Fortnightly, 7 October 2015

Fortnightly, 7 October 2015

October 7, 2015





1.1  Kahlon Sets Out Measures to Boost Growth
1.2  Government Signs Agreement To Build 20,000 Homes In Beer Sheva


2.1  Tel Aviv Ranks Among World’s Top Financial Centers
2.2  Forbes to launch Under 30 Summit Offshoot in Israel
2.3  Prosper Marketplace to Acquire Leading Personal Finance Company BillGuard
2.4  Elbit Systems to Supply Intelligence Integrated Systems to a Latin American Country
2.5  Delta to Add 4 Weekly Flights from JFK to Israel
2.6  Dome9 Secures $8.3 Million in Series B Financing to Meet Enterprise Cloud Security Demand
2.7  Silicom to Acquire ADI Engineering
2.8  Mellanox Technologies Announces Definitive Agreement to Acquire EZchip
2.9  Mazor Robotics’ First Renaissance System Installations at New York Metropolitan Area
2.10  Cyber Security Innovator Morphisec Raises $7 Million Series A Funding Round
2.11  Elbit Systems to Provide Europe with UAS-Based Advanced Intelligence Systems


3.1  Dubai International Airport Sets New Record with 7.2 Million Passengers in August
3.2  Smashburger Announces Expansion into Egypt
3.3  Egypt Has Largest Customer Base in the Arab Region’s Electronics Market
3.4  Tangier Renault Plant Aims to Produce 250,000 Vehicles in 2015
3.5  Austrian Group Eglo Africa to Open 10 Stores in Morocco by 2020


4.1  Major Wind Farm Being Built In Israel, First In 30 Years


5.1  Lebanese Tourism Reaches a 3-Year High by July
5.2  Jordan’s GDP Grows by 2.4% in Second Quarter

♦♦Arabian Gulf

5.3  GCC Railway Completion Date to be Reviewed
5.4  Gulf’s Asian Workers See Remittance Boom From Strong Dollar
5.5  Kuwait Rejects IMF Proposals to Introduce Tax on Public Services
5.6  Kuwait to Fingerprint Expats at Airport
5.7  Qatar Commits to Invest $35 Billion in the US
5.8  UAE GDP Set to Grow Over 3.5%
5.9  UAE Second-Biggest Supplier of Oil to Japan
5.10  Nepal Lifts Ban on Housemaids Working in UAE

♦♦North Africa

5.11  Egypt & Morocco Economic Growth Stronger than Other MENA Countries in 2015
5.12  Egypt’s President Announces Planned Shift to VAT Regime
5.13  IMF Says Egypt Has Not Requested Financing
5.14  France & Egypt Agree on $1.06 Billion Warship Deal
5.15  Egypt Plans New Mediterranean Gas Exploration Round In First Half 2016
5.16  Number of Tourists to Egypt Rose By 8.2% in 2015
5.17  Libya’s Oil Output Down to 300,000 bpd
5.18  Casablanca, the World’s 44th Most Competitive Financial Center
5.19  Soaring Arms Budget Pushes Morocco for Defense Industry
5.20  First MEBAA Morocco Hailed a Success


6.1  Turkish Sept Inflation Picks Up, Adding To Worries
6.2  Turkey & Singapore Plan FTA Signing at Antalya Summit
6.3  SEV Says Greek Economy is Showing Some Signs of Recovery
6.4  Greece’s Tsipras Says Reforms & Debt Relief Are Priorities
6.5  No Progress Made On Greek Politicians’ Wealth Inspections Since 2014
6.6  EU Parliament Backs Urgent Frontloading of €35 Billion for Greece
6.7  Greece to Set Single Tax Rates for All?



7.1  Bon Jovi Helps Israelis ‘Keep the Faith’ with Tel Aviv Concert
7.2  Hijri New Year May Begin on 15 October


7.3  Lebanese Activists Take to the Streets Amid National Dialogue Debate
7.4  Egypt to Include New Suez Canal Logo on the Half Pound Coin


8.1  Rosetta Genomics Receives U.S. Patent for Treatment of Prostate Cancer
8.2  ETView and Anderson Cancer Center Start Clinical Evaluation of VivaSight-DL
8.3  Brainsway Helps the US Navy Treat Depression
8.4  SmartZyme to Present at Ladenburg Thalmann 2015 Healthcare Conference
8.5  Teva Acquires Gecko Health Innovations
8.6  ElastiMed Off to a Strong Start with $1 Million Investment
8.7  Eye-D Technology Featured at Partnership Opportunities in Drug Delivery Conference
8.8  Teva Announces Approval of COPAXONE in Japan for the Prevention of Relapse of MS
8.9  Cell Cure Receives Fast-Track Designation for Macular Degeneration Treatment
8.10  MediWound Awarded BARDA Contract for NexoBrid for the U.S.
8.11 Teva Acquires Rimsa, a Leading Mexican Pharmaceutical Company
8.12  MValve Implants First Human Catheter Based Mitral Valve Replacement System


9.1  Healthcare Organizations Select Mellanox InfiniBand-Based Cloud
9.2  Indian Property Firm Selects CYREN WebSecurity to Protect Mobile Users
9.3 Secures $8 Million & Launches Innovative Analytics Cloud Service
9.4  Poprush Innovative Advertising Celebrates Record Breaking Beginning
9.5  Hinduja Group’s HITS Installs Actus Broadcast Monitoring Platform


10.1  Israel’s Unemployment Remains Unchanged at 5.3%


11.1  LEBANON: Standstill Persists in Lebanon
11.2  TUNISIA: Tunisian Prime Minister Promises Economic & Security Reforms
11.3  TURKEY: Soaring Bad Debts Sound Alarm in Turkey
11.4  TURKEY: Turkey’s Snap Elections May Not Change Much
11.5  CYPRUS: IMF Completes Eighth Review of EFF and Approves €126 Million Disbursement


1.1  Kahlon Sets Out Measures to Boost Growth

Finance Minister Moshe Kahlon promised more aid for Israeli exporters, faster connection to the gas supply and special measures for Israel’s high-tech sector.  Against a background of slowing economic growth in Israel, Minister of Finance Moshe Kahlon announced these “measures to encourage growth” today, among them aid for exports, a new loan fund for small and medium-size businesses, expediting the hook-up of factories to the natural gas supply, and measures to accelerate growth in high-tech.

The steps announced by Kahlon include:

  • Expanded guarantees for Ashra, the Israel Foreign Trade Risks Insurance Corporation by $800 million.
  • $300 million in guarantees for banks providing export insurance.
  • State guarantees totaling $50 million for exporters bidding in tenders
  • A new loan fund for small and medium-size business granting loans of up to 12% of turnover, compared with 8% today.
  • Special loan track for farmers providing state loan guarantees of 85%, compared with 70% today.
  • Regularization of crowd funding in order to vary the sources of funding for technology companies.
  • Allowing non-bank credit providers to issue bonds, to enable easier financing of businesses and investments.

In addition, Kahlon promised the implementation of the recommendations of the committee examining the Law for the Encouragement of Capital Investment, with the aim of boosting the activity of large international firms in Israel.  This would also encourage IP activity in Israel by adapting the law to the needs of knowledge-intensive companies, and instituting proactive measures to attract international companies.

Faster connection of factories to the natural gas supply, with a new regulatory model designed to give faster permits, removal of obstacles to laying the distribution network and more efficient processes with fixed timetables would be expedited.  (Globes 24.09)

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1.2  Government Signs Agreement To Build 20,000 Homes In Beer Sheva

The Ministry of Finance, the Ministry of Construction and the Israel Lands Authority signed an agreement on 6 October with the city of Beer Sheva for the building of some 20,000 residential units.  It is the seventh such agreement signed since the initiative began during the previous government, and the second signed during the present administration.  Originally, the agreement was to include plans for 12,000 units but it was decided to expand the plans during deliberations.  Despite the announcement, the agreement still needs to be approved by the Beer Sheva city council.  According to the roadmap in the agreement, the new units will be available by 2019 and NIS 1.5 billion will be invested in infrastructure and public buildings across the city.  Furthermore, the city will receive funding for a refurbishment of its central avenue and the old city as well as the construction of a stadium.  (Globes 06.10)

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2.1  Tel Aviv Ranks Among World’s Top Financial Centers

The 2015 Global Financial Centers Index, released on 29 September, ranked Tel Aviv as the world’s 25th leading financial center.  Published semiannually, the GFCI, compiled by the Z/Yen Group, a London-based commercial think tank, ranks the world’s 84 leading financial cities based on data from the World Economic Forum, the U.N., World Bank, the OECD and other sources.  Cities are evaluated across several dimensions, including business environment, financial sector development, infrastructure, human capital, and reputation, as well as a series of other parameters meant to gauge their financial services’ diversity.

London led the 2015 GFCI ranking, followed by New York and Hong Kong. Singapore, Tokyo, Seoul, Zurich, Toronto, San Francisco and Washington, D.C. joined the three to make up the top 10 financial centers in the world.  As the world’s 25th most robust financial center, Tel Aviv outperformed other major cities, such as Abu Dhabi, ranked 28th, Beijing (29), Stockholm (32), Rio de Janeiro (35), Amsterdam (36), Paris (37), Oslo (67), Moscow (78) and Madrid (79).  Tel Aviv has improved its position by seven spots since the Global Financial Centers Index was first published in 2007.  The Israeli metropolis ranked 27 on the 2014 index.  (Various 30.09)

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2.2  Forbes to launch Under 30 Summit Offshoot in Israel

The first Under 30 Summit EMEA (Europe, Middle East, and Africa) will be held in Jerusalem and Tel Aviv, Forbes announced.  The media conglomerate will introduce the new offshoot of the Under 30 Summit , which has been hosted in Philadelphia for the past two years, in Israel on 3-6 April 2016.  It will feature a full agenda of panels, innovative presentations, keynotes, pitch competitions and mentorship from successful business and governmental leaders.  In addition, the Summit will provide rich cultural immersion opportunities and a rare international networking environment for young entrepreneurs.

The Summit’s pitch competition will include a global social impact competition for entrepreneurs under the age of 30 to advance solutions that address global challenges, as well as programming to foster Israeli and Palestinian entrepreneurial cooperation.  Tel Aviv will host the opening ceremony and the first day of activities and move to Jerusalem for its final two days in Israel.  The summit includes programming to advance cooperation among Israeli and Palestinian entrepreneurs and a pitch competition for entrepreneurs under the age of 30 seeking solutions to global challenges.  (Forbes 06.10)

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2.3  Prosper Marketplace to Acquire Leading Personal Finance Company BillGuard

San Francisco’s Prosper Marketplace, which operates a leading online marketplace that connects borrowers and investors, signed a definitive agreement to acquire BillGuard.  The acquisition will enable Prosper Marketplace to offer borrowers and investors a full suite of powerful tools to help them make smarter financial decisions, and will give Prosper Marketplace access to Israel’s extraordinary engineering and product talent pool.

BillGuard’s app helps consumers track their spending across all accounts, budget effectively, protect their money from wrongful charges and monitor their credit score.  BillGuard’s technology, powered by crowdsourcing, also helps consumers detect the billions in fraudulent payment card charges that strike Americans each year.  Since inception, BillGuard has flagged over $70 million in unauthorized charges.  With more than 1.3 million registered users, BillGuard’s five-star rated iPhone and Android mobile apps have won almost every industry award in their category, including being named one of the top banking innovations of all time by Online Banking Report and a Best App of 2014 by Google.

Tel Aviv’s BillGuard’s mission is to empower consumers to control, protect and do more with their money.  BillGuard’s proprietary transaction monitoring technology pioneered the use of crowdsourcing and big data analytics to help consumers detect the $8 billion in wrongful payment card charges missed by banks each year.  Downloaded over a million and a half times since release, BillGuard’s 5-star rated mobile apps have won almost every industry award in their category, including being named one of the top banking innovations of all time by Online Banking Report.  (Prosper Marketplace 24.09)

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2.4  Elbit Systems to Supply Intelligence Integrated Systems to a Latin American Country

Elbit Systems announced that it was awarded a contract from a customer in the Latin American region, in an amount of approximately $70 million, for the supply of intelligence integrated systems, for homeland security applications.  Under the contract, to be supplied within less than a year, Elbit Systems will provide the customer with Hermes 900 UAS systems and an intelligence gathering system.

Haifa’s Elbit Systems is an international high technology company engaged in a wide range of defense, homeland security and commercial programs throughout the world.  The Company, which includes Elbit Systems and its subsidiaries, operates in the areas of aerospace, land and naval systems, command, control, communications, computers, intelligence surveillance and reconnaissance, unmanned aircraft systems, advanced electro-optics, electro-optic space systems, EW suites, signal intelligence systems, data links and communications systems, radios and cyber-based systems.  (Elbit Systems 25.09)

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2.5  Delta to Add 4 Weekly Flights from JFK to Israel

Delta Airlines announced it is adding 4 more weekly flights between Tel Aviv and New York from May 2016.  The four new flights will depart New York’s JFK airport on Tuesdays, Wednesdays, Fridays and Saturdays and bring the total number of weekly flights between JFK and Ben Gurion airport to 11.  Delta will offer more than 2,300 additional seats per week on the Tel Aviv-New York route, one of its biggest Trans-Atlantic routes; this in response to customer demand to expand this service.  Delta said that prices for night flights next May start at $1,085.  No price has yet been quoted for morning flights.  (Globes 24.09)

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2.6  Dome9 Secures $8.3 Million in Series B Financing to Meet Enterprise Cloud Security Demand

Dome9 Security, the leader in security and compliance for public clouds, announced that it had raised $8.3 Million in Series B financing.  The new capital will enable the company to grow its sales and marketing efforts, and expand its product portfolio for purpose-built cloud security solutions.  This new round of funding comes in the wake of the company’s tremendous success of its popular cloud security service which currently protects more than 250 enterprise customers.

The company has raised a total of $13 million in funding to date and this new round will primarily be used to accelerate its growth among enterprise cloud users.  The Series B round is being led by ORR Partners and include new Investors JAL Ventures, Pinnacle and Lazarus Israel Opportunity Fund. Existing investor Opus Capital Ventures also participated in the round.

Dome9 Security protects cloud infrastructure.  Leveraging cloud-native technologies Dome9 visualizes security risks, verifies and enforces security policies, and remediates threats to ensure continuous secure application delivery in cloud. Dome9’s self-managed cloud service is trusted by hundreds of enterprise customers to protect clouds over Amazon Web Services (AWS), Windows Azure, IBM/Softlayer and many others.  (Dome9 Security 01.10)

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2.7  Silicom to Acquire ADI Engineering

Silicom has entered into a definitive agreement to acquire ADI Engineering, a privately-held, Virginia based provider of high performance, high-quality, first-to-market Intel-based products targeted at the SDN, NFV, IoT, Cloud computing and Virtualization trends.  Under the terms of the agreement, Silicom will pay ADI’s stockholders $10 million in cash at closing, and an additional consideration subject to the attainment of certain future performance milestones. The transaction has been approved by the Boards of Directors of both companies and is subject to customary closing conditions. The transaction is expected to close in the fourth quarter of 2015. Silicom expects the acquisition to be accretive to earnings per share on a non-GAAP basis.

ADI’s products and core technologies are highly complementary with Silicom’s and do not compete with them.  ADI focuses on the implementation of highly innovative networking, telecom, and embedded solutions using the latest Intel technologies that enable new applications to be brought to market quickly.  In fact, since ADI frequently develops reference designs for upcoming Intel technologies, ADI can leverage its deep technical expertise and early access into a time-to-market edge over the competition.

Kfar Saba’s Silicom is an industry-leading provider of high-performance networking and data infrastructure solutions.  Designed primarily to increase data center efficiency, Silicom’s solutions dramatically improve the performance and availability of networking appliances and other server-based systems.  Silicom’s products are used by a large and growing base of OEM customers, many of whom are market leaders, as performance-boosting solutions for their offerings in the Cyber Security, Network Monitoring and Analytics, Traffic Management, Application Delivery, WAN Optimization, High Frequency Trading and other mission-critical segments within the fast-growing data center, enterprise networking, virtualization, cloud computing and big data markets.  (Silicom 30.09)

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2.8  Mellanox Technologies Announces Definitive Agreement to Acquire EZchip

Mellanox Technologies and EZchip have entered into a definitive merger agreement under which Mellanox shall acquire 100% of EZchip’s outstanding ordinary shares for a cash purchase price of $25.5 per share implying a transaction value of approximately $811 million (approximately $620 million net of cash).  The terms of the transaction have been unanimously approved by both the Mellanox and EZchip Boards of Directors.  The EZchip acquisition is a step in Mellanox’ strategy to become the leading broad-line supplier of intelligent interconnect solutions for the software-defined data centers.  The addition of EZchip’s products and expertise in security, deep packet inspection, video, and storage processing enhances Mellanox’ leadership position, and ability to deliver complete end-to-end, intelligent 10, 25, 40, 50, and 100Gb/s interconnect and processing solutions for advanced data center and edge platforms.  The combined company will have diverse and robust solutions to enable customers to meet the growing demands of data-intensive applications used in high-performance computing, Web 2.0, cloud, secure data center, enterprise, telecom, database, financial services and storage environments.  The combined businesses currently have approximately 2,400 employees, and have generated combined revenues of $668 million for the twelve months ended 30 June 2015.

Yokneam’s EZchip is a fabless semiconductor company that provides high-performance processing solutions for a wide range of applications for the carrier, cloud and data center networks.  EZchip’s broad portfolio of solutions scales from a few to hundreds of Gigabits-per-second, and includes network processors, multi-core processors, intelligent network adapters, high-performance appliances and a comprehensive software ecosystem.

Yokneam’s Mellanox Technologies is a leading supplier of end-to-end InfiniBand and Ethernet interconnect solutions and services for servers and storage.  Mellanox interconnect solutions increase data center efficiency by providing the highest throughput and lowest latency, delivering data faster to applications and unlocking system performance capability.  (Mellanox 30.09)

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2.9  Mazor Robotics’ First Renaissance System Installations at New York Metropolitan Area

Mazor Robotics received purchase orders for and delivered three Renaissance systems in the third quarter ended September 2015.  The three systems were delivered to U.S. hospitals representing new markets for the Company, including the first two systems installed in the New York City metropolitan area and one in the Pacific Northwest.  The systems installed in the New York City metropolitan area include clinical and academic centers, one of which is within the largest and most comprehensive hospitals in the U.S.  The Company ended the third quarter with 96 Renaissance systems installed globally, including 56 in the U.S., the Company’s primary growth market.  This compares with 77 and 44 systems for the third quarter ended September 30, 2014, respectively.

Caesarea’s Mazor Robotics (TASE: MZOR; NASDAQGM: MZOR) believes in healing through innovation by developing and introducing revolutionary robotic-based technology and products aimed at redefining the gold standard of quality care.  Mazor Robotics Renaissance Guidance System enables surgeons to conduct spine and brain procedures in a more accurate and secure manner.  (Mazor Robotics 06.09)

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2.10  Cyber Security Innovator Morphisec Raises $7 Million Series A Funding Round

Morphisec announced the closing of a $7 million Series A funding round led by JVP (Jerusalem Venture Partners), GE Ventures, Deutsche Telekom, Portage Advisors and OurCrowd.  With hackers constantly finding creative angles to attack corporations, the security industry needs a new, proactive approach.  Morphisec’s patented suite of security defense tools protects enterprises against targeted and zero-day attacks utilizing the concept of polymorphism — in other words, by turning attackers’ tactics back on themselves.  This innovative security method provides enterprises the ability to detect attacks earlier than ever before, to block them, and to create fingerprint information of attacks.

The company was launched in 2014 in JVP Cyber Labs in Beer Sheva, based on patented technology originating out of Ben-Gurion University of the Negev.  Proceeds of the round will be used to launch Morphisec’s flagship product and expedite the growth of marketing and sales in North America and Europe.

Emerging from the national cyber security center, and some of the sharpest cyber security minds in Israel, Beer Sheva’s Morphisec offers unique, instantaneous and deterministic detection and arrest of zero-day and known attacks, combined with rich contextualized forensics.  Morphisec is planning to come out of stealth mode in Q4/2015.  (Morphisec 06.10)

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2.11  Elbit Systems to Provide Europe with UAS-Based Advanced Intelligence Systems

Elbit Systems was awarded a contract from a European country to supply an Unmanned Aircraft System (UAS)-based cutting-edge intelligence solution.  Valued at approximately $78 million, the contract will be performed over a two-year period by Elbit Systems’ ISTAR Division, established several months ago, as a result of combining Elbit Systems’ Electro-optics – Elop and UAS Divisions.  Elbit Systems’ solution will consist, among other elements, of AMPS (Advanced Multi-Sensor Payload System) – a multi-sensor electro-optics system capable of long-range visual intelligence for both day and night.  The system is adaptable for a large variety of airborne applications and serves as an important building block for the integrated intelligence solution.

Haifa’s Elbit Systems is an international high technology company engaged in a wide range of defense, homeland security and commercial programs throughout the world.  The Company, which includes Elbit Systems and its subsidiaries, operates in the areas of aerospace, land and naval systems, command, control, communications, computers, intelligence surveillance and reconnaissance, unmanned aircraft systems, advanced electro-optics, electro-optic space systems, EW suites, signal intelligence systems, data links and communications systems, radios and cyber-based systems.  (Elbit Systems 06.09)

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3.1  Dubai International Airport Sets New Record with 7.2 Million Passengers in August

According to the latest traffic report issued by operator Dubai Airports, traffic at the world’s number one hub for international passengers reached 7,282,256 in August, up 9.5% from 6,648,058 recorded during the same month in 2014.  The year to date traffic totaled 52,264,223, up 12.4% compared to 46,479,919 recorded during the first eight months last year.  The bumper traffic was boosted by the seasonal rush of travelers, including inbound traffic of residents returning for the start of the academic year, as well as increase in flight frequency and launch of new services by Emirates, flydubai and other airlines.

The Indian subcontinent topped the list of regions with highest growth in passenger numbers (+143,970 passengers) followed by Western Europe (+129,950) and the GCC (+111,637).  Eastern Europe was the fastest-expanding market in terms of percentage growth (+67.9%), followed by North America (24.8%) which benefited from the increase in Emirates’ capacity with bigger aircraft to Chicago, Dallas, Houston, and San Francisco, and the added daily flights to both New York and Seattle, Russia & the CIS (12.9%), and the Middle East (11.6%), spurred mainly by launch of services to new destinations and additional capacities on Emirates and flydubai among other carriers.  (ABME 29.09)

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3.2  Smashburger Announces Expansion into Egypt

Denver, Colorado’s Smashburger is smashing its way to Egypt.  The critically acclaimed fast-casual better burger restaurant with fresh, smashed to order burgers, is excited to announce that it has added the Pearll Investment Group as a new franchise partner in Egypt.  This is Smashburger’s initial entry into Egypt, with 25 restaurants expected to open over the next several years.  The launch of Smashburger in Egypt will expand the brand footprint to nine countries.  Currently owning more than 10 chain-restaurants in the region, Pearll Investment Group brings extensive restaurant management and operations experience to the table and will be funding the growth of the Smashburger operation in Egypt.  Smashburger restaurants in Egypt will be led by Mr. Abdel Hameed Mostafa Ahmed, who has 10 years of experience in the fast casual industry.  Smashburger will be Pearll Investment Group’s latest addition to the better burger landscape in the Egypt.

Smashburger is a leading fast casual “better burger” restaurant known for its fresh never frozen, 100% Certified Angus Beef burgers that are smashed on the grill to sear in the juices, creating an upscale quality burger packed with flavor and served at a great value.  (Smashburger 05.10)

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3.3  Egypt Has Largest Customer Base in the Arab Region’s Electronics Market

A report by PAYFORT considered Egypt the largest market for electronics trade in the Arab region in terms of the number of online buyers.  The number of Egyptian online buyers exceeded 15.2 million people, according to the company, while Saudi Arabia came in second place with 10.6 million online buyers, followed by Emirates with 6.8 million online buyers.  Lebanon came in fourth place with 2.6 million buyers, then Kuwait with 2.4 million buyers through the Internet, while Jordan took the last place with 1.6 million buyers.

According to the report, Egypt is the largest Arab country with access to the internet, where there are more than 40.7 million Internet users.  After that, Saudi Arabia comes in with 17.4 million users, then Emirates with 8.2 million users.  The report said that the three countries will lead the change in the e-commerce industry in the Arab world during the coming period.

As for the payment methods, 72% of the Egyptians who buy through Internet prefer to pay in cash and only 22% prefer to pay through credit cards, while 2% use CashU services, and 1% use PayPal services.  Meanwhile, the majority of the customers who buy online in Egypt are low-income people, where the clients with monthly income of less than $286 represent 21% of the total online buyers, while people with a monthly income of $286-799 represent 37% of Egyptians.  (PAYFORT September 2015)

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3.4  Tangier Renault Plant Aims to Produce 250,000 Vehicles in 2015

The Renault factory in Tangier, which produces Dacia vehicles, aims to produce 250,000 vehicles this year, an increase of 43% compared to 2014.  Renault has increased the number of vehicles produced   In 2014, the Tangier plant, the spearhead of Renault industrial system in Morocco, had manufactured more than 174,000 vehicles, a significant growth compared to 2013.  To cope with this increase, the Tangier plant recruited a thousand workers in early September who will support the second line of the plant.  The plant will now divide work in 3 shifts a day.

After the government decided to launch a renewal program for grand taxis in June of 2014 as part of measures aimed at the development of taxi transport services, Dacia, the first brand to have joined this effort, had already sold 113 Lodgy Taxis as of February 2015.  Now, 60% of the sales of the company are of the Lodgy Dacia model, purchased by taxi drivers.  Everything is on track to reach the optimum capacity of 340,000 units annually in 2017-2018.  (MWN 04.10)

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3.5  Austrian Group Eglo Africa to Open 10 Stores in Morocco by 2020

Morocco is becoming Africa’s “new regional hub” as hundreds of international companies have opened their doors in the Kingdom.  According to L’Economiste, the Austrian Group Eglo Africa, which launched in Morocco in 2008 is planning to open 10 more franchise stores in the country.  Eglo Africa already has 14 franchises in operation across Africa.  The Austrian giant’s office in Morocco has reportedly achieved great success and the company’s management wants to turn it into a regional office to service the African continent.  Eglo Africa will have its African Headquarters in the Kingdom, making Morocco a continental hub.  According to the report, the first franchise is scheduled to open in Casablanca in January 2016, followed by showrooms in Rabat, Marrakech, Agadir and Tangier.  Eglo’s main factory is in China with a production capacity of 37,000 items per day, servicing all franchises.  (L’Economiste 06.10)

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4.1  Major Wind Farm Being Built In Israel, First In 30 Years

For the first time in decades, Israeli is building wind turbines which will create electricity by harnessing the power of the wind.  Afcon Holdings, a part of the Shlomo Group, has started construction in recent days on two wind farms, which will house 25 wind turbines each in Ramat Sirin and Ma’ale Gilboa in northern Israel.  The turbines can produce 21 MW of electricity at any given moment and are set to become active next year.  Israel’s first wind farm was established 30 years ago, in the Golan Heights.  No turbines of the same scale have been built since.

Israel’s current electricity generating capacity is 13,000 MW, meaning that the electricity generated by the new wind farm won’t be a game changer, but the project is the first of its kind in decades, and surpassed some major hurdles.  The first hurdle was the difficult regulations that held the project up in recent years, in addition to different obstacles from Israel’s Electric Authority, as well as the IDF’s staunch opposition to projects of this kind.  In addition, there are very few sites in Israel with continuous and strong winds, as well as a general opposition from environmental groups, which fear the turbines may harm birds.  The raising of the first turbines mark the last step in a long process which included planning, purchasing the pieces and preparing the infrastructure at the sites.   (Ynetnews 20.09)

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5.1  Lebanese Tourism Reaches a 3-Year High by July

Lebanon’s tourism sector progressed by July 2015, to reach its highest level in 3 years.  According, to the Ministry of Tourism, the number of incomers by July 2015 reached 880,079, a 17.9% surge from 746,456 recorded in the same period last year.  The number of Arab tourists, constituting 30.82% of the total, displayed a yearly increase of 15.52%, to record 271,258 by July 2015.  As for Iraqi incomers, their share was the largest among Arab tourists at 37%, while increasing by an annual 14.23% to 101,371 over the same period.  It is worth mentioning that Iraqi tourists are actually refugees that are granted tourist visas.  The number of UAE and Saudi visitors registered the most distinct increases going from 3,753 to 5,094 and from 24,335 to 29,738, respectively.  The number of Kuwaitis also progressed by 20.42% annually to 15,496 by July 2015.

The number of European visitors took 33.55% of the total, augmented by 15.5% y-o-y, to reach 295,310.  French tourists held the largest share of European tourists at 27%, rising by a yearly 13.32% to 787,283.  The number of incomers from Turkey, the UK and Germany also saw respective improvements of 40.60%, 16.58% and 16.14% y-o-y to 12,387, 33,554 and 43,386 by July 2015.  American visitors accounted for the third major portion of the total at 17%, recording 160,943 in the first seven months of 2015, a 21% y-o-y increase from the same period last year.  (BlomInvest 01.10)

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5.2  Jordan’s GDP Grows by 2.4% in Second Quarter

Jordan’s GDP grew by 2.4% at fixed market prices in the second quarter of this year, compared to the same period of 2014, according to the Department of Statistics (DoS).  The official data said that most sectors recorded growth in the April-June period, with the extractive industries sector achieving the highest growth rate of 23%.  The private services sector came second in terms of highest growing sectors as it recorded a 6.3% expansion rate, followed by the water and electricity sector at 4.4%, the financial, insurance, real estate and business services sector (4.2%) and the transport, storage and telecommunications sector, which recorded 3.2%.  Amman and the IMF expects the Kingdom’s economy to grow by 3.5% this year, a figure seen by commentators as “difficult” to achieve in light of slow expansion recorded in the first two quarters of 2015.  The GDP grew by only 2% in the first three months of this year.  (JT 02.10)

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►►Arabian Gulf

5.3  GCC Railway Completion Date to be Reviewed

Officials overseeing the construction of the GCC rail network, which will connect all six GCC countries, will meet on 15 October to assess whether the project will have to be postponed or will indeed be completed by 2018 as scheduled.  The entire network when completed will span over 2,100 km and will provide an alternative means of travel around the peninsula.

The UAE is currently developing the Dh40 billion Etihad Rail project, which will eventually connect with the rest of the GCC railway.  The 1,200 km line, originally planned to be completed in 2018, will link major industrial zones, cities and ports in the UAE.  The UAE has already built 264 km of the 1,200 km network across the UAE, from the border of Oman to the Saudi border.  The UAE plans to build a comprehensive mass transport system, which will include the railway, to connect all cities in the country.  (GN 06.10)

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5.4  Gulf’s Asian Workers See Remittance Boom From Strong Dollar

The US dollar’s strength against Asian currencies is leading to a surge in remittances from migrant workers in the Arab Gulf region, exchange houses say, giving a boost to their home countries such as India, Philippines and Pakistan.  But lower oil prices are expected to gradually reduce demand for blue-collar workers, tempering growth in remittances next year.

With its huge population of expatriates, the Arabian Gulf is one of the most important sources of remittances as mainly lower-skilled workers send money home to families in Asia.  Expatriates in the Gulf sent home $93.4 billion in 2013, according to the World Bank, which rates Saudi Arabia and the United Arab Emirates among the top five migrant destination countries.  With most Gulf currencies pegged to the dollar, its rise in recent months has helped swell remittances as expatriates take advantage of the strong dollar.  Year-to-date, the dollar is up 4.84% against the Indian rupee, 3.75% against the Pakistani rupee, 2.65% against the Chinese yuan and 4.7% against the Philippine peso, according to Thomson Reuters data.

In Kerala, an Indian state with roughly two million expatriates in the Arabian Gulf, international remittances make up around a third of the state’s domestic product.  In the Philippines, global remittances make up some 10% of GDP.  (Reuters 28.09)

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5.5  Kuwait Rejects IMF Proposals to Introduce Tax on Public Services

Kuwait’s National Assembly has rejected proposals by the International Monetary Fund (IMF) to impose taxes and life subsidies on public services.  The IMF put forward the plans in order to reduce the state budget deficit, but the assembly’s financial and economic affairs committee refused to accept them, citing its opposition to measures which would come at the expense of Kuwaiti citizens.

Kuwait’s revenues have dropped since June 2014 due to a slump in oil prices, with the value of crude falling almost 60%.  Oil income contributes to about 94% of public revenues in Kuwait.  The IMF’s proposals were based on the projection that oil prices are not likely to rebound.

Kuwait is projecting a budget deficit of KD7 billion ($23.2 billion) in the current fiscal year – the first shortfall after 16 years of surpluses that have helped Kuwait accumulate foreign reserves worth $592 billion.  Government measures to have already addressed the economic situation include the lifting of subsidies on diesel, kerosene and aviation fuel. It is considering lifting or reducing subsidies on electricity and petrol.  (AB 21.09)

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5.6  Kuwait to Fingerprint Expats at Airport

The new policy by the Kuwaiti Ministry of the Interior will have all expats fingerprinted before flying out of the country.  The policy targets only foreign workers and not Kuwaiti citizens, diplomats or judges.  This move is one of around 30 new procedures issued to employees at Kuwait International Airport.  Staff was also instructed to make sure there are no travel bans issued on a traveler before stamping the passport or the boarding pass.  (AB 21.09)

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5.7  Qatar Commits to Invest $35 Billion in the US

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Qatar has committed to spend $35 billion in the United States over the next five years, continuing the Gulf Arab state’s diversification from investments traditionally focused on Europe.  Qatar’s acquisitive sovereign wealth fund, the Qatar Investment Authority (QIA), gave the figure on 28 September in an announcement of opening of an office in New York, which it said was a sign of its confidence in the United States and the wider Americas.  The QIA has about $334 billion of assets.  It is one of the most active sovereign investors in the world, snapping up assets from prime real estate such as the company that owns London’s Canary Wharf financial district, to stakes in blue chip companies including Total and Credit Suisse.  (Reuters 28.09)

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5.8  UAE GDP Set to Grow Over 3.5%

The UAE economy is on target to grow more than 3.5% to exceed Dh1.6 trillion in 2015 on the back of a vibrant non-oil sector, UAE Minister of Economy Sultan bin Saeed Al Mansouri said.  Despite the plunge in oil prices, the Arab world’s second-largest economy is able to maintain such steadfast growth rate because of its successful diversification policy that is increasingly reliant on non-oil sectors to propel expansion.  Currently, hydrocarbon revenues account for 25% of GDP and 20% of total export revenues.  Al Mansouri’s upbeat projection for the economy comes amid the IMF’s forecast that the UAE’s growth is expected to moderate amid lower oil prices.  The IMF said the country’s non-oil growth, which remained robust at 4.8% in 2014, would slow down to 3.4% in 2015 and would pick up steam from 2016 and post a 4.6% growth by 2020.

The UAE ranks second in the GCC and 17th in the world in terms of competitiveness, the World Economic Forum’s Global Competitiveness Report 2015-16, released recently.  With a population of approximately nine million and a GDP per capita of $43,875, the UAE has become a role-model for global economies in transition from oil-reliant to non-oil driven.  The gross official reserves of the UAE is projected to grow 8.9% to $83.7 billion in 2016 from $76.8 billion in 2015 and hit $118.4 billion in 2020 as the economy picks up gradual growth momentum over the next five years regardless of the oil price plunge, a forecast by the IMF shows.  (WAM 04.10)

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5.9  UAE Second-Biggest Supplier of Oil to Japan

The United Arab Emirates is the second-biggest supplier of crude oil to Japan, which remains a strategic trading partner of the UAE, says Sultan bin Saeed Al Mansouri, UAE Minister of Economy.  Roughly 24% of Japan’s crude oil imports come from the UAE, while Japan is the UAE’s sixth largest trading partner.  Over the past few years, the UAE’s exports to Japan started to include products other than oil such as aluminum and copper.  However, crude oil continues to account for about two-thirds of bilateral trade.  In 2014, the two-way UAE-Japan trade exchange amounted to $14 billion.  (AME 29.09)

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5.10  Nepal Lifts Ban on Housemaids Working in UAE

Nepal has lifted its yearlong ban on citizens working as housemaids in the UAE.  However, UAE residents must comply with new rules on recruitment of domestic help.  Nepal banned its citizens from moving to work abroad as housemaids last July following reports of exploitation and harassment.  Before the ban, only women aged over 30 were permitted to seek overseas employment as housemaids

Nepal has lifted the ban and reduced the age restriction from 30 to 20 , though UAE residents wishing to hire a Nepalese maid would have to recruit via an agency rather than by contacting the Nepalese embassy directly.  It is hoped this will reduce instances of abuse within the industry.  In recent years, housemaids were often recruited through illegal channels – receiving foreign visas to work as cleaners or in other roles and then later being roped in to work as live-in housemaids.  (AB 24.09)

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►►North Africa

5.11  Egypt & Morocco Economic Growth Stronger than Other MENA Countries in 2015

The World Bank announced on 5 October that the economies of Egypt and Morocco have grown stronger than those of other countries in the stagnating Middle East and North Africa (MENA) region in 2015.  The World Bank projected overall GDP growth for MENA in 2015 at about 2.8%, while “low oil prices, conflicts and the global economic slowdown make short-term prospects of recovery unlikely”.  Egypt’s growth could hover at about 4% in 2015 and 2016 as a result of reinforced security and ongoing reforms, said the World Bank.

The past year has seen an improving security situation, with a decline in the unrest witnessed following the 2011 ouster of long-time autocrat Hosni Mubarak and the later toppling of Islamist president Mohamed Morsi.  Since the election of President Abdel-Fattah El-Sisi in 2014, the Egyptian government has taken up politically sensitive reforms, including the raising of fuel prices and introducing new taxes.  The Egyptian government, keen to lure foreign investors, has also reformed investment legislation and seeks to cut red tape and facilitate the process of doing business.  The World Bank estimates Egypt would still need an extra $30–35 billion in investment and another $10 billion for developing its infrastructure in coming years.  However, the task of attracting foreign investments is challenging amid the global economic slowdown.  (WB 05.10

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5.12  Egypt’s President Announces Planned Shift to VAT Regime

Egyptian President Abdel-Fattah el-Sisi says his government is planning to move toward a value-added tax regime as part of a series of major economic reforms.  In an opinion piece published in The Wall Street Journal, he said the value-added tax regime, along with a simplified tax system for small and medium-sized enterprises, will “raise revenues and bolster investment incentives by boosting growth, creating jobs and improving firms’ cash flow.”  Egypt has launched mega-projects and taken tough measures, including slashing fuel subsidies and amending the property tax law, in a bid to revive the economy following the turmoil unleashed by the 2011 uprising.  El-Sisi says the government has been “willing to forge ahead with the long-overdue and contentious reforms that prior governments had known were necessary but did not carry out.”  (AP 28.09)

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5.13  IMF Says Egypt Has Not Requested Financing

The International Monetary Fund (IMF) is not in talks with Egypt about a new loan program, IMF Mission Chief for Egypt Chris Jarvis has said.  His comments came in an IMF-issued statement after a team led by Jarvis visited Cairo in September of this year to review economic developments since November 2014 when the IMF consulted on Egypt’s economy, after being requested to do so as part of their Article IV Consultation program.  The team discussed their economic policies for the remainder of the fiscal year with Egyptian officials.

“The Egyptian authorities succeeded in significantly reducing the underlying budget deficit despite a decline in foreign grants, thanks to a wide-ranging set of reforms including energy subsidy reforms, and progress in containing the wage bill and increasing tax revenues,” according to the IMF Mission Chief for Egypt.  “The government’s plan is designed to balance fiscal consolidation with increased spending on social programs and infrastructure investment”, said Jarvis.  However Jarvis noted that “the fiscal deficit is still large and domestic public debt high.”  Such declarations have caused some experts to predict that Egypt will re-enter discussions with the IMF for a loan.  (IMF 06.10)

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5.14  France & Egypt Agree on $1.06 Billion Warship Deal

France has agreed to sell two Mistral helicopter carriers to Egypt for €950 million ($1.06 billion) after their sale to Russia was canceled in August.  Unlike the deal with Moscow, this will not include any technology transfer.  As of yet there had been no talks on the potential armament for the carrier, which can hold up to 16 helicopters and 1,000 troops.

Cairo has sought to boost its military power in the face of a two-year insurgency based across the Suez Canal in the Sinai peninsula and fears the conflict in neighboring Libya could spill over. Egypt’s allies are also keen to burnish its image in a region beset by turmoil.  The deal with Egypt comes as France has nurtured new links with Sunni Arab states, which appreciate its tough stance on their Shi’ite rival Iran and similar positions on the region’s conflicts.  France has also benefited from what some Gulf countries perceive as disengagement from a traditional ally, the United States.  The Mistral is known as the “Swiss army knife” of the French navy for its versatility.  The sale will take the number of French naval vessels sold to Egypt to seven in just two years.  (Reuters 24.09)

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5.15  Egypt Plans New Mediterranean Gas Exploration Round In First Half 2016

Egypt is preparing to launch a new bidding round for gas exploration off the Mediterranean coast in the first half of 2016, the head of the state gas company EGAS told Reuters on 6 October.  His comments came after Egypt announced it had awarded four new licenses to explore for oil and gas off its Mediterranean coast, weeks after Eni’s giant Zohr gas find piqued fresh international interest in the area.  (Reuters

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5.16  Number of Tourists to Egypt Rose By 8.2% in 2015

 The number of tourists visiting Egypt rose by 8.2% in the first half of 2015 compared to the same period in 2014, according to CAPMAS.  In the period from January to June 2015, Egypt welcomed 4.8 million tourists, compared to 4.4 million tourists in the same period of the previous year.  Around 45.1% of visitors in 2014 came from Eastern Europe, mainly Russia at around 70.4%, while 31.6% were from Western Europe with UK tourists representing 29% of that number.  Some 13.6% of visitors were from the Middle East, with Saudi tourists representing the majority at 26.1%, with Africa ranking next with four% and Sudanese tourists being the majority at 46.8%.  Some 2.1% of visitors were from North America, with American tourists representing the majority at 74%.  Egypt’s tourism sector has seen a relative recovery in the last year after receiving a blow following regime changes in 2011 and again in 2013, seeing 9.9 million tourists in 2014, up from 9.5 million in 2013.  Tourism has traditionally been one of Egypt’s main sources of vital foreign currency.  (CAPMAS 19.09)

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5.17  Libya’s Oil Output Down to 300,000 bpd

Libya’s oil production has dropped to 300,000 barrels per day, according to a report from Reuters.  The senior state oil official with the recognized Libyan government said that output was reduced because of fighting between various armed factions and the closure of 50,000 km of oil pipeline.  The internationally recognized government in Tobruk has been trying to get oil companies to abandon contracts signed with the Tripoli-based National Oil Corporation (NOC), but companies are wary given that much of the state oil company’s infrastructure and contracts remain in the capital.  (Reuters 06.10)

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5.18  Casablanca, the World’s 44th Most Competitive Financial Center

British consulting firm Z/YEN has named Morocco’s economic hub Casablanca as the world 44th most competitive global financial center.  According to the Global Financial Centers Index (GFCI), Casablanca scored 657 points, ranking 44th among 84 international financial centers compiled by the consulting firm.  Casablanca has moved up by twelve points on this year’s list, up from 62 on the 2014 edition.  Morocco’s largest and most populous city is the second most competitive financial center in Africa behind South Africa’s Johannesburg.  London topped the list with 796 points, surpassing New York, which was number one last year.  Hong Kong, Singapore, Tokyo and Seoul were ranked third, fourth, fifth and sixth, respectively.  (MWN 26.09)

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5.19  Soaring Arms Budget Pushes Morocco for Defense Industry

Morocco reportedly wants to build a home-grown defense industry in a bid to meet its military needs and reduce soaring arms budget.  According to Lieutenant General Juan Manuel Garcia Montana, General Director of armament and equipment at the Spanish Army, Morocco plans to fulfill its defense requirements by establishing a local arms sector in collaboration with Spanish companies.  The Spanish military official said that Morocco officially requested the support of the Spanish military to establish a national military industry, with the assistance of Spanish defense firms.  This cooperation will primarily focus on the transfer of Spanish technology and military know-how to Morocco.  The support could also be in the form of cooperation agreements to carry out some of the programs it plans to launch.

The move confirms reports that Morocco has plans to establish a military industry to reduce the increasing cost of arms acquisitions from Western military powers.  According to Frost & Sullivan, Morocco is trying to develop an industrial base to bolster its local footprint and diminish reliance on foreign equipment.  Morocco’s military spending is expected to increase by 3.6% over the next decade due to rising regional threats.  (MWN 26.09)

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5.20  First MEBAA Morocco Hailed a Success

MEBAA Show Morocco, the first edition of a new dedicated business aviation show, was hailed a success by the Middle East and North Africa Business Aviation Association (MEBAA).  More than 2,033 visitors flocked to the two-day show (1-2 September) at Mohammed V airport, Casablanca in order to view displays from the leading players in the business aviation market.  The show had 57 exhibitors and featured names like GDC Technics, Boeing Business Jets and Bombardier/TAG, plus other international and local companies such as Gulfstream, AfricAir and Saudia Private Aviation.  MEBAA Show Morocco was organized by F&E Aerospace on behalf of MEBAA.  Amongst the attractions were the Bombardier Global 6000 and the Gulfstream G550 aircraft, both on static display.  The next edition of the show will take place in 2017.  (ABME 31.09)

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6.1  Turkish Sept Inflation Picks Up, Adding To Worries

Turkish annual inflation rose more than expected to near 8% in September, data showed on 5 October, reinforcing concerns about the economic outlook ahead of the 1 November election.  The data will likely place more pressure on the central bank to raise interest rates, although it is seen as unlikely to take action before the elections.  It left rates unchanged last month but analysts say it will have to hike eventually to curb inflation.  The consumer price index (CPI) rose 0.89% month-on-month in September, the Turkish Statistics Institute said.  It rose 7.95% year-on-year, sharply above a government target of 5%.

At the end of July the central bank raised its year-end inflation forecast to 6.9% but in the bank’s latest survey of business leaders’ expectations last month, the end-year forecast rose to 7.98%.  The data had little impact on the lira which had weakened to 2.9975 against the dollar from around 2.9900 last week.  It has lost around 22% of its value against the US currency this year but has recovered from a record low of 3.0750 on 24 September.

The September price rises were driven by food and non-alcoholic beverages, which rose 1.24%, along with the transportation and miscellaneous goods and services sectors which were both up 1.93%.  TUIK’s data also showed domestic producer prices rose 1.53% on the month, for an annual rise of 6.92%.  (TUIK 05.10)

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6.2  Turkey & Singapore Plan FTA Signing at Antalya Summit

Singapore and Turkey are expected to officially sign a free trade agreement (FTA) following two-year-long negotiations, during the 10th G20 summit that will be held in Antalya in November.  Turkish Economy Minister Zeybekci met Singaporean Trade and Industry Minister Hng Kiang in Istanbul on 6 October, announcing the completion of negotiations for an FTA that started in 2013.  Zeybekci noted Singapore was an important port for Turkish companies.  Singapore sits at the center of a 600 million-strong market, and the city-state thus holds an important place in today’s global economic and commercial exchanges.  The Turkish minister further said the FTA negotiations were conducted in order to include all sectors of the economy and that both Singapore and Turkey would benefit from each other’s geographical advantages.  The Singaporean minister told Singaporean companies Turkey is a gateway to Europe, Central Asia, North Africa and the Middle East.  He emphasized that the planned FTA will offer Turkish companies a door to the Southeast Asian region.  (Zaman 06.10)

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6.3  SEV Says Greek Economy is Showing Some Signs of Recovery

Three months after the shock that Alexis Tsipras’s previous government generated with the imposition of capital controls, the first positive signs of a return to stability have become discernible, according to the monthly bulletin issued by the Hellenic Federation of Enterprises (SEV).  September witnessed a halt in the downward spiral of the economic sentiment index, while the purchasing managers’ index (PMI) in manufacturing started to recover in August and September after nosediving in July, and the labor market showed signs of a return to normality within August, SEV notes.  However, opposition deputy and former alternate economy minister Christos Staikouras noted that the state has returned to primary deficits despite the government’s new austerity measures, while unemployment will this year come to 3% higher than anticipated last year for 2015.  (Ekathmerini 06.10)

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6.4  Greece’s Tsipras Says Reforms & Debt Relief Are Priorities

Greek Prime Minister Alexis Tsipras answers reporters’ questions at the end of a European Union leaders’ extraordinary summit on the migrants’ crisis, in Brussels, Belgium on 24 September, saying Greece needs to move swiftly to secure a positive review of its economic reforms by lenders in coming weeks and start discussions on debt relief.  The firebrand leftist cemented his position as Greece’s dominant political figure in recent national elections in which his Syriza party won 145 of 300 parliamentary seats.  But he faces a dauntingly long “to do” list that includes implementing the austerity mandated by Greece’s international creditors, negotiating debt relief and dealing with waves of migrants landing on Greek shores.

Greece’s €86 billion ($96 billion) bailout package, its third since 2010, is contingent on pension reform, ending tax breaks, labor reforms, and privatizations.  Of that amount, up to €25 billion has been set aside for shoring up the capital of banks, hobbled by deposit flight earlier this year and a mountain of non-performing loans, a consequence of a crippling six-year economic recession

Greece has also become the main point of entry into Europe for migrants fleeing war and poverty in the Middle East.  Hundreds are reaching its shores every day, most of whom then head by land across the Balkan peninsula to richer EU countries further north.  Generally sympathetic to the plight of migrants, Greece has highlighted discord among its EU partners on how best to deal with Europe’s worst humanitarian crises in decades.  (Various 24.09)

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6.5  No Progress Made On Greek Politicians’ Wealth Inspections Since 2014

A backlog of almost 40,000 derivation of wealth (or pothen esches in Greek) forms submitted by politicians, judges and other public officials has built up because of a change to the law last year, which Athens is considering addressing.  Until mid-2014, the anti-money laundering authority was responsible for investigating the forms and judging whether those submitting them had fully explained where their wealth came from.  However, at that point the New Democracy-PASOK coalition passed an amendment that passed authority for these checks to a special committee, which lacked the capacity to undertake this oversight task.  The same committee has also been assigned the task of probing politicians’ pothen esches forms dating back to 1974.  So the panel has not inspected any new forms since last year and some 38,000 declarations are currently thought to be outstanding.  (Ekathimerini 27.09)

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6.6  EU Parliament Backs Urgent Frontloading of €35 Billion for Greece

The European Parliament on 6 October backed a set of one-off measures aimed at boosting the effective spending of €35 billion earmarked for Greece in the EU 2014-2020 budget.  This includes €20 billion from structural and investment funds and €15 billion from agricultural funds.  MEPs followed the recommendation of Parliament’s regional development committee and adopted the Commission’s proposal by a vote of 586 to 87, with 21 abstentions.  This fast-track procedure paves the way for the swift adoption of the measures by the Council and their immediate implementation.  The measures are aimed at helping Greece ensure that all the money available from the 2007-2013 programing period is used before its expiry at the end of 2017 and to meet the requirements for accessing all the EU funds available to it in the current programing period of 2014-2020.

The funding covers programing periods up to 2020.  The amendment to the current regulation proposed by the Commission and agreed by Parliament allows some €500 million to be released as soon as the legislation is adopted and a further €800 million released in advance of the formal closure of the programs in 2017.  Two specific measures will allow Greece to finish projects started under the 2007-2013 period by removing the need for national co-financing because the EU contribution rate is raised to 100% and making available the total amount, including pre-financing and interim payments, immediately (otherwise the last 5% of EU payments would have had to be held back until 2017).  (Ekathimerini 06.10)

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6.7  Greece to Set Single Tax Rates for All?

Greek Finance Minister Euclid Tsakalotos and his alternate minister, Giorgos Houliarakis signaled on 23 September the abolition of tax exemptions that do not benefit those on low incomes, as well as radical changes to income tax rates for salary workers, pensioners and property owners.  Sources say that one of the scenarios under examination concerns the creation of a single set of tax rates for incomes from salaries, pensions, securities and real estate.  The plan is for the creation of a tax-free threshold for a small portion of taxpayers, probably those earning up to €9,000 or €12,000 annually, as the threshold has not yet been decided.  Those on a slightly higher income will have to pay a low rate of tax from the first euro, possibly meaning people earning medium incomes will have to pay about the same amount of tax as they do today.

The same sources note that the self-employed and farmers will continue to be taxed according to a different set of rates than other taxpayers, although talks with the creditors’ technical experts are still ongoing.

Another scenario provides for taxing all sources of income according to the same set of rates, which would see the rates applying to incomes from farming and rentals rising further. In any case, the solidarity tax will be incorporated into the tax rates, while today it is separate.

The ministry intends to do away with most existing tax exemptions to create a simpler tax system and to offer direct benefits to taxpayers in need.  There are 700 tax exemptions which apply today, costing the state budget about €3.6 billion per year, including the various value-added tax exemptions that are gradually being abolished.  (Ekathimerini 23.09)

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7.1  Bon Jovi Helps Israelis ‘Keep the Faith’ with Tel Aviv Concert

The tens of thousands of Bon Jovi fans gathered in Tel Aviv’s Yarkon Park on 3 October for Bon Jovi’s first-ever in Israel concert.  The veteran band regaled an enthralled audience with hits old and new.  Band members though in their 50s seemed to have boundless energy.  Front man Jon Bon Jovi constantly flashed a trademark megawatt smile that has kept him a heartthrob for decades, as he ran around the stage, gyrating and waving his arms, and not tiring for a second during the two-hour set on a humid night.  The crowd spanned generations, all jumping, waving their hands and singing every single word to “Runaway,” “Bad Medicine,” “Have A Nice Day” and more.  The band came to Israel despite pressure from anti-Israel provocateurs.  Bon Jovi energized the crowd by dedicating two empowering songs to Israel, saying he would return whenever he or his fans wanted!

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7.2  Hijri New Year May Begin on 15 October

This year the Hijri New Year, also known as Islamic New Year, will fall on perhaps 14 or 15 October.  It is the day that marks the beginning of a new Islamic calendar year.  The first day of the year is observed on the first day of Muharram, the first month in the Islamic calendar.  The first Islamic year began in 622 AD during which Muhammad fled from Mecca to Medina, known as the Hijra.  While some Islamic countries prefer determining the new month (and hence the new year) by local sightings of the moon, other Islamic countries, including Saudi Arabia, follow astronomical calculations to determine future dates of the Islamic calendar.  In Egypt, the Hijri New Year is planned for 13 or 14 October.

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7.3  Lebanese Activists Take to the Streets Amid National Dialogue

Lebanese civil society activists have rallied against the arrest of a top #YouStink organizer as Lebanon’s leaders met once again for a national dialogue session aimed at breaking the political impasse gripping the country.  On 6 October, a few dozen protesters blocked the road leading to Beirut’s Hamra district following the arrest of Assaad Thebian, one of the top organizers in the #YouStink grassroots movement protesting the government’s handling of Lebanon’s worsening garbage crisis as well as systemic corruption.  #YouStink decried the “kidnapping” of Thebian—in reference to his detention—which came after the activists held an impromptu march from a Finance Ministry annex building in central Beirut toward the Central Bank, where they called for funds to be released to municipalities to handle waste management.  The protesters reopened the road after half an hour and then marched toward the nearby Interior Ministry to rally against Thebian’s arrest, while the Internal Security Forces announced the activist had been detained for “defiling the Lebanese flag.”

These and other protests, the latest to rock Beirut, came as Lebanon’s leaders met for the fourth session of a national dialogue session in the Parliament in Downtown Beirut.  Amid a heavy security presence, leaders of all the country’s parties, except the Lebanese Forces, gathered in yet another attempt to hammer out a political understanding to elect a new president – a post vacant since Michel Suleiman’s term ended in May 2014 – and find a mechanism to get Lebanon’s paralyzed cabinet to meet effectively again.

The cabinet last met on September 9 to agree on a waste management plan after trash built up on the streets of Beirut and surrounding areas of Mount Lebanon following the closure of the Naameh landfill on 17 July.  The government’s failure to initially address the trash crisis in the mid-summer sparked a growing protest movement that has seen civil society groups call for the resignation of Interior Minister Machnouk after security forces responded to a series of gatherings in a heavy-handed manner.  Protesters last held a mass-rally in Downtown Beirut on 25 September, while Lebanon’s government has yet to enact its own trash plan.  (NOW 07.10)

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7.4  Egypt to Include New Suez Canal Logo on the Half Pound Coin

Egypt is in the process of issuing new half-pound coins with the logo of the new Suez Canal on them, according to the Finance Ministry.  In August, Egypt inaugurated the expansion of the Suez Canal to include a new waterway parallel to the historic one as part of the government’s plans to revive the economy through megaprojects and foreign investment.  As part of the celebrations, the finance ministry issued gold coins with the logo of the new Suez Canal with various weights which have sold to the value of LE8 million ($1 million) thus far.  (Ahram Online 01.10)

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8.1  Rosetta Genomics Receives U.S. Patent for Treatment of Prostate Cancer

Rosetta Genomics received a Notice of Allowance from the United States Patent and Trademark Office (USPTO) for U.S. Patent Application No. 14/446,505, titled “Compositions and Methods for the Prognosis and Treatment of Prostate Cancer.”  The patent claims the treatment of prostate cancer through the administration of anti-hsa-miR-210 or a sequence having 80% identity thereto, as well as a method for inhibiting the growth or viability of prostate cancer cells using anti-hsa-miR-210 or a sequence having 80% identity thereto.

In June 2014, the Company announced receipt of a separate Notice of Allowance from the USPTO for U.S. Patent Application No. 13/390,995, entitled ”Compositions and Methods for Prognosis and Treatment of Prostate Cancer,” which claims cover the expression of miR-205 as an indicator of good prognosis and relates to methods and kits for prognosis of prostate cancer.

Rehovot’s Rosetta develops and commercializes a broad range of microRNA-based and other high-value molecular diagnostics. Rosetta’s integrative research platform combining bioinformatics and state-of-the-art laboratory processes has led to the discovery of hundreds of biologically validated novel human microRNAs.  Building on its strong patent position and proprietary platform technologies, Rosetta is working on the application of these technologies in the development and commercialization of a full range of microRNA-based diagnostic tools.  Through the acquisition of PersonalizeDx, the Company also offers core FISH, IHC and PCR-based testing capabilities and partnerships in oncology and urology that provide additional content and platforms that complement the Rosetta offerings.  (Rosetta 22.09)

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8.2  ETView and Anderson Cancer Center Start Clinical Evaluation of VivaSight-DL

ETView Medical announced initiation of a prospective, randomized clinical evaluation on the use of VivaSight-DL to achieve One Lung Ventilation (OLV) at The University of Texas MD Anderson Cancer Center (Houston, TX).  The objectives of the clinical trial, titled, “Prospective Randomized Study on Video Double-Lumen Tube versus Double-Lumen Tube,” include assessment of time to achieve OLV, improvements in clinical workflow and economic impact of utilizing VivaSight-DL vs. standard double-lumen endotracheal tubes in the establishment and management of OLV during surgical cases where OLV is required.  Final clinical results are not expected for several quarters.

Misgav’s ETView Medical has successfully combined airway management with continuous direct airway visualization for One Lung Ventilation (OLV).  OLV is employed to provide one-lung ventilation in patients undergoing thoracic, cardiac, vascular, or esophageal surgeries.5 ETView’s VivaSight airway management portfolio combines single-use disposable single and double lumen ventilation tubes with integrated continuous high resolution airway imaging.  VivaSight-SL and VivaSight-DL are sold worldwide to overcome current limitations and associated adverse surgical events during OLV surgeries.  (ETView Medical 21.09)

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8.3  Brainsway Helps the US Navy Treat Depression

The US Navy will start using an Israeli product as part of a comprehensive treatment approach to depression at some of its healthcare centers for service people and their families.  Brainsway’s deep TMS (transcranial magnetic stimulation) helmets use magnetic pulse energy similar to MRI to stimulate deep structures of the brain and regulate their electrical activity.  The helmets are used in several countries for noninvasive, painless treatment of major depressive disorder, addictions and a wide range of other neurological, psychiatric and medical conditions.

Since receiving US FDA approval in 2013 for the treatment of depression in patients who have failed to respond to antidepressant medications, the Brainsway device has been installed in many therapeutic settings in the United States, Australia and Sweden, among other countries.

Jerusalem’s Brainsway is dedicated to developing and providing advanced technology solutions for the treatment of a variety of brain disorders.  Brainsway’s Transcranial Magnetic Stimulation technology is based on patents filed by the U.S. National Institutes of Health (NIH), and by the company.  The company holds an exclusive license from the NIH for the patent and for Deep TMS technology.  Brainsway runs clinical research programs with leading scientists worldwide, collaborating with prominent institutions and researchers in clinical trials covering various neuropsychiatric and neuroscience applications.   (Various 01.10)

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8.4  SmartZyme to Present at Ladenburg Thalmann 2015 Healthcare Conference

SmartZyme announced that management made a corporate presentation at the Ladenburg Thalmann 2015 Healthcare Conference in New York City.  Doug Kohrs, chairman, Shilo Ben Zeev, chief executive officer and David Baram, Ph.D, president and chief technology discussed the Company’s progress with its fast-acting coagulation factor for blood clotting and its progress with licensing its innovative enzyme and device for diabetic blood glucose monitoring.

Ness Tziona’s SmartZyme Innovation is a life science company using PROVOLUTION, a proprietary technological platform for protein design and engineering, in accordance with industry required specifications.  The company aims to efficiently design and create proteins and potent enzymes with the specific characteristics required for optimal performance. Its products will be used to revolutionize industries by addressing unmet needs of various industrial fields.  The company’s PROVOLUTION technology combines some of the most advanced scientific tools for protein engineering, computational biology and electrochemistry.  These tools enable the development of improved, or “superior”, proteins and enzymes for wide ranging applications.  (SmartZyme 25.09)

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8.5  Teva Acquires Gecko Health Innovations

Teva Pharmaceutical Industries and Massachusetts’ Gecko Health Innovations, a privately-held company focused on developing software and product solutions to aid in compliance and adherence improvement in the management of respiratory diseases, announced that they have entered into a definitive agreement in which Teva will acquire Gecko Health Innovations.  Through the agreement, Teva will acquire CareTRx, a novel cloud-based solution developed by Gecko Health Innovations, designed to simplify chronic respiratory disease management, connecting patients and caregivers through remote monitoring and real-time adherence tools.  Together with Gecko Health Innovations, Teva will explore innovative ways to apply the CareTRx technology to its robust pipeline and portfolio of respiratory products with the goal of enhancing clinical outcomes for patients.  CareTRx is a solution comprised of a hardware device which attaches to most metered-dose inhalers (MDIs) as well as a software program which synchronizes and stores data through an app-based user interface.

Teva Pharmaceutical Industries is a leading global pharmaceutical company that delivers high-quality, patient-centric healthcare solutions to millions of patients every day.  Headquartered in Israel, Teva is the world’s largest generic medicines producer, leveraging its portfolio of more than 1,000 molecules to produce a wide range of generic products in nearly every therapeutic area.  (Teva 25.09)

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8.6  ElastiMed Off to a Strong Start with $1 Million Investment

Misgav’s ElastiMed, a portfolio company of Trendlines Medical, announced that it raised $1 million, which includes an investment from Pix Vine Capital, a Singapore-based investment house.

ElastiMed is developing an effective wearable device using smart materials to treat Chronic Venous Insufficiency (CVI) and to prevent Deep Venous Thrombosis (DVT).  CVI is a condition that affects 40% of the adults in the United States, whereby the veins cannot pump enough blood back to the heart, causing blood to “pool” or collect in the veins.  Symptoms include pain, swelling, ulcers, lymphedema, varicose veins, and spider veins. DVT, one of the most common causes of CVI, is responsible for 600,000 hospitalizations per year in the U.S. and is one of the leading causes for preventable deaths.

Wearing compression stockings is a proven and effective treatment that works by exerting pressure on the lower limbs.  The stocking reduces the diameter of distended veins and causes an increase in venous blood flow velocity and valve effectiveness.  However, current compression therapy devices are inconvenient and difficult to apply, causing patients’ non-compliance to reach 60%.  ElastiMed utilizes innovative, smart material technology in the development of an easy-to-wear stocking, which is expected to significantly improve patient compliance.  (ElastiMed 25.09)

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8.7  Eye-D Technology Featured at Partnership Opportunities in Drug Delivery Conference

BioLight Life Sciences Investments announced that its Eye-D platform insert was presented at the 5th Annual Partnership Opportunities in Drug Delivery conference in Boston.  The Eye-D is BioLight’s platform insert for controlled release ophthalmic medications.  The Eye-D is designed to address the known poor compliance of eye drops administration.  The first Eye-D indication, the VS-101, contains the market leading glaucoma drug, latanoprost.  Utilizing a simple in-office procedure, the VS-101 is intended to release prostaglandin analog (PGA) drug in a controlled manner over time, providing 100% patient compliance to drug therapy.

Tel Aviv’s BioLight invests in, manages and commercializes biomedical innovations grouped around defined medical conditions – ophthalmology and cancer diagnostics.  The ophthalmic technologies include IOPtiMate, a laser-based non-invasive surgical treatment for glaucoma; TeaRx, a point-of-care multi-parameter diagnostic test for dry eye syndrome; Eye-D, a subconjunctival platform insert for controlled release of eye drops for the improvement of ocular molecule transmission; and OphRx, a drug delivery technology platform for ocular uses.  The cancer diagnostic technologies include proprietary tests that are designated for bladder, cervical, multiple myeloma and other cancers.  (BioLight 24.09)

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8.8  Teva Announces Approval of COPAXONE in Japan for the Prevention of Relapse of MS

Teva Pharmaceutical Industries announced the approval by the Japanese Ministry of Health, Labour and Welfare (MHLW) of once-daily COPAXONE (glatiramer acetate injection) 20mg injection for the prevention of relapse of multiple sclerosis.  The product will be commercialized in Japan by Takeda Pharmaceutical Company Limited (Takeda).  In Japan, glatiramer acetate was developed as an Unapproved New Drug by Teva Pharmaceutical K.K., a wholly owned subsidiary of Teva, at the request of the MHLW.  In March, 2013, Takeda and Teva signed an agreement in which Teva granted Takeda the right to commercialize COPAXONE in Japan.  The Japanese approval for COPAXONE is based on the safety and efficacy results of an open-label, 52-week clinical trial conducted by Teva Pharmaceutical K.K. in patients with relapsing-remitting multiple sclerosis in Japan as well as the pivotal trial data sets used for approvals in other countries.

Teva Pharmaceutical Industries is a leading global pharmaceutical company that delivers high-quality, patient-centric healthcare solutions to millions of patients every day.  Headquartered in Israel, Teva is the world’s largest generic medicines producer, leveraging its portfolio of more than 1,000 molecules to produce a wide range of generic products in nearly every therapeutic area.  In specialty medicines, Teva has a world-leading position in innovative treatments for disorders of the central nervous system, including pain, as well as a strong portfolio of respiratory products.  (Teva 28.09)

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8.9  Cell Cure Receives Fast-Track Designation for Macular Degeneration Treatment

BioTime and its subsidiary Cell Cure Neurosciences announced that the U.S. FDA has granted Fast Track designation for OpRegen, a cell-based therapeutic product consisting of retinal pigment epithelial (RPE) cells designed to block the progression of the severe dry-form of age-related macular degeneration (AMD), a leading cause of blindness in an aging population.  Under an Investigational New Drug Application (IND) for “Retinal Pigment Epithelium (RPE) Cells derived from Allogenic Human Embryonic Stem Cells; Transplanted Subretinally” and after receiving approval from the Israel Ministry of Health, Cell Cure is now enrolling patients at Hadassah University Medical Center in Jerusalem, Israel, in a clinical Phase I/IIa dose-escalation study evaluating the safety and efficacy of OpRegen for geographic atrophy (GA), the severe stage of the dry form of age-related macular degeneration (dry-AMD).  The first patient was treated earlier this year and Cell Cure expects to provide interim data in early 2016.

Cell Cure Neurosciences was established in 2005 as a subsidiary of ES Cell International Pte. (ESI), now a subsidiary of BioTime.  Cell Cure is located in Jerusalem, Israel on the campus of Hadassah University Hospital.  Cell Cure’s mission is to become a leading supplier of human embryonic stem cell-based therapies for the treatment of retinal and neural degenerative diseases.  Its technology platform is based on the manufacture of diverse cell products sourced from clinical-grade (GMP) human embryonic stem cells. Its current focus is the development of retinal pigment epithelial (RPE) cells for the treatment of age-related macular degeneration.  (Cell Cure 28.09)

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8.10  MediWound Awarded BARDA Contract for NexoBrid for the U.S.

MediWound announced that the U.S. Biomedical Advanced Research and Development Authority (BARDA) has awarded the company a contract valued at up to $112 million.  The contract is for the advancement of the development and manufacturing, as well as the procurement of NexoBrid, the Company’s proprietary pharmaceutical product for enzymatic removal of eschar in adults with deep-partial and full-thickness thermal burns, as a medical countermeasure as part of BARDA preparedness for mass casualty events.  The 5 year base contract includes $24 million of funding to support development activities to complete the U.S. FDA approval process for NexoBrid for use in thermal burn injuries, as well as $16 million for procurement of NexoBrid, which is contingent upon FDA Emergency Use Authorization (EUA) and/or FDA marketing authorization for NexoBrid.  In addition, the contract includes options for further funding of up to $22 million for expanding NexoBrid’s indications and of up to $50 million for additional procurement of NexoBrid.

NexoBrid represents a new paradigm in burn care management having demonstrated in clinical studies, with statistical significance, its ability to non-surgically and rapidly remove in a single, four-hour application the dead or the damaged tissue (eschar) earlier than other modalities, without harming viable tissue.  In clinical studies NexoBrid has demonstrated a significant reduction in surgical burden with long-term outcomes that are comparable to the current surgical treatment.  NexoBrid was granted marketing authorization from the European Medicines Agency and the Israeli Ministry of Health for the removal of eschar in adults with deep partial and full-thickness thermal burns, and has been launched in Europe and Israel.  MediWound is currently conducting a Phase 3 clinical study with NexoBrid in the U.S. for the removal of eschar in adults with deep-partial and full-thickness thermal burns.

Yavneh’s MediWound is a fully integrated biopharmaceutical company focused on developing, manufacturing and commercializing novel therapeutics based on its patented proteolytic enzyme technology to address unmet needs in the fields of severe burns, as well as chronic and other hard-to-heal wounds.  MediWound’s first innovative biopharmaceutical product, NexoBrid, received marketing authorization from the European Medicines Agency and from the Israeli Ministry of Health for removal of dead or damaged tissue, known as eschar, in adults with deep partial- and full-thickness thermal burns.  NexoBrid represents a new paradigm in burn care management, and clinical trials have demonstrated, with statistical significance, its ability to non-surgically and rapidly remove the eschar earlier and, without harming viable tissues.  (MediWound 30.09)

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8.11  Teva Acquires Rimsa, a Leading Mexican Pharmaceutical Company

Teva Pharmaceutical Industries has entered into definitive agreements under which the Company will acquire Representaciones e Investigaciones Medicas, S.A. de C.V. (Rimsa), a leading pharmaceutical manufacturing and distribution company in Mexico, along with a portfolio of products and companies, intellectual property, assets and pharmaceutical patents in Latin America and Europe in a debt-free, cash free set of transactions, for an aggregate of $2.3 billion.  Through this acquisition, Teva will become a leading pharmaceutical company in Mexico, the second largest market in Latin America and one of the top five emerging markets globally.  Teva expects the deal will yield substantial and achievable synergies and offer a platform for growth in the region.

Rimsa had revenue in 2014 of $227 million with an annual growth, year over year of 10.6% since 2011. The company has an extensive portfolio of specialty products, including fixed-dose combination products which have fueled its growth.  Rimsa’s well-established sales footprint is expected to provide a platform for additional Teva products.

Teva Pharmaceutical Industries is a leading global pharmaceutical company that delivers high-quality, patient-centric healthcare solutions to millions of patients every day.  Headquartered in Israel, Teva is the world’s largest generic medicines producer, leveraging its portfolio of more than 1,000 molecules to produce a wide range of generic products in nearly every therapeutic area.  In specialty medicines, Teva has a world-leading position in innovative treatments for disorders of the central nervous system, including pain, as well as a strong portfolio of respiratory products.  (Teva 01.10)

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8.12  MValve Implants First Human Catheter Based Mitral Valve Replacement System

MValve Technologies announced the first human implantation of its catheter based trans apical mitral valve replacement system.  The procedure was completed successfully at the University Clinic in Bonn, Germany.  The procedure was performed on a 72 year-old male with longstanding history of valve disease.  The patient underwent surgical aortic valve replacement several years ago and recently his diseased mitral valve began to fail with worsening regurgitation in the setting of severe mitral annular calcification.  Given this patient’s general cardiac status, unfavorable mitral valve anatomy, and overall frailty, he was deemed inoperable by the local heart team.

The MValve trans catheter docking device in combination with the Lotus trans catheter heart valve were implanted successfully.  Post-operative imaging confirmed the valve was positioned perfectly and functioning well with no residual regurgitation.

Herzliya’s MValve is a privately held company founded in 2011, with lead investment from Boston Scientific Corporation.  MValve is dedicated to the development of novel and minimally invasive technologies for trans catheter valve replacement.  (Mvalve Technologies 05.10)

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9.1  Healthcare Organizations Select Mellanox InfiniBand-Based Cloud

Mellanox Technologies announced that the HPC4Health Consortium, led by The Hospital for Sick Children (SickKids) and the University Health Network’s Princess Margaret Cancer Centre, has selected its InfiniBand networking solutions to improve patient care and help researchers to optimize treatment with the ultimate goal of finding a cure for cancer.  The end-to-end FDR 56Gb/s InfiniBand networking solution was adopted as the foundation of the center’s cancer and genomics program, to accelerate the sharing, processing and analysis of data generated from radiology imaging, medical imaging analysis, protein folding, x-ray diffraction in order to improve patient care and expedite cancer research.  HPC4Health has deployed Mellanox CloudX to connect the individual clouds hosted by SickKids and the Princess Margaret Cancer Centre to consolidate resources, minimize maintenance and operational costs, and improve the utilization of computational resources.  Mellanox’s end-to-end FDR 56Gb/s InfiniBand solution provides high-bandwidth and a low-latency processing framework needed for the internal data network to link with the two private clouds.

Yokneam’s Mellanox Technologies is a leading supplier of end-to-end InfiniBand and Ethernet interconnect solutions and services for servers and storage.  Mellanox interconnect solutions increase data center efficiency by providing the highest throughput and lowest latency, delivering data faster to applications and unlocking system performance capability.  Mellanox offers a choice of fast interconnect products: adapters, switches, software, cables and silicon that accelerate application runtime and maximize business results for a wide range of markets including high-performance computing, enterprise data centers, Web 2.0, cloud, storage and financial services.  (Mellanox Technologies 21.09)

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9.2  Indian Property Firm Selects CYREN WebSecurity to Protect Mobile Users

CYREN announced that Splendor Landbase Limited, one of India’s leading residential and commercial property developers, recently joined the growing list of organizations to select CYREN WebSecurity for protection against the latest Internet threats.  As a multi-discipline firm excelling in engineering, consultancy, information technology, real estate development and property management services, Splendor needs to protect its mobile workforce as well as its devices and data, regardless of device type or location.  Without the need for hardware or software, the CYREN WebSecurity solution was quickly deployed and now provides Splendor with consistently powerful protection against the latest malware.  Additionally, CYREN WebSecurity delivers highly accurate Web filtering that blocks connections to phishing and other malicious sites, preventing infections, login compromises, and loss of business-critical data.  New Delhi-based Houston Technologies Limited, a system integrator and provider of networking, data security, access control and IT infrastructure management services, is the local CYREN partner for Splendor’s deployment, covering hundreds of mobile users.

Founded in 1991, Herzliya’s CYREN is a long-time innovator in cybersecurity.  Through full-function Security as a Service and embedded deployment options, CYREN provides web, email, mobile and endpoint security solutions that are relied upon by the world’s largest IT companies to protect against today’s advanced threats.  CYREN collects threat data and delivers real-time cyber intelligence through a unique global network of over 500,000 points of presence that processes 17 billion daily transactions and protects 600 million users.  (CYREN 29.09)

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9.3 Secures $8 Million & Launches Innovative Analytics Cloud Service

Tel Aviv’s, the Predictive ELK (Elasticsearch, Logstash and Kibana) log analytics cloud service company, formally launched with an announcement of $8 million in financing led by 83North (formerly Greylock IL) and Giza Venture Capital.  The company will use the funding to fuel additional product development and build sales, marketing, and support teams. offers an open source based alternative to the plethora of existing competitors whose products are based on proprietary technologies.  Incumbents in the market include solutions such as Splunk, Sumo Logic, and dozens of others.  In contrast, the platform takes the open source ELK, a stack extensively used by companies such as Google, Facebook, Netflix and many others, and offers it as a full-featured, enterprise-grade log analytics cloud service, coupled with advanced machine-learning techniques.  The company has already experienced pre-launch success with hundreds of companies worldwide onboarding the platform over the last few months.  Existing users include: Playbuzz, Asurion/Soluto, BigPanda, Mirakl and Applicaster, among others.  ( 05.10)

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9.4  Poprush Innovative Advertising Celebrates Record Breaking Beginning

Israel’s Poprush, the innovative pop-under advertising network, designed to maximize performance, is excited to announce a record-breaking first three months.  With an astonishing influx of 20,000 publishing partners and 1,200 advertisers utilizing its services, the company has launched to already notable acclaim.  Introduced earlier this year, Poprush aims to provide its publishing partners with high quality advertisements to reach target audiences worldwide.  Offering a unique ad code that bypasses adblock, and guarantees safe, reliable and quality advertising, Poprush has perfected sophisticated targeting methods, paired with local and global reach, to deliver an unsurpassed quantity of leads and sales for advertisers.  Even in a difficult economic climate, clients have seen sales spike to up to an unusual but impressive 18% in two months.

From its inception, Poprush has worked to meet that challenge, and secure the satisfaction of publishers and advertisers across the digital market. Website membership continues to accrue no registration cost, a huge incentive for advertisers eager to unfold their advertising campaigns at premium publishing companies.  Poprush’s new script results in typically greater returns for website owners compared to competitors, facilitating their growth, as well as that of the company and generating a surge in publishers on the network.  (Poprush 06.10)

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9.5  Hinduja Group’s HITS Installs Actus Broadcast Monitoring Platform

NXT DIGITAL, the Headend-in-the-Sky (HITS) digital service platform from Grant Investrade Limited, part of the global Hinduja Group, has installed the Actus broadcast monitoring platform.  The recently launched HITS platform offers over 500 channels to the fast-growing television market in India.  By implementing the latest version of Actus’s broadcast monitoring platform, NXT is being guaranteed that all IP-based channels are reliably recorded 24×7 and that whenever more channels are added; Actus’s scalable broadcast recording platform will be easily expanded.  In order to comply with the current requirements, Actus has deployed Actus View to record and monitor the 350 IP-based channels, Actus Multitrak to support multiple audio tracks, Actus EncoderPro to save hardware resources, Actus Loudness to monitor audio levels and Actus AlertCenter to provide NXT with real-time alerts for any audio or video issues.

Israel’s Actus Digital delivers an industry-leading intelligent broadcast monitoring platform for video recording, tagging, monitoring, analysis and content repurposing for OTT, catch-up TV, VOD or mobile platforms.  Actus’s easy-to-use web-based solutions are answering the broadcast media management needs of broadcasters and government agencies; cable, satellite and IPTV providers; and advertising, media agencies and content producers around the world.  Actus’s solutions enable media monitoring, ad detection for ad verification and rating analysis, legal compliance and extensive automated exporting tools for content repurposing and rebroadcasting linear broadcasts to the internet and mobile phones.  (Actus 06.10)

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10.1  Israel’s Unemployment Remains Unchanged at 5.3%

Israel’s unemployment remained unchanged at 5.3% in August, the Central Bureau of Statistics announced.  Employment among those aged 15 and over reached 3,878,000 in August, with 3,674,000 employed and 204,000 unemployed. 1,946,000 of the employed were men, compared with 1,940,000 in July, and 1,728,000 were women, compared with 1,693,000 in July.  Participation in the labor force among those aged 15 and over reached 64.5% in August, compared with 63.9% in July.  The participation rate among men fell marginally from 69.7% in July to 69.6% in August, while the participation rate among women rose from 58.5% in July to 59.5% in August.

The Central Bureau of Statistics data also showed that the rate of participation in the labor force among those aged 25-64 rose from 79.7% in July to 80.3% in August.  The rate of participation among men in this age bracket dropped from 85.3% in July to 85.0% in August, while the rate of participation among women rose from 74.3% in July to 75.8% in August.  (CBS 24.09)

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11.1  LEBANON:  Standstill Persists in Lebanon

On 21 September, Jean Aziz posted in Al Monitor that facing international pressure to elect a new president for Lebanon, some political parties in Beirut are suspicious of what they call a dubious request.

Lebanon has been without a president for over a year now, and the current international pressure to hold elections is not going over well with the country’s term-extending parliament.

These political parties are requesting, first and foremost, that parliamentary elections be held.  They seem assured of their stance from a legal and constitutional standpoint.  They also seem certain that the confrontation between their own demands and the international ones to elect a president will end up favoring their side and Lebanon will resist caving to international pressure.

A parliamentary official in the Change and Reform Bloc, the largest Christian parliamentary bloc in the Lebanese parliament, explained the details of the situation to Al-Monitor on condition of anonymity: “First is the demand to give priority to the parliamentary rather than presidential elections, right?  In Lebanon, the president is elected indirectly.  The Lebanese people do not elect the president directly, rather through parliamentary elections.  They elect the parliament, which in turn elects the president.  Therefore, the parliament is empowered by the people.”

The source continued, “Under the current circumstances, there is a huge legal imbalance in this equation.…  The legal mandate of the current parliament expired more than two years ago, specifically since June 20, 2013.  The parliament did not continue its duties in this abnormal situation because the Lebanese people re-elected it, but rather because most of these parliament members decided to extend their own term for four full years under the pretext that the security situation in the country does not allow holding new parliamentary elections.  This is how the public legitimacy of the current parliament was challenged.  Moreover, the presidential vacuum happened after the end of the parliament’s term.  When the Lebanese people elected the current parliamentarians, they were not tasked with electing a president.  Their public and representative mandate did not allow them to elect a president, as their parliamentary term was supposed to end on June 20, 2013.  The election of a new president was scheduled to take place on March or May 25, 2014, according to the constitution.  Therefore, parliamentary elections should precede presidential elections and as per democratic logic, parliament members whose term has ended shouldn’t be voting for a president.  The priority is to hold parliamentary elections that renew the Lebanese parliament and grant its new members legitimate constitutional power to elect a new president for the republic.”

Why are the large Christian parliamentary blocs now suspicious of the international pressure to elect a president?  The official said, “The [Christian] bloc is afraid of the open-ended foreign interests in the Syrian crisis, to say the least, or the collusion of foreign parties, to say the most, in the issue of Syrian refugees and their ongoing displacement into Lebanese territory.  The primary Christian group [the bloc headed by Gen. Michel Aoun] in Lebanon is afraid of plans that aim to settle the war in Syria while disregarding the remaining Syrian refugees in Lebanon or dismissing the return of those people to Syria as nonessential.  This would result in a crisis, with the presence of more than 1 million Syrian refugees in a country whose population amounts to 4 million people, with a surface area of only 10,452 square kilometers [4,035.5 square miles].”

He noted, “Electing a president who does not have clear public legitimacy and direct, strong parliamentary representation might exacerbate international pressure in the issue of refugees.  This is dangerous for the Lebanese country and government.”

Why does this bloc seem so assured of its ability to face the pressure?  The source answered, “It is a matter of simple math.  The bloc and its allies have more than a third of parliamentary seats in the current self-extending parliament.  This is constitutionally sufficient to forbid any session to elect a president.  The Lebanese Constitution states that two-thirds of the MPs should be present for a quorum to be complete in order to elect a president.  The MPs of the bloc and their allies have been preventing the completion of the quorum since the presidential vacuum on May 25, 2014, to circumvent presidential elections and head to parliamentary ones first.”

What if international pressure increases?  The source answered, “We will keep facing the pressure until Europe backs down,” adding, “Tehran will not put any pressure on Hezbollah to push its parliament members to relinquish their supporting stance for the largest Christian bloc.  This is a constant.  Moscow also supports the largest Christian bloc’s demand, which prioritizes the parliamentary over the presidential elections.  Even Paris has started to tone down its encouragement for presidential elections.  France is mulling over delaying [President] Francois Hollande’s visit to Beirut, which was mentioned a few days ago and was supposed to take place end of September.  This indicates that Europeans have realized their inability to demand the election of a new president.”

Nevertheless, the source admitted that the bloc is currently unable to fulfill its demand and head to parliamentary elections for the time being.  The current standstill will persist until further notice.  (Al-Monitor 21.09)

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11.2  TUNISIA:  Tunisian Prime Minister Promises Economic & Security Reforms

Barbara Slavin wrote in Al Monitor on 30 September that Tunisian Prime Minister Habib Essid said his country will have a new investment code by the end of the year and will implement other reforms to overcome deep economic and security crises.  “We have many challenges,” Essid, a US-educated economist, told an audience at the Council on Foreign Relations. “We need to have important reforms in many domains.”

Once the darling of democracy advocates, due to its inclusive political process following the overthrow of dictator Zine El Abidine Ben Ali in 2011, Tunisia has lately lost a bit of its luster.

Tunisian President Beji Caid Essebsi responded to two gruesome terrorist attacks directed against foreign tourists earlier this year by declaring a state of emergency and implementing a draconian new law that prescribes the death penalty for vaguely defined terrorist crimes.

In addition, Essebsi is trying to push a law through parliament that would allow corrupt businessmen to admit guilt and pay compensation rather than face imprisonment.  Critics say the law — which has provoked protests, including street demonstrations, from civil society activists — would undercut what had been seen as a promising truth and reconciliation process.  The law is meant to encourage more investment in the Tunisian economy, which is struggling.

A new report on Tunisia to be issued soon by the Atlantic Council and shared with Al-Monitor in advance warns, “Unless the Tunisian government moves rapidly to turn the economy around, Tunisia could well turn out to be the country where the Arab Spring both was born and died.”  Asked about these challenges by Al-Monitor, Essid said that security sector reform is “one of our priorities” but that “it is not an easy job” because of the legacy of impunity left by the Ben Ali regime.

Regarding the corruption law, Essid said the democratically elected parliament “can refuse the proposal of the president of the republic.  There are institutional safeguards” that did not exist earlier.

The economy is a major focus given lackluster gross domestic product growth this year expected to be only about 0.5%.  Essid said unemployment stood at 15%, of which one-third were educated youths.  The Atlantic Council report said that 50% of college graduates are unemployed and every year about 60,000 new graduates enter the labor force but only 35,000 new jobs are created.  “In a nutshell, what we are saying is that Tunisian elites have focused only on political developments to stress consensus and pluralism, and this is fine, but they have completely overlooked the importance of the economy and of economic reforms,” Karim Mezran, one of the authors of the report, told Al-Monitor. “This can undermine the whole process.”

The report urges the Tunisian government to reduce subsidies and widen the tax base, streamline business and investment regulations, change labor laws to allow more flexibility, strengthen the financial system, increase privatization and reduce the “skills mismatch between the supply and demand for labor.”  Mezran also stressed the need for reform of the security services, which he said are still carrying out torture and unlawful detentions.

A House subcommittee has also called for Tunisia to reform its security services.  The Obama administration has called for a doubling of annual US bilateral economic aid to $134 million for Tunisia, but the Senate has offered $50 million less in a reflection of concern about Tunisia’s trajectory.  Essid, who was in New York to attend the annual meeting of the UN General Assembly, said his government has prepared a five-year plan to tackle many of these issues.

The government is providing loans to the tourism sector to expand beyond beach holidays and is focusing on building new roads, harbors, airports and other infrastructure, he said.  To deal with wide disparities between the well-developed coast and the interior of the country — where the Arab Spring movement arose in late 2010 when a young fruit vendor self-immolated to protest government harassment — Essid said many of these new projects would be situated in rural areas.

In addition to a new investment code to provide more incentives to local and foreign investors, Essid said his government planned fiscal reform and to “shake up” what he called a “frozen” administrative bureaucracy that has been slow to respond to Tunisia’s needs.  The government also plans to increase the retirement age from 60 to 65 to address a large deficit in the pension system, he said.

Asked by moderator Farid Zakaria why so many young Tunisians have turned up in Syria to join groups such as the one that calls itself the Islamic State, Essid said the numbers of Tunisian jihadis is going down.  He blamed the phenomenon on both ideology and unemployment.

Tunisian radicals trained in Libya have been responsible for the recent terrorist attacks in Tunisia. Essid acknowledged that the political chaos in Libya is having a deleterious effect on Tunisia and quoted a saying from the Prophet Muhammad that it is important “to take care of your neighbors.”

“All the world” has to help find a solution for Libya, Essid said. “It is important for Tunisia that Libya will be stabilized because many of the security problems we have come from there.”

Despite concerns about a return to authoritarianism to deal with terrorism, Essid insisted that the transition from dictatorship “is irreversible. Nobody can go back, and if he wants to go back, nobody will let him,” he said.

Barbara Slavin is the Washington correspondent for Al-Monitor and a senior fellow at the Atlantic Council, where she focuses on Iran.  (Al-Monitor 30.09)

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11.3  TURKEY:  Soaring Bad Debts Sound Alarm in Turkey

The deterioration in Turkey’s real economy is accelerating, with political uncertainty, early elections and bloody conflict with Kurdish militants taking their toll on the economy in general.  Statistics by the Banks Association of the Turkish Risk Center show a dramatic increase in both the number and value of bounced checks, especially in August, when the Kurdistan Workers Party stepped up its terror attacks.  The problem seems to be particularly rife in the predominantly Kurdish provinces in the east and southeast, where since August 2014 the number and value of bounced checks increased by up to 115%, well above the national average, with local economies struggling amid the simmering unrest.

Author Zilfikar Dogan posted on 23 September in Al-Monitor that political uncertainty and conflict with the PKK are taking their toll on the Turkish economy, with the number and value of bounced checks on the rise, threatening company bankruptcies and fresh woes in the banking sector.

In the first eight months of 2015, the overall number of bounced checks rose 21% compared to the same period in 2014, while their total value was up 49%, according to the Risk Center.  Some 15 million checks worth TL429 billion were presented to banks for clearance, with legal action launched in regard to 490,000 bounced checks worth TL 17.6 billion ($5.8 billion; 1 Turkish lira = $0.33).

The regional breakdown for August indicates how political uncertainty and the rekindled Kurdish conflict have put a serious strain on businesses across Turkey, including the country’s economic powerhouses in the west.  In the southeast, the trend is even gloomier. In August, five southeastern provinces topped the list of regions with the worst rate of bounced checks in terms of value.  The rate was the highest in Bitlis and Bingol, at 11.1%, followed by Van at 10.6%, Hakkari at 9.3% and Mardin at 8.4%.

Another alarming signal from the real economy stems from the number of protested promissory notes, which stood at 646,229 in the first eight months of the year.  The figure is expected to reach some 1.5 million by year’s end, up from 1 million in 2014.  In terms of value, the protested notes were worth TL 6 billion for the eight months.  As a result of the accelerating downturn, the figure is expected to hit TL 10 billion by the end of the year, up from TL 8 billion in 2014.  Bounced checks worth TL 17.6 billion and another TL 6 billion in contested promissory notes signal that payment chains in the economy have begun to break.

A 2012 legal amendment lifted the jail sentences faced by issuers of bad checks since 1985.  The new law only bans offenders from issuing checks for at least three years, should they become the subject of an official complaint.  Banks, on the other hand, were handed more obligation to deter fraud, including a payment guarantee of TL 10,000 for each check leaf of more than TL 10,000.  Thus, the soaring number of bounced checks is now increasing the financial burden of the banks.

Meanwhile, banks were already struggling under an increasing amount of unpaid consumer loans and credit card debt.  According to the Banking Regulation and Supervision Agency, as of the end of July, more than 2.5 million people faced litigation over unpaid loans and credit card debt.  The amount of litigated debt totaled TL 15.1 billion ($5 billion), including TL 8.9 billion in consumer loans and TL 6.2 billion in credit cards.  The litigated loan and credit card debts had stood, respectively, at TL 7.4 billion and TL 5.4 billion at the beginning of the year, meaning they swelled by 20% and 14.5%, respectively, in seven months.

Small tradesmen and small and medium-size enterprises are also increasingly failing to repay loans. In this category, the amount of unpaid arrears to banks stood at TL 42 billion ($14 billion) in July, up from TL 36 billion ($12 billion) at the end of 2014.

All these figures of swelling bad debt illustrate how fast the woes of the Turkish economy are spreading, harming the income and repayment capacity of individuals, enterprises and companies alike.  The increase in bounced checks, both in number and value, is bound to have a particularly damaging impact on trade and exports, with many companies likely to go bankrupt as a result.

The hardships in the banking sector, too, are growing.  Banks have already taken a hit from the dramatic depreciation of the Turkish lira this year, significantly swelling their foreign currency debt. Unpaid loans and bouncing checks are only adding to their burden.

Zilfikar Dogan began his career in journalism in 1976 at the Yanki news magazine in Ankara. He has worked as a reporter, news editor, representative and columnist at Milliyet, Posta, Aksam, Finansal Forum, Star and Karsi newspapers, and as a TV programmer and commentator on the economy and politics for TRT-1, Star, NTV and CNBC-e. He is currently editor in chief and columnist at the Korhaber news site.  (Al-Monitor 23.09)

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11.4  TURKEY:  Turkey’s Snap Elections May Not Change Much

In the Washington Institute’s PolicyWatch 2491 on 28 September, Asli Aydintasbas and Soner Cagaptay wrote that barring a last-minute surprise, President Erdogan’s efforts to return his AKP to single-party rule could be hindered by a faltering economy and declining domestic security.

As a deeply polarized Turkey approaches the 1 November snap elections, it is unclear whether the governing Justice and Development Party (AKP) will recoup any or all of its 20% overall drop in support during the June vote, which ended thirteen straight years of single-party rule in the country.

Judging from recent polls, the AKP may not gain much at all, owing to the resumption of fighting with the outlawed Kurdistan Workers Party (PKK) and the Turkish lira’s sharp decline.  Polls are showing the AKP hovering around 40 – 41% — in line with its June outcome (40.87%).  What is different from previous elections, however, is the tighter party control by Recep Tayyip Erdogan, the AKP’s founder and erstwhile leader, who resigned from the party in August 2014 to assume the presidency.  Over the past eighteen months, Turkish citizens have voted in three major elections (local, presidential and general), all of which seemed to be referendums on Erdogan and his assertive style of governance.  Five weeks before the new vote, little evidence suggests that this contest will be much different — or that Erdogan will shy away from campaigning for the AKP, even though the constitution bars partisan affiliation by the president.


The 7 June elections effectively ended the pro-Islamist AKP’s hegemony over Turkish politics and appeared to herald a new era of power sharing.  Although still the top vote getter, the AKP paid a heavy price for its half-baked peace process with the PKK, simultaneously losing Kurdish and nationalist Turkish voters.  Popular backlash against Erdogan’s attempts to install himself as the country’s de facto chief executive, in violation of the Turkish constitution, also harmed the AKP.  Erdogan’s handpicked successor as prime minister, Ahmet Davutoglu, delivered just 258 seats in the vote, 18 short of the 276 needed to form a single-party government.  Thereafter, party leaders entered into coalition talks with the main opposition Republican People’s Party (CHP) and the Nationalist Action Party (MHP), which earned 25% and 16%, respectively.  But these talks failed to yield a power-sharing agreement.

Presidential Shadow

Senior CHP members who took part in meetings with the AKP delegation in July and early August believe Davutoglu was sincere in his efforts to form an alliance — and thus reclaim the center of gravity in Turkish politics.

Erdogan, however, seems to have decided on a different course.  He and supportive media voices started talking about new elections — which he called “repeat elections” — immediately after the 7 June vote and on his 31 July return from China, he told reporters that it was “futile to expect any benefits for the country” from coalition governments, thus making his preference clear.  Although an AKP-CHP coalition initially looked likely, Erdogan easily and swiftly steered the AKP away from this and other coalition formulas, announcing fresh elections by 24 August.

Whereas polls show the AKP — and the other three major parties, for that matter — with about the same support as on 7 June, Erdogan is counting on the idea that, given a declining economy and deteriorating domestic security, voters might set aside their AKP-related grievances and opt to back a strong leader.  This would turn Erdogan’s main disadvantage – an authoritarian streak – into an advantage.  Erdogan, who has maintained greater hands-on party control than ever, reportedly had the final say in determining party leadership at the AKP’s 12 September convention as well as in screening names for its parliamentary lists submitted for the 1 November polls.

Erdogan vs. 13% and Vice Versa

Despite the constitutional ban, Erdogan will doubtless be on the campaign trail over the next few weeks seeking AKP votes — mostly in the framework of massive antiterrorism rallies, the first of which took place in Istanbul on 18 September.  As preceding the June vote, Erdogan’s real target will likely be not the main opposition CHP but rather the pro-Kurdish Peoples’ Democratic Party (HDP), a smaller bloc that made big gains in June.

Indeed, led by the charismatic forty-two-year-old Selahattin Demirtas, the HDP was both dark horse and game changer in the June vote.  A former human rights activist, Demirtas doubled the movement’s previous tally, sending it above the 10% threshold needed to enter parliament.  Moreover, the HDP successfully expanded its base beyond PKK supporters en route to its 6 million votes (13%), garnering support from middle-class and urban Kurds, liberal Turks and far-left voters.  Prior to the June elections, candidates representing the country’s Kurdish political movement ran as independents by district and would typically amount to twenty-five to thirty-five parliamentarians in Ankara.  This time, with a campaign focused on diversity, cultural pluralism and inclusivity, the HDP fielded a list that was half women and also included members of the country’s ethnic and religious minorities, including Armenians, as well as LGBT candidates – a first in Turkey.  In running this united party list, the HDP won 80 parliamentary seats, equal to the MHP’s haul, making it a major political player to be reckoned with.  The HDP’s success has also brought the Kurdish issue into the Turkish mainstream: Turks can disagree with Kurdish political demands, but they can no longer simply ignore them.

In many ways, the June elections represented a stare-down between Erdogan and Demirtas, and since the vote Turkey’s president has continued to target the HDP and its leader, often calling them “terrorist supporters” – a reference to the party’s kinship with the PKK.  Long before the June elections, Demirtas made a name for himself by challenging Erdogan’s aspiration to convert the political system to one based on an executive presidency, declaring, “We will not allow you to become [executive] president.”  This became the HDP rallying cry, helping attract left-wing voters and liberal-leaning Alevi voters but also leading Erdogan to halt the peace process with the PKK and its imprisoned founder, Abdullah Ocalan.

Violence Escalates

In July, hostilities resumed between the PKK and the Turkish government, with the first PKK attacks occurring on 20 and 22 July, ending a once-promising ceasefire.  Since then, the PKK has been targeting police and soldiers in eastern Turkey, resulting in a surge of Turkish nationalist sentiment.  This could help Erdogan and the AKP on 1 November, peeling off voters from the Turkish nationalist MHP.  But fighting in the Kurdish southeast could also hurt the AKP and simultaneously boost the HDP by aligning conservative Kurdish voters, angered by the suspension of civil rights in Kurdish-majority provinces, with the HDP.  In other words, Erdogan’s gains from fighting the PKK could be offset by losses.

It’s the Economy

The AKP won successive elections after coming to power in 2002 primarily by delivering prosperity and good governance.  Yet over the past year, the Turkish lira has been devalued by almost 35% against the dollar and the construction sector – the engine behind the AKP’s consumption-driven economic model – is suffering.  The AKP government’s use of targeted tax audits to punish political opponents, with prominent cases including Koc Holding and the Dogan Media Group, has since 2011 intimidated major Turkish economic players from embarking on large-scale investments.

Erdogan believes in a state-driven capitalism, not dissimilar from Putin’s model, and personally helps decide the winners in major government contracts.  Yet whereas the AKP government’s appeal for international investors had long been its promise of financial stability, foreign direct investment has been falling since 2013 – aside from investment in state-sponsored infrastructure projects – a result of waning global interest in emerging markets and questions about Turkey’s political stability and business environment.  The economic slowdown, meanwhile, is seemingly reflected in popular sentiments.  According to a June survey by Metropoll, a Turkish polling company, 58% of Turks – nearly equaling the votes cast for the combined opposition parties that same month – believed the country’s economy was “being managed poorly.”  Today, this number has climbed to 64.6%.  AKP support, barring a last-minute surprise, could thus stagnate or even drop on 1 November, reflecting souring views on the economy.

Implications for U.S. Policy

Should Turkey’s November vote result in continued political uncertainty, one effect could be Ankara’s reduced ability to further cooperate with the U.S. campaign against the Islamic State of Iraq and al-Sham (ISIS) in Syria.  A hung parliament in Ankara would result in either no government, a caretaker government, or a shaky coalition government, all leading to political stalemate.  The dangerously polarized atmosphere in Turkey, a source of potential instability, is also unlikely to change.  As Washington plans to push deeper into Syria against IS, a weak Ankara government will lack the political capital to fully support the mission.


Asli Aydintasbas is a journalist and commentator on Turkish politics based in Istanbul.

Soner Cagaptay is the Beyer Family Fellow and director of the Turkish Research Program at The Washington Institute, and author of “The Rise of Turkey: The Twenty-First Century’s First Muslim Power,” named by the Foreign Policy Association as one of the ten most important books of 2014.  (TWI 28.09)

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11.5  CYPRUS:  IMF Completes Eighth Review of EFF and Approves €126 Million Disbursement

On 23 September, the Executive Board of the International Monetary Fund (IMF) completed the eighth review of Cyprus’ economic adjustment program supported by the Extended Fund Facility (EFF) arrangement.  The completion of the review enables the disbursement of SDR 99 million (about €126 million), which brings total disbursements under the program to SDR 693 million (about €882 million).  Completion of the ninth review would be expected to take place before the end of the year.

The three-year, SDR 891 million (about €1 billion) EFF was approved on May 15, 2013.  Cyprus’ economic program is also supported by financial assistance from the European Stability Mechanism (ESM) amounting to €9 billion.

Following the Executive Board’s discussion, Mr. Mitsuhiro Furusawa, IMF Deputy Managing Director and Acting Chair, issued the following statement:

“Cyprus’ reform program remains a success.  Economic activity in the first half of the year has been better than expected, and fiscal outturns are running ahead of projections.  Liquidity in the core banking system has continued to improve, and the prospects for resolving non-performing loans are improving.  Going forward, it will be important to continue with sound macroeconomic management and maintain the reform momentum.

“A significant improvement in addressing non-performing loans remains an urgent priority to preserve financial stability and boost growth. In this respect, recent progress on making the new private debt restructuring framework operational is encouraging.  To ensure effective implementation of the new framework, it is important to closely monitor implementation and correct any deficiencies.  Adopting supporting legislation to facilitate loan sales and securitization and continued steps to enable swift transfer of title deeds will be essential to support balance sheet clean-up.

“Further efforts are needed to strengthen banking supervision and regulation.  It is important that financial institutions continue their efforts to restructure loans. In light of continued uncertainties in the region, the financial status of Greek-owned subsidiaries will continue to warrant close attention.

“The strong fiscal performance is impressive.  Nevertheless, high public debt together with sizeable contingent liabilities warrant continued prudence while ensuring support for growth-enhancing public spending and the safety net.  Reform efforts should focus on advancing public administration, improving the management of government guarantees, and strengthening revenue administration.

“The authorities should press ahead on other key structural reforms to support growth.  To this end, measures are needed to overcome the delays on the privatization program, and to improve the business environment,” Mr. Furusawa said.  (IMF 23.09)

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