning of 2019 exports (excluding diamonds) to Taiwan, India and Thailand increased significantly compared with the same period in 2018.

According to trend data, exports (excluding diamonds) to the “Other Countries” decreased by 3.8%, at an annual rate, in March – May 2019, following a decrease of 12.3% in December 2018 -February 2019.  Since the beginning of the year exports (excluding diamonds) to Moldova Republic, Argentina and Nigeria decreased significantly compared with the same period in 2018.  (CBS 19.06)

Back to Table of Contents

11.2  ISRAEL:  Israel’s Kibbutzim Are Ahead of the Trend on Cannabis

Tzally Greenberg posted in Calcalist on 11 June that over the past year, medical cannabis has become the Tel Aviv Stock Exchange’s hottest trend.  Mostly newly established companies in this field have attracted notable public figures such as former Israeli Prime Ministers Ehud Barak and Ehud Olmert and former Shin-Bet head Yaakov Peri, one after the other.  But while politicians, businessmen, and former military officials are bringing their brand of glitz and glamor to the industry, Israel’s kibbutzim have been working behind the scenes to establish themselves for much longer.

Formerly socialist communes that made their living off the land, the decline of Israeli agriculture and simple manufacturing has seen most of the country’s kibbutzim fall from grace and become privatized.  But in recent years, more and more kibbutzim have repurposed their wheat and corn fields for a new kind of plant.

Today, there are 14 kibbutzim in Israel that are either active growers of cannabis or in advanced stages of entering the domain. In the industry, estimates are that a third of Israel’s 270 kibbutzim are considering a pivot.  While some early birds have made the change as early as 2008, most of the interest is a result of Israel’s decision to start setting up a regulatory framework in 2016.  Only weeks later, a few dozen kibbutzim applied to the Israeli Ministry of Health for a preliminary permit.

Since then, many kibbutzim have been putting aside between 4,000 and 200,000 square meters for greenhouses and production facilities and creating collaborations with private and public cannabis companies.  “It was love at first sight,” Ran Gorelik, the Israeli representative of Toronto-listed cannabinoid company Cronos Group Inc., said in a recent interview with Calcalist.  Cronos has a partnership with Kibbutz Gan Shmuel, located in Israel’s north, which has an advanced cannabis operation.

“When Cronos looked for a partner in Israel, the Kibbutzim offered everything it looked for,” Gorelik said.  “A size advantage, an existing infrastructure, and proven abilities as an agricultural organization.”  Cronos and Gan Shmuel set up a joint company two years ago for the growth, manufacturing, and distribution of medical cannabis.  Cronos always assumed Israel will authorize export at some point, Gorelik said, adding that they intend to be ready whenever export starts.

The ready infrastructure found in Israel’s kibbutzim is bolstered by several other benefits the country offers, Gorelik explained: it is cheaper to manufacture here than in Europe or Canada, and Israel is also considered a global leader when it comes to cannabis and pharmaceutical research and development.  Furthermore, Cronos is also aiming to supply to the Israeli market, he said.

More local collaboration is that of Kibbutz Dan and Israel-based home cannabis farming startup Seedo (incorporated as Eroll Grow-Tech Ltd.), which is traded on the U.S. OTC market.  The kibbutz has considered the risks and decided that Seedo was an interesting business opportunity, Eitan Rahimi, Dan’s business manager, told Calcalist in an interview.  As part of their deal, Dan is set to operate 12 three-story cannabis growing containers and additional facilities to be placed over 5,000 square meters.  Seedo expects the partnership to generate 1.8 tonnes of dried buds worth NIS 36 million ($10 million) within three years.

Kibbutzim can provide land both for growth and for production, lowering costs and creating one manager for all business aspects, Itay Hecht, CEO of cannabis company Hi Pharma Ltd., told Calcalist.  Hi Pharma, currently in the process of merging with Tel Aviv-listed Ophectra Real Estate & Investments Ltd., has a partnership with kibbutz Ramot Menashe in Israel’s north.  Ramot Menashe set aside 200,000 square meters for cannabis growth and 7,000 square meters for production, including an already existing facility that conforms to the GMP (good manufacturing practices) standard. Hi Pharma is contributing the knowledge.

Israeli medical cannabis regulations also demand that employees hold Israeli citizenship, Hecht added, which kibbutzim can also easily provide. “…and the kibbutz is a brand name outside of Israel,” he said. “It is seen as something stable, and that helps raise money.”

Kibbutz Kfar Masaryk, located south of Acre, pivoted to the industry two years ago after member Chen Flor recognized its potential and pushed for it in member meetings.  “We wanted to continue traditional kibbutz values of working the land,” he said, and also realized that the kibbutz had an asset that could be used more efficiently.  Initial plans are for 6,500 square meters of greenhouses, which could be expanded to as much as 20,000 square meters, and another 8,500 square meters of production facilities.  “Alongside the inner-kibbutz reorganization, we started talks with four companies in the industry, which can come with the relevant knowledge as a strategic partner,” Flor said.  “Despite what people think, each kibbutz has its own character and way of life, and not every partner will be a good fit.”

Lots of companies today are scouting kibbutzim for business opportunities, Doron Arami, head of the medical cannabis sector at the Israeli branch of international accounting firm BDO, told Calcalist.  Israeli regulation conditions an initial permit for growing cannabis on having a “connection” to a land and an existing water quota, both of which come with kibbutzim in a packaged deal, he said.

More than large plots of land, Kibbutzim have can also provide industrial spaces, Arami said.  “That alone saves NIS 1.5 million ($420,000) a year on security and transport costs,” he said.  Under Israeli law, companies that generate more than 25% of their revenues through exports enjoy various tax exemptions and benefits, he added, and the rural location of most kibbutzim also awards tax benefits.  On their side, Arami said, kibbutzim will see more money from medical cannabis than from other agricultural products.  (Calcalist 11.06)

Back to Table of Contents

11.3  ISRAEL:  The Negotiations between Israel and ‎Lebanon on the Maritime Border

Orna Mizrahi and Oded Eran posted in INSS Insight No. 1180 on 24 June that an agreement has been reached between Israel and Lebanon on advancing negotiations to ‎resolve the dispute on demarcation of the maritime border – an issue that has become ‎more relevant following gas discoveries in the Mediterranean Sea and the interest of ‎both countries in maximizing the economic benefit of gas production.

So far, all ‎attempts at mediation have failed, even though in the last set of talks (2011-2012), ‎Israel agreed to a suggested compromise that provided a greater portion (with a ratio of ‎‎55:45) of the area in dispute (860 sq. km) to Lebanon.  Nonetheless, Lebanon did not ‎respond to this concession.  Lebanon’s current agreement to negotiate stems mainly ‎from its difficult economic situation and without a doubt required the agreement of ‎Hezbollah, which is also facing financial hardship and expects its own portion of the ‎dividends from the gas production.  It seems that aside from the economic benefit, ‎agreement between the countries would have additional positive implications, but at this ‎stage it is still an open question whether an agreement would serve as an incentive for ‎Hezbollah to maintain calm along the border with Israel over time.  In the regional ‎framework, if an agreement is reached, it would be possible to consider four-way ‎cooperation between Israel, Lebanon, Cyprus and Egypt to advance a regional transport ‎system from the Eastern Mediterranean to Europe.  In any case, despite the joint interest ‎in resolving the issue, Israel can expect difficult and complex negotiations with national ‎security implications.  Therefore, it is proposed that a designated inter-ministerial team ‎be established to manage the negotiations, which will ensure the inclusion of all ‎relevant parties and manage an organized decision making process.‎

In the coming weeks, negotiations are supposed to begin between Israel and Lebanon on ‎demarcation of the maritime border between them.  Agreement on forthcoming talks was ‎reached following intensive efforts by United States Assistant Secretary of State David ‎Satterfield and it was decided that negotiations will be held at the UN facility in ‎Naqoura, on the Israel-Lebanon border.  Due to Lebanese opposition to American ‎mediation, the United States will participate in the talks only as a facilitator.  The ‎conflict between Israel and Lebanon concerns an 860 sq. km. triangular area in the ‎Mediterranean Sea, and stems from a dispute regarding the demarcation method (Israel ‎marks the border as being at a 90-degree angle to the land border, while Lebanon marks ‎it as a continuation of the land borderline).  The issue grew more relevant and became an ‎open conflict following the natural gas discoveries in the Mediterranean Sea.  Lebanon, ‎which wanted to pursue gas drilling off its coast, submitted its demarcation of the ‎maritime borders to the UN ten years ago, making this area part its Exclusive Economic ‎Zone.  Israel, which saw this as an infringement of its rights, also submitted its version ‎of the border demarcation to the UN.‎

The two countries presumably have a clear interest in reaching an agreement on the ‎maritime border between them, mainly for economic reasons.  In 2011, Israel asked the ‎United States to mediate and assist in reaching agreement with Lebanon.  Israel sought ‎not to discuss the issue as part of the Joint Military Commission established through ‎Security Council Resolution 1701, which was adopted at the end of the Second Lebanon ‎War (2006) and in whose framework Lebanon demanded simultaneous discussion of ‎the issues related to both the land border and the maritime border.  Moreover, Israel ‎opposed and continues to oppose a UN role in determining its borders, including its ‎maritime border, in part because it is not a signatory to the United Nations Law of the ‎Sea Convention.  In the indirect negotiations that took place in 2011-2012, Israel agreed ‎to the suggested compromise on demarcating the maritime border, making concessions ‎to Lebanon and providing it with the greater share of the territory in dispute (with a ‎ratio of 55:45), but so far Lebanon has not responded to this offer.‎

The dispute with Israel has slowed Lebanon’s development of its natural gas industry. ‎ Although foreign companies won tenders for exploration rights including in the ‎disputed area, they quickly announced that they would not operate there.  The Lebanese ‎government’s current agreement to renew the negotiations, and this time in a direct ‎manner, seems to have been made possible by the formation of the Lebanese ‎government earlier this year, but it is clear that the main backdrop is the urgent ‎economic need, due to Lebanon’s severe economic hardship (according to Moody’s ‎‎2018 credit rating, Lebanon is in third place among countries with the highest debt, ‎which constitutes 140 percent of GDP).  While last month Hariri’s government ‎succeeded in approving an “austerity budget” for 2019, already – even before its ‎approval by the parliament – the budget has triggered protests due to the salary cutbacks ‎of public servants and army retirees, and due to the expected tax hike.  It is estimated ‎that this budget will continue to include a deficit, and will not lead to a significant ‎change in Lebanon’s economic situation (Moody’s estimates that the debt will rise to ‎‎155 percent of GDP in 2023).‎

Moreover, it seems that there has been a change in Hezbollah’s position on the issue, as ‎Lebanon’s willingness to negotiate would not have been possible without this ‎organization’s approval.  Hezbollah gained an added strength in the last elections and is ‎currently a leading and influential power within the Lebanese government.  Hezbollah ‎recognizes the expected economic benefit to Lebanon of pursuing natural gas drilling in ‎the sea, and more importantly, the organization itself expects dividends, in light of its ‎economic difficulties following an increase in its expenditures (due to its involvement ‎in the war in Syria) and a reduction in its income (following the American sanctions on ‎its patron Iran, as well as the direct sanctions imposed on the organization itself).  This ‎change in Hezbollah’s position increases the chances of reaching an agreement, as the ‎organization’s involvement in the government also forces it to address national ‎considerations that weigh on issues related to Lebanon-Israel relations.  However, ‎difficult and complex negotiations are expected in any case, as the Lebanese will likely ‎demand a greater portion than what may have been offered to them in the past, but that ‎is not a sufficient reason for Israel to agree to a different formula than what was ‎presented in the past and already included the Israeli concession of the 55:45 ratio.‎

Israel began gas exploration in the Mediterranean Sea 20 years ago.  The enormous ‎investments in mapping the potential reserves, estimating their economic value, ‎launching exploratory drilling, and building the infrastructure for producing and ‎transporting the gas to Israel proved justified when the Israeli economy began ‎transitioning to an energy source that is cheaper and cleaner than oil and coal.  Today, ‎over two thirds of the electricity produced in Israel comes from natural gas, and in ‎addition to its advantages over other energy sources, the royalties from gas production ‎enrich the state’s coffers.  A solution to the conflict with Lebanon will not change the ‎supply of natural gas for Israel, as existing amounts are enough to supply Israel’s ‎internal needs even in the long term, including the ability to meet contracts to supply ‎gas to parties outside of Israel, such as the Palestinian Authority, Jordan and Egypt.‎

However, a resolution of the conflict with Lebanon would also have strategic ‎implications vis-à-vis Lebanon and in the regional context.  The key question is: would ‎reaching an agreement serve as an incentive for Hezbollah to maintain calm along the ‎border with Israel?  Given the Lebanese political reality, presumably each of the actors ‎in this arena, including Hezbollah, has been promised its share in the expected income ‎from the gas.  Some also claim that with Hezbollah’s increasing hold over the ‎government, its sense of responsibility toward the Lebanese state has grown.  All of ‎these – in addition to its other difficulties – could contribute to a desire to maintain ‎calm on the border with Israel.‎

In the regional context, if an Israeli-Lebanese agreement is reached, the two countries ‎could jointly examine the possibility of pursuing a regional gas transport system from ‎the Eastern Mediterranean to Europe (an important potential market for gas from the ‎Eastern Mediterranean), with the participation of Egypt and Cyprus.  There are three ‎main alternatives for transporting the gas to Europe: liquefaction facilities in Egypt ‎and/or Cyprus and from there in tankers to European ports; a pipeline from the Eastern ‎Mediterranean to a destination in Europe; and a relatively short pipeline that would ‎connect to the pipeline system in Turkey as a market and conduit to Europe.  The high ‎cost of each of these alternatives would require all of the countries in the Eastern ‎Mediterranean to agree to joint use of the transportation facilities in order to justify the ‎investments, which would come from outside the region.‎

An agreement on the demarcation of the maritime border is an essential but not ‎exclusive step for beginning gas exploration and production operations in the area in ‎dispute. It is likely that gas found in this region would be part of a field whose borders ‎would deviate from the borders of the area determined in the agreement.  If the border ‎demarcation issue is resolved, then Israel and Lebanon would need to reach a unitization ‎agreement (an agreement on the division of profits from production in this region), ‎which could also be delayed due to a dispute between the sides.  Lebanon and Israel can ‎avoid a delay if they agree to entrust the technical-economic decision on the issue to the ‎companies that would have the rights on the two sides of the agreed-upon borderline, ‎while they would reserve the right to approve such an agreement.‎

In any case, despite the joint interest in reaching an agreement, a difficult and complex ‎set of negotiations lies ahead that will require suitable preparations on the Israeli side.  ‎Given the complexity of the issue and the broad implications of these negotiations for ‎Israel’s national security, a designated inter-ministerial negotiating team should be, ‎similar to the teams established prior to the negotiations with the Palestinians (before ‎the Camp David Summit in 2000 and the Annapolis process in 2007-2008), headed by a ‎senior figure with experience in negotiations management.  The establishment of such an ‎administration is all the more important in light of Lebanon’s connection between the ‎issue of the maritime border and the issue of the land border.  These issues are under the ‎responsibility of different ministries and require the involvement of many parties within ‎the security and political establishments.  Thus, the first part of the negotiations on the ‎issue of demarcating the maritime border should be led by the National Security ‎Council and the Ministry of Foreign Affairs and include mapping experts, while the ‎second part of the process, following agreement on the demarcation of the border, ‎should include economic and energy experts.‎  (INSS 24.06)

Back to Table of Contents

11.4  ARAB MIDDLE EAST:  Shooting for the Stars – the Arab Space Club

Yoel Guzansky posted in INSS Insight No. 1175 on 16 June that in recent years, several Arab countries have sped up research, development and collaborations in the field of space in order to establish an independent technological-scientific infrastructure.  The United Arab Emirates and Saudi Arabia are taking the lead, using their vast economic resources for research, commercial, and even military purposes.  The Arab countries still have a shortage of scientific-human infrastructure for research and development in the space field, although it is being built.  They also lack the ability to launch independently, although the motivation is there.  The lion’s share of the projects are intended for economic and scientific needs and express their striving for prestige and status.  The desire of the Arab countries to walk the path of progress, in and of itself, should not cause the State of Israel concern; on the contrary.  Several of the civilian Arab projects in the field of space research could also serve as fertile ground for collaboration with Israel.  In the Arab world, however, space-related endeavors are seen more than before through the prism of security, which could pose a challenge to Israel over the long term.

Israel’s lunar probe, Beresheet, aroused interest in the Arab world.  Alongside the schadenfreude over the spacecraft’s crash on the moon’s surface, Arab writers also mentioned the necessity of an “Arab space awakening” in order to learn from Israel, in an effort to catch up with its space program.  Even before then, several Arab countries sped up their research and development efforts in the field of space in order to construct an independent technological-scientific infrastructure.  Particularly prominent are the efforts of the United Arab Emirates (UAE) and Saudi Arabia, which are using their vast economic resources for research, commercial and even military space uses.

While the main motivation for those efforts has to do with considerations of prestige and status (i.e., intra-Arab competition), it is also linked to the understanding that space research serves as a “technological engine” that draws many industries and fields of knowledge in its train.  This understanding is tied to the desire of Arab countries to diversify their economies (and in the case of the Gulf States, to reduce their dependence on revenues from oil and its products) and develop modern economies.  The growth in the number of private companies in the West in this field also contributes to the interest among Israel’s neighbors in the advantages that space could give them.


The UAE space push is the broadest and most ambitious in the Arab world.  The UAE’s intention is to become a hub in this field.  The federation, which has invested approximately $6 billion in space R&D, has already launched into space several satellites, some of them developed independently.  It is also building infrastructure and training scientists via branches of international universities that operate within its borders.  In 2019, the UAE published its “National Space Strategy 2030,” containing 21 projects in which 85 organizations, now under the auspices of the Emirates Space Agency, are taking part.  An unmanned atmospheric research probe (called Hope), to be launched from Japan, is supposed to reach Mars in 2021, approximately at the time of the fiftieth anniversary celebrations of the UAE’s independence.  The launch of the first Emirati astronaut to the International Space Station, using a Russian launcher, is planned for September.  The UAE is also establishing a “space city” whose purpose is to simulate life on Mars.

The UAE, which has cooperation agreements in the space field with foreign companies, has brought private companies on board with its ambitious vision.  In 2018, KhalifaSat, the first product of development and production from the UAE, was launched from Japan.  It broadcasts imaging at a reported resolution of 0.7 meters to a ground station in Dubai for various purposes, including urban and environmental planning.  In 2019, the existing collaboration between the UAE and Virgin Galactic (in which the federation owns a share) was deepened in order to promote, among other things, space tourism activity from its territory.  Alongside the research and commercial activity, the UAE also purchased two advanced satellites for military purposes (Falcon Eye) from French companies for $1 billion.  The satellites, the first of which is expected to be launched in July 2019, will provide imaging at a reported resolution of at least 0.7 meters.  This is taking place after a protracted delay that stemmed from, among other things, obstacles that the United States reportedly had placed before the implementation of the deal.

Saudi Arabia

The Saudi Space Agency was established in December 2018 and Prince Sultan bin Salman Al Saud, who in 1985 was the first Arab (and Muslim) astronaut on the space shuttle Discovery, was appointed its chairman.  The agency, which is responsible from now on for national coordination and policy planning in the field, has a starting budget of more than one billion dollars for its first year of operation.  Space-related research and development in the kingdom are coordinated by the King Abdulaziz City for Science and Technology (KACST) and operates under the auspices of the National Center for Remote Sensing Technology (NCRST).  In addition, Saudi Arabia is establishing a center for space research in cooperation with NASA and Stanford University.

Saudi Arabia is not progressing in the field as rapidly as its neighbor, the UAE.  As a result, Riyadh has decided to establish research, development and production infrastructure of satellites with outside assistance.  In 2018, two observation satellites, “the fruit of Saudi development” -Sat 5A and Sat 5B-were launched by a Chinese rocket, and agreements in the space field between the kingdom and Ukraine, Russia and Kazakhstan have been reported.  Saudi Arabia is also involved in China’s lunar research.  In addition, it has been reported that the kingdom entered a partnership with DigitalGlobe for the development of small satellites that will provide imagining at a reported resolution of 0.8 meters, and it is making contacts with France and Russia regarding the purchase of satellites for military purposes.  Russia has also agreed to train and send a Saudi astronaut to the International Space Station.

Other Arab Countries

Arab countries long ago took advantage of the opening of the commercial communications satellite market and benefited from the prestige that went along with possessing advanced technology without having independent scientific infrastructure for its development.  ArabSat was established under the Arab League’s auspices as far back as 1976.  The organization, which is located in Riyadh, purchases and operates communications satellites, which also serve as a platform for influencing public opinion in the Arab world through Arab-owned satellite channels.  The first satellite was launched in 1985, and the most recent one, ArabSat 6A, build by Lockheed-Martin, was launched in April 2019.

It seems that every Arab country wants to put its national flag in space these days.  In 2018, Jordan launched a micro-satellite of its own production, JY1, into space; Qatar launched a second communications satellite (Es’hail 2), produced by Japan, into space; Morocco launched another observation satellite (Mohammed VI-B), French built; and Egypt, which uses satellites for scientific, commercial, and military purposes, established its own national space agency and deepened its cooperation with Russia and China in the space field.

Together with the national efforts, there is also an attempt to promote Arab space collaboration.  The UAE has already signed a cooperation agreement with Bahrain, and it is likely to sign a similar agreement with Saudi Arabia.  The UAE is also the driving force behind the renewed initiative to establish the “Arab space cooperation group,” to include eleven countries, which got under way last March at the fringes of the Global Space Congress that took place in the UAE.

The first project of the group, whose goal is to increase scientific cooperation, will be to construct the 813 climate-monitoring satellite, funded by the UAE.  The establishment of such a body is a way of cutting the large research and development costs in the field and making the fullest possible use of the existing knowledge among its member countries.  However, it should be mentioned that previous attempts at cooperation within the Arab world in this field were stopped due to mutual suspicions, political differences, and different priorities, which reflected the patterns of competition and struggles for prestige in the Arab world.


Arab leaders have begun investing in the space field in order to contribute to the progress of their respective countries and as a rapid way to obtain prestige and status.  They do not want to lag behind Israel and Iran, which are more advanced than they are in this field.  They have concentrated thus far on acquiring satellites from foreign companies in order to add to their countries’ (and their leaders’) prestige simply by planting their national flags in space.  But it is already evident that they are engaged in long-term efforts to develop an independent infrastructure with assistance from various entities, including Russia and China, which are more willing to provide them with technologies as part of the transactions.

Nonetheless, some in the Arab world hope to reduce their dependence upon foreign elements.  Progress in the satellite field will enable them to establish safer communication channels, and an observation satellite in their control will provide them with operational flexibility that they cannot get from commercial satellites, due, among other things, to the restrictions on resolution that the United States imposes upon imaging of Israel.

Almost any country can purchase satellite products for research, communications or even military uses.  The Arab states are still greatly lacking in scientific-human infrastructure, though it is being built.  They also lack the ability to launch independently, though they are motivated to make progress in this area as well. Saudi Arabia, for example, is evidently developing a launcher, with foreign assistance.  Among other things, it has been reported that an installation for assembling surface-to-surface missiles is located near Riyadh; its construction began in 2013.  Like the accelerated (“civilian”) nuclear development in the region, satellite and space technology can be put to dual use – for civilian-commercial and security-military needs alike.

The Arab countries’ desire to walk the path of progress should not cause Israel concern.  On the contrary, some of the Arab projects in the field of space research may even serve as fertile ground for cooperation with Israel.  Several of the Arab Gulf states benefit from cooperation with Israel, which can launch and operate satellites independently and has an advantage in building small, cheap and advanced satellites.  Still, the Arab world increasingly perceives space through the prism of security, which, in the long term, may pose a challenge to Israel. Israel needs to evaluate when and how the combination of the above-mentioned Arab space motivation and vast resources put to play may challenge its security.  (INSS 16.06)

Back to Table of Contents

11.5  JORDAN:  Fitch Publishes Jordan’s ‘BB-‘ Rating; Outlook Stable

On 13 June, Fitch Ratings published Jordan’s Long-Term Foreign-Currency Issuer Default Rating (IDR) of ‘BB-‘ with a Stable Outlook.

Key Rating Drivers

Jordan’s ratings are supported by a track record of fiscal and economic reforms and resilient availability of domestic and external financing linked to the liquid banking sector, growing public pension fund and funding from Jordan’s external partners.  Jordan’s ratings are constrained by high government debt, weak growth and risks stemming from domestic and regional politics, large external financing needs and GDP per capita that is lower than the ‘BB’ median.

Jordan has built up a track record of reforms that have substantially reduced the budget deficit and stabilized government debt/GDP after being hit by multiple shocks and a slowdown in economic growth since 2011.  The central government (CG) budget deficit (including transfers to state water and electricity companies) narrowed by 9% of GDP in 2013-2018, albeit helped by a fall in energy input prices for electricity generation.

The authorities continue to pursue a program of fiscal and economic reforms and are back on track with the IMF Extended Fund Facility (EFF) signed in August 2016, after protests slowed measures in 2018.  In May, the IMF completed the second review of the EFF, while emphasizing the need for continued gradual fiscal consolidation and further measures to improve the finances of the state electricity sector.  We would expect a follow-on arrangement between Jordan and the Fund after the EFF ends in March 2020.

Public finances remain a core rating weakness, despite the fiscal consolidation in recent years.  Gross general government (GG) debt at 79.5% of GDP at end-2018 is far higher than the ‘BB’ median of 43%.  We project a gradual reduction in government debt over the medium term, assuming Jordan maintains fiscal discipline.  Availability of domestic financing owing to a fairly large and liquid banking sector and the fact that half of government external debt is owed to multilateral and official bilateral creditors are mitigating factors.

Gross public debt, as reported by the Ministry of Finance and IMF, is higher at 94.4% of GDP at end-2018, while Fitch has calculated a consolidated general government estimate by netting out the Social Security Investment Fund’s (SSIF) holdings of government debt (17.7% of GDP at end-2018) and adding municipal debt (the SSIF manages the assets of the Social Security Corporation; SSC).  Like the official public debt numbers, Fitch’s GG estimate includes all government guaranteed debt, namely the debt of the public water authority (WAJ) and the electricity company (NEPCO).  In 2018 the government decided to assume the debt of WAJ and material risks remain from the debt burden NEPCO accumulated during the period after Jordan lost access to Egyptian natural gas.

The headline CG budget deficit narrowed marginally to 2.4% of GDP in 2018, but missed the government target of 1.7% of GDP because weak growth hit revenue performance and the income tax reform assumed in the budget was delayed.  Including cash transfers to NEPCO and WAJ (0.7% of GDP), which are not included by the government above the line as spending, the central budget deficit widened to 3.1% of GDP, from 2.9% of GDP in 2017.

We forecast that the headline CG budget deficit will narrow to 2.2% of GDP in 2019 (and to 2.9% of GDP including further transfers to WAJ and zero transfers to NEPCO), helped by the income tax law, which came into force in January and could add 0.7% of GDP in revenue, but constrained by further increases in interest payments.  Fitch’s GG estimates indicate an almost balanced budget in 2019 owing to the substantial annual surplus of the SSC, but this does not give a good indication of the government’s financing needs as the SSIF cannot invest more than 60% of SSC assets in CG securities

Jordan’s external financing flexibility is a rating strength, underpinned by strong relations with the international donor community, multilateral organizations and bilateral allies, including the US and partners in the GCC.  Foreign grants and concessional loans averaged 7.3% of GDP in 2012-2017.  Of this, grants averaged 4.8% of GDP in 2012-17. In 2018 committed amounts were higher than in 2017 and grants in the central budget increased.  Most recently, the World Bank has agreed to a second Development Policy Loan for Jordan of $1.45 billion.

While the availability of external financing has helped the Central Bank of Jordan (CBJ) retain a significant stock of international reserves despite persistent current account deficits, Jordan’s net external debt is rising.  The CBJ’s reserves fell in 2018 but remained robust at 7.1 months of current external payments, backing the dinar’s peg to the US dollar.  However, non-debt creating inflows such as foreign direct investment have weakened and Jordan’s net external creditor position of 2004-2014 has reversed, with net external debt reaching 16.2% of GDP in 2018.  We forecast the current account deficit to average 6.3% of GDP in 2019-2020 and for gross external financing needs of 15%-16% of GDP.

Low inflation is a rating strength. Jordan has preserved macroeconomic stability, albeit with slowing GDP growth (to 1.9% in 2018), despite multiple and severe shocks since 2011, including heightened regional instability since the Arab Spring, violent conflicts in neighboring Syria and Iraq, the closure of important trade routes and markets in those countries, and an influx of Syrian refugees. Fitch forecasts growth to improve but remain moderate, at 2.3% in 2019-2020, given fiscal constraints and only gradual improvement in trading and investment conditions in the region.  A border crossing reopened with Syria in late 2018 and trade and border agreements with Iraq were updated in 2019 following the reopening of the border in 2017, with the latter already helping Jordan’s exports.  Travel receipts increased by over 13% in 2018 and we expect tourism to continue growing in 2019.

Jordan scores above the ‘BB’ median for governance as measured by the World Bank governance indicators, but in Fitch’s view these scores do not fully capture the domestic and regional political risks that Jordan faces.  Jordan has weathered multiple regional shocks since 2011, but these did adversely affect the economy and public finances.  The geopolitics of the region remain volatile, presenting the risk of further negative spillovers.  While political stability has been maintained under the leadership of King Abdullah, low growth and the high unemployment rate (19.1% in Q1/19, with youth unemployment far higher) present ongoing risks of social unrest.  Over the medium term there may be calls for further political and constitutional reforms that could disrupt economic policymaking.

Rating Sensitivities

The main factors that, individually or collectively, could lead to positive rating action are:

-Progress in fiscal consolidation leading to a sustained reduction in government debt/GDP

-Higher and sustained real GDP growth

-Sustained reduction of the current account deficit and net external debt

The main factors that, individually or collectively, could lead to negative rating action are:

-Rising external indebtedness or a weakening of support from external partners

-A deterioration in government debt/GDP for example due to loosening of fiscal policy

-Deterioration in domestic political stability or geopolitical shocks that adversely affect the economy or public finances  (Fitch 13.06)

Back to Table of Contents

11.6  EGYPT:  Egypt’s Electricity Deal With Cyprus & Greece Brightens Energy Outlook

Menna A. Farouk wrote on 13 June in Al-Monitor that Egypt has signed an agreement with Cyprus and Greece to build undersea electrical cables allowing it to export electricity to Europe.  The electricity interconnection framework agreement establishes an undersea cable called the EuroAfrica Interconnector.  The agreement was signed on 22 May by EuroAfrica Interconnector Limited and the Egyptian Electricity Transmission Company.

According to the project developer, EuroAfrica Interconnector Limited, the 2,000 MW cable will be connected from Egypt to continental Europe via Cyprus, making Egypt an energy hub for Africa and link it to the European continent.  The cable will run from Egypt to Cyprus, from Cyprus to Crete and from Crete to Attica in Greece.

Ioannis Kasoulides, chairman of the Strategic Council of the EuroAfrica Interconnector, said in a statement following the signing ceremony, “With the historic signing agreement between EuroAfrica Interconnector and the Egyptian authorities, the first major electricity interconnection project linking Africa with Europe has been realized.”

“Cyprus now becomes a major hub for the transmission of electricity from Africa to Europe, and Egypt establishes itself as a regional energy hub for the transmission of electricity from Africa to the Arabian peninsula,” Kasoulides stated, adding that with the signing of this agreement, Egypt’s national grid will be connected to Europe’s electricity system.  “This historic project is of great importance to Egypt’s strategic plan for economic development and energy security, and the EuroAfrica Interconnector is connecting Egypt to the European electricity network through Cyprus.  Egypt will be an important electricity and energy partner for the European Union,” Egyptian Minister of Electricity Mohamed Shaker told a press conference following the signing of the deal.

Energy experts have praised the signing of this agreement, which will serve Egypt’s strategy to turn into a major energy hub, but they also point to challenges ahead.  Tharwat Ragheb, professor of petroleum and energy engineering at the British University in Cairo, said that the agreement serves Egypt’s plan to become a hub for trade of energy in the Middle East.  “Egypt has also signed electricity interconnection deals with Saudi Arabia, Sudan, Libya and Jordan. Such access to power grid projects will make Egypt a pivotal energy carrier in the Middle East, from the east with Jordan and Saudi Arabia, from the west with Libya, from the south with Sudan, or from the north with Cyprus and Greece,” Ragheb told Al-Monitor.

However, he added that sea operations, as in the case of Cyprus and Greece, are more difficult.  “Transporting electricity via sea will need a lot financial resources and high technology.  It will also take some time,” Ragheb said.

Hani Farouk, a member of the non-governmental organization of the Egyptian Experts Association for Development who specializes in planning and managing oil and gas projects, said that the Egyptian government needs to work on developing the electricity infrastructure in order to be qualified to connect to the European electricity system.  He added that with the signing of such electricity interconnection agreements with African, European and Asian countries, electricity will become a source of national income for Egypt.  “This is a real game-changer for Egypt, which has been relying on energy imports for years,” Farouk told Al-Monitor.

Farouk said that Turkey has missed its chance to become an energy hub in the Middle East.  “Turkey was trying to take Egypt’s position, but it failed when Egypt signed an agreement with Cyprus last year to establish a direct sub-sea gas pipeline that would transport gas from Cyprus’ Aphrodite gas field to Egyptian liquefaction stations for re-export to European countries.  What Turkey is now doing is just nonsense threats over territorial waters,” he added.  “Now Egypt will become the top gas exporter to Europe.”

Since 2014, Egypt has been ramping up its efforts to address energy shortages and become an oil and gas exporter once again for the first time since the January 25 Revolution.

In January this year, seven eastern Mediterranean countries met in Cairo and agreed to establish the Eastern Mediterranean Gas Forum based in the Egyptian capital.  The meeting was attended by ministers of energy from Egypt, Jordan, the Palestinian Authority, Israel, Cyprus, Greece and Italy.  Turkey was not represented at the meeting.

The establishment of the forum, which seeks to offer competitive prices and build a regional gas market, comes as Egypt seeks to transform itself into a regional energy hub.  “Deciding to have the headquarters of this forum in Cairo boosts Egypt’s plan to become an energy hub in the Middle East region and the top energy exporter to Europe,” Farouk said.

Menna A. Farouk, a journalist and an editor at The Egyptian Gazette, writes about social, political and cultural issues, including press freedom, immigration and religious reforms among other topics.  (Al-Monitor 13.06)

Back to Table of Contents

11.7  TUNISIA:  IMF Completes Fifth Review Under the Extended Fund Facility (EFF) Arrangement

On 12 June 2019, the Executive Board of the International Monetary Fund (IMF) completed the Fifth Review of Tunisia’s economic program supported by an arrangement under the Extended Fund Facility (EFF).  The Board’s decision makes available to Tunisia an amount equivalent to SDR 176.7824 million (about $245 million), bringing total disbursements to SDR 1,161.7133 million (about $1.6 billion), and catalyze much-needed financing from other partners and international markets. In completing the review, the Board also approved the authorities’ request for waivers of non-observance of end of March 2019 performance criteria on net international reserves and net domestic assets.  These waivers were granted on the ground of the corrective measures undertaken by the authorities.

The Executive Board also approved the authorities’ request for rephasing of purchases under the arrangement, including the requested reduction of the total access under the arrangement to an amount equivalent to SDR 1.9522533 billion (about 358.1% of Tunisia’s quota).  The four-year EFF arrangement was approved by the Executive Board in May 2016 for an original amount equivalent to SDR 2.045625 billion (about $2.9 billion or 375% of Tunisia’s quota at the time of approval of the arrangement).

Socially-balanced macroeconomic stabilization remains the government’s priority for 2019, which the EFF arrangement supports.  Fiscal policies aim at mobilizing revenue and containing current spending to reduce Tunisia’s budget deficit, while maintaining public investment and strengthening the social safety-net for low-income households.  Monetary policy focuses on curbing inflation, and continued exchange rate flexibility will help to improve the current account deficit and international reserves.  Structural reforms supported under the arrangement include measures to improve the business climate, broaden access to finance, and reduce corruption.

Following the Executive Board discussion on Tunisia, Mr. David Lipton, First Deputy Managing Director and Acting Chair, made the following statement:

“While improving over the course of 2017 and 2018, growth remains subdued and elevated macroeconomic vulnerabilities persist, but policy efforts are starting to show results.  A strong revenue effort and energy subsidy reform have supported significant fiscal deficit reduction, monetary tightening has started to reduce inflation, and lower foreign exchange (FX) interventions have allowed the exchange rate to better reflect fundamentals.  Against the backdrop of a challenging domestic socio-political environment and external pressures, program performance since the Fourth Review has been mixed.

“Socially-conscious stabilization efforts will have to remain center stage to reduce vulnerabilities.  Near-term policies should continue to focus on improving fiscal and external deficits to reverse the adverse debt dynamics, reducing inflation, and strengthening the social safety net for low-income households. Improved communication of policy and reform objectives and their rationale will facilitate implementation.

“Reducing the fiscal deficit to 3.9% of GDP in 2019 will require unwavering discipline.  The authorities’ strategy relies on strong revenue collection, targeted energy subsidy reforms with improved communication, and tight wage bill management.  The budget allows for maintaining growth-enhancing investment and increasing social spending, but there is no room for relaxing the effort on taxes or current expenditure after the recent increase in civil service wages.

“Monetary policy needs to focus on maintaining price stability.  Additional policy rate hikes would be warranted if inflation projections for December 2019 exceed the target.  Success with disinflation will also depend on reducing central bank refinancing and on reforming the collateral framework, while preserving financial stability.

“Reducing external imbalances hinges on a market-determined exchange rate.  Competitive FX auctions together with reduced Central Bank interventions and effective communication to the market remain critical to improve the current account and reserves cover.  Efforts to strengthen social protection should continue. In particular, increased transfers to low-income households should quickly follow the recent measures to improve access to public health care.

“Structural reforms should focus on enhancing the business climate and improving access to finance to boost private-sector led growth.  The appointment of the members of the High Anti-Corruption Authority would help address corruption concerns.

“Program risks remain very high. The authorities’ steadfast commitment to the policy and reform agenda, quarterly monitoring, and strong financial and capacity building support by Tunisia’s external partners will remain essential for their mitigation.”  (IMF 12.06)

Back to Table of Contents

11.8  MOROCCO:  Coding Academy Opens New Opportunities for Moroccan Youth

Catherine Cartier wrote in Al-Monitor on 13 June that 3W Academy Maroc aims at addressing youth unemployment in Morocco through accessible tech education.  “We really believe that coding is a solution for our youth. It’s a skill that is going to open doors,” said Hamza Debbarh, founder of 3W Academy Maroc.

The coding school opened its doors in October 2018 in Casablanca.  Founded in France in 2012, 3W Academy also has a branch in Tunis.  Its main program is a 3-month web development boot camp that is open to students regardless of their technology background.  Students work on real projects and participate in internships, using an online platform common to all 3W Academy schools.

Guided by a blended learning approach, the platform allows students to work on exercises from home and in the classroom.  In Morocco, a country where the youth unemployment rate stood at 24% at the beginning of 2019, this skill-focused training has the potential to transform lives.  “We create opportunities for people through technology — people with no background in tech, who work low-paying jobs or have degrees that haven’t been useful,” Mahdi Lafram, head of communications and community at 3W Academy, told Al-Monitor.

Ali Ait Belk, one of the first 3W Academy graduates, agrees that his training has created new opportunities.  “I worked as a cashier in a restaurant for 2½ years.  I did the full stack development program in order to get a new job and advance my career,” he told Al-Monitor.  Originally from Agadir, Belk is now employed as a junior web developer with a small agency based in Rabat.  He envisions moving into IT project management and starting his own web agency.

Youth unemployment is steep in Morocco:  One in three Moroccan graduates of higher education institutions cannot find jobs, according to a Reuters report.

As a board member of Education for Employment, a nonprofit organization that trains Moroccan youths and connects them to jobs in the region, Debbarh examined youth unemployment, wondering about the skills young people need to get a job and be financially independent.  “If you have skills for coding or web development, you can easily find work in the Moroccan job market.  Or you can get freelance jobs in any job market,” he said.

Many of the students were self-trained prior to coming to 3W, reflecting a growing demand for coding skills in Morocco and regionally.  3W Academy is also focused on attracting students who had no prior passion for tech or web development.  “We try to get people excited about coding and opportunities in the tech sector,” Lafram said.

3W Academy primarily works toward this goal by offering free coding workshops, in addition to a 3-month web development program.  Since its opening in Morocco, it has provided free coding classes on a weekly basis, reaching more than 1,000 students.  “We want to democratize access to coding, IT skills and web development for Moroccans and people in the Middle East and North Africa as well as the rest of Africa,” Debbarh added.

Similar initiatives already exist in Morocco, such as YouCode, a tuition-free coding school in Yousoufia that opened in 2018 and trains students ages 18 to 35 regardless of their background, aiming to make jobs in the tech sector accessible to underrepresented groups.

Improving the representation of women in tech is one of 3W’s goals, which has proven to be a challenge so far.  The vast majority of students are men, but women make up almost 50% of participants in the free coding classes. Currently, two women take part in the 3-month program and they will graduate later this year.

3W Academy tries to maintain affordable prices and a flexible payment plan. Its campus is located in the center of Casablanca, chosen for its proximity to businesses and transportation.  Looking toward geographic development, 3W is in conversation with potential partners in two other cities in Morocco, and new campuses would be situated in city centers for accessibility.

Debbarh and his team plan to launch an online platform across the Middle East and North Africa as well as the rest of Africa by 2020.  “Entrepreneurs who are interested in social impact often prioritize the business side [at the expense of making an impact],” Debbarh said.  His ambition to grow 3W Academy Maroc comes alongside a commitment to the human and social sides of the startup.

His determination to prioritize social impact stems from his family background.  Born into a family of educators, he said, “We talked about education during breakfast, lunch and dinner.”  He attended business school and received a master’s degree in education science in France.  Before returning to Morocco, he learned about and decided to partner with 3W Academy.  3W joins a growing startup scene in Morocco, centered in Casablanca.  “The story behind 3W is really just happening,” Debbarh concluded. “I’m telling you a story that I couldn’t tell you two years ago.”

Catherine Cartier studies history and Arab studies at Davidson College. Her work has been featured in the New Arab, Syria Untold and Calvert Journal.  She is a Beyond Religion Reporting Fellow at the Pulitzer Center on Crisis Reporting.  (Al-Monitor 13.06)

Back to Table of Contents

11.9  TURKEY:  Moody’s Downgrades Turkey’s Ratings to B1 and Maintains Negative Outlook

On 14 June, Moody’s Investors Service downgraded the Government of Turkey’s long-term issuer ratings to B1 from Ba3 and has maintained the negative outlook. The senior unsecured bond ratings and senior unsecured shelf ratings have also been downgraded to B1 and (P) B1 respectively from Ba3/(P)Ba3.

Concurrently, Moody’s has downgraded to B1 from Ba3 the backed senior unsecured bond ratings of Hazine Mustesarligi Varlik Kiralama, a special purpose vehicle wholly owned by the Republic of Turkey from which the Turkish Treasury issues sukuk lease certificates, and has maintained the negative outlook.

This downgrade reflects Moody’s view that the risk of a balance of payments crisis continues to rise, and with it the risk of a government default.  The B1 rating balances these risks against the country’s fundamental credit strengths, particularly its large, diversified economy and still-moderate levels of government indebtedness.

In a related decision, Moody’s lowered Turkey’s long-term country ceilings: the foreign currency bond ceiling to B1 from Ba2; its foreign currency deposit ceiling to B3 from B2; and its local currency bond and deposit ceilings to Ba2 from Ba1.  The short-term foreign currency bond ceiling and short-term foreign currency deposit ceiling remain at Not Prime (NP). Ceilings generally act as the maximum ratings that can be assigned to a domestic issuer in Turkey, including structured finance securities backed by Turkish receivables.  The decision to align the foreign currency bond ceiling and the government bond ratings reflects Moody’s view that exposure to a single, common threat – loss of external confidence and capital – means that the fortunes of public and private sector entities in Turkey are, from a credit perspective, increasingly intertwined.

Ratings Rationale

The impact of the continued erosion in institutional strength and policy effectiveness on investor confidence is increasingly outweighing Turkey’s traditional credit strengths including its large, diverse economy and the low level of government debt.  Turkey is structurally highly reliant on external capital flows and Moody’s confidence in its ability to continue to attract the large sums needed each year to repay debt and sustain growth is waning.  It remains highly vulnerable to a further prolonged period of acute economic and financial volatility.  Foreign exchange reserve buffers are weak and Moody’s expects them to weaken further over the next two years relative to economy-wide short-term liabilities.  While policy announcements have been made, the political authorities have yet to implement a plan that would allow the economy to adjust to a new, more sustainable equilibrium due to the negative short-term economic impact that this adjustment would entail.

The government’s willingness or ability to implement policies that will sustain external investor confidence in the economy and financial system by addressing underlying weaknesses remains uncertain.  Since mid-2018, the government has announced a number of economic reform packages.  Ultimately, these announcements have been either reactive to particular pressures on the economy or a restatement of measures that would be credit positive if implemented, but have been discussed for years, and where little concrete has been done to execute on these policy aspirations.  Most government measures, including those targeting the banking system, continue to be focused on the near-term priority of propping up economic activity at the expense of eroding the underlying resilience of the economy and its banking system to external shocks, in part by increasing its fragility to shifts in market sentiment.

The longer that remains the case, the more the weakness implied by Turkey’s very high reliance on external capital across all sectors of the economy comes to dominate Moody’s analysis; and the greater the risk of further externally-sourced shocks involving further capital outflows, loss of reserves, weakening in the exchange rate, rises in inflation and severe damage to medium-term growth.  As a result, Moody’s believes that the country’s vulnerability to an acute and highly disruptive balance of payment crisis that ultimately would significantly constrain the capacity and perhaps the willingness of the government to service its debt is now more aligned to a single B rating, despite its still moderate debt burden relative to similarly-rated peers.

Turkey is indeed once again facing intermittent currency crises after a period of relative calm that lasted from late September 2018 through February 2019.  In consequence, both gross and net reserves have fallen since February, with the decline in net reserves being particularly pronounced.  Gross and net reserve levels have been structurally weak for many years, but this decline contributes to a significant increase in external vulnerability for the country.  In 2019, Moody’s expects that short-term external debt repayments, currently maturing long-term external debt, and total non-resident deposits will total more than 2.6 times the level of FX reserves.  Moreover, funding costs have risen rapidly, with yields up by around 400 basis points since February.

The fall in FX reserves seems contrary to the central bank’s longstanding policy to allow the exchange rate to float freely, and raises further concerns about the transparency and independence of the central bank and, by extension, Turkey’s broader institutional framework.

External pressures are exacerbated by the ongoing disagreement between Turkey and the United States, this time relating to Turkey’s purchase of the S-400 missile system from Russia.  The sanctions which the US Congress will consider if the purchase goes ahead, while largely undefined to date, cast a further shadow over Turkey’s economy and financial system.

Rationale for the Negative Outlook

The balance of risk is firmly tilted to the downside.  The risk of an acute balance of payments crisis remains relatively low in the very near term, consistent for now with the highest rating level in the single-B rating category.  However, weakening external buffers point to this being an unstable equilibrium, and the more time passes the more the government’s ability to steer the economy away from a more credit-negative path of a balance of payments crisis is diminished.  This, in turn, increases the probability of more credit negative outcomes involving the need for capital controls, restrictions on access to foreign currency and (sanctions permitting) external support.

There are a number of possible near-term drivers for further instability.  In Moody’s view, the re-run of the Istanbul mayoral election in June 2019 creates potential for political unrest that could trigger a further material decline in the value of the lira and a further depletion of FX reserves.  The imposition of sanctions on Turkey could also lead to a further, highly credit negative, market reaction.  Moreover, depending on the sanctions imposed, it could also raise doubts over Turkey’s ability to access an IMF program, should one be needed in the future to avoid an escalation of a balance of payments and economic crisis.  Even if Moody’s does not currently expect that to be needed, the potential tension between sanctions and external support could in itself further undermine investor confidence in the credit.

What Could Change the Rating Down/Up

Moody’s would likely downgrade Turkey’s rating if it were to become clear that avoiding a more credit-negative path was becoming increasingly unlikely, perhaps because of the currency crisis deepening further.  Any indication that capital controls were becoming more likely or that Turkey’s fiscal strength was deteriorating in a significant way would be credit negative.  A material deterioration in relations with the US in the form of sanctions would also put downward pressure on the rating due to the implications that might have for receiving IMF assistance.

Given the negative outlook, upward rating movement is unlikely.  However, the rating could be stabilized if the authorities were able to present and, crucially, implement a credible and broad-based program for addressing external pressures and engineering a rebalancing of the economy.  Significant external financial support, and the policy agenda that would likely accompany it, would also be supportive for the rating.

National Scale Ratings

Moody’s will shortly publish an update to its National Scale Rating (NSR) map for Turkey to reflect the downgrade of the government’s long-term issuer rating.  Moody’s NSRs are ordinal rankings of creditworthiness relative to other credits within a given country, which offer enhanced credit differentiation among local credits. NSRs are generated from Global Scale Ratings (GSRs) through correspondences, or maps, specific to each country.  However, unlike GSRs, Moody’s NSRs are not intended to rank credits across multiple countries.  Instead, they provide a measure of relative creditworthiness within a single country.  (Moody’s 14.06)

Back to Table of Contents

11.10  TURKEY:  Turkey’s Car Manufacturing Sector Sputters Amid Economic Downturn

Mustafa Sonmez posted in Al-Monitor on 21 June that Turkey’s automotive sector, which holds a 1.5% share in global automotive production, is struggling on an uphill track, hit by domestic economic woes and unfavorable external factors.

The automotive industry has been a major leg in the economic growth model of Turkey’s ruling Justice and Development Party (AKP), which has relied heavily on foreign funds, while encouraging production focused on the domestic market and consumption.  Now that this growth model is stumbling, the automotive sector has begun to struggle as well, with production on the decline, coupled with setbacks in foreign trade.

Linked to myriad sectors in the production chain, the automotive industry affects the development of other industries, mainly iron and steel, electronics, software, rubber and plastics, fuel, energy, textiles and chemicals.  It is also directly linked to many sub-branches of the services sector such as distributorship, retail sales, insurance, car rental and maintenance and repair.  Hence, when the automotive industry picks up, it has an invigorating effect on related sectors, and, conversely, when the automotive industry sputters, it threatens to slow down other segments of the economy.

In 2018, Turkey was the world’s 14th largest producer of motor vehicles.  Its output of 1.5 million vehicles, including roughly 1 million cars and 500,000 commercial vehicles, accounted for about 1.5% of the global production of 95 million vehicles.  China was the leader with 30%, or 28 million motor vehicles, manufactured last year.  The United States was second, yet with less than half of China’s production figure.

In 2012, Oyak Renault dominated automotive production in Turkey, boasting a 54% share.  By 2017, it saw its share shrink to 32% as competitors such as Hyundai Assan, Toyota and Tofas stepped up their investments in the country.  Toyota’s average share of 15% rose to 24% at the end of 2017 after the company launched a plant in the northwestern province of Sakarya to produce its popular CH-R model for the global market.

In terms of commercial vehicles, Koc Holding is Turkey’s dominant manufacturer.  Its subsidiaries Ford Otosan and Tofas hold market shares of 57% and 35% respectively.  Seven global brands — Volkswagen, Renault, Ford, Fiat, Opel, Toyota and Hyundai — hold a combined share of 63% in Turkey’s automotive market.  Volkswagen is the leader, with a 13% market share, followed by Renault with 12% and Ford and Fiat with just below 12% each.

For Turkey, foreign exchange rates constitute a major factor affecting automotive production and importation.  The stability of exchange rates contributes to a steady growth of both production and demand for imported vehicles.  Conversely, as has been the case in recent years, turbulence in foreign capital inflows and rising exchange rates cause volatility in the sector.

The AKP has encouraged road transport and automotive industry growth through various infrastructure investments, production incentives and loans.  As a result, the number of automobiles in use rose to 12.5 million in 2018 from 6 million in 2006, increasing by about 6% on average per year.  However, the automotive industry’s growth trend now appears to have stalled.

Despite government efforts to stabilize matters through tax interventions, the sector appears exhausted in terms of production and importation amid ups and downs since 2014.  According to the most recent data, covering the first five months of the year, sales declined by 50% from the same period in 2018.  Some 152,500 cars and light commercial vehicles were sold from January to May, down from about 302,300 in the same period last year.  Reflecting the impact of the economic crisis gripping the country, sales of light commercial vehicles saw a sharper drop of 62.1%, totaling 5,890 vehicles.

The Automotive Distributors Association has revised its market forecast for the year-end to 400,000 sales at best, down from 450,000 sales in its original estimation.  The sales of the automotive sector had totaled about 642,000 in 2018, including heavy commercial vehicles.

A similar downtick is observed in exports.  According to figures from the Uludag Exporters Union in the northwestern city of Bursa, a major automotive hub, the sector’s exports stood at $11.7 billion in the first five months, falling 7% from the same period last year under the impact of shrinking demand in the European Union.

The weakest aspect of Turkey’s automotive industry stems from its unabating reliance on imports.  Low foreign exchange rates until several years ago had increased the appeal of imported inputs, deepening the sector’s dependence on foreign sources.  But once the Turkish lira tumbled and hard currency became more expensive, this resulted in sharp cost increases, leading to inevitable price hikes, curbing domestic demand.

In another important downside, local industries lag behind in the design of engine and powertrain technologies, relying again on foreign sources.

Last but not least, the domestic automotive market is saddled with hefty taxes.  In addition to indirect taxes, comprising the special consumption and value-added taxes, the government collects a yearly motor vehicles tax from consumers.  The value-added tax is fixed at 18%, while the special consumption tax varies from 45% to 160%, depending on engine volumes and pretax prices.  The motor vehicles tax, meanwhile, is calculated on the basis of the vehicle’s age, emission rate and number of seats.  Apart from the hefty tax burden, the frequent changes in tax regulations represent an additional drawback, creating uncertainty.

Mustafa Sonmez is a Turkish economist and writer. He has worked as an economic commentator and editor for more than 30 years and authored some 30 books on the Turkish economy, media and the Kurdish question.  (Al-Monitor 21.06)

Back to Table of Contents

11.11  TURKEY:  Opposition Candidate Wins Istanbul Mayor’s Race in Blow to AKP

Diego Cupolo posted on 23 June in Al-Monitor that Turkish voters rebuked long-time AKP dominance in Istanbul, delivering victory to CHP candidate Ekrem Imamoglu in a controversial election do-over.

In a country that has been in perpetual campaign mode for the last five years, the sudden end of the Istanbul election do-over came as shock few could have predicted.  Cheers and car horns echoed through the streets of the central Beyoglu district as the Binali Yildirim, the candidate of the Justice and Development Party (AKP), conceded defeat in a televised speech, ending his party’s long dominance over Turkey’s largest city.  “As of now my rival is leading,” Yildirim said minutes after the initial results were released, showing Ekrem Imamoglu, the candidate of the Republican People’s Party (CHP), with 54% of the vote.  “I congratulate him and wish him all the luck.  My wish is for Imamoglu to serve Istanbul well.”

The election do-over came after Turkish President Recep Tayyip Erdogan’s ruling AKP contested the initial 31 March municipal vote in which Imamoglu won by a slim margin.  Following the original defeat, AKP officials brought forth a succession of vote recounts and appeals until Turkey’s top election board annulled the results, citing irregularities due to the credentials of some ballot box observers.

Preliminary results indicate Imamoglu significantly widened his margin in the re-held election, which saw a voter participation of roughly 84%.  In a televised speech, the Istanbul mayor-elect warned party officials and ballot box observers not to leave their posts until all ballots had been officially registered and to avoid early celebrations.  “This victory will pave the way for the democratization of Turkey,” Tuba Torun, a CHP official, told Al-Monitor.  “We have a government that is ready to do anything to keep its power. As you know, we won last time and they didn’t accept the results, but this time the voting margin is so wide that they can’t deny the defeat here.”

The results come after a largely uneventful voting day, in which people streaming into polling stations largely spoke of election fatigue, citing the fact Turkey has gone through six elections in the last five years.  The day’s main controversy came when a number of ballot envelopes stamped with parliamentary election seals, instead of municipal election seals, were discovered in the Uskudar district of Istanbul.  Following complaints from both AKP and CHP officials, the election board ruled that the votes cast in the mislabeled envelopes would be considered valid in the final count.

According to the news outlet Bianet, a total of 111 people reportedly violated election laws.  Forty-three people were accused of photographing their stamped ballots, 22 were apprehended for disturbing order in polling stations, nine individuals were found to be casting votes simultaneously and 14 were written up for entering voting areas with their phones.  Overall, voting proceeded without serious ballot box irregularities that have cast doubt on recent Turkish elections.

Polling stations closed at 17:00 in Istanbul, where more than 10.56 million registered voters were eligible to cast ballots in about 31,000 ballot boxes.  Campaigning efforts in the lead-up to the election do-over brought about a string of unusual events for contemporary Turkish politics, including a rare televised debate between the leading candidates, as well as a public letter from imprisoned Kurdistan Workers Party leader Abdullah Ocalan, who urged Kurdish voters not to be swayed by AKP and CHP attempts to draw their votes.

The unprecedented events came as officials from both parties took Erdogan’s oft-repeated line “Whoever wins Istanbul, wins Turkey” to heart and campaigned for the mayoral seat accordingly.  Such rhetoric has grown tiresome for people such as Yasmin, a five-time ballot box observer volunteering in Sisli who only provided her first name.  “I think we shouldn’t mix state policy and foreign policy with city politics,” she told Al-Monitor.  “This is only a municipal vote. We don’t need to make it more complicated than that.  If people want a mayor, they should be able to vote without outside inference.”

Political observers have raised concerns over an ongoing fraud case against Imamoglu, which could be used to distract or limit the governing abilities of the mayor-elect in the coming months.  For the time being, Erdogan has recognized the election outcome in a tweet:

“Many people assumed that Erdogan wouldn’t have decided to re-run the election unless he had a clear-cut plan for winning it,” Nicholas Danforth, a senior visiting fellow at the German Marshall Fund, told Al-Monitor.  “That seems not have been the case.”  “Imamoglu’s been allowed to win, it remains to be seen if he’s allowed to govern,” Danforth added.  “The government has shown it has a range of tools at its disposal to limit his power and even remove him from office, although the margin of his victory will make it more politically costly for them to do so.”

Diego Cupolo is a freelance journalist and photographer based in Ankara, Turkey. His work has appeared in The Atlantic, The Financial Times, Foreign Policy and The New Statesman, among other publications.  (Al-Monitor 23.06)

Back to Table of Contents

The Fortnightly newsletter is a free service of Atid, EDI. We are a team of economic and trade development consultants, headquartered in Jerusalem, but active throughout the region and beyond. EDI works with an international clientele interested in identifying and researching business opportunities in the region. We also serve as the regional representative offices for a number of U.S. states and bilateral Chambers of Commerce, as well as Invest Hong Kong, the Canadian Province of Ontario and European clients.

EDI’s other services include customized business delegations, partner searches, business development, market feasibility studies and tailored research reports, as well as identification of potential joint ventures for commercial clients.  For more information on how we may better assist you, please visit our Web site at:  http://