Fortnightly, 31 October 2018

Fortnightly, 31 October 2018

October 31, 2018


31 October 2018
22 Cheshvan 5779
22 Safar 1440




1.1  PM Netanyahu Makes Surprise Trip to Oman and Meets with Sultan Qaboos
1.2  Punjab Chief Minister Seeks Israel’s Assistance
1.3  New Program Starts to Boost Employment of Arabs & Ultra-Orthodox in High-Tech Sector


2.1  Israeli Blockchain Startup Landscape Now Stands at Over 200 Companies
2.2  WhiteSource Raises $35 Million to Mainstream Open Source Security Management
2.3  Workiz Raises $2 Million
2.4  FundGuard Raises $4 Million
2.5  EyeSight Raises $15 Million
2.6  Resonetics Announces Acquisition of STI Laser Industries
2.7  Team8 Leads Walmart, Softbank, Airbus, Microsoft, Moody’s Led Strategic Coalition
2.8  VPTax Marks Global Expansion with First Office in Israel
2.9  Yissum Launches Express Licensing Campaign to Increase Academic & Industry Collaboration
2.10 Raises $4 Million
2.11  Tel Aviv University Partners in Entrepreneurship & Innovation Center in Chicago
2.12  Volkswagen, Mobileye & Champion Motors Invest in Israel & Deploy First Autonomous EV Ride-Hailing Service
2.13  HARMAN Strengthens Presence in Israel with New Headquarters


3.1  Esri Enters into MoU with United Arab Emirates’ Statistics Authority
3.2  Blueground Raises $20 Million in Funding from Global Investors
3.3  Saudi Arabia’s Unifonic Announced $21 Million in Series A Funding Round


4.1  UAE Waste to Fuel Facility Set to Start Operations in 2020
4.2  Ras Al Khaimah Launches Major Energy Efficiency Drive


5.1  Lebanon’s Average Inflation Reached 6.10% by September 2018
5.2  Lebanon’s Trade Deficit Reached $11.73 Billion by August 2018
5.3  Tourist Spending in Lebanon Climbed by an Annual 5.41% by the Third Quarter
5.4  Lebanese Total Tourist Arrivals Up by 3.88% y-o-y in Third Quarter While Arab Tourists Lagged
5.5  Jordan’s Trade Balance Deficit Down 3.7% in First 8 Months of 2018
5.6  Germany Allocates €462.12 Million to Support Jordan

♦♦Arabian Gulf

5.7  GCC Forecast to Enjoy 125% Growth in Russian Tourists by 2023
5.8  MHI Successfully Launches UAE’s KhalifaSat Satellite
5.9  UAE Workforce Comprised of 91% Expats
5.10  Dubai Picked to Host First Overseas Russian Innovation Hub
5.11  RTA & du Set to Add Free Wi-Fi to All Dubai Taxis
5.12  WEF Says Saudi Arabia Leads GCC in Economic Stability
5.13  Saudi Arabia’s Recovery Gains Pace with Higher Consumer Spending
5.14  Saudi Arabia Pledges $3 Billion to Support Pakistan’s Economy

♦♦North Africa

5.15  Egypt’s Trade Volume Amounts to $67.63 Billion Over First 9 Months of 2018
5.16  Cairo Tops the List for the Fastest Growing City in Tourism
5.17  Morocco’s Privatization to Cut Deficit to 3.3% of GDP in 2019
5.18  First 8 Months of 2018 See 8.7 Million Tourists Visit Morocco


6.1  Greece is the Eurozone’s Leader in Indirect Taxation



7.1  Israel Ended Daylight Savings Time on 28 October
7.2  Israel’s National Anthem Played in UAE Following Israeli Judoka Win


7.3  Jordan Changed Its Clocks to Wintertime on 26 October
7.4  Moroccans are the Largest Foreign Student Community in France


8.1  Positive Results of Orthopedic Treatment With ApoGraft Enriched Stem Cells Derived
8.2  Turning Apple Waste into a Superfood
8.3  FSD Pharma Signs Binding LOI to Acquire Therapix Biosciences
8.4  Clew Medical Raising $20 Million
8.5  Teva & New Jersey Governor Formalize North America Headquarters Move in Israel Ceremony
8.6  NRGene and Kayagene Collaborate to Improve Cannabis Breeding and Seed Production
8.7  Cellect Breakthrough for Industrialization of Apotainer Stem Cell Product Line
8.8  CollPlant Agreement for 3D Bioprinting of Solid-Organ Scaffolds for Human Transplants
8.9  Regentis Biomaterials Expands SAGE Clinical Trial of GelrinC for Knee Pain
8.10  Wize Pharma Announces $4.45 Million Private Placement
8.11  Alvit LCS Pharma Manufacturing Agreement with Bazelet
8.12  89Bio Launches into Liver and Metabolic Disorders with $60 Million Series A Financing
8.13  Gamida Cell Raises $50 Million in NASDAQ IPO
8.14  FDA Grants Breakthrough Therapy Designation (BTD) for UroGen Pharma’s UGN-101 Cancer Treatment


9.1  Kaymera Technologies to Expand Adaptive Mobile Threat Defense Footprint
9.2  Tactile Mobility Comprehensive Tactile Data Solution for Road Authorities
9.3  Israel Develops Bomb-Detecting Robot to Save Soldiers’ Lives
9.4  My Size & Lightspeed Provide Mobile Measurement Solution to e-Retailers Worldwide
9.5  Baccara Geva is a Market Leader in Water Management Solutions
9.6  Aurora Labs Named a Cool Vendor by Gartner
9.7  Comtrend Selects Celeno High Performance Tri-Band Wi-Fi Solution for Gateways
9.8  Allot Narrows Technological Divide in Rural Territories with Improved Web Security
9.9  IAI $777 Million Deal for Barak 8 LRSAM Air & Missile Defense Systems to India’s BEL
9.10  Introducing Walabot HOME: A New Senior Care Smart Home Device for Fall Detection
9.11  Waterfall Unidirectional Security Gateways CCC Certified
9.12  Ethernity Networks’ ENET Flow Processor Firmware Integrated by North American Vendor
9.13  macOS Goes Password-Free With Introduction of Octopus Authentication
9.14  Cymulate Finds Logical Bug in Microsoft Office Suite – Word Embedded Video Code Execution
9.15  Allot Partners With Swiftel to Provide DDoS Protection for Their ISP and Enterprise Customers
9.16  VisIC Technologies is a Final Nominee for the 2018 GSA Company Award
9.17  On Track Innovations Receives Interac Certification for Canadian Market


10.1  Israel Places 20th on Global Competitiveness Index


11.1  ISRAEL: High-Tech Companies Raised $1.6 Billion in 131 Deals in Q3/2018
11.2  ISRAEL: Netanyahu Visits Oman
11.3  LEBANON: Lebanon’s Perfect Financial Storm
11.4  JORDAN: Policing and Protection for Syrian Refugees in Jordan
11.5  TUNISIA: Tunisia’s Bold Move to End Racial Discrimination
11.6  MOROCCO: Morocco’s Auto & Phosphates Exports to Narrow Account Deficit
11.7  TURKEY: Turkey’s Fantasy War on Inflation
11.8  CYPRUS: Fitch Upgrades Cyprus to ‘BBB-‘; Outlook Stable


1.1  PM Netanyahu Makes Surprise Trip to Oman and Meets with Sultan Qaboos

On 25 October, Israel’s Prime Minister Benjamin Netanyahu has made an unpublicized trip this week to Oman, a Gulf Arab country that it has no diplomatic relations with.  Prime Minister Netanyahu met with Oman’s Sultan Qaboos bin Said, being the first Israeli leader to visit the sultanate since Shimon Peres in 1996.

In recent years, Netanyahu has insisted that relations between Israel and Gulf Arab countries have been growing, without much official evidence.  None of the seven Gulf Arab countries officially recognizes Israel.  Netanyahu’s office revealed the visit on his return, and images of the prime minister and Sultan Qaboos meeting and shaking hands began to circulate.

According to Israel, PM Netanyahu travelled to Muscat at the invitation of the sultan after lengthy communications.  It called it a “significant step” towards implementing Netanyahu’s policy of strengthening ties with Gulf Arab countries.  A joint statement said the two sides “discussed ways to advance the Middle East peace process and discussed a number of issues of mutual interest to achieve peace and stability in the Middle East”.

The visit also came as Israel’s Culture and Sports Minister Regev arrived in the United Arab Emirates for the Abu Dhabi Grand Slam Judo tournament, in which the Israeli national team competed.  The Israeli flag could also fly in Qatar soon, if the country’s athletes taking part in the World Artistic Gymnastics Championship being held in Doha do well in the competition.  Qatar had assured organizers that it would allow Israeli national symbols at the event.  (MEF 26.10)

Back to Table of Contents

1.2  Punjab Chief Minister Seeks Israel’s Assistance

To check pollution and generating water for irrigation purposes, Punjab Chief Minister Capt. Amarinder Singh sought Israel’s assistance in enabling recycling of sewerage water in five major cities of the state.  The Chief Minister recently held extensive talks in Jerusalem with Israel’s Minister of Energy and Water Resources Steinitz on the issue of water management to boost water conservation in Punjab.  Impressed with the fact that 95% of sewerage water was being recycled for agriculture in Israel, Capt. Amarinder said that Punjab would like to do the same in urban areas.

Capt. Amarinder apprised the Israeli Minister of the problems being faced by Punjab on the water front as a result of its depleting water table caused by melting glaciers.  While Punjab had a power surplus, water resources remained a challenge for the state, which was trying to get out of the paddy-wheat cycle to save this precious resource.  Dr. Steinitz said that Israel would be happy to extend all possible support in this regard, while underlining the need for proper water management through assessment of total requirement and availability.

He pointed out that Israel was having its fifth year of drought but was managing its water needs through various measures, such as double desalination, to meet 80% of its domestic water need.  Regulating water distribution was the crux of water management, said the Minister, stressing the need for educating people in this regard.  The Chief Minister invited the Minister to visit Punjab to further strengthen the cooperation between the two sides.

Underlining Punjab’s role in building India’s food security over the past 40 years, the Chief Minister said the depleting water table was now threatening to destroy the state’s agricultural prowess.  He stressed the need to diversify crop cultivation in the state to get it out of the wheat-paddy cycle and said that Israel’s drip irrigation technology was a laudable initiative that Punjab could adopt to its advantage.  (PNS 25.10)

Back to Table of Contents

1.3  New Program Starts to Boost Employment of Arabs & Ultra-Orthodox in High-Tech Sector

A new program launched recently by a coalition of Israeli NGOs, high-tech companies, philanthropists and government leaders, put together by the non-profit Start-Up Nation Central (SNC) is set to tackle the serious shortage of skilled workers for the tech sector, while increasing the participation of Israel’s Arab and ultra-Orthodox communities in the industry.

The Program for Enhancement of Arab and Haredi [ultra-Orthodox] Human Capital for the Jerusalem High-Tech Workforce, dubbed Excellenteam, is based in Jerusalem and will focus on computer science graduates from the two communities to provide “hands-on technical training, experience in problem solving, exposure to the industry, help in developing soft skills, and assistance in finding relevant placements in tech companies.

According to SNC research, the ultra-Orthodox population makes up only 2% of the workforce in the sector, and the Arab population only 3%.  Meanwhile, the country suffers from a chronic shortage of high-tech workers.  A survey conducted by Start-Up Nation Central, JP Morgan Chase Foundation and Israel Advanced Technology Industries put that figure at up to 15,000 unfilled positions in the industry.  Excellenteam selected its first group of 20 graduates from each community for the program, with a future goal of 12 cycles in three years. It includes full tuition and scholarships toward living expenses.  (No Camels 22.10)

Back to Table of Contents


2.1  Israeli Blockchain Startup Landscape Now Stands at Over 200 Companies

The Israeli Blockchain Association has released its third Israeli Blockchain Startup Map, which covers over 200 startups operating in the blockchain industry.  Most Israeli blockchain startups are concentrated in the Fintech (57 companies) and Protocols/ Core Infrastructure (37 companies) sectors.  A large increase was seen in the Security sector, which today accounts for 23 startups.  It is also worth mentioning that since the beginning of the year, 20 blockchain startups have ceased operations.

Regarding the 2019 forecast, the Israeli Blockchain Association expects the amount of blockchain startups to double, the role of academic structures in startup companies to increase, and the radical growth of “non-native” blockchain startups in A & B rounds, which are going through a blockchain-transformation.  The complete version of the map can be found at: It is updated quarterly.

The Israeli Blockchain Association aims to educate, develop, and empower the blockchain community of Israel and to connect it with both global leaders and best practices.  The Israeli Blockchain Association was founded in 2017 and currently has more than 1200 individual members, 37 advisory board members, experts and ambassadors, as well as dozens of corporate, investment, and academic partners from all over the world.  (IBA 17.10)

Back to Table of Contents

2.2  WhiteSource Raises $35 Million to Mainstream Open Source Security Management

WhiteSource announced a $35 million funding round led by Susquehanna Growth Equity, with participation by existing investors 83North and M12 – Microsoft Ventures.  This $35 million Series-C adds to the $11 million raised by WhiteSource in previous financing rounds.

Founded in 2011, WhiteSource was created with the mission to help businesses harness the power of open source without compromising on security or slowing development.  With the latest funding, WhiteSource plans to double down on serving the enterprise market where leading customers such as Microsoft, IBM, Comcast and KPMG already leverage the WhiteSource platform.  WhiteSource continues to gain attention for its ability to think beyond the abstract concepts of security and compliance and has delivered capabilities that answer the business needs of development and security teams alike, as it has proven with its latest revolutionary offering, Effective Usage Analysis, which reduces open source vulnerabilities alerts by 70%.

Tel Aviv’s WhiteSource is the pioneer of open source security management.  Its vision is to empower businesses to develop better software by harnessing the power of open source.  WhiteSource is used by more than 500 customers worldwide, from all verticals and sizes, including 23% of Fortune 100 companies, as well as industry leaders such as Microsoft, IBM, Comcast and many more.  The company has been recognized by Forrester as the best current offering in its Software Composition Analysis (SCA) Wave report.  (WhiteSource 17.10)

Back to Table of Contents

2.3  Workiz Raises $2 Million

Israeli field service market platform developer Workiz has announced the completion of a $2 million seed financing round by Aleph venture capital fund.  The funds will support the expansion of the company’s operations in North America and the acceleration of its product development with new employees being hired in Israel and the US.

Some 75% of small field service businesses in North America close within their first five-years.  Workiz slashes this number down to 20%.  Tens of thousands of field service professionals use Workiz’ platform to run highly profitable, five-star operations and provide premium service to millions. Backed by state-of-the-art technology, like AI, bots and unified communication feeds, they are now able to outperform larger competitors – without the need for huge budgets or specialized expertise.  Workiz operates in two strategic areas – with its technological and business development centers located in Israel, and its sales center located in America.  (Globes 21.10)

Back to Table of Contents

2.4  FundGuard Raises $4 Million

FundGuard has raised a $4 million financing round led by Blumberg Capital and LionBird. FundGuard will use the capital to accelerate the development of its platform and Contingency NAV product as well as to bring operational efficiencies afforded by AI and cloud technologies to market.

FundGuard’s Contingency and Oversight NAV product provides an unparalleled daily-resetting, fully automated operating system at a secondary independent location to enable asset managers to fulfill their fiduciary responsibility for business continuity and for protecting their funds’ proprietary and most critical data and valuation during core systems failures and cyberattacks.  This solution is designed to efficiently address the systemic risk of long period outages similar to a week-long incident at a large custodian bank that impacted hundreds of mutual funds and exchange-traded funds, damaging their reputations.

Tel Aviv’s FundGuard helps asset managers, custodian banks and fund administrators manage investments across mutual funds, ETFs, separately managed accounts, pension funds as well as insurance.  Using machine learning and AI to identify unstructured financial and operational anomalies or potential fraud, the platform provides real-time support while providing insights and recommendations to its customers.  (Globes 21.10)

Back to Table of Contents

2.5  EyeSight Raises $15 Million

Herzliya Pituah’s EyeSight Technologies announced it has raised $15 million in a funding round led by Hong Kong-based Jebsen Capital, Arie Capital and Mizrahi-Tefahot Bank, bringing its total raised to date to $50 million.  EyeSight said its artificial intelligence computer vision system monitors a driver’s gaze direction, pupil dilation, eye openness and head position and uses algorithms to detect levels of drowsiness and distraction.

The European New Car Assessment Program, which awards safety stars to car models, will require new car models to have driver monitoring systems by 2020.  EyeSight will also scan the entire cabin of a car, understanding who and what is in the vehicle.  In addition, an EyeSight system can identify drivers, automatically adjusting their seats and mirrors or selecting their music playlist, which could be useful as car-sharing increases, the company said.  EyeSight also makes vision-based solutions for the smart home and consumer electronics.

Eyesight offers the most advanced edge-based Computer Vision and AI solutions.  The company’s technology improves daily life experiences in the car, home, and with other consumer electronics, using intelligent interactions that are responsive to users and their actions.  The company’s technology utilizes proprietary algorithms to deliver a range of applications: from passive sensing with the detection user presence, to active interactions using touch-free gesture control.  With Eyesight’s technology devices now “see” and “understand” their users, unlocking a world of enhanced user experiences.  (EyeSight 23.10)

Back to Table of Contents

2.6  Resonetics Announces Acquisition of STI Laser Industries

Nashua, New Hampshire’s Resonetics has acquired STI Laser Industries (STI), based in Or Akiva, Israel, a leading supplier of laser processing, nitinol shape setting and electro-polishing, and cleanroom assembly and packaging for the medical device industry.  In addition to servicing the prolific startup community in Israel, STI has developed a global business with extensive customer relationships in the U.S., Japan, China and Korea.

STI is doubling the size of its operations in Or Akiva, 40 minutes North of Tel Aviv.  Building 2 is under construction and will open in early 2020 to increase the Israel operation to 60,000 sq. ft. to accommodate the company’s growth and new manufacturing capabilities.

STI Laser Industries is an original equipment manufacturer (OEM) specializing in laser cutting and finishing of miniature metal components.  STI provides a comprehensive manufacturing platform for medical device, bio-engineering and hi-tech companies.  STI focuses on medical device manufacturing of implants and surgical tools intended for Minimally Invasive Surgery (MIS) procedures.  (Resonetics 23.10)

Back to Table of Contents

2.7  Team8 Leads Walmart, Softbank, Airbus, Microsoft, Moody’s Led Strategic Coalition

Team8 announced the launch of an international coalition incorporating Walmart, Airbus, Softbank, Moody’s, Dimension Data, Munich Re, Scotiabank and Barclays.  Team8’s existing investors, including M-12, Microsoft’s venture-capital arm, Cisco Investments, Nokia, Bessemer Venture Partners, Temasek and Innovation Endeavors have also joined the coalition.  By bringing together leaders in finance, technology, retail, aerospace, risk and insurance, the coalition aims to build technology companies to create secure and agile environments that empower enterprises to realize the true benefits of digital transformation and leverage data to create real business impact.

The coalition formed with this unprecedented approach after respective member organizations concluded that the formidable threat posed by cyber-crime inhibits enterprises’ ability to maximize digital transformation opportunities due to inherent risks.  Rather than simply viewing cybersecurity as a necessity, the Coalition will unlock its value through rethinking enterprise infrastructure, enabling new growth opportunities through infrastructure for networks, the Cloud, data and computing.

The Coalition members have secured $85 million in capital to fund and build a series of companies that accelerate secure digital transformation through Team8’s company-building model, driven by its dedicated team of researchers, scientists, engineers and analysts.  Chief Information, Technology, Data and Security Officers from each of the member organizations will work together with Team8’s research, recruiting and business development teams to identify problems, ideate on disruptive solutions, validate technology, hire talent and plan go-to-market approaches.  The committed $85 million will be invested at seed-level into each of the solutions, resulting in independently operating companies with shared ownership by the investors.

Team8 was founded by former leaders of Israel’s military intelligence Unit 8200.  To date, Team8 has launched four disruptive companies, with four more operating in stealth mode, each with an innovative approach for organizations to build resilience against cyber warfare and that today protect dozens of Fortune 100, 500 and other leading companies.  Including the new $85 million investment, the group has raised more than $260 million to date and employs more than 370 people worldwide.

Team8 is a leading think tank and company creation platform specializing in cyber resilience and data analytics.  Team8 is supported by an in-house team of top researchers, engineers and analysts. Team8 combines its in-depth understanding of the attacker perspective, data science AI to develop disruptive technologies and category-leading companies that enable businesses to reap the benefits of digital transformation in an agile and secure manner.  (Team8 23.10)

Back to Table of Contents

2.8  VPTax Marks Global Expansion with First Office in Israel

VPTax, a San Francisco-based professional services firm, announced that the company is expanding its presence globally with the opening of an office in Israel.  This new office will allow VPTax to offer its tax expertise to the growing number of Middle Eastern companies looking to do business in the U.S.  VPTax is owned and operated by experts drawn from senior level positions at the Big 4 accounting firms.  By leveraging proprietary software applications and in-house expertise, VPTax delivers superior quality at prices far below the competition.  VPTax also provides services specific to the new sales tax regulations stemming from the U.S. Supreme Court case South Dakota v. Wayfair, Inc. Clients include companies such as The RealReal, Google, Oanda and Bloom Energy.  (VPTax 24.10)

Back to Table of Contents

2.9  Yissum Launches Express Licensing Campaign to Increase Academic & Industry Collaboration

Yissum launched its pioneering Express Licensing Campaign at the ITTN’s 5th biennial conference: Tech Transfer 4.O: Reinventing Technology Transfer.  The campaign aims to make the cutting-edge research conducted at the Hebrew University of Jerusalem more accessible to industry partners by dramatically simplifying technology licensing or acquisition.

Yissum currently dominates academic tech transfer in Israel and in 2017 was responsible for nearly half of all tech transfer licensing agreements signed by universities as well as new company formations.  The Express Licensing Campaign is yet another channel initiated by Yissum to broaden industry reach into Intellectual Property (IP) born out of translational academic research, by offering close to 70 technologies alongside ready-to-sign license contracts, drafted in collaboration with several leading law firms in Israel.

Israel is a global leader in tech transfer, second only to the United States in the amount of IP revenue it generates, mainly because of the academia’s extensive experience and capabilities in inventing new technologies and powering new markets and industries.  A recent ranking of Reuters World’s Most Innovative Universities, which identifies the top 100 international universities that excel at original research, create useful technologies, and contribute to the world’s economy put Hebrew University at #79 worldwide and first in the Middle East.

Yissum also recently launched its 3rd seed fund, focused on venture creation from the top nanotech research innovations from Hebrew University.  More than 20 startups were established by Yissum’s funds over the last five years.

Yissum is the technology transfer company of The Hebrew University of Jerusalem.  Founded in 1964, it is the third company of its kind to be established and serves as a bridge between cutting-edge academic research and a global community of entrepreneurs, investors and industry.  Yissum has registered over 10,000 patents covering 2,800 inventions; licensed over 900 technologies and has spun out more than 135 companies.  (Yissum 24.10)

Back to Table of Contents

2.10 Raises $4 Million announced the closure of a $4 million funding round on 24 October.  The round was led by IrishAngels Ventures, with participation from Array Venture and Stage Venture Partners.  The funds will be used to expand its service for tracking and predicting foot traffic and people’s movements and to grow its sales and marketing teams.  The company said it obtains its data through the 100 popular smartphone apps that use its SDK and that it can anonymously but accurately track the movements of 60% of Android users and 40% of iOS smartphone users in the United States.

Alongside the funding news, announced the launch of a free version of its app that can share limited foot traffic movement details about virtually any business in the U.S. aims to tell users not just who visits a business but where they came from and where they go after they leave.  Machine learning is then used to make predictions about customer data or visitation trends.  Initial users include CBRE, Caesar’s Entertainment, tech company Oath, and the Santa Cruz boardwalk in California.

Placer was founded in 2016 and has 35 employees in offices in Los Altos, California and Tel Aviv, Israel.  (Placer 24.10)

Back to Table of Contents

2.11  Tel Aviv University Partners in Entrepreneurship & Innovation Center in Chicago

Tel Aviv University is one of four founding partners in the innovative Discovery Partners Institute (DPI), which will be established and operated in Chicago.  Led by the University of Illinois, together with the University of Chicago and Northwestern University, all the partners in the project are among the leading research institutions in the world, and in the coming months, additional institutions are expected to join them.  The new center will focus on research and teaching in the fields of entrepreneurship and innovation, and will focus on topics currently facing the forefront of science and society, including cyber security, artificial intelligence, data and food security. The first group of students from the Koller Faculty of Management has already stayed at the center (which is currently operating in an existing building), and the activity is expected to expand with the construction of the new facilities.

The ambitious project was welcomed by Illinois Governor Rowner and Chicago Mayor Emanuel, who promised the city’s support for its establishment.  The Illinois House of Representatives has allocated $500 million to build the center and deploy a network of innovation centers across the country.  EDI represents the interests of the DPI in Israel. (TAU 24.10)

Back to Table of Contents

2.12  Volkswagen, Mobileye & Champion Motors Invest in Israel & Deploy First Autonomous EV Ride-Hailing Service

The Volkswagen Group, Mobileye and Champion Motors announced plans to deploy Israel’s first self-driving ride hailing service – or Mobility-as-a-Service (MaaS) – starting next year.  For this, the partners are planning to establish a joint venture.  The planned cooperation is subject to approval by the responsible authorities and bodies.  Operating as “New Mobility in Israel,” the group’s proposal was formally accepted by the Israeli government during a private ceremony at the recent Smart Mobility Summit in Tel Aviv.

The Volkswagen Group will provide the electric vehicles (EVs) and bring in its in-depth knowledge and competency about design and deployment of user-centered mobility services.  Mobileye will provide its level-4 AV Kit – a turn-key, driverless solution comprised of hardware, driving policy, safety software and map data. Champion Motors will run the fleet operations and control center.  Together, the three companies will add the mobility platform and services, content and other MaaS tools, ensuring a seamless rider experience in the deployment of a full-stack MaaS offering.

The government of Israel has committed to support the project in three main areas: furnishing legal and regulatory support, sharing the required infrastructure and traffic data, and providing access to infrastructure as needed.  While New Mobility in Israel will be Israel’s first commercial MaaS service with self-driving vehicles, all facilitations and rulings will be applied to all other ventures that wish to operate a MaaS in Israel.

Volkswagen, Mobileye and Champion Motors will use New Mobility in Israel to serve as a global beta site for testing the Mobility-as-a-Service model using autonomous electric vehicles.  The project will start in early 2019 and scale to commercialization by 2022. New Mobility in Israel will roll out in phases and grow quickly from several dozen to hundreds of self-driving electric vehicles.  This initiative harnesses the disruptive power of several trends in the automotive industry: autonomous vehicle platforms changing the way we control vehicles, electric vehicles changing how we power vehicles, and Mobility-as-a-Service changing how we access mobility.  (Volkswagen 29.10)

Back to Table of Contents

2.13  HARMAN Strengthens Presence in Israel with New Headquarters

Stamford, Connecticut’s HARMAN International, a wholly-owned subsidiary of Samsung Electronics Co. focused on connected technologies for automotive, consumer and enterprise markets, announced that the company is strengthening its presence in Israel by opening a new R&D center with an advanced smart car lab in Hod HaSharon

HARMAN’s new facility in Hod HaSharon will now serve as the headquarters for HARMAN in Israel.  This building will feature an advanced Smart Car Lab, where teams can research, test and validate the company’s award-winning cybersecurity, over-the-air software updates technologies, and automotive cloud solutions, in real-life conditions.  The company’s existing Research & Development (R&D) centers, currently based in Kfar Saba, Hod HaSharon and Ramat Gan will now be consolidated under the new center at Hod HaSharon.

HARMAN is increasing its innovation capabilities globally, including expanding its workforce in Israel. HARMAN’s innovation hubs in Israel are home to a team of highly-skilled, senior engineers developing technologies that will shape our future, including autonomous, connected and augmented reality platforms.  HARMAN has acquired three Israeli start-ups in the last five years: iOnRoad, a red alert company situated in Ramat Gan; Red Bend, which enables today’s cars to be connected to the cloud and is located in Hod HaSharon; and TowerSec Automotive Cybersecurity, which was based in Kfar Saba.  (HARMAN 29.10)

Back to Table of Contents


3.1  Esri Enters into MoU with United Arab Emirates’ Statistics Authority

Redlands, California’s Esri, the global leader in location intelligence, has entered into an MOU with the Federal Competitiveness and Statistics Authority (FCSA), the national statistics body for the United Arab Emirates (UAE).  Under the agreement, FCSA and Esri will work together to geo-enable its vital work.  This agreement seeks to strengthen the future cooperation between FCSA and Esri.  The resultant collaboration between the two will include the creation of an innovative road map to further enhance the geospatial capabilities of FCSA, further integrate location intelligence technology with statistics data, and provide subject and technical expertise to the UAE.

Esri, the global market leader in geographic information system (GIS) software, offers the most powerful mapping and spatial analytics technology available.  Since 1969, Esri has helped customers unlock the full potential of data to improve operational and business results.  (Esri 24.10)

Back to Table of Contents

3.2  Blueground Raises $20 Million in Funding from Global Investors

Blueground, the hospitality-tech company that is transforming the experience of big city living, completed a new funding of $12M from a group of global investors, including Dubai-based Jabbar Internet Group, VentureFriends and Endeavor Catalyst.  The latest investment marks the fourth and largest round of funding for Blueground, bringing the total investment from global investors in Blueground to nearly $20 million.  The Blueground concept is simple: to lease carefully-selected, high-quality properties in the most sought-after locations on a medium and long-term stay basis to professionals and individual travelers.

Blueground in-house interior design team works with individual and corporate property owners – such as Emaar Properties, Meraas Holding, Daman Investments, Orra Intl and others – to upgrade properties into best-in-class apartments.  This ensures a premium experience for renters, and boost revenue opportunities for owners.  The funding has helped Blueground gain the trust and confidence of well-known property management companies and individual owners.

Blueground has an ambitious vision for growth, with the goal of becoming the largest tenant in Dubai in 2019, as well as expanding to more than 50 cities with 50,000 properties in its worldwide portfolio by 2023.  Besides Dubai, the company is currently present in New York, San Francisco, Boston, Chicago, Los Angeles, Washington DC, Istanbul and Athens.  (ArabNet 25.10)

Back to Table of Contents

3.3  Saudi Arabia’s Unifonic Announced $21 Million in Series A Funding Round

Unifonic, the Riyadh-based communication platform, has closed a $21 million Series A round of funding.  This round was led by STV with the participation of RTF, Endeavor Catalyst, ELM and Raed Ventures.  The startup plans to use the investment to accelerate company’s growth and continue building different communications solutions.

Unifonic was founded in 2006 and provides cloud-based communication tools to business customers and enables integration of text and voice-based solutions through its API platform.  Therefore, Unifonic eliminates the need for costly hardware infrastructure making business communication simple, fast, and cost-effective.  The company has been profitable for over 8 years, has experienced double-digit monthly revenue growth, and has grown to over 100 employees in 5 countries.  (ArabNet 17.10)

Back to Table of Contents


4.1  UAE Waste to Fuel Facility Set to Start Operations in 2020

The UAE’s Ministry of Climate Change and Environment has signed a concession agreement with the shareholders of the Emirates RDF Company to develop and operate a refuse derived fuel facility in Umm Al Quwain.  The project will be developed under a public private partnership (PPP) scheme and is co-financed by the Ministry of Presidential Affairs.  The construction of the RDF facility will start in December and is expected to start operating in April 2020.

The RDF facility will receive 1,000 tons per day of household waste from Ajman and Umm Al Quwain and will cost around $40 million to build.  It will convert the waste of 550,000 residents from the two emirates into an alternative energy source.  This product, named refuse derived fuel (RDF), will be used in cement factories as a fuel. It will partially replace the traditional use of gas or coal.  By implementing this project, approximately 90% of household waste will be diverted from landfill.  The Emirates RDF Company is a joint venture consisting of UAE-based contractor BESIX, Ajman-based Tech Group Eco Single Owner Holding and Finland’s Griffin Refineries.  (AB 17.10)

Back to Table of Contents

4.2  Ras Al Khaimah Launches Major Energy Efficiency Drive

Ras Al Khaimah Municipality has launched a major initiative to retrofit thousands of buildings in the emirate to make them more energy efficient.  The Retrofit Program, coordinated by the Energy Efficiency and Renewables Office (REEM) within RAK Municipality, aims to retrofit about 3,000 buildings by 2040.  It’s an important pillar of the RAK Energy Efficiency and Renewable Energy Strategy 2040, which targets 30% energy savings, 20% water savings, and 20% generation from renewable energy sources.

The Government is expected to lead by example in the execution of the strategy by improving energy efficiency in its buildings.  RAK Municipality has issued a set of guidelines to support all government entities in achieving their energy efficiency goals, and will provide direct support through its Energy Efficiency and Renewables Office (REEM).  A first retrofit project involving the Municipality buildings has already begun.  (AB 27.10)

Back to Table of Contents


5.1  Lebanon’s Average Inflation Reached 6.10% by September 2018

According to the Central Administration of Statistics (CAS), Lebanon’s average prices rose by 6.10% by September 2018 compared to the same period last year as all 13 components of the Consumer Price Index (CPI) posted average yearly upturns.  The average costs of Housing and utilities (water, electricity, gas and other fuels) constituting a combined 28.4% of the Consumer Price Index or CPI, rose by 6.64% year-on-year (y-o-y) by September 2018.  In fact, Owner-occupied rental costs, which grasped 13.6% of this category, rose by 3.90% y-o-y.  As for the average prices of Water, electricity, gas, and other fuels (11.8% of the total CPI), they increased by an annual 10.16% by September 2018.  In turn, the average prices for Food and non-alcoholic beverages (constituting 20% of the CPI), Transportation (13.1% of the CPI), and education costs (6.6% of CPI) registered yearly upticks of 4.86%, 8.55%, and 4.07% by September 2018.  (CAS 22.10)

Back to Table of Contents

5.2  Lebanon’s Trade Deficit Reached $11.73 Billion by August 2018

Lebanon’s trade deficit widened by 4.83% year-on-year (y-o-y) to reach $11.73B by August 2018.  Total imports increased by a yearly 4.76% to $13.72B by August 2018 while exports recorded a yearly rise of 4.39% to $1.99B over the same period.

Mineral products were the leading imports to Lebanon in the first 8 months of 2018, grasping a 21.29% stake of total imported goods.  Machinery and Electrical Instruments followed, constituting 11.87% of the total, while Products of the chemical or allied industries grasped 10.92% of the total.  The value of imported mineral products stood at $2.92B by August 2018, down by a yearly 0.12%, owing it to a 26.73% y-o-y decline in their imported volume to 5.40M tons by August 2018.  Meanwhile, the average price of oil increased by 38.08% y-o-y to $72/barrel over the same period.

As for the value of machinery and electrical instruments, it recorded a rise of 25.76% y-o-y to settle at $1.63B, and that of products of the chemical or allied industries also increased by 5.63% to $1.50B over the same period.  In terms of top trade partners, Lebanon primarily imported from China, Italy, Greece and USA with shares of 10%, 8%, 8% and 7% in the total value of imports, respectively, in August 2018.

As for exports, the top category of products exported from Lebanon was pearls, precious stones and metals, which grasped a share of 23.59% of total exports, followed by a share of 13.61% for prepared foodstuffs, beverage and tobacco and 13.59% for base metals and articles of base metal by August 2018.  In details, the value of pearls, precious stones, & metals rose by an annual 16.82% to reach $468.49M by August 2018. In turn, the value of prepared foodstuffs, beverage, and tobacco decreased by 12% y-o-y to $270.25M.  Meanwhile, the value of base metals and articles of base metal climbed by a yearly 22.9% to $269.95M.  In August 2018, the UAE, followed by South Africa and Saudi Arabia were Lebanon’s top three export destinations, respectively constituting 14%, 8% and 7% of the total value of exports.  (DoS 22.10)

Back to Table of Contents

5.3  Tourist Spending in Lebanon Climbed by an Annual 5.41% by the Third Quarter

According to Global Blue, tourist spending in Lebanon added 5.41% by Q3/18, compared to Q3/17.  The rise can be linked to the 3.88% yearly increase in tourist arrivals to 1.51M by September 2018.  The number of refund transactions rose by 2.12% y-t-d by September 2018.  The highest increase of number of refund transactions was executed during the month of September with growth rate of 13.9% while the highest drop was performed during the month of June with a reduction of 5.17%.

Tourists from the Arab countries remained the largest spenders in Lebanon, with Saudis, Emiratis, Syrians and Kuwaitis in particular grasping shares of 12%, 11%, 9 and 7% of total spending, respectively.  On a year-to-date basis, tourist spending by Syrian, Kuwaiti and Qatari visitors rose by 74.56%, 5.89% and 62.55%, respectively.  Meanwhile, spending by Saudi Arabian visitors and Emiratis slumped by 19.9% and 2.19%, weighing down on overall tourist spending for the period.  In Q3/18, tourists expended 67% of their total spending on Fashion and clothing, followed by 18% on watches and jewelry, noting that spending on fashion and clothing grew by a marginal 1% by September 2018.  Similarly, spending on watches and jewelry increased by 23.8% over the same period.  (GB 25.10)

Back to Table of Contents

5.4  Lebanese Total Tourist Arrivals Up by 3.88% y-o-y in Third Quarter While Arab Tourists Lagged

The latest data by the Ministry of Tourism revealed that the number of tourist arrivals to Lebanon increased by 3.88% year-on-year (y-o-y) in Q3/18 to settle at 1.51 million.  However, the rise remains incremental (compared to the growth rate of 11.3% recorded a year before) owing it to the growth of tourist arrivals namely from Europe and America, and to a slump in the number of Arab tourists who are Lebanon’s largest spenders.  In details, the number of visitors from the Arab countries (constituted 27.8% of total arrivals) declined by an annual 5.45% to 419,142 visitors in Q3/18.  In fact, geopolitical tensions arose between Lebanon and the KSA particularly following the Prime Minister Hariri crisis in November 2017.  The developments since weighed down on the number of Arab incomers in general, and on Saudis, Emiratis and Kuwaitis in particular.  As such, the number of tourists coming from Saudi Arabia retreated by a yearly 18.06% to 44,369 by Sept. 2018.  Similarly, tourists from the United Arab Emirates and Kuwait slumped by 20.98% and 14.35% y-o-y to 1,296 and 29,930 over the same period.  In addition, visitors from Iraq slipped by yearly 10.58% to reach 161,228 tourists, respectively, in Q3/18.  On the counterpart, European tourists (which grasped 35.70% of total tourists) added a yearly 9.52% to 537,846 travelers in Q3/18.  In details, the number of French and German visitors increased by 6.58% y-o-y and 4.18% y-o-y, to 139,620 and 82,876 tourists, respectively.  By the same token, British, Turkish and Italian tourist arrivals added 12.25%, 6.65% and 6.98% annually, to settle at 60,705 travelers, 23,389 and 27,295 visitors, respectively.  Meanwhile, tourists from Sweden slipped by a yearly 4.89% to 30,469 travelers over the same period.  As for American tourists, (19.1% of total tourists), their number increased by 8.68% y-o-y to 287,887 visitors by September 2018 owing it to the 6.88% and 11.32% annual upticks recorded in the number of visitors coming from the USA and Canada, to reach 153,616 and 101,098 visitors, respectively.  (MoT 18.10)

Back to Table of Contents

5.5  Jordan’s Trade Balance Deficit Down 3.7% in First 8 Months of 2018

Jordan’s balance of trade deficit for the first eight months of 2018 fell by 3.7%, driven by higher national exports and lower imports, latest figures showed.  According to data from the Department of Statistics, the total exports during the same period amounted to JD 3.555 billion with an increase of 2.9%, compared to the same period in 2017.

National exports during the first eight months of 2018 stood at JD 2.999 billion with an increase of 2.6% compared to the same period last year.  The value of re-exports reached JD564 million during the first eight months of this year, an increase of 4.5% compared to the same period of 2017.  Imports were at JD9.949 billion during the first eight months of 2018, down by 1.3% compared to the same period of 2017.  The total export coverage of imports reached 37.8% during the first eight months of 2018, the coverage rate was 36.2% during the same period of 2017.  (Petra 22.10)

Back to Table of Contents

5.6  Germany Allocates €462.12 Million to Support Jordan

The German government on allocated €462.12 million in new aid, grants and soft loans to finance development projects in Jordan and support Syrian refugees.  The Ministry of Planning and International Cooperation said that the annual Jordanian-German government talks on development cooperation for 2018 led to the signing of a memorandum to allocate the funding.

The new aid was distributed to €291.8 million to fund vital sectors through grants, technical assistance and soft loans, of which €164 million would be grants to support various sectors such as water and sanitation, the environment, solid waste management, education, vocational training and technical education, €25.8 million in technical assistance, and €102 million in very concessional loans to support water, sanitation and to enhance energy efficiency in the water sector.  Some €73.32 million was allocated to support Syrian refugees and host communities through UN organizations and NGOs, and €86 million as a soft loan to support the public budget and support economic reforms in Jordan.  (Petra 23.10)

Back to Table of Contents

►►Arabian Gulf

5.7  GCC Forecast to Enjoy 125% Growth in Russian Tourists by 2023

Russia continues to be one of the top 10 source markets for the UAE, with 530,000 Russian visitors entering the UAE in 2017.  The number of Russian tourists travelling to the GCC is expected to increase 125% from 933,000 in 2018 to 2.1 million in 2023.  The latest research published by Colliers International predicts the increase in Russian tourists to the GCC to create an extra 2.9 million room nights over the coming five years.

It said Russia’s links with the GCC have strengthened in recent years due to the introduction of additional airline routes, relaxed visa regulations for Russian nationals, the oil price recovery and stabling of value of the Russian ruble.

Russia continues to be one of the top 10 source markets for the UAE, with 530,000 Russian visitors entering the UAE in 2017, a 121% increase from the previous year.  This increase stemmed from the UAE’s introduction of visas on arrival for Russian tourists last year.  Colliers International expects this trend to continue in 2018, with 895,700 Russian visitors expected, an increase of 69% from 2017.

Supporting this demand, in June Emirates announced a third daily flight to Moscow, while in September the airline confirmed that it would be the first to fly an A380 to St Petersburg.  Etihad Airways and flydubai have also increased their flights between the UAE and Russia, with flydubai twice extending its Russian network in 2017, adding flights to Makhachkala, Voronezh and Ufa, and daily flights to a second airport in Moscow – Sheremetyevo International.

While the UAE is expected to account for the majority of Russian arrivals in 2018, Saudi Arabia witnessed the highest compound annual growth rate (CAGR) between 2013 and 2018, at 20% compared with 17% for the UAE.  Despite the UAE and Saudi Arabia leading comparative growth, Oman witnessed an increase of 11% between 2013 and 2018, while Kuwait experienced an aggregate growth rate of 7%.  (AB 24.10)

Back to Table of Contents

5.8  MHI Successfully Launches UAE’s KhalifaSat Satellite

Japan’s Mitsubishi Heavy Industries successfully delivered UAE Mohammed bin Rashid Space Centre’s (MBRSC) KhalifaSat satellite into orbit on 29 October via the H-IIA launch vehicle F40.  The launch vehicle trajectory was executed as planned, and at about 24 minutes after liftoff, separation of the KhalifaSat satellite was confirmed.  This mission was performed along with Japan Aerospace Exploration Agency’s (JAXA) Greenhouse gases Observing SATellite-2 “GOSAT-2” satellite.

KhalifaSat is the first national satellite manufactured by the UAE, thus the mission should prove to be a great step towards UAE’s mid-and-long term plans in government space activities and industries.  Additionally, MHI holds the launch service contract for the Emirates Mars Mission (EMM spacecraft, planned to be launched in 2020), through which it hopes to build upon a strong and lasting relationship with the MBRSC and UAESA (UAE Space Agency).

KhalifaSat is one of the most technologically advanced remote-sensing observation satellites, with five patents registered.  The images provided by the satellite will be used in urban planning and management, ensuring the effective optimization of land use and realistic infrastructure proposals.  The images will also be used to develop detailed maps of targeted areas and monitor major engineering and construction projects.  In the field of environmental protection, KhalifaSat will monitor environmental changes locally and internationally to support global efforts to preserve the environment.  The satellite is also expected to provide detailed imagery of the ice caps at the North and South Poles, helping to detect the effects of global warming.  (MHI 29.10)

Back to Table of Contents

5.9  UAE Workforce Comprised of 91% Expats

Based on the surveys and findings of various agencies, an expert pointed out that the non-nationals in the GCC workforce are estimated to comprise 75% of workers, with the UAE at the largest number of expats in its workforce at 91%.  In 2018, nationals formed just 8% of the UAE workforce.  The number is projected to further dip to 6% in 2020 and to 3% by 2030.  According to government statistics, the employment of nationals remains at less than 2% in the private sector, which comprises more than 62% of the total jobs in the country.  Additionally, jobseekers have increased from 30,000 in 2006 to 36,000 in 2018.

Jobseekers in the GCC stand at an average of 6.1%: Oman and Bahrain at 15%, Saudi Arabia at 11.8%, the UAE at 4.2%, Kuwait at 4.1% and the lowest in Qatar at 1.5%.  The total population of the GCC has surpassed over 54 million in 2018 and is expected to grow by nearly 12 million in 2030. GCC states need to create 500,000 top private jobs annually at twice the present salaries.  (KT 25.10)

Back to Table of Contents

5.10  Dubai Picked to Host First Overseas Russian Innovation Hub

Dubai Internet City (DIC) has signed an agreement with the Russian Export Center (REC) to launch the first Russian Center for Digital Innovations and Information and Communication Technologies outside of Russia in Dubai.  The center is the first of four global centers planned, and the first commitment to investment promotion of this scale by Russia abroad, a statement said.  The opening of the center comes at a time when the UAE and Russia reported growth in bilateral trade between the countries to $1.2 billion in 2017.

Leaders of both countries reviewed bilateral relations, discussed cooperation, and signed a new strategic partnership earlier this year.  In addition to opening the center, the Russian Export Centre and DIC will jointly work to support Russia and UAE-based technology companies of all sizes, including start-ups and entrepreneurs and further support DIC’s commitment to provide a thriving and nurturing ecosystem for companies to thrive in.  (AB 17.10)

Back to Table of Contents

5.11  RTA & du to Add Free Wi-Fi to All Dubai Taxis

Dubai’s Roads and Transport Authority (RTA) and telecom firm du are set to embark on a joint project to fit all taxis in Dubai – about 10,800 cabs – with free Wi-Fi.  The entities have signed a cooperation agreement on the sidelines of GITEX 2018, saying the deal demonstrated their commitment to support the efforts of ranking Dubai as the smartest and happiest city in the world.  “According to the agreement, du will start fitting the required devices to taxis.  All fleet vehicles of the six taxi franchise companies operating in Dubai will be covered by the service within one year from the date of signing this agreement, said the CEO of RTA’s Public Transport Agency.  The Wi-Fi service is also available at more than 400 hotspots in the UAE including the Dubai Metro, Dubai Tram, shopping centers, Emaar Boulevard Downtown and the Global Village.  (AB 18.10)

Back to Table of Contents

5.12  WEF Says Saudi Arabia Leads GCC in Economic Stability

Saudi Arabia lead the list of the region’s country as the most stable economy according to the World Economic Forum’s global competitiveness index for 2018.  The Saudi kingdom was also ranked 39 out of 140 economies, showing progress, its best since 2012.  The kingdom advanced two ranks in the Global Competitiveness Index compared to last year report.  The report gives decision makers a full score of confidence in the stability of the Saudi economy and its ability to withstand external challenges and enhance sustainable growth opportunities.

Among the countries in the region, the Global Report for 2018 gave Saudi Arabia, the UAE and Kuwait a full score in the macroeconomic stability index by 100%.  The World Economic Forum’s Global Competitiveness Index 4.0 is a composite indicator that assesses the set of factors that determine an economy’s level of productivity- widely considered as the most important determinant of long-term growth.  The GCI 4.0 framework is built around 12 main drivers of productivity – institutions, infrastructure, technological readiness, macroeconomic context, health, education and skills, product market, labor market, financial system, market size, business dynamism and innovation.  (Al Arabiya 17.10)

Back to Table of Contents

5.13  Saudi Arabia’s Recovery Gains Pace with Higher Consumer Spending

Latest macroeconomic indicators from Saudi Arabia points to a sustained recovery in the economy supported by improving consumer spending, corporate and banking sector earnings and gains in government revenues, according to analysts.  A recent analysis from Arqaam Capital showed the Saudi Kingdom witnessed strongest consumer spending numbers up 9%, year on year, in the third quarter of this year more than expected after a weak first half of 2018.

The International Monetary Fund (IMF) has forecast a real GDP growth of 1.9% in 2018, with non-oil growth strengthening to 2.3%.  The pickup in GDP growth follows a negative growth of 0.9% in 2017. GDP growth is expected to pick up further over the medium-term as the reforms take hold and oil output increases.  The fiscal deficit is projected to narrow to 4.6% of GDP in 2018 from an estimated 9.3% last year.  Higher exported oil, domestic energy, and non-oil revenues more than offset additional capital spending, compensatory payments to households through the citizens’ accounts, and the cost of the January Royal Decree, which introduced monthly allowances for public sector workers, retirees, students, and those on social benefits through end-2018 (1.8% of GDP).

Latest data showed aggregate consumer spending as indicated by point of sales (POS) and ATM withdrawals registered a 16% year on year growth in September and 9% in the third quarter of 2018 compared to 5% in the second quarter over the first quarter.  The IMF estimates non-oil growth to strengthen to 2.3% this year supported by higher on and off-budget fiscal spending and higher oil prices, although rising interest rates could act as a drag.  (AB 29.10)

Back to Table of Contents

5.14  Saudi Arabia Pledges $3 Billion to Support Pakistan’s Economy

On 23 October, Saudi Arabia pledged $3 billion to Pakistan as the South Asian country battles a balance of payment crisis.  It also agreed to provide up to another $3 billion on deferred payment for import of oil, the statement added.  The agreement came between the two countries during a visit by Prime Minister Imran Khan to Riyadh where he met King Salman bin Abdulaziz.  Khan also attended a Saudi Arabian investment conference where the new Pakistani leader launched a charm offensive targeting potential investors as Pakistan continues to seek funding to plug its deteriorating finances.

It was also agreed that a one year deferred payment facility for import of oil, up to $3 billion, will be provided by Saudi Arabia.  This arrangement will be in place for three years, which will be reviewed thereafter.

Since taking power in August Khan has also sought loans from allies such as China and Saudi Arabia, promised to recover funds stolen by corrupt officials and embarked on a series of high-profile populist austerity measures.  But help has been in short supply and economists’ warnings have grown increasingly urgent.  The Saudi pledge comes days after Pakistan’s central bank warned inflation could double in the coming year — hitting 7.5% — while the country’s growth target rate of 6.2% would likely be missed.

Pakistani Finance Minister Umar warned the country was fast heading towards bankruptcy.  However, he promised to end the country’s reliance on IMF bailouts to shore up its shaky economy, as officials prepared to negotiate a new loan.  An IMF team is set to arrive in Pakistan in early November to begin negotiations.  (AB 24.10)

Back to Table of Contents

►►North Africa

5.15  Egypt’s Trade Volume Amounts to $67.63 Billion Over First 9 Months of 2018

Egypt’s trade volume from January to September 2018 hit $67.63 billion, up from $59.82 billion during the same period the previous year; a rise of 13%, according to a report released on 28 October by the General Organization for Import and Export Control (GOEIC).  The report said that Egypt’s non-petroleum exports during the first nine months of the year reached $15.514 million, compared to $16.605 million during the same period the previous year; a rise of 11%.  Egyptian exports during September 2018 rose by 20% to hit $1.933 billion compared to $1.613 billion during the same month last year.  Imports recorded a drop of 13% to register $4.206 billion compared to $4.860 billion in September 2017.

The report added that the countries of the League of Arab States take the lead when it comes to imports from Egypt at $6.735 billion from January to September 2018, followed by the EU countries at $5.528 billion.  Egypt exports to the United States in the same period were worth $1.185 billion, while to non-Arab African countries $1.123 billion.

When it comes to the most important markets Egypt sent exports to in the past nine months, the UAE lead at $1.576 billion, followed by Turkey at $1.49 billion, while the United States came in third at $1.185 billion.  Italy came in fourth place with exports equal to $1.17 billion, followed by Saudi Arabia at $1.05 billion.  (Ahram Online 28.10)

Back to Table of Contents

5.16  Cairo Tops the List for the Fastest Growing City in Tourism

According to the latest City Travel and Tourism Impact Report published by the World Travel and Tourism Council, Cairo tops the list for the fastest growing cities in travel and tourism activity, constituting 34% of the country’s GDP in 2017.  This rapid growth was achieved after a recovery from a long period of decline following the Arab Spring and frequent terror attacks, including the Russian Metrojet plane crash in 2015.  However, while tourism is on the rise, it remains well below its 2010 peak, when an estimated number of 14.7 million tourists visited Egypt and generated $12.5 billion in revenue.

The tourism sector in Egypt faced a huge setback following the January 2011 revolution, seeing a 37% decline in visitors.  However, things started to take a positive turn as the United Nations World Tourism Organization reported in 2017 that Egypt is the second fastest growing destination in the world.  Currently, Cairo is taking several measures to boost the tourism sector, from attempts to eliminate terrorism in the Sinai Offensive launched this year and announcing new projects, such as the new administrative capital and the grand new Egyptian museum expected to open in early 2019.  (WTTC 26.10)

Back to Table of Contents

5.17  Morocco’s Privatization to Cut Deficit to 3.3% of GDP in 2019

Moroccan Economy Minister Benchaaboun announced that Morocco will privatize some public companies to help reduce the budget deficit to 3.3% of GDP in 2019.  The move will also generate MAD 8 billion, Minister Benchaaboun said in a parliamentary session.  The decision comes to improve the governance of public companies and to increase state resources.  Benchaaboun estimated that the treasury’s deficit in 2018 would end at 3.8% instead of 3% of GDP as stipulated in the finance bill.

Without revenue from privatization, the budget deficit is expected to stay almost flat at 3.7% from a forecasted 3.8 this year.  However, the minister did not reveal which companies the government plans to privatize.

According to Al Massae, the National Railway Office (ONCF) and the Moroccan Airports Authority (ONDA) may be privatized.  Benchaaboun also stated that increasing taxes on tobacco consumption will generate additional revenue estimated at MAD 1.2 billion in 2019.

The government has also considered other measures to raise revenues.  The 2019 Finance Bill will levy an additional 2.5% corporate income tax on companies with annual profits equal to or more than MAD 40 million.  The government believes it will generate MAD 2 billion in 2019-2020 to be used as a “solidarity contribution” to reduce social disparities.  Benchaaboun also noted the impact that rising oil and gas prices will have on financial balances.  The economy, he added, requires measures to mobilize resources, control spending and establish mechanisms to reduce the burden on the investment budget.

The government allocated MAD 17.67 billion for the subsidy fund to subsidize butane gas, sugar and flour in 2019.  The significant increase of MAD 4.65 billion from the 2018 budget can be explained by the increase of oil prices at the international level.  (MWN 23.10)

Back to Table of Contents

5.18  First 8 Months of 2018 See 8.7 Million Tourists Visit Morocco

Morocco received 8.7 million tourists from January to August, according to statistics released on 30 October by the Ministry of Tourism.  Tourist arrivals in Morocco rose 8% for the eight month period from the same period last year.  Foreign tourist numbers were up 14% while returning Moroccans increased by 2%.  Tourist arrivals from Italy made the most considerable increase between the first eight months of 2017 and 2018, rising 14%.  German tourist numbers increased 10%, French 7% and Dutch 6%.

Morocco earned $4.88 billion in tourism revenue in the period, compared to $4.82 billion during the same period in 2017.  Counting overnight stays at hotels and guest houses, Marrakech, Casablanca, and Agadir were tourists’ top destinations.  Along with the traditional European market, the number of Asian visitors, mainly from China, hiked significantly.  The increase follows Morocco’s exemption of Chinese travelers from needing to apply for visas in 2016.  Morocco’s 2020 vision, presented by King Mohammed VI in 2010, aims to double the tourism sector and set the country among the top tourist destinations in the world.  (MWN 26.10)

Back to Table of Contents


6.1  Greece is the Eurozone’s Leader in Indirect Taxation

Greece has the highest indirect taxes in the Eurozone and is showing no signs of reducing them in 2019.  This ominous conclusion for taxpayers stems from a comparison of the 2019 draft budgets submitted to the European Commission by the 19 members of the Eurozone.  According to the figures, special consumption taxes and the value-added tax will amount to 17.3% of Greek GDP in 2019, putting the country in the top spot in the Eurozone, followed by France and Cyprus.

Greece’s absence of tax justice is also illustrated by another statistical finding: The country has the largest spread between returns of direct and indirect taxation, with direct tax revenues expected to come to 10% of GDP next year, 7.3% below indirect tax takings.  No other Eurozone country will have such a wide spread, which is actually widening as in 2018 it is projected to come to 6.8%.

In the sum of taxes and social security, Greece ranks fifth among the Eurozone member-states for 2019, only behind Belgium, France, Finland and Italy.  The difference is that citizens in the other states get a lot more back: While Finland spends 2.1% of its GDP to protect its unemployed, Greece contributes just 0.6%.  (eKathimerini 21.10)

Back to Table of Contents



7.1  Israel Ended Daylight Savings Time on 28 October

Israel’s winter began officially at 2:00 on 28 October as clocks were turned back one hour, marking the end of daylight savings time.  Daylight savings time will return officially on 29 March 2019.  The change in Israel coincides with the EU and the Palestinian Authority, but not the US, which changes on 4 November.

In 2013, the Knesset passed legislation extending daylight savings time from the last Sunday in March to the last Sunday in October.  Before that, standard time would begin the Saturday night before Yom Kippur, so that the day’s fast, which ended at nightfall, would end an hour “earlier.”

Because the Hebrew calendar is lunar, Yom Kippur can fall between mid-September and mid-October, which used to mean that Israelis returned to standard time as much as a month and a half before most other countries, where daylight savings time ends on 1 November.  As a result, the issue of the seasonal time transition became contentious among Israelis, and was caught up in political tensions between religious and secular political parties.  (ToI 25.10)

Back to Table of Contents

7.2  Israel’s National Anthem Played in UAE Following Israeli Judoka Win

Israel’s Culture and Sports Minister Miri Regev fought back tears as the Israeli national anthem played for the first time in the United Arab Emirates – a country that does not recognize Israel – after Israeli judoka Sagi Muki won gold in Abu Dhabi on 28 October.  Muki, the current European champion, won the men’s under-81 kilogram category in this year’s Abu Dhabi Grand Slam, just as Israeli Tal Flicker did at the same event in 2017.  But unlike last year, when Israel’s competitors appeared under the International Judo Federation flag rather their own, this year the Israeli competitors appeared with the Israeli flag stitched to their uniforms.  After downing his Belgian rival to win the gold medal, Muki pointed proudly to the Israeli flag on his judo uniform.  This year’s event was a significant change from last year, when UAE organizers singled Israel out with a ban on displaying its flag or playing its anthem during the tournament.

The Israeli national anthem Hatikvah was played for Muki’s gold win – the first ever sounding of the Israeli anthem in the Arab country.  Regev stood next to the podium as the anthem played and wept visibly while singing along. Israeli television channels broke into their regular broadcasts to show the medal ceremony live.  Regev credited the IJF’s president, Austria’s Marius Vizer, for influencing the organizers to change their policy on Israeli symbols.  (Various 29.10)

Back to Table of Contents


7.3  Jordan Changed Its Clocks to Wintertime on 26 October

Jordan changed over to wintertime on Friday, 26 October, according to a Cabinet decision.  Clocks were set back by 60 minutes at midnight Thursday, making Jordan two hours ahead of Greenwich Mean Time.  Under the Cabinet decision taken in 2013, Jordan switches to wintertime on the last Friday of October every year.  (Petra 22.10

Back to Table of Contents

7.4  Moroccans are the Largest Foreign Student Community in France

The French Agency for the Promotion of Higher Education, Hospitality and International Mobility, “Campus France,” has ranked Moroccans as the largest foreign student community in France during the 2017/2018 academic year.  According to the statistics, the number of Moroccan students enrolled in French higher education institutions is 39,855 students.  During the 2016/17 academic year, the number of Moroccan students in France stood at 38,002, or 43.9% of foreign students.  It reflects an increase of 17% compared to the 2011 – 2016 period.  Algeria follows Morocco, with 30,521 students, followed by China with 30,071 students, Italians with 13,341 students and Tunisia ranked 5th with 12,842 students.

France ranks fourth among the countries that host international students, behind the US, the UK and Australia, and ahead of Germany.  (MWN 14.10)

Back to Table of Contents


8.1  Positive Results of Orthopedic Treatment With ApoGraft Enriched Stem Cells Derived

Cellect Biotechnology has achieved positive results on the use of human fat derived stem cells (mesenchymal) treated with the ApoGraft process in orthopedic treatments of animals.  The study used ApoGraft enriched human mesenchymal stem cells at the time of surgery with the aim of improving the post-surgery healing process.  Preliminary evidence of enhanced strength on biomechanical testing and significantly improved rotator cuff repair in animals treated with ApoGraft-treated human fat-derived stem cells (ASCs) have been achieved with shorter incubation compared to standard preparations of adipose derived stem cells.

Until this study, ApoGraft was mainly used on blood cells (hematopoietic) and, in studies to date, has proven to be beneficial in stem cells selection of bone marrow (including for treatment of cancer by Bone marrow transplantation, and autoimmune diseases).  The new study has shown beneficial effect of the Apograft treated cells in an orthopedic model.  This study further supports previous reported data showing activation of MSCs, as measured by significant increase in proliferation, the ability of those cells to create colonies and differentiate into bone after only a short incubation.

Kfar Saba’s Cellect Biotechnology has developed a breakthrough technology for the selection of stem cells from any given tissue that aims to improve a variety of stem cell-based therapies.  The Company’s technology is expected to provide research, hospitals and pharma companies with the tools to rapidly isolate stem cells in quantity and quality allowing stem cell-based treatments and procedures in a wide variety of applications in regenerative medicine.  The Company’s current clinical trial is aimed at bone marrow transplantations in cancer treatment.  (Cellect Biotechnology 18.10)

Back to Table of Contents

8.2  Turning Apple Waste into a Superfood

Each year, more than 150 thousand tons of apples are picked in Israel, but 10% of the crop is considered waste, due to appearance, size, dents and damage as a result of falling prematurely from orchard trees.  This causes huge economic damage of NIS 25 million a year after these defective-looking apples are marketed to wholesalers or to the juice industry, at a seriously low prices that are not economical for the farmers.

New research currently being conducted by at Tel-Hai College and at Kiryat Shmona’s MIGAL Galilee Research Institute has found that it is possible to use this waste to create high-quality “apple powder” with surprising nutritional advantages putting it in the category of “superfood” products.

The apples go through a long process that includes grinding, drying through two different processes (oven or freeze-dried) and vacuum storage.  In the research process, comparisons were made among a number of different kinds of “apple flour” taken from five different kinds of granny smith apple waste: grade A – with no damage, intended for stores; grade B – with minimal damage (marks), intended for markets; grade C – with mechanical damage and sun spots, intended for animal feed; grade D – with much damage and marks, intended for companies that use it for processed food; and grade E – apples that fell in the orchard and did not reach the sorting stage in the packing house, but which are still edible.

Examination of the different grades of apples was intended to map levels of waste that are usable for creating the powdered superfood with high nutritional quality, through comparison among five apple powders in different quality categories and examination of the drying process.  It was found that there is no difference between powder that is created from high quality apples (grade A) and powder created from waste apples.  In addition, it was found that the technology of freeze drying is preferable to heat drying technologies because it better preserves the natural nutritional value of the fruit.  According to the research findings, “apple flour” from apple waste has a great deal of nutritional value, identical to powder made from grade A apples!

The powder made from waste apples has 600 ml of vitamin C, three times the amount found in a guava, which is considered to have record high levels of vitamin C, and ten times more vitamin C than orange juice! In addition, the powder has a high quantity of 25% nutritional fiber and high anti-oxidant properties.   (IsraelAgri 22.10)

Back to Table of Contents

8.3  FSD Pharma Signs Binding LOI to Acquire Therapix Biosciences

Ontario’s FSD Pharma announced the signing of a binding letter of intent (LOI) to acquire Therapix Biosciences, effective 22 October 2018.  The Transaction combines two highly-complementary businesses and creates a medical cannabis industry innovator focused on the research and development of advanced cannabinoid treatments.  Therapix Biosciences shareholders will receive $48 million of FSD stock upon closing of the Transaction.  The terms of the LOI will be superseded by a definitive agreement, which FSD Pharma and Therapix intend to execute within 30 days.

The intended acquisition of Therapix Biosciences at this time is a pivotal step in the evolution of FSD by entering the high-value medical cannabis market.  In addition to growing products for the direct to consumer retail cannabis market in Canada, they are now developing a new class of novel cannabinoid-based treatments for several central nervous system disorders, including chronic pain, fibromyalgia, irritable bowel syndrome and several other disease areas.  With this acquisition, FSD Pharma is signaling its commitment to furthering very high-value pharmaceutical R&D clinical programs centered on cannabinoid molecules, a number of which are actively under way at several distinguished medical institutions across the globe, including among others, the Therapix’ investigator-initiated Phase IIa study at Yale University Medical Center in the U.S. for Tourette syndrome Program, the preparations for commencing anticipated subsequent Phase IIb studies at the Hannover and Munich University Medical Schools in Germany for Tourette syndrome program, and collaboration with Assuta Medical Centers in Israel to develop therapeutic products in the field of sleeping disorders.

Givatayim’s Therapix Biosciences is a specialty clinical-stage pharmaceutical company led by an experienced team of Senior Executives and Scientists.  Their focus is creating and enhancing a portfolio of technologies and assets based on cannabinoid pharmaceuticals.  With this focus, the company is currently engaged in the following drug development programs based on repurposing an FDA-approved cannabinoid: THX-110 for the treatment of CNS disorders, THX-120 for the treatment of sleep disorders and the treatment of pain; THX-130 for the treatment of Mild Cognitive Impairment (MCI) and Traumatic Brain Injury (TBI); and THX-150 for the treatment of infectious diseases.  (FSD 22.10)

Back to Table of Contents

8.4  Clew Medical Raising $20 Million

Netanya’s Clew Medical is currently in the final stages of raising $20 million and has signed an agreement with Sheba Medical Center at Tel HaShomer.  Clew has developed an analytics platform for predicting at an early stage, life threatening complications in intensive care.

When a body is in distress, it gradually shuts down all systems that are not vital, in a process known as systems collapse.  The aim is to protect the most vital systems, the brain and the heart, but the systems that collapse aren’t always restored to full functioning and in all likelihood won’t be restored.  So if the patient reaches the stage, after the appearance of clinical indications, of systems collapse and the kidneys, pancreas, lungs and liver are not functioning.  Sometimes the systems collapse could have been prevented if it was identified two or three hours ahead of time.

Clew’s product has already been used in trials at Ichilov Hospital in Tel Aviv and several US hospitals and will now also be used at Sheba Medical Center in Tel Hashomer.  Marketing approval and regulatory matters must still be finalized, but it is hoped that the system will be available as a product from next year.  Clew has raised $10.5 million to date and as mentioned has almost raised another $20 million.  (Globes 22.10)

Back to Table of Contents

8.5  Teva & New Jersey Governor Formalize North America Headquarters Move in Israel Ceremony

Teva Pharmaceuticals executives formalized with New Jersey Governor Murphy Teva’s commitment to consolidate its North America Commercial business areas into New Jersey (NJ) on 21 October at the company’s global headquarters in Petah Tikva, Israel.

Announced earlier this year as part of a global restructuring process, Teva will establish its North America headquarters in Parsippany-Troy Hills, including more than 1,000 high-wage jobs and the transfer and creation of more than 800 positions.  Teva accepted an offer of 10-year, $40 million tax savings incentives from the NJ Economic Development Authority to move forward with its plan to negotiate a lease for office space in the Parsippany-Troy Hills area.

This ceremony marks another step forward in Teva’s global restructuring efforts to drive savings, restore financial security and stabilize its business. Reducing the number of sites is part of Teva’s strategy to unify and simplify the organization, as well as improve productivity and efficiencies.

Teva Pharmaceutical Industries is a global leader in generic medicines, with innovative treatments in select areas, including CNS, pain and respiratory.  Headquartered in Israel, with production and research facilities around the globe, Teva employs 45,000 professionals, committed to improving the lives of millions of patients.  (Teva 21.10)

Back to Table of Contents

8.6  NRGene and Kayagene Collaborate to Improve Cannabis Breeding and Seed Production

California’s Kayagene, an innovative cannabis breeding company, and NRGene are collaborating on research to enhance Kayagene’s breeding capabilities to develop improved cannabis varieties and more robust seed production.  The non-exclusive partnership between NRGene and Kayagene will accelerate development of cannabis varieties for hybrid seed production through stabilized lines.  The companies will be working in tandem to sequence and assemble multiple genomes of diverse cannabis lines to enhance valuable traits, related to cultivation practices, overall cannabinoid profiles, and yields.

NRGene’s DeNovoMAGIC 3.0 is used to develop high-quality, comprehensive genome assemblies of several varieties of cannabis to uncover and utilize the genetic variation of the species in a breeding program.  NRGene is a global leader in crop genomics and recently entered the cannabis industry to leverage its vast experience in crops to advance cannabis breeding.

The genome assemblies will increase genetic gain using markers in selecting for valuable traits while reducing the time and space required for each cycle in the breeding program and providing means to validate and protect the IP of the new varieties.  The varieties of Kayagene will be tailored to customers’ needs, including healthier, hardier plants that are optimal for production, as well as custom cannabinoid and terpenoid profiles.  These metabolite profiles are key for targeting specific therapeutic uses, such as pain relief and sleep support, as well as providing unique flavor profiles for energy drinks, edibles, and recreational products.

Ness Ziona’s NRGene is a genomic, big data company delivering cutting-edge software and algorithms to their clients to facilitate the modern genomics-based research that is revealing the function, complexity, and diversity of human, plant, and animal genomes that supports the most advanced medical research and sophisticated breeding programs.  NRGene tools have already been employed by some of the leading agribiotech companies worldwide, as well as the most influential research teams in academia.  (Kayagene 22.10)

Back to Table of Contents

8.7  Cellect Breakthrough for Industrialization of Apotainer Stem Cell Product Line

Cellect Biotechnology has successfully developed for industrialization its first in kind new technology as an integral part of Cellect’s ApoTainer.  The new technology utilizes FasL-coated magnetic beads for maximizing efficacy and scalability of stem cell-based products’ manufacturing.  The Apotainer improves the uniformity and hence quality of the outcome thereby supporting the safety and efficacy of raw material for all cell therapy.

During the last 6 months, the Cellect team was able to optimize the beads size, coating technology, elimination of the release of FasL into the medium, all while preserving the biological activity observed in Cellect’s ongoing human clinical trial.  As previously reported, pre-clinical proof of concept testing of the ApoTainer has shown that the use of FasL-coated magnetic beads significantly increases the active surface allowing a dramatic increase of interactions between the selecting agent and the cells.  Further, such testing showed that the outcome increases specific elimination of certain (but not all) of the non-stem cells while full preservation of the number and function of the stem and progenitor cells.

The enhancement of the ApoTainer with the Fas-L-presenting magnetic beads is designed to replace highly complex and expensive procedures currently used by laboratories (e.g. T cells depletion), with a significantly more effective process at a fraction of the time and cost.  Utilizing the ApoTainer, Cellect expects blood stem cell donation to be transplantable within less than 6 hours from donation through a simple process performed bedside instead of undergoing a lengthy laboratory procedure in a highly specialized setting.  The standard medical procedure for reaching enriched stem cells currently costs tens of thousands of dollars and produces significant adverse effects.

Kfar Saba’s Cellect Biotechnology has developed a breakthrough technology for the selection of stem cells from any given tissue that aims to improve a variety of stem cell-based therapies.  The Company’s technology is expected to provide research, hospitals and pharma companies with the tools to rapidly isolate stem cells in quantity and quality allowing stem cell-based treatments and procedures in a wide variety of applications in regenerative medicine.  The Company’s current clinical trial is aimed at bone marrow transplantations in cancer treatment.  (Cellect Biotechnology 22.10)

Back to Table of Contents

8.8  CollPlant Agreement for 3D Bioprinting of Solid-Organ Scaffolds for Human Transplants

CollPlant and Silver Spring, Maryland’s United Therapeutics Corporation announced that they have entered into a license, development and commercialization agreement for 3D bioprinted lung transplants.  The agreement combines CollPlant’s proprietary recombinant human collagen (rhCollagen) and BioInk technology with the regenerative medicine and organ manufacturing capabilities of United Therapeutics.

Under terms of the agreement, CollPlant granted United Therapeutics, through its wholly owned organ manufacturing and transplantation-focused subsidiary Lung Biotechnology PBC, an exclusive license to its technology for the production and use of rhCollagen-based BioInk for 3D bioprinted lung transplants throughout the universe.  CollPlant will manufacture and supply BioInk for a few years to meet development process demand, and will provide technical support to United Therapeutics as it establishes a U.S. facility for the manufacture of CollPlant’s rhCollagen and BioInk.  In addition to the initial focus on lung manufacturing, the agreement grants United Therapeutics an option, in its sole discretion, to expand the field of its license to add up to three additional organs.

Under financial terms of the agreement, once effective, CollPlant will receive an upfront payment of $5 million and milestone payments of up to $15 million based on the achievement of certain operational and regulatory milestones related to the development of manufactured lungs. The agreement also provides for option exercise payments of up to $9 million, and additional developmental milestone payments of up to $15 million if United Therapeutics elects to develop manufactured organs other than lungs using CollPlant’s technology.

Ness Ziona’s CollPlant is a regenerative medicine company focused on 3D bioprinting of tissues and organs, developing and commercializing tissue repair products for orthobiologics, and advanced wound care markets.  The Company’s products are based on its rhCollagen (recombinant human collagen) that is produced with its proprietary plant-based genetic engineering technology.  (CollPlant 22.10)

Back to Table of Contents

8.9  Regentis Biomaterials Expands SAGE Clinical Trial of GelrinC for Knee Pain

Regentis Biomaterials has expanded the SAGE clinical trial of GelrinC for the treatment of articular cartilage damage in the knee to 11 U.S. sites.  GelrinC is an investigational device being evaluated as a treatment to help the body regrow cartilage in the knee.

The SAGE study is an FDA Investigational Device Exemption (IDE) clinical study comparing GelrinC to microfracture, the current standard of care treatment for damaged knee cartilage.  The multi-center Phase III pivotal study will enroll 120 patients.  All patients who meet study requirements and agree to enter the trial are provided GelrinC as treatment, and their results will be compared to raw level historical data of a microfracture control arm.

In the U.S., GelrinC from Regentis Biomaterials is an investigational device for patients with articular cartilage damage in their knee.  GelrinC is composed of a synthetic material called polyethylene glycol (PEG) and a structurally modified form of human fibrinogen, a protein which in its native form assists healing processes. PEG and native human fibrinogen have been used individually in medical products for many years with excellent results.  GelrinC’s unique mode of action relies upon its ability to be implanted as a liquid so that it completely fills the defect, and then be cured into a gel that enables the body’s own stem cells to settle on its surface.  Over a period of six to 12 months, the GelrinC is gradually resorbed by the body and replaced by new cartilage tissue.  Preliminary clinical trials in Europe have indicated that this regenerated tissue provides excellent improvement in pain and function.

With offices in Princeton, New Jersey, and Or Akiva, Israel, Regentis Biomaterials is a privately held company focused on developing and commercializing proprietary hydrogels for tissue regeneration.  The technology was originally developed at Haifa’s Technion-Israel Institute of Technology.  (Regentis Biomaterials 23.10)

Back to Table of Contents

8.10  Wize Pharma Announces $4.45 Million Private Placement

Wize Pharma has entered into a securities purchase agreement with a group of investors, which will result in gross proceeds to Wize Pharma of approximately $4.45 million, before deducting placement agent fees and estimated offering expenses.  The net proceeds of the offering are expected to be used for advancement of the Company’s development plans for its lead product, LO2A, including completing clinical studies.  ThinkEquity, a division of Fordham Financial Management, acted as sole placement agent for the offering.

Hod HaSharon’s Wize Pharma is a clinical-stage biopharmaceutical company currently focused on the treatment of ophthalmic disorders, including dry eye syndrome (DES).  Wize Pharma has in-licensed certain rights to purchase, market, sell and distribute a formula known as LO2A, a drug developed for the treatment of DES, and other ophthalmological illnesses, including conjunctivochalasis (CCH).  (Wize Pharma 24.10)

Back to Table of Contents

8.11  Alvit LCS Pharma Manufacturing Agreement with Bazelet

Israel’s largest medical cannabis company Bazelet signed a manufacturing and licensing agreement with Israeli medical cannabis pharmaceutical product developer Alvit LCS Pharma to manufacture, market and sell Alvit’s line of pharma grade medical cannabis products in Israel and the EU.  These products include sublingual tablets, oral sprays, extended release, delayed release, and suppositories containing Bazelet’s proprietary and patent-pending active pharmaceutical ingredient (API).  Bazelet will manufacture the products in its recently completed, state of the art, fully GMP compliant manufacturing facility, and expects to begin marketing the products in the first half of 2019.  Bazelet and Alvit additionally signed a joint research and development agreement to develop a new pharmaceutical drug for the treatment of Inflammatory Bowel Disease (IBD) based on Bazelet’s API.  Alvit will be responsible for researching and developing a pharmaceutical product based on Alvit’s unique drug delivery technologies and Bazelet’s API.

Even Sapir’s Bazelet is an Israeli medical cannabis company that provides medical cannabis products to its patients since 2014.  The capacity of Bazelet’s new, state of the art manufacturing plant is large enough to supply the cannabis needs of 100,000 patients.  Bazelet securely delivers its products to the homes of thousands of patients every month, and runs an in-house laboratory to analyze its products confirming their composition, quality, and reproducibility.  Bazelet’s scientists have developed proprietary technologies for improved production and a range of new compositions of improved therapeutic efficacy. Bazelet’s intellectual property portfolio includes 18 families of patent applications.

Tel Aviv’s Alvit is an international leader in the development of products based on standardized cannabis extracts.  Alvit’s products are differentiated by the fact that they have undergone clinical trials to prove their efficacy and bioavailability.  These pharma grade, clinically tested products speak the language of doctors, allowing them to know how much cannabis is being delivered to the body, how much is being absorbed into the body, and for what duration it is effective in the body, providing them the knowledge they need to more effectively prescribe cannabis to patients.  (Alvit LCS Pharma 24.10)

Back to Table of Contents

8.12  89Bio Launches into Liver and Metabolic Disorders with $60 Million Series A Financing

89Bio has closed a $60 million Series A financing.  The funding will be used to advance the company’s pipeline of biologic and small molecule drug candidates acquired from Teva Pharmaceutical Industries.  The investment round was led by OrbiMed Israel, OrbiMed US, and Longitude Capital and joined by RA Capital Management and Pontifax.  OrbiMed Israel and OrbiMed US founded 89Bio.

89Bio’s lead candidate for the treatment of NASH is BIO89-100 (formerly TEV-47948).  Currently in Phase 1, BIO89-100 is a novel long-acting glycopegylated fibroblast growth factor 21 (FGF21) analogue that was developed using a proprietary glycopegylation technology to prolong the half-life and optimize the biological activity of native FGF21.  In preclinical studies BIO89-100 demonstrated a long half-life, potentially enabling extended-interval dosing, and significant improvements in biomarkers such as body weight, blood glucose, and lipids.  89Bio also has an undisclosed preclinical compound with potential utility in the treatment of NASH and other related disorders.

89Bio is a privately held biopharmaceutical company building a pipeline of biologic and small molecule treatments for liver and metabolic disorders.  The company’s lead product candidate for the treatment of NASH is BIO89-100. Currently in Phase 1, BIO89-100 is a novel long-acting glycopegylated FGF21 analogue. 89Bio is headquartered in San Francisco with R&D and operations in Herzliya, Israel.  (89Bio 25.10)

Back to Table of Contents

8.13  Gamida Cell Raises $50 Million in NASDAQ IPO

Gamida Cell announced the pricing of its initial public offering of 6,250,000 ordinary shares at a public offering price of $8.00 per share for aggregate gross proceeds of $50 million.  All of the shares in the offering are being offered by Gamida Cell.  In addition, Gamida Cell granted the underwriters a 30-day option to purchase up to 937,500 additional ordinary shares at the initial offering price, less underwriting discounts and commissions.  Gamida Cell’s ordinary shares began trading on the Nasdaq Global Market on 26 October 2018, under the ticker symbol GMDA and the offering closed on 30 October, subject to customary closing conditions.

BMO Capital Markets and RBC Capital Markets are acting as joint book-running managers for this offering. Needham & Company and Oppenheimer & Co. are acting as co-lead managers for this offering.

Jerusalem’s Gamida Cell is a clinical stage biopharmaceutical company leveraging its proprietary technology to develop cell therapies that are designed to cure cancer and rare, serious hematologic diseases.  Gamida Cell leverages its nicotinamide-, or NAM-, based cell expansion technology to develop a pipeline of products designed to address the limitations of cell therapies.  Gamida Cell’s most advanced product candidate, NiCord, is a NAM-expanded cord blood cell therapy which has the potential to serve as a universal curative stem cell graft for patients who need a hematopoietic stem cell transplant, or HSCT.  (Gamida Cell 26.10)

Back to Table of Contents

8.14  FDA Grants Breakthrough Therapy Designation (BTD) for UroGen Pharma’s UGN-101 Cancer Treatment

UroGen Pharma announced that the U.S. FDA has granted Breakthrough Therapy Designation status to the Company’s lead product candidate, UGN-101, (mitomycin gel) for instillation.  UGN-101 is currently in Phase 3 development for the treatment of patients with low-grade upper tract urothelial cancer (LG UTUC).  Breakthrough Therapy Designation is designed to expedite the development and review of new drugs to treat serious or life-threatening conditions, so patients may have access to therapies through FDA approval as soon as possible.  The FDA previously granted both Orphan Drug and Fast Track designations to UGN-101 for the treatment of LG UTUC.

LG UTUC is a rare malignant tumor of the cells lining the urinary tract.  It most commonly presents in the elderly who also suffer from comorbid conditions such as hypertension, diabetes, obesity and the metabolic syndrome.  No therapeutic agent has ever been approved to treat LG UTUC.  The criteria for Breakthrough Therapy Designation require preliminary clinical evidence that demonstrates that use of the drug may result in substantial improvement on at least one clinically significant endpoint over available therapy.  The Breakthrough Therapy Designation for UGN-101 is supported by data from the ongoing Phase 3 OLYMPUS clinical trial of UGN-101 for the non-surgical treatment of LG UTUC.

UGN-101 (mitomycin gel) for instillation is an investigational drug formulation of mitomycin in Phase 3 development for the treatment of low-grade (LG) upper tract urothelial cancer (UTUC).  Utilizing the RTGel™ technology platform, UroGen’s proprietary sustained release, hydrogel-based formulation, UGN-101 is designed to enable longer exposure of mitomycin to the urinary tract tissue, thereby potentially enabling the treatment of tumors by non-surgical means. UGN-101 is delivered to patients using standard intravesical catheters.

Ra’anana’s UroGen Pharma is a clinical-stage biopharmaceutical company developing advanced non-surgical treatments to address unmet needs in the field of urology, with a focus on uro-oncology.  UroGen has developed RTGel, a proprietary sustained release, hydrogel-based platform technology that has the potential to improve therapeutic profiles of existing drugs.  UroGen’s sustained release technology is designed to enable longer exposure of the urinary tract tissue to medications, making local therapy a potentially more effective treatment option.  (UroGen 30.10)

Back to Table of Contents


9.1  Kaymera Technologies to Expand Adaptive Mobile Threat Defense Footprint

Kaymera Technologies, the leader in high-end Mobile Threat Defense solutions, announced that BGZ BNP Paribas have chosen the Kaymera’s Adaptive Mobile Threat Defense Platform to help protect personal and business-related mobile data across its employee base and business partners.

Kaymera’s Adaptive Mobile Threat Defense Platform takes a holistic approach to organization level mobile security.  It provides proactive protection and predictive intelligence to help organizations and their mobile users stay ahead of cyberattacks and improve their overall mobile security health.  Using multi-layered threat identification and mitigation approach, together with a flexible product portfolio to match various organization segments’ sensitivity levels and deployment options, the Kaymera platform, leveraging years of vast experience in providing high-end mobile security to public sectors worldwide, can identify known and unknown threats, in real time, without infringing on end user experience or privacy.  From military-grade mobile security solution designed to provide top level protection for high-risk employee segments, to application-based mobile security solution for BYOD (managed and unmanaged) governed by a centralized, cross product, management and monitoring capabilities, the Kaymera product portfolio is uniquely positioned to provide IT security professionals the most flexible, organization-centric mobile security structure.

Herzliya’s Kaymera was founded by veterans in the cyber security industry with in depth knowledge and expertise in mobile cyber security, cyber-attack and intelligence gathering techniques.  Kaymera delivers the world’s most advanced mobile cyber threat defense technology, designed to protect organizations, governments and professionals against all types of mobile security threats.  (Kaymera 18.10)

Back to Table of Contents

9.2  Tactile Mobility Comprehensive Tactile Data Solution for Road Authorities

Tactile Mobility is demonstrating the feasibility and importance of combining vision-based data with tactile data in order to develop better and safer autonomous vehicles and cities.  The first-of-its-kind tactile mapping solution for road conditions was on display at the NVIDIA GPU Technology Conference in Tel Aviv recently.

Tactile Mobility collects “first principle data”, such as wheel speed, wheel angle, RPM, paddle position, gear position and then analyzes it to yield actionable insights, like vehicle-road dynamics, the vehicle and the road profile, in real-time.  Pairing tactile data collection with visual automotive data yields “first principle-based” mapping of the road conditions alongside enriched visual media for the end-user.  The two modalities produce a more robust and reliable output vis-à-vis both mapping and real-time auto responses.  The pairing of Tactile Mobility’s solution and the NVIDIA DRIVE compute platform will enable vital insights for road authorities and municipalities, i.e. real-time hazard detection and correction, as well as better informed road repair, that will improve urban planning, reduce road incidents, and build a smart city future.

Haifa’s Tactile Mobility is the world’s leading tactile data and sensing technology solution, enabling actionable insights for autonomous vehicles, municipalities, insurers and fleet managers.  Tactile Mobility’s unique technology collects “first principle”, crucial, real-time data from vehicle sensors and turns it into actionable insights such as road quality, tire grip, vehicle weight and other vehicle- and road-specific models.  Insights provided by Tactile Mobility greatly enhance vehicle intelligence, safety and dependability.  (Tactile Mobility 18.10)

Back to Table of Contents

9.3  Israel Develops Bomb-Detecting Robot to Save Soldiers’ Lives

Israel Aerospace Industries has completed the development of an autonomous system that can identify, locate and destroy improvised explosive devices (IEDs) and mines before troops reach them.  The system is installed on a robotic platform made by IAI and integrates a combination of multiple sensors that detect IEDs which may be hidden in “complex areas.”  The robotic engineering scout can be maneuvered autonomously without danger to troops, and can detect, engage and remove the IEDs by using a blade installed on the vehicle.

The robotic system enables faster, more efficient execution of missions without risk to human life. It combines a number of different detection devices capable of finding explosives on and under surfaces, and the engineering capabilities for neutralizing them. The system can be operated in any terrain and has a precision system that generates a real image of the area for its operator.  The device will now be transferred for trial and evaluation purposes.

The system is part of the SAHAR IED detection family, which includes a number of robotic platforms that can locate hidden or buried explosives before clearing them.  Each system includes the robotic platform, a control system and detection payloads.  Last summer IAI announced that it had begun testing its Counter Improvised Explosive Device and Mine Suite (CIMS) mobile system, which can identify, locate and destroy improvised explosive devices and mines.  Primarily intended for patrols during routine security missions on Israel’s borders, CIMS can be operated day or night and in any weather conditions and environment.  A large, rectangular multi-sensor system is placed directly in front of armored vehicles, allowing it to search and destroy IEDs.

According to IAI, CIMS has a 270-degree visual radius.  When an IED or mine is identified, the system alerts soldiers with warning sounds and indicators displayed on a screen.  The system also includes a firing position from where troops can shoot at the explosive device to destroy it without having to leave the safety of their vehicle.  (IAI 21.10)

Back to Table of Contents

9.4  My Size & Lightspeed Provide Mobile Measurement Solution to e-Retailers Worldwide

My Size announced it has partnered with Montréal’s Lightspeed, a leading point-of-sale solution for independent retailers and restaurants with roughly $15 billion in annual on-line apparel transactions, to provide access to its MySizeID mobile measurement solution to e-retailers worldwide.

Retailers utilizing Lightspeed’s online platform will soon be able to deploy the MySizeID turnkey solution through a simple widget integration from the Lightspeed app store and offer their customers the personalized and efficient online shopping experience they deserve.  With MySizeID, retailers can provide customers with a personal sizing profile to ensure each item purchased fits properly, without having to guess the appropriate size and excessive returns.  Following a 30-day free trial period, retailers will be able to subscribe to a monthly paid service plan to continue providing MySizeID to customers, while also maintaining the back office services for data and sizing entry the solution provides.

The MySizeID app is a turnkey solution that helps any online shopper choose the appropriate apparel size for that specific brand, based on the shopper’s real-time body measurements.  My Size’s innovative technology enables consumers to measure themselves once using their smartphone and then be matched with a brand-specific apparel item in their size.

Airport City’s My Size has developed a unique measurement technology based on sophisticated algorithms and cutting-edge technology with broad applications including the apparel, e-commerce, DIY, shipping and parcel delivery industries.  This proprietary technology is driven by several algorithms which are able to calculate and record measurements in a variety of novel ways.  ((Lightspeed 22.10)

Back to Table of Contents

9.5  Baccara Geva is a Market Leader in Water Management Solutions

Baccara Geva has launched a series of new products which along with the ii.ri, will contribute to this ‎market.  The ii.ri features a smart and user-friendly App for both IoS and Android platforms, ‎having a wide range of logic irrigation plans and unique options to help sustain healthier ‎landscapes and maximize crop growing yields, making the most of every drop of water.‎

Baccara 11 LG is a smartphone operated controller is compatible with a wide range of valve ‎sizes and port sizes, has no display and by pressing the button on the top, allows to pair the ‎smartphone to either IoS or Android.  The simple, smart software does not require a pairing ‎code to connect and suits a wide range of logic irrigation plans.  Equipped with a ¾” UNEF male ‎thread, the ii.ri is compatible with most valves from 1/8” to 2” range.  The IP68 class ii.ri ‎controller is supplied with a Li battery which can be easily replaced and the controller ‎automatically shuts off on low battery.‎

Baccara’s new G75-A3P, an innovative 3 ways plastic solenoid valve featuring multiple ‎positioning Manual Override (Open – Auto – Close) for 2 and 3 ways latch valves. This manual ‎mechanism guarantees correct positioning of the latch coil safely.  This new 3 ways solenoid ‎valve suits a pressure range from 1 to 10 bar. It offers a wide range of orifice sizes up to 2.40 ‎mm on NO or NC configurations.‎

The G75-VM, is new 3 way direct operated solenoid valve with a modular assembling feature for ‎manifolds. The manual connection design suits an easy and friendly mounting for up to 10 ‎stations.  It allows a fast manual connection and guarantees optimal sealing for conveying air ‎and water at industrial, mining, landscape and farming applications.‎

Kvutzat Geva’s Baccara is a market leader in the manufacture and specialization of products ‎for automation such as air valves, air cylinders, solenoid valves and nylon tubing for use in ‎industry, agriculture and irrigation.  Today, one can find BACCARA products in all sectors of ‎industrial and agricultural automation, designed to be dependable in the most adverse ‎environments such as marine conditions, chemicals and heavy industries.  They have gained ‎ISO-9001:2000 certification for all products and ISO 14001 certification for environmental quality ‎control.  (Baccara 11.10)‎

Back to Table of Contents

9.6  Aurora Labs Named a Cool Vendor by Gartner

Aurora Labs has been named a Cool Vendor by Gartner in their October 2018 report: “Cool Vendors in Automotive and Smart Mobility.”  The report highlights new and innovative vendors that use AI-powered solutions with the potential to transform the mobility market.

Aurora Labs, one of only four companies identified as a Cool Vendor in the report, enables automotive manufacturers to proactively respond to future vehicle software architectures, processes, and services in order to bring vehicles to market faster, today.  According to the report, “Software and AI are becoming increasingly fundamental not only to vehicle operational performance but also as the primary interface for systems that frame the user experience.  The software age in the automobile is leading to an explosion of innovation around the car.”

Gartner’s naming of Aurora Labs as a Cool Vendor in Smart Mobility comes soon after Aurora Labs being invited to participate in the STARTUP AUTOBAHN, the innovation platform created by Daimler, Plug and Play and the University of Stuttgart to further develop the Self-Healing Software solution.

Launched in 2016 with offices in Tel Aviv and Munich, Aurora Labs is pioneering Self-Healing Software for connected cars to enable OEMs to proactively respond to future vehicle software architectures, processes and services.  Agile user-centric software development processes create a plethora of continuous opportunities and risks for the OEMs, even after the car has left the production line.  Aurora Labs’ Line-Of-Code Maintenance technology uses machine learning algorithms to uniquely address all three stages of a software health solution, future proofing the next generation of software-driven automotive features.  From detecting line-of-code faults to predicting downtime events, fixing errors on-the-go and enabling reliable and cost-effective rollouts of new automotive features to all ECUs in the vehicle without any downtime for the user, Aurora Labs is paving the way for the age of the self-healing car.  (Aurora Labs 23.10)

Back to Table of Contents

9.7  Comtrend Selects Celeno High Performance Tri-Band Wi-Fi Solution for Gateways

Celeno Communications announced that Comtrend, a leading designer and manufacturer of broadband communication equipment, has selected its powerful 4×4 + 4×4 + 4×4 Tri-Band Wi-Fi solution for gateways and extenders.  The solution leverages Celeno’s advanced CL2400 802.11ac Wave 2 chipset and is ready for the Wi-Fi Alliance EasyMesh certification for a powerful multi-AP topology.  The solution enables a compact Tri-Band Access Point that delivers double the capacity and implements Celeno’s enhanced Wi-Fi technologies, supporting multi-AP centralized orchestration and dynamic interface assignment, taking into account home topology and network conditions for optimal Wi-Fi connectivity deployment.

The hardware reference design enables exceptional RF performance over three bands, allowing simultaneous transmissions on the 2.4GHz band and adjacent channels in the 5GHz high and low bands with no inter-band interference.  The solution enables an all-wireless multi-AP architecture utilizing independent backhaul and front-haul (service) channel assignments for the main AP and each of the Tri-Band smart extenders. This results in a high performing mesh network with enhanced spectral efficiency.

Leveraging Wi-Fi smarts perfected in the home environment, Ra’anana’s Celeno offers advanced Wi-Fi chipsets, edge software and cloud technology to take Wi-Fi beyond connectivity into the realm of smart homes, smart cities, smart buildings and smart industry.  Celeno’s field-proven chips and software technology have been successfully integrated into numerous OEM Wi-Fi devices and have been deployed in tens of millions of homes around the world by almost 100 leading service providers worldwide.  (Celeno 23.10)

Back to Table of Contents

9.8  Allot Narrows Technological Divide in Rural Territories with Improved Web Security

Allot Communications announced that a regional government in North America chose the Allot Secure Service Gateway (SSG) unified solution to increase end-to-end visibility of all network traffic and to strengthen its web filtering.  The precise monitoring of traffic usage and pinpointing of application performance anomalies and threats provided by Allot’s SSG will allow the regional government to improve network and bandwith performance in both its own offices and to vital online public services for local residents.

The diverse and comprehensive features and functionality of the Allot SSG: including, flexible redundancy configurations, passive bypass via automatic port failover, maximizing uptime and availability as well as Quality of Service (QoS) traffic shaping, traffic steering, bot containment and web security – will empower the regional government to improve the quality and breadth of online services they provide to their residents.

Hod HaSharon’s Allot Communications is a provider of leading innovative network intelligence and security solutions for service providers worldwide, enhancing value to their customers.  Their solutions are deployed globally for network and application analytics, traffic control and shaping, network-based security services and more.  Allot’s multi-service platforms are deployed by over 500 mobile, fixed and cloud service providers and over 1000 enterprises.  (Allot 23.10)

Back to Table of Contents

9.9  IAI $777 Million Deal for Barak 8 LRSAM Air & Missile Defense Systems to India’s BEL

Israel Aerospace Industries (IAI) has been awarded an additional, $777 million contract for the supply of LRSAM Air & Missile Defense systems (the marine version of the AMD system Barak 8) for seven ships of the Indian navy.  The contract was entered with Indian state-owned company Bharat Electronics Limited (BEL) which serves as the main contractor in the project.

The LRSAM system, part of the Barak 8 Family, is an operational AMD system used by Israel’s navy as well as by India’s navy, air and land forces.  It provides broad Aerial and point defense against a wide range of threats to the marine arena from the air, sea or land.  The system integrates several advanced state-of-the-art systems as, digital radar, command and control, launchers, interceptors with modern RF seekers, Data link and system-wide connectivity.

Barak-8 AMD system was developed by IAI in collaboration with Israel’s MOD India’s DRDO (Defense Research and Development Organization), the navies of both countries, IAI’s ELTA Group, RAFAEL and local industries in India and Israel.

IAI is a world leader in both the defense and commercial markets, delivering state-of-the-art ‎technologies and systems in all domains: air, space, land, sea, cyber, homeland security and ‎ISR.  Drawing on over 60 years’ experience developing and supplying innovative, cutting-edge ‎systems for customers around the world, IAI tailors optimized solutions that respond to the ‎unique security challenges facing each customer.  IAI employs its advanced and proven engineering, manufacturing and testing capabilities to ‎develop, produce and support complete systems – from components, sensors and subsystems ‎all the way to large-scale, fully-integrated systems of systems.  (IAI 24.10)‎

Back to Table of Contents

9.10  Introducing Walabot HOME: A New Senior Care Smart Home Device for Fall Detection

Vayyar Imaging announced the launch of Walabot HOME.  Poised to radically change the future of digital health monitoring, Walabot HOME detects if a person has fallen and automatically places a call for help, without requiring any wearables.  Walabot HOME is Vayyar’s flagship product in a new line of smart home devices being developed to ensure seniors stay connected when it matters most: in case of emergency.

Vayyar has created Walabot HOME to eliminate the need to carry a fall detection device by discreetly monitoring for a fall; it operates in the background of the home just like a smoke detector sensor.  Simply place it on the wall and forget about it, but in the case of a fall, it will call loved ones for help.  Additionally, individuals can place a call to their emergency contact at any time with simply the push of a button on their Walabot HOME device.

Walabot HOME is easy to install and does not require further action once it’s been setup.  The device uses advanced, low-power radio wave technology, similar to Wi-Fi, instead of cameras, to monitor individuals’ movements.  This ensures occupants maintain their privacy, especially in locations where falls are more likely to happen, such as bathrooms.  Walabot HOME also works in a wide range of conditions that cameras cannot, including steam and darkness, and can sense through objects like curtains and glass walls.

Yehud’s Vayyar Imaging is the global leader for imaging and sensing applications with its cutting-edge 3D imaging sensor technology.  Vayyar’s sensors quickly and easily look into objects or any defined volume and detect even the slightest anomalies and movements to bring highly sophisticated imaging capabilities to many industries.  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, and safe 3D imaging sensors.  (Vayyar Imaging 24.10)

Back to Table of Contents

9.11  Waterfall Unidirectional Security Gateways CCC Certified

Waterfall Security Solutions announced that Waterfall’s flagship products were awarded China Compulsory Product Certification (CCC).  The CCC Mark is essential for any manufacturer selling to Chinese manufacturers, industries and critical infrastructures.  With CCC certification in place, Chinese owners and operators of industrial control systems can be confident that Waterfall’s products comply with Chinese safety and other operating requirements.

Waterfall Unidirectional Security Gateways provide safe IT/OT integration for industrial control system and critical infrastructure networks.  The gateway hardware creates an impassable, physical barrier preventing external online attacks, network-propagating malware and remote-control attacks. The gateway software makes copies of servers and emulates devices to IT networks.  The IT replica servers participate normally in IT network ecosystems and are indistinguishable from the original industrial servers.

Rosh HaAyin’s Waterfall Security Solutions is the global leader in industrial cybersecurity technology. Waterfall products, based on innovative unidirectional security gateway technology, represent an evolutionary alternative to firewalls.  The company’s customers include national infrastructures, power plants, nuclear plants, on-shore and off-shore production facilities, refineries, rail systems, manufacturing plants, utility companies, and many more.  (Waterfall Security Solutions 25.10)

Back to Table of Contents

9.12  Ethernity Networks’ ENET Flow Processor Firmware Integrated by North American Vendor

Ethernity Networks has signed a contract to supply its ENET Switch and Traffic Manager firmware for a North American tier 1 telecommunications OEM.  Ethernity has completed the integration of its firmware on the equipment manufacturer’s existing fiber-to-the-home optical networking platform for advanced broadband services with 4K video.  The contract represents significant short-term revenue for Ethernity and, given the popularity of the platform and the size of the OEM, is expected to generate generous ongoing future royalty streams.  Further, the parties have already engaged in discussions to apply Ethernity’s ENET firmware and software to the customer’s broadband switch and router platforms, which, if successfully concluded, would add significantly to the ongoing royalty stream.

Lod’s Ethernity Networks is a leading innovator of network processing technology and products.  Mounted on low-cost COTS FPGAs and with a rich set of networking features, Ethernity’s ACE-NIC smart network adapters, ENET SoCs, and network appliances offer best-in-class all-programmable platforms for the fixed and mobile telecom, enterprise security, and data center markets.  Their complete offering, incorporating hardware, FPGA firmware, and software applications, enables full programmability at the pace of software development, quickly adapting to changing market demands and applications and facilitating the deployment of edge computing, 5G and SDN/NFV.  (Ethernity Networks 24.10)

Back to Table of Contents

9.13  macOS Goes Password-Free With Introduction of Octopus Authentication

Secret Double Octopus is now available for Mac enterprise users.  Octopus Authentication is the first high-assurance, password-free authentication for macOS within corporate networks managed by Microsoft’s Active Directory.

Microsoft’s Active Directory (AD) centralizes authentication and authorization for domain resources.  However, by only using one password to access all resources, AD passwords are a lucrative target for attacks.  In place of passwords, Octopus Authentication enables login from a macOS host using a high-assurance, password-free authenticator.  Octopus Authentication for macOS supports access to all enterprise resources, whether on-premise, remotely accessed or in the cloud.  The solution is built upon unbreakable cryptography that is highly resistant to common attacks, such as phishing, MitM and cracking.

Tel Aviv’s Secret Double Octopus is pioneering the password-free workplace.  Its high-assurance authentication solutions are built on provably unbreakable cryptography that is highly resistant to attacks and provide superior user experience. Secret Double Octopus is a Gartner Cool Vendor, Business Insider ‘Startup that will boom in 2018’, PwC game-changer for Global Financial Services Innovation, and recipient of the Frost and Sullivan ‘Technology Innovation Award’.  (Secret Double Octopus 25.10)

Back to Table of Contents

9.14  Cymulate Finds Logical Bug in Microsoft Office Suite – Word Embedded Video Code Execution

Cymulate has uncovered a security flaw in Microsoft Office Suite which may affect Word users.  Cymulate’s security research team identified the bug and notified Microsoft.  The security flaw was identified as a JavaScript code execution within the office-embedded video component.  It has the potential to impact all users with Office 2016 and older versions of the popular Productivity Suite.  Cymulate noted that no configuration was required to reproduce the issue and no security warning is presented while opening this document with Microsoft Word.

This logical bug is revealed when a user embeds a video via the ‘online video’ feature.  It resides in the .xml file, where a parameter called embeddedHtml refers to a YouTube iframe code.  Hackers can replace the current YouTube iframe code with malicious html /JavaScript that would be rendered by Internet Explorer.  One way attackers can use this unauthorized entry is by phishing.

Rishon LeZion’s Cymulate helps companies to stay one step ahead of cyber attackers with a unique breach and attack simulation platform that empowers organizations with complex security solutions to safeguard their business-critical assets.  By mimicking the myriad of strategies hackers deploy, the system allows businesses to assess their true preparedness to handle cyber security threats effectively.  (Cymulate 25.10)

Back to Table of Contents

9.15  Allot Partners With Swiftel to Provide DDoS Protection for Their ISP and Enterprise Customers

Allot Communications has partnered with South Dakota based Swiftel Networks, a leading provider of global network and IP transit.  Allot will provide Swiftel with a distributed denial-of-service (DDoS) protection solution to offer it as a service across their expansive network of internet service provider (ISP) and enterprise customers.  Allot developed a turnkey DDoS security-as-a-service solution that provides an additional opt-in layer of protection on top of the existing transit link services purchased from Swiftel Networks.  This solution is groundbreaking as it provides DDoS and deep packet inspection (DPI) in a cloud scrubbing center. Revenues from the security solution will be shared between the two companies.

To create this solution specifically for Swiftel, Allot incorporated its DDoS Secure solution for mobile, fixed, and cloud service providers with an added DPI and root cause intelligence.  Swiftel customers and partners will benefit from detailed attack forensics and analytics to treat the root cause of misbehaving endpoints.  They will also benefit from the solution’s ability to rapidly mitigate volumetric DDoS attacks and neutralize outbound threats before they affect network service and business continuity.  The solution allows Swiftel and its customers to be aware of their transit utilization and quality of experience while DDoS is being mitigated.

Hod HaSharon’s Allot Communications is a provider of leading innovative network intelligence and security solutions for service providers worldwide, enhancing value to their customers.  Their solutions are deployed globally for network and application analytics, traffic control and shaping, network-based security services, and more.  Allot’s multi-service platforms are deployed by over 500 mobile, fixed and cloud service providers and over 1000 enterprises.  (Allot 29.10)

Back to Table of Contents

9.16  VisIC Technologies is a Final Nominee for the 2018 GSA Company Award

Ness Ziona’s VisIC Technologies is one of the four final nominees for the 2018 Global Semiconductor Alliance “2018 Outstanding EMEA Semiconductor Company Award”.  VisIC’s GaN transistors feature low RDS(ON), exceptionally fast switching performance, ultra-low switching energy and advanced embedding packaging with record low thermal resistance. Its ALL-Switch (Advanced Low Loss) products are an ideal fit in performance power conversion applications requiring high efficiency, high power density and low system cost, such as in on/off board chargers and inverters for hybrid/electric vehicles, server power supplies for data centers, high end gaming power supplies, green energy conversion systems and various industrial applications.

The winner will be announced at GSA’s Awards Dinner Celebration on 6 December in Santa Clara, California, USA.  GSA’s annual Awards Dinner Celebration is the industry’s premier event celebrating the achievements of semiconductor companies in several categories ranging from outstanding leadership to financial accomplishments as well as overall respect within the industry.  (VisIC 28.10)

Back to Table of Contents

9.17  On Track Innovations Receives Interac Certification for Canadian Market

On Track Innovations has received a renewed Interbank Network Interac certification, which now allows Canadian businesses to integrate OTI’s secure cashless payment solutions into vending machines, kiosks and other unattended devices throughout Canada.  Interac Corp. operates an economical, world-class debit payments system with broad-based acceptance, reliability, security, and efficiency.  The organization is one of Canada’s leading payments brands and is chosen an average of 16 million times daily to pay and exchange money.

Rosh Pina’s On Track Innovations (OTI) is a global leader in the design, manufacture and sale of secure cashless payment solutions using contactless NFC technology.  OTI’s field-proven innovations have been deployed around the world to address cashless payment and management requirements for the Internet of Payment Things (IoPT), wearables, automated retail, and petroleum markets.  (OTI 30.10)

Back to Table of Contents


10.1  Israel Places 20th on Global Competitiveness Index

Israel placed 20th from 16th a year ago on the latest World Economic Forum’s Global Competitiveness Index, released on 16 October.  The index said several factors are impeding the growth of the Israeli economy and have caused its fall in the rankings, including measuring government bureaucracy (59), the time it takes to open a business in Israel (74), the costs associated with starting a business in Israel (50), and cumbersome business credit application practices (45).  Israel also fell short in indices measuring the complexity of its tariffs and payments system (81), the ease of employing foreign workers (125), maritime and air services (42), the quality of vocational training (37) and government budgetary transparency (90).

Despite this, the index stressed that Israel has been able to maintain its position as the world’s No.1 start-up nation in terms of investment in research and development companies and the overall approach to entrepreneurial ventures.  Israel ranked 10th in the World Economic Forum’s Patent Application Index and second in its Venture Capital Availability Index.  As well, Israel ranked 6th in the index evaluating the integration of women in the workforce.

The United States, Singapore, Germany, Switzerland and Japan lead the new index, while Chad was ranked last at 140th place.  (WEF 16.10)

Back to Table of Contents


11.1  ISRAEL:  High-Tech Companies Raised $1.6 Billion in 131 Deals in Q3/2018

The IVC Research Center and ZAG S&W Zysman, Aharoni, Gayer announced on 29 October that during Q3/18, Israeli high-tech companies raised $1.6 billion in 131 deals.  While the amount invested was comparably high, there were fewer deals compared with the last quarters.  Only one mega-deal was recorded in Q3/18 – Trax Solutions raised $125 million, equal to 8% of the total amount raised in the third quarter.

In Q1-Q3/2018, Israeli high-tech companies raised $4.5 billion.  The number of deals matched 68% of the total number of deals in 2017. Yet, in the first nine months of 2018, Israeli high-tech capital raising equalled 82% of the total raised in 2017.

Following an uplift of seed capital raising in H1/18, only 21 seed deals were recorded in Q3/18, the lowest number since 2013 and below the ranges of the last five years.  The number of mid and late financing rounds (B and Later rounds) was in the range of the previous years, while A rounds decreased in Q1-Q3/2018.  According to IVC analysis, median numbers at all stages continued to increase.

Chart 1: Israeli High-Tech Capital Raising Q1/2013-Q3/2018

Capital Raising by Deal Size and Type

In Q3/18, deals above $20 million reached a record level of $1.1 billion.  While the number of deals under $5 million decreased, the number of deals larger than $10 million continued to rise.

Marianna Shapira, research director at IVC Research Center points out: “Investors preference for mature companies has negatively affected the levels of seed financing, which continues to shrink similar to US patterns.”  Shapira added, “We expect capital raising in 2018 to achieve the levels of 2017.  According to the investment patterns in Israeli high-tech from the last years, it seems the third quarter marked a bottom for the latest period.”

In Q3/18, VC-backed capital raising deals totaled $1.3 billion in 67 deals.  The number of VC-backed deals dropped 34% compared with Q3/17.  Non-VC-backed deals accounted for $285 million, at the lower end of the last three years.

Chart 2: Israeli High-Tech Capital Raising by Deal Size Q1/15-Q3/18

Capital Raising by Stages and Selected Technology Clusters

In Q3/18, mature-stage companies raised almost six times more capital compared with early-stage companies. In terms of number of deals, IVC found that, through 2016, investors favored seed and R&D stages.  Since 2017 and even more in 2018, the trend shifted, as investors turned to more mature companies (initial growth + revenue growth stages).

In Q3/18, software companies raised $760 million mainly due to 12 deals, each larger than $20 million. Artificial Intelligence (AI) companies were the main attraction for financing deals in the last quarter.  The number of deals grew 15% in Q3/18, compared with the corresponding quarter last year.  The number of AI deals in Q1 – Q3/18 rose steadily – 17 companies attracted more than $20 million each.

Investor’s Activity

In Q3/18, IVC analysis found that the share of corporate VCs grew to 14% of total capital invested.  An increase was noted in VC funds’ investments, following a slowdown that started in Q1/17.  In Q3/18, VC funds’ investments accounted for 42% of total capital invested.

“Despite the vacations in the third quarter, Israeli high-tech was able to withstand this period,” said Shmulik Zysman, managing partner at Zysman, Aharoni, Gayer & Co. (ZAG-S & W): “More importantly, the total amount raised was similar to the total amount raised in the corresponding quarter of last year, one of the highest in the past six years, indicating the stability of the market.”

Zysman notes that, “Although the number of companies that raised capital this quarter declined, the amount of capital grew.  Some would see it as a lack of confidence in the Israeli high-tech industry, we believe it is another evidence of the vitality of the Israeli high-tech.”

According to Zysman, the volume of capital raised from foreign investors continues to be particularly high: “This is in spite of the fact that Israeli companies that have benefited from Chinese investors are now encountering much more sophisticated and selective Chinese investors.  This increase can also be credited to European venture capital funds that start investing in Israel”.

Chart 3: Israeli High-Tech Investments by Investor Type ($M)

IVC Research Center is the leading online provider of data and analyses on Israel’s high-tech, venture capital, and private equity industries. Its information is used by all key decision-makers, strategic and financial investors, government agencies, and academic and research institutions in Israel.

IVC-Online Database ( showcases over 8,000 Israeli technology startups, and includes information on private companies, investors, venture capital and private equity funds, angel groups, incubators, accelerators, investment firms, professional service providers, investments, financings, exits, acquisitions, founders, key executives, and R&D centers.

ZAG-S&W (Zysman, Aharoni, Gayer & Co.) is an international law firm with offices in Israel, the United States, China and the UK.  The firm’s attorneys specialize in all disciplines of commercial law for both publicly held and private companies, with particular expertise in hi-tech, life science, international transactions, and capital markets.  ZAG-S&W provides result-driven legal and business advice to its clients, addressing all aspects of the clients’ business activities, including penetration into new markets in strategic locations.  In recent years, the firm has acted on a majority of the equity and debt financing transactions by Israeli technology companies on the NASDAQ.  It has been the firm’s experience that the best results, those that give their clients the competitive advantage they need, are attained by coupling professional experience, global presence, and connections with the investor communities in Israel and abroad.  (IVC 29.10)

Back to Table of Contents

11.2  ISRAEL:  Netanyahu Visits Oman

Simon Henderson and Assaf Orion wrote in The Washington Institute on 26 October that the high-profile nature of the meeting reaffirms Israel’s success in developing ties with Gulf states, as well as the independent character of Oman’s leader.

On 25 October, Prime Minister Binyamin Netanyahu traveled to Oman for the first such visit by an Israeli leader in more than twenty years.  According to a joint statement issued after the trip, he and Sultan Qaboos discussed “ways to advance the peace process in the Middle East, as well as several matters of joint interest regarding the achievement of peace and stability in the Middle East.”

The reference to the peace process will give Qaboos diplomatic cover from criticism elsewhere in the Arab world, building on the effect of Palestinian leader Mahmoud Abbas’s visit earlier that week.  Yet the substance of the conversation may have concentrated on “deepening relations with the states of the region while leveraging Israel’s advantages in security, technology, and economic matters,” in the words of the Israeli Prime Minister’s Office.

Omani state television broadcast video of the visit on the evening news, showing the sultan, who is seventy-eight next month and has been unwell, looking spirited but frail.  He introduced Netanyahu to four of his top advisors: Minister of the Royal Court Khalid al-Busaidi, Minister of the Royal Office Sultan al-Numani, Minister Responsible for Foreign Affairs Yousef bin Alawi bin Abdullah, and Head of Liaison and Coordination Munthir al-Said, whose duties center on external intelligence.  Netanyahu’s delegation included Mossad chief Yossi Cohen, National Security Council head Meir Ben-Shabbat and Foreign Ministry director Yuval Rotem.

The last such visits occurred before the turn of the century.  Prime Minister Yitzhak Rabin traveled to Oman in 1994 and acting prime minister Shimon Peres hosted Yousef bin Alawi in Jerusalem a year later.  In 1996, the two countries agreed to establish reciprocal trade representative offices, with Peres formally opening the one in Muscat.  Although Oman closed the office after the second Palestinian intifada broke out in 2000, it continued allowing Israeli representatives to stay in the country.  Undeclared intelligence and security relations between the two governments have since become very close.  As with other Arabian Gulf states, Muscat allows non-identifiable Israeli products to be sold inside Oman.

For Israel, the visit shows that Netanyahu’s regional approach is paying dividends, which could prove useful domestically if the next elections are held soon as expected.  It also shows Muscat’s role as a possible back channel with Iran, perhaps relating to Syria.  For Qaboos, the meeting may help deflect criticism of his relations with Tehran and his willingness to tolerate the transshipment of Iranian weapons to Houthi rebels in Yemen.  In addition, it implies that Saudi Arabia and the United Arab Emirates are not the only regional routes for Israeli diplomacy.  For Washington, the meeting is another good first step down the long road to reviving the peace process.

Simon Henderson is the Baker Fellow and director of the Bernstein Program on Gulf and Energy Policy at The Washington Institute.  Assaf Orion, a retired Israeli brigadier general and defense strategist, is a visiting military fellow at the Institute.  (TWI 26.10)

Back to Table of Contents

11.3  LEBANON:  Lebanon’s Perfect Financial Storm

Mona Alami wrote on 17 October in the Atlantic Council that as Lebanon’s debt grows and the traditional pillars of its economy stagnate, a drop in remittances from the Gulf may push the country into bankruptcy.

At Hope or Gloom, an economic conference held by Lebanese International Finance Executives (LIFE) on 7 August that brought together economic experts and Lebanese government officials, the state’s narrative bordered on the absurd. Government advisors and parliamentarians issued unconvincing economic predictions and reassurances, all of which showed a disconnect from the clear signs of impending economic disaster.  Notably, in addition to longer-term financial problems, a likely drop in remittances from the Gulf is expected to worsen banks’ ability to continue financing the public debt.

Lebanon’s economy is struggling.  Recent annual growth continued to hover between 1 and 1.5% throughout 2017 and 2018, a long-term issue tied to the Syrian war, which caused a drop in exports and worsened investors’ fear of instability.  This is a significant drop from the 8 to 10% growth witnessed prior to 2011.  This meager growth pales in comparison to rate at which the debt is growing, estimated at 7.5% as of May 2018.  This means Lebanon will not be able to pay off this debt through economic growth alone.  This has left Lebanon’s debt-to-GDP ratio at 157% as of April 2018, the fifth-highest in the world.  Moreover, as Lebanon fails to pay down its public debt – which amounted to $81.5 billion as of February 2018 – interest payments on the debt are rising and further widening the fiscal deficit, currently estimated to be over 8.5% of GDP.

Even the usually unflappable Finance Minister Ali Hasan Khalil warned in April that Lebanon’s public debt was more of a threat than the country’s security situation.  Banks have been taking their own steps to mitigate it, in particular seeking to prevent capital flight and maintain the current level of currency deposits by printing more money to finance the debt – which alleviates the debt but worsens inflation.  To encourage people to save, average interest rates on deposits of Lebanese pounds increased by 95 basis points between February 2017 and February 2018 to reach nearly 7%.  This not only puts more money in the central bank but also discourages the high spending that can increase imports and therefore deplete foreign reserve levels.  But if the deposit rates climb too high, it will also increase inflation and discourage taking out loans for new enterprises that could spur much-needed economic growth.  The Central Bank has already tightened lending provisions, in response to rising non-performing loan ratios that reflect nonpayment of debts.

This lack of access to loans, as well as foreign investors’ decreasing trust in Lebanon’s economy, has notably affected the real estate sector, one of Lebanon’s economic pillars.  Without easy access to loans, together with the prevailing political and economic crises that are discouraging investment in Lebanon, the sector has been on a steady decline.  Construction of new buildings has slowed dramatically: the total area of land to be developed under new registered building permits fell by 23.9% in the second quarter of 2018 compared to the same period in 2016.  Facing such pressures, Sayfco – one of the largest Lebanese real estate companies, with projects worth an estimated $2 billion – went bankrupt in May 2018.

According to a World Bank report issued in April 2018, these problems trace back in part to long-term financing challenges, but also to the November crisis between Saudi Arabia and Lebanon.  On 4 November, Prime Minister Saad Hariri issued a televised statement from Riyadh resigning his position, citing Iranian influence via Hezbollah rendering it difficult for him to do his job without fear of assassination.  The situation quickly escalated with claims that Saudi Arabia was holding Hariri hostage. In response, Riyadh threatened to expel Lebanese nationals working in Saudi Arabia and other Gulf states and withdraw investments from Lebanon.  Through French intervention, Hariri and his family were able to leave Saudi Arabia, and he withdrew his resignation on 5 December, calming the situation down, but tensions have remained high.

The tensions between Saudi and Lebanon are affecting remittances.  Lebanese workers in the Gulf contribute nearly one-fifth of Lebanon’s GDP, making them a vital source of the deposits banks are using to buy more debt.  The approximately 400,000 Lebanese expats in the Gulf – half of them in Saudi Arabia – contributed to between 43% and 60% of total remittances in 2015, but total remittances dropped by 7% in 2017.  Another decline is expected this year, as Saudi Arabia’s Vision 2030 undertakes unprecedented economic restructuring to provide more jobs for Saudi nationals.  Already, increased taxes on foreign residency permits in Saudi Arabia are making jobs for Lebanese nationals scarcer.  Dubai, another hub for Lebanese workers, is also facing an economic downturn and higher overall unemployment that will reduce opportunities for foreign nationals in general.  Although remittances are still coming in steadily from other regions, money earned by Lebanese workers in the Arabian Gulf will continue to decline in the face of these trends.

The tensions are also affecting Lebanon’s other main revenue-generating sector, tourism.  It was already in decline due to security concerns and high airline and hotel prices, falling from its peak of 2.2 million visitors in 2010.  Since tensions with Saudi Arabia erupted, there has also been a sharp decline in tourism from Gulf visitors, who spend the most money while in Lebanon.  Spending by Saudi tourists decreased by 21.4% in the first half of 2018 compared to the same period in 2017.  Likewise, total visitors from Saudi Arabia dropped by 21.1% compared to the same period of last year and visitors from the UAE dropped by 32.2%.

Given that Lebanon’s three main revenue-generating sectors – real estate, tourism and remittances – are dangerously in the red, combined with soaring debt and eroding trust in its banking sector, bankruptcy could be imminent. International aid is unlikely to help avert bankruptcy, even in the short term.  In April 2018, an international donors meeting in Paris pledged more than $11 billion of investment for Lebanon, but conditioned the aid on strict economic reforms that cannot be enacted without a functioning government – the formation of which remains stalled five months after parliamentary elections due to political bickering.  The World Bank has likewise earmarked $2.2 billion for investments in Lebanon to be spent on job creation, health services and transportation projects all of which require government’s approval before it can be disbursed.

Speaker of the Lebanese parliament Nabih Berri attempted to circumvent government approval by proposing on 24 September that parliament be authorized to approve urgent legislation but was unable to get parliamentarians to stop bickering long enough to debate the proposal, let alone vote on it.  For now, the political elite appears to be more concerned with securing prominent appointments on the next cabinet, however long it takes, rather than speeding up the process so they can get to work fixing the economy.

Looking at the lack of progress on economic reform, World Bank Group Vice President for the Middle East and North Africa Ferid Belhaj stated in July that “Lebanon has been defying gravity for quite some time.”  It appears than in the near future Lebanon will realize it cannot beat gravity.  Its only saving grace remains in finalizing political institutions, namely the cabinet, which can then prioritize reforms.

Mona Alami is a nonresident fellow at the Atlantic Council and at Trends Research and Advisory.  (AC 17.10)

Back to Table of Contents

11.4  JORDAN:  Policing and Protection for Syrian Refugees in Jordan

Jessica Watkins posted in Sada on 16 October that in Jordan, internationally backed efforts to extend successful community policing programs beyond refugee camps face multiple challenges.

Jordan’s official refugee camps, where roughly 20% of Jordan’s 671,000 registered Syrian refugees live, have served as testing grounds for policing models since 2012.  While the United Nations High Commissioner for Refugees (UNHCR) and Emirati Red Crescent run camp administration, the Syrian Refugees Affairs Directorate (SRAD) – part of Jordan’s Public Security Directorate (PSD) – has always overseen security.  The darak (gendarmerie) man the perimeters, while inside the main gates, police stations house representatives from Criminal Investigations, Family Protection and Juvenile Police.  Criminal matters are referred to the Mafraq and Zarqa police stations, but disputes are taken to various stakeholders in the camps’ security.

When the Zaatari refugee camp opened in 2012, police interaction with residents was minimal.  Police and gendarmerie dealt with riots, but otherwise kept out of day-to-day camp affairs and rarely patrolled the streets.  In the camp’s residential districts, which correspond roughly to areas in Syria from which residents hail, a collection of street leaders emerged, primarily by self-appointment.  They became principal points of contact for aid agencies and police alike.

In late 2013, the U.S. Embassy funded a pilot project to enable camp refugees to preserve their own security.  Zaatari’s Neighborhood Watch Program aimed to recruit, vet and train 600 Syrians to police their own neighborhoods in coordination with Jordanian police.  Despite an initial bout of training, the program was quickly shelved as the potential for corruption and vigilantism became apparent and Syrians voiced hostility toward fellow refugees acting as “spies” for the PSD.

Parallel to the U.S. project, a U.K.-backed pilot program took shape in December 2013.  The British company SIREN Associates was contracted to train a batch Jordanian police as community police officers.  Espousing the principles of visibility, approachability and accessibility, SIREN trained a pilot group of twelve officers to engage with residents’ ongoing concerns while patrolling Zaatari’s streets.  Despite recruits’ initial fears that angry residents would attack them, the program’s low-key approach coupled by the willingness of the community police to work with street leaders, imams and aid agencies appeared to gain them progressively more approval.  While NGO staff generally left the camp after 4:00 in the evening, the community police were always present.

The community police became resources for solving myriad problems from medical emergencies to water and sanitation issues, to family and neighborhood disputes.  One former Jordanian community police officer recalled how she had secured positions for several widows at relief agencies as part of the money-for-work initiative.  “Traditional policing is about transactions,” said a SIREN trainer; “community policing is about relations.”  In total, 90 community police officers were trained to work in Zaatari and Azraq, which opened in 2014.

In 2015, the United Kingdom funded another camp-based initiative to recruit former Jordanian police officers as Community Police Assistants (CPAs).  Over 800 retired officers applied for 44 initial vacancies, and the program eventually trained 83 CPAs.  The retired officers brought extensive experience from other PSD departments, with most having served in the tourist or traffic police, Family Protection Department and/or on UN missions abroad.  CPAs solved police manpower shortages, but not everyone approved.  One retired senior PSD officer criticized employing retired officers in what he described as guard positions.  Emphasizing the importance of sovereign Jordanian control over security across the kingdom, he added that employing retirees amounted to privatizing policing.4

The police assistant project ended in late 2016, but broadly speaking, the U.K. initiative was hailed a success.  SIREN left the camps at the end of 2017, leaving SRAD to run the show singlehandedly.  Since then, British trainers have turned their attentions toward policing Jordanian host communities in northern Jordan, aiming to instill the same principles of accessible policing to the PSD’s local police stations.  They face formidable challenges.

Major-General Fadel al-Hmoud, Jordan’s current police chief and former head of the Family Protection Department, has highlighted community policing as a PSD priority, and police trainers are taking inspiration from the model developed in the camps to improve police engagement with the general public.  But tensions are high in urban communities where refugees and the local population compete over jobs, education, and resources, and most urban refugees are keen to avoid the police wherever possible.  The PSD can help change that state of affairs, but only by evolving.

In the confines of the camps, where serious crimes are rare, it is easier for the police to cultivate trust with refugees than in an urban context.  In the northern governorates of Amman, Mafraq, Irbid and Zarqa where over 85% of Syrian refugees are concentrated, the ability of the police to act as intermediaries in disputes involving refugees is undermined by their role as law enforcers.  Possibly the majority of refugees are at odds with the law: whether because they have not registered with the UNHCR and local police, have not registered in the correct district, are working without work permits or are sending their children to beg instead of to school.

Legal irregularities make refugees vulnerable to illegal exploitation and abuse.  An amnesty instituted by the government in March 2018 enabling around 30,000 unregistered urban refugees to register without penalty has reduced fear of the authorities, as has an increase in working permits available to Syrians.  But fears that the police forcibly relocate or deport “illegal” refugees are often justified, and surveys suggest that few are confident to seek police protection.  Most first seek out the UNHCR and its partner agencies for assistance.  Domestic abuse cases, for instance, which are prevalent within the refugee community, are rarely taken directly to the PSD’s Family Protection Department where they are supposed to be managed.  Victims seldom seek legal action against abusers and are more likely to approach women’s NGOs for advice and support.

Recognizing the limitations of formal dispute resolution channels, several NGOs in northern Jordan focus on engaging both Jordanian and Syrian parties to reduce community tensions.  One such program by Mercy Corps, for instance, combines funding for local infrastructure projects with interest-based conflict resolution training to community leaders, who include municipal council members and tribal elders but also housewives and young activists.  Participants in focus groups in Mafraq town, even those in official positions, indicated that going to the police was a last resort that would inevitably magnify the problem.

For years, Jordan boasted low crime rates, crediting “preventative measures designed to reduce crime and provide education and alternative activities for teenagers.”  Now, with economic pressures created by a rapidly expanding population, as well as changes to the penal code and increasing social diversity, crime is rising, although under-reporting makes it difficult to judge how much.

In this context, enhancing community engagement is harder but more crucial than ever for the police.  With U.K. and Dutch funding, British police trainers are currently training members of the PSD’s Community Policing Department with modules covering cultural awareness, gender sensibility, managing community meetings and de-escalation of conflict.  But the concept of police as a citizen-oriented service is still new. Until 1956, the police were attached to the military and it shows.  The rank system copies the army’s, and the majority of PSD police chiefs are appointed from the military.  The systematically rapid turnover of senior officers makes securing top-down support for new initiatives tortuous.  Moreover, by admission of several former PSD officers, the organization is inexperienced in cooperating with other organizations whose services intersect with its own.

Conversely, the police are accustomed to working alongside tribal figures to diffuse tensions.  The large majority of the police, like the military, hail from East Bank “tribal” backgrounds, with few Palestinian Jordanians achieving high ranks within the PSD despite the fact that they comprise up to 65% of Jordanian citizens.  At local police stations, familiarity with tribal processes for resolving disputes has partly institutionalized these processes, for example with police officers witnessing tribal truces.  Much of the Syrian refugee population hails from rural Deraa, Homs and Aleppo, and are also familiar with tribal solutions to grievances ranging from verbal disputes to injuries and fatalities caused by traffic incidents.  But social capital always plays a role in the negotiated outcomes of tribal settlements, and this is something refugees lack.

For most police and many Jordanians, liaising with influential tribal figures is the central component of community policing.  Whether or not this practice encourages egalitarian solutions to disputes, it is unlikely to be dislodged any time soon.  But increasingly, community-based organizations, NGOs and civil society activists are also claiming central roles in mediating disputes between East Bankers, Palestinian Jordanians, Syrian and Iraqi refugees, and foreigners.  If the Jordanian police are to play a role in enhancing social cohesion, they need to connect and cooperate with both new and conventional tribal and administrative figures in dispute resolution.  Doing so does requires enhanced knowledge, but more fundamentally it requires a shift in the organizational culture away from the patriarchal norms that still characterize the PSD.

Jessica Watkins is a research officer in the Middle East Center at the London School of Economics.  (Sada 16.10)

Back to Table of Contents

11.5  TUNISIA:  Tunisia’s Bold Move to End Racial Discrimination

Stephen Quillen posted on 17 October in Al-Monitor that activists have hailed the Tunisian parliament’s recent approval of a law criminalizing racial discrimination, although they believe the road is still long to completely eliminate racism that is deeply rooted in Tunisian society.

Tunisia’s parliament voted to criminalize racial discrimination on 9 October in what supporters are calling a historic step in the protection of minority rights in the country.  “Today, minorities and non-Tunisians who might face discrimination in our country are protected by the law,” said Rania Belhaj Romdhane, a member of M’nemty (My Dream), an anti-racism organization that advocated for the legislation.  “It is a very important step.”

Messaoud Romdhani, head of the Tunisian Forum for Economic and Social Rights, agreed in regard to the law’s significance.  After the vote, he was reported as saying, “This is a very important turning point in the history of Tunisia, equivalent to the abolition of slavery.”

Under the law’s provisions, those convicted of using racist language could be imprisoned for one month or fined $350, while those guilty of inciting hatred, making racist threats, spreading and advocating racism or belonging to an organization that supports discrimination could face one to three years in prison or a $1,050 fine.  Even steeper fines can be levied against institutions and associations found to have engaged in discriminatory practices.  The legislation puts Tunisia, often hailed as the catalyst and biggest success story of the Arab Spring, once again at the forefront of progressive change in the region.

Throughout its history, Tunisia has often led the way on social issues, among them racial equality and women’s rights.  In 1846, it became one of the first countries to formally abolish slavery (though the practice continued until 1890).  Under the autocratic rule of former President Habib Bourguiba, it introduced landmark reforms protecting women’s rights, a legacy on which Tunisia’s current president, Beji Caid Essebsi, has sought to build.

Tunisia also prides itself on its diverse and tolerant character.  Living at the crossroads of the Maghreb, Europe and the Levant, Tunisians are an ethnically diverse people — a mix of Arab, Berber, European and Phoenician roots along with others — bringing together a range of cultural influences.  A small community of Jews has also lived alongside their Muslim neighbors for centuries, mostly on the southeastern island of Djerba.  They now number around 2,000, less than 0.1% of the overall population.

Despite Tunisia’s diverse background and open outlook, racism — particularly directed at the country’s significant black population — remains deeply ingrained throughout the country, activists say.  Those of darker skin tones are frequently subjected to racial slurs, social stigma, discrimination and even violence.

“You see racism on the streets on a daily basis — when you get mocked, when you get bullied, when you are called names,” asserted Belhaj Romdhane, a black woman who said she regularly encounters such behavior.  “When I was a child, I was always called names, even by my teachers, who were supposed to be role models. … This made me always feel scared of being judged.”

Fadwa Gmiden, from Gabes, told Al-Monitor that life as a black Tunisian has come with its struggles.  “Sometimes I’m not sure which is harder: being a woman or being black,” Gmiden said.  “It requires double the effort to be accepted.  There is always this ‘You’re not Tunisian enough.’”

Since the 2011 revolution, civil society groups have pressured the government to pass legislation specifically geared at protecting racial and ethnic minorities, but at first, there was little political will, said Belhaj Romdhane.  That changed in 2016 following a series of racially motivated assaults that prompted a wave of protests and a national conversation about racism.  In one highly publicized case in December of that year, three Congolese students were attacked with a knife in central Tunis, landing one of them in intensive care.

Responding to the incident, Prime Minister Youssef Chahed called on parliament to “ratify the draft law criminalizing racial discrimination as a matter of urgency.”  Today, nearly two years later, Belhaj Romdhane and other activists are proud that the law they long worked to enact has finally been passed.  That done, however, they recognize that the road ahead for ensuring equality is a long one.

“For years, we’ve held many protests, we’ve held many sit-ins, including behind the doors of parliament.  We’ve organized a lot of marches on the streets, and we’ve held many cultural events and campaigns to raise awareness,” said Belhaj Romdhane.  “Without the presence of civil society, none of this would have happened.”  She added, “Today, we are very hopeful. We are very excited, and we are very proud of our country, but this is only the beginning.  We can’t say that racism or discrimination will stop immediately because of a law.  This is only the key to opening the door.”

Along those same lines, Romdhani remarked, “It’s a giant step, but there’s still a lot of work to be done to make this law a reality in a society where there is racism against the 10% of black Tunisians and sub-Saharan Africans who suffer from insults and sometimes violent attacks.”

According to Minister of Higher Education and Scientific Research Salim Khalbous, Tunisia’s black minority is estimated to account for 10-15% of the overall population, and there are some 6,500 foreign African students, mostly from the sub-Sahara, currently living in the country.  Gmiden, asked whether she was optimistic about the new law, stated, “In Tunisia, we have good legislation for many things that are not yet put into practice. … We need a cultural shift in order for this law to be successful.”

The Tunisian Press Agency has reported that to help educate the public and to fulfill the spirit of the law, a new body, the National Commission against Racial Discrimination, will be tasked with overseeing strategies and public policies and conducting public awareness campaigns on the issue.  Proponents of the law said that efforts to raise awareness, especially among the country’s younger generations, are critical to effecting change.  “Today, many Tunisians, most of them with good intentions and good faith, say that we have no problem with racism, but the first act to tackle the issue of racism is to recognize it,” said Mehdia Ben Gharbia, Tunisia’s former human rights minister, after passage of the new law, which he helped bring forward.

“Racism is a universal illness that you can find everywhere” said Belhaj Romdhane. “We just need to talk about it, because denial is always a problem.  We want this country to become fully democratic, so that it can be an example for other countries in the region, a country that leads on human rights, that leads on diversity and that accepts all people.”

Stephen Quillen is a Tunis-based journalist.  (Al-Monitor 17.10)

Back to Table of Contents

11.6  MOROCCO:  Morocco’s Auto & Phosphates Exports to Narrow Account Deficit

In a report by Fitch Solutions Macro Research, Morocco’s account deficit is set to shrink to 3.3% of GDP in 2018 and 2.2% in 2019, down from 3.6% in 2017.  The lowered deficit is thanks to rising export growth, expected to continue in 2019. The main drivers behind booming exports are vehicles, phosphates, aeronautics and agricultural products.

The report also anticipates rapidly increasing growth in Morocco’s vehicle production.  Production will grow by 18.2% in 2019, up from 16.8% in 2018, in line with the government’s 2014-2020 Industrial Acceleration Plan.  The plan has two major goals.  The first goal is to create 500,000 jobs, half of which are to be generated by Foreign Direct Investment (FDI) and half from the restored industry.  Second, the plan aims to increase industrial production’s share in GDP from 14% in 2018 to 23% in 2020.  “FDI has performed poorly over 2018, with liabilities (investments by foreign residents) contracting by 1.9% quarter-on-quarter in Q218. That said, this still represents a 3.9% increase on a year-on-year basis.”

The report keeps an optimistic tone over Morocco’s ability to attract more FDI over the coming years.  The US and Brazilian markets’ demand for fertilizers, “the primary end-product of Moroccan phosphates,” is also expected to increase, the report states.  Moreover, the projected slower rise of global energy prices compared to the rapid rise in 2018, will support Morocco’s current account by moderating imports.

Rapid Rise of Oil Prices Pressured Moroccan Imports

The rapid rise in oil price “has put immense upward pressure on Moroccan imports,” states the report, explaining that Brent crude oil prices rose to $86.3 per barrel in early October 2018 from $57.2 per barrel a year earlier.  Fitch expects Brent crude to remain $82 per barrel on average in 2019, calling the trend “more tepid oil price gains ahead.”  As Morocco’s energy imports are expected to remain more steady, the current account deficit will gradually narrow.

In its previous report, Fitch group argued that the Moroccan government is no longer considering capping fuel prices, taking back its earlier argument which stated that the “political pressure brought about by rising inflation on the back of higher oil prices, would push the government to cap fuel prices.”

For now, Morocco’s fuel prices cap scheme has “fizzled out,” since inflation is on the back foot again.  “Given that we expected subsidies to account for nearly a third of new spending in 2018, the avoidance of this measure will be positive for consolidation efforts,” it states.  The government had reportedly finalized a plan to cap fuel prices in July and was awaiting approval by Head of Government Saad Eddine El Othmani.

The fuel price cap plan came amid growing anger and demonstrations against rising living costs that have fueled a boycott against three companies: Sidi Ali, Afriquia gas, and Centrale Danone.  Morocco lifted fuel subsidies in 2015, deregulating the fuel distribution market.  Now prices have reached a five year high as oil prices worldwide have increased.

The public became angrier when a parliamentary report was leaked revealing fuel distributors had increased their profits. As prices increased, distributors’ profit margins widened, but they did not expand Morocco’s storage capacity to the extent they pledged.  (Fitch 23.10)

Back to Table of Contents

11.7  TURKEY:  Turkey’s Fantasy War on Inflation

Mustafa Sonmez posted on 23 October in Al-Monitor that Ankara has declared an “all-out fight against inflation,” cajoling sellers into 10% discounts and sending municipal police to hunt hoarders, and while this bizarre strategy is unlikely to bear fruit, it might be a sign of other plans that are being cooked up in Ankara.

Turkey is grappling with soaring inflation, the highest since 2003, which was the first full year in power of the Justice and Development Party (AKP).  In September, year-on-year inflation reached 24.5% in consumer prices and 46% in producer prices.  The inflation dynamics indicate that the year-end figures could climb to between 30% and 35% in consumer prices and between 50% and 60% in producer prices.

Consumer inflation had been in single digits since 2003, excluding last year, when it reached 11.9%.  The current surge is a new situation that makes wage earners and pensioners relatively poorer as they fail to increase their incomes in line with price increases.  The biggest fear of working people, however, is that they could end up with no income at all if the slowing economy spawns a new wave of layoffs.  For those indebted to banks, the reasons to worry are even bigger.

Faced with an inflation unseen in the last 15 years, Turks are primarily incensed over the increase in food prices, which owes heavily to the ill-advised policies of the AKP.  For years, the AKP encouraged construction-centered growth, neglecting agriculture, as a result of which Turkey is now facing supply shortages and has become a net importer of food.

The main factor fueling inflation, however, is the dramatic depreciation of the Turkish lira or, in other words, the huge increase in foreign exchange prices.  At the end of September, the price of the dollar was up 82% from the same period last year.  In the first 10 years of AKP rule, the price of the greenback had increased only 27%, which made possible the single-digit inflation rates.  With the currency crisis this year, imports became much more expensive and the costs of producers shot up, hence the 46% producer inflation in September.

The big gap between producer and consumer inflation indicates that retailers have refrained from hiking their prices at the rate of producers.  Yet despite the threat of sharp declines in domestic demand, consumer prices have already soared 24.5%.  No doubt the global increase in the prices of energy and commodities such as wheat, iron ore and copper has also played a role in the growing cost burden for producers.

According to government officials, however, the soaring inflation is essentially the work of malevolent actors such as greedy middlemen and speculators who have to be disciplined through forceful measures, including the mobilization of municipal police.  In a 2 October speech, for instance, President Erdogan said, “I’d like to appeal to my dear nation: You are the ones who inspect the prices most closely at supermarkets and elsewhere.  If you spot products with extraordinary price differences, report them immediately to the municipal police.  I am also calling on mayors to encourage more attention on the issue among the municipal police.  It is our duty to do what is necessary if there are fluctuations in prices and to raid stocks if there are hoarders.”

Treasury and Finance Minister Berat Albayrak, who is also the president’s son-in-law, followed suit. In a television interview the following day, he said citizens were reporting “speculative” price hikes on a consumer line set up by the government.  “Citizens and [government] are both in action,” he said.

Interior Minister Suleyman Soylu, for his part, instructed governors across the country to tighten measures against hoarding and price gouging and slap fines on transgressors.

In short, Ankara has refused to acknowledge the real dynamics of inflation and draw up measures accordingly.  True to style, it has instead pointed an accusing finger at “villains,” who, in this case, are hoarders and opportunists.

For those familiar with the AKP, this strategy is hardly a surprise.  Blaming setbacks and problems on external factors, conspiracies or instigators has been an AKP hallmark for years.  According to this thinking, the surging inflation cannot be the result of Ankara’s mismanagement, so it must be the work of greedy actors in the market, against whom the victimized populace has to be protected.

Then, at a 9 October meeting attended by leading business people, Albayrak announced an “all-out fight against inflation.”  As part of the campaign, which is perhaps unprecedented in the world, the private sector promised 10% discounts to consumers by the end of the year.  Another measure envisaged a freeze on the prices of gas and electricity, again by the end of the year. Banks, for their part, would contribute a 10% cut in the interest rates of already issued loans.

The Turkish Statistical Institute (TUIK) calculates consumer inflation on the basis of more than 400 products and services, which are provided by tens of thousands of companies in the market.  Participation in the campaign was not obligatory, but the business community was asked to promise discounts.  Of course, no one publicly raised objections, but many could not conceal sardonic smiles. With consumer prices already up by more than 24% and further cost-related hikes already factored into producer prices, discounts of 10% will make little difference.

The increased prices, meanwhile, have led to a drop in domestic sales.  According to TUIK, retail sales were down 3% in August in terms of inflation-adjusted value.  The drop is likely to have worsened since then, given the decreasing real income of consumers.  The shrinking demand has already forced companies to make markdowns, with many shops advertising discounts of up to 50%.  This again raises the question of what difference the 10%-discount campaign can make.

So, what is the government’s actual purpose with the campaign?  Is it another attempt to shirk responsibility by portraying inflation as an external calamity against which a fierce struggle is waged?  Or is the government laying the ground for looming negotiations with trade unions to determine the hike in the minimum wage, which is the principal income of millions of Turks?  By claiming a sincere struggle against an externally inflicted setback, Ankara might be planning to press its interlocutors to make their own sacrifice in the “all-out fight” and acquiesce to a low pay hike.  This perhaps is the calculus behind the AKP-style fight against inflation.

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 23.10)

Back to Table of Contents

11.8  CYPRUS:  Fitch Upgrades Cyprus to ‘BBB-‘; Outlook Stable

On 19 October, Fitch Ratings has upgraded Cyprus’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘BBB-‘ from ‘BB+’.  The Outlooks are Stable.

Key Rating Drivers

The upgrade of Cyprus’s IDRs reflects the following key rating drivers and their relative weights:


Buoyant fiscal revenue and prudent fiscal policy mean we expect Cyprus will record a fiscal surplus of 2.7% of GDP in 2018, compared with a target of 1.7% in the April 2018 Stability Programme Update and a current ‘BBB’ median fiscal deficit of 2%.  We forecast the fiscal surplus will remain high at 2.4% and 2.2% of GDP in 2019 and 2020, respectively, compared with 3.1% and 2.9% targeted in the 2019 Draft Budgetary Plan.  Robust economic growth will boost fiscal receipts, while previously adopted hiring freeze and collective agreements will likely limit growth in the wage bill.

Cyprus’s gross general government debt (GGGD)/GDP will remain on a firm downward trajectory, despite a one-off expected increase in 2018.  Following the placement into Cyprus Cooperative Bank (CCB) of €3.19 billion government bonds (15.5% of GDP) to facilitate the acquisition of part of the state-owned bank by Hellenic Bank (HB), GGGD/GDP is set to increase to 104.4% at end-2018 from 95.7% in 2017.  However, we expect large primary surpluses, robust growth and contained nominal effective interest rates will reduce GGGD/GDP to 70% of GDP by 2027.


The ratio of non-performing exposures (NPEs) to total loans decreased to pro-forma 40.3% in H1/18 from 44% in 2017 as per the Central Bank of Cyprus, partly supported by the announced securitization by Bank of Cyprus (BoC) of €2.7 billion gross NPEs, which is still subject to regulatory approval by the European Central Bank.  The acquisition by HB of CCB’s good assets and the subsequent transfer into a run-off entity of CCB’s €5.7 billion NPEs portfolio are estimated to have led to a further decrease in NPEs to 30% in September 2018.  This will support a substantial decrease in contingent liabilities stemming from the banking sector, although these remain large.

The government has taken further decisive steps to address legacy issues within the banking sector.  Key legislative amendments aimed at facilitating NPEs securitization and sales of loans, and strengthening foreclosure and insolvency toolkits were adopted by the parliament in July.  The government also intends to launch a subsidy scheme to defaulting borrowers (Estia scheme) in January 2019, which implies loan restructurings and state subsidies to incentivize loan repayment.  So far, use of foreclosure instruments has been negligible and the degree of implementation of the scheme and enforcement of the new legislative package remains uncertain.

Additional fiscal costs could arise from potential calls on the government-guaranteed Asset Protection Scheme, covering unexpected losses on €2.6 billion of CCB’s assets acquired by HB.  State subsidies related to the Estia scheme and increased debt servicing costs following government support to CCB are estimated at a yearly 0.5% of GDP by the government and are already captured in our forecasts.

Cyprus is benefitting from a strong economic recovery with real GDP reaching pre-crisis level and the economy forecasted by Fitch to grow 4% in 2018 and 3.8% in 2019, supported by large foreign-financed investment projects in construction and tourism, and robust private consumption.

Cyprus’s ‘BBB-‘ IDRs also reflect the following key rating drivers:

Cyprus’s ratings are supported by a high level of GDP per capita, strong governance indicators and a favorable business environment significantly above ‘BBB’ rated peers’ and closer to ‘A’ category peer levels.

Private sector debt and non-performing exposures remain high, however, at 226% (excluding special purpose entities) and 97% of GDP in Q1/18, respectively, and constrain credit growth.  Household and corporate debt stood at 105% and 121% of GDP and a large part of the recent decline in such debt stemmed mostly from high GDP growth, debt-to-asset swaps, loan write-offs, rather than loan repayment.

We expect private sector deleveraging will accelerate, however, as enforcement of new legal amendments, improving earnings and recovering house prices foster debt repayment.  Economic growth will likely remain resilient to a faster resolution in NPEs as rising wages, a dynamic labor market and high household savings will help preserve disposable income and smooth consumption.

The banking sector remains extremely weak as reflected by Fitch Banking System Indicator (BSI) of ‘b’.  Very weak asset quality and high NPE ratios are still weighing on new lending and profitability.  The acquisition of CCB’s healthy assets by HB, respectively the second- and third-largest banks of the country, will result in further concentration within the sector between the two large national banks, with total banking sector’s assets still accounting for a high 336% of GDP at end-H1/18 (352% at end-2017).  Unreserved NPEs for BoC and HB will also decrease to an estimated €3.8 billion (19% of GDP) following the sale of CCB assets and BoC transaction, but could lead to some capital shortfall if losses are crystallized and higher-than-expected haircuts incurred on collateral.  This level of unreserved NPEs is significant relative to the banks’ common equity Tier 1 capital, highlighting their vulnerability to asset quality shocks.

Banking sector liquidity has improved after a 0.8% decline in deposits in Q1/18 due to uncertainty around the CCB sale.  A highly indebted private sector has led to an accumulation of liquid assets and a decrease in the loan-to-deposit ratio to 91% in July 2018 (104% in 2017).  Non-resident deposits in locally active credit institutions, however, still represent 29.5% of total deposits in H1/18, albeit on a declining trend.  These are largely short-term funding and confidence-sensitive and would likely become more volatile than domestic deposits in case of stress.

Fitch forecasts the current account deficit will widen to 6.7% of GDP in 2018 and 7.2% in 2019, compared with the current ‘BBB’ median of 1.6%, as strong domestic demand, especially in the construction sector, fuels imports.  When excluding special purpose entities (SPEs) including shipping and financial companies that materially distort external statistics, the current account deficit decreases substantially, according to the Central Bank of Cyprus.  Cyprus’s net external debt (NXD) turned into a small asset position in Q2/18, when adjusted for SPEs, compared with a non-adjusted NXD of 154% at-end 2017 and a current ‘BBB’ median of 7.7%.

Cyprus’s financing flexibility has improved substantially since the country exited the macroeconomic adjustment program in March 2016.  The government improved access to capital markets by issuing Eurobonds in June 2017 and September 2018.  The sovereign has a large cash buffer, which accounts for 11% of GDP and covers more than the government’s medium-term debt management strategy of prefunding the next nine months of gross financing needs.

Fitch has revised the Country Ceiling to ‘A’ from ‘BBB+’.  It is now four notches above the Long-Term Foreign-Currency IDR, up from three previously.  This reflects Cyprus’s recent structural economic and financial sector adjustments and reduced risk of capital controls.  It is still below the maximum possible six-notch uplift for Eurozone member states, owing to the weakness of the banking sector and recent history of capital controls.

Rating Sensitivities

Future developments that may, individually or collectively, lead to a positive action include:

-Materially reduced contingent liabilities to the sovereign stemming from the banking sector, for example from declining NPEs or an upgrade in the sector’s Viability Ratings;

-Marked reduction in the GGGD/GDP ratio; and

-Continued deleveraging of the private sector.

Future developments that may, individually or collectively, lead to a negative action include:

-Heightened risks in the banking sector, for example from deterioration in asset quality; and

-Stalling of the decline in the government debt-to-GDP ratio, for example due to deterioration of budget balances, weak growth or materialization of contingent liabilities.

Key Assumptions

Gross government debt-reducing operations such as future privatizations are not considered in Fitch’s baseline scenario.  The projections also do not include the impact of potential future gas reserves off the southern shores of Cyprus, the benefits from which are several years into the future.

Fitch does not expect substantial progress with reunification talks between the Greek and Turkish Cypriots over the next quarters.  The reunification would bring economic benefits to both sides in the long term but would entail short-term costs and uncertainties.  (Fitch 19.10)

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://