Fortnightly, July 1st 2015

Fortnightly, July 1st 2015

July 1, 2015





1.1  Netanyahu Defers Knesset Vote on Gas Agreement Powers
1.2  Knesset Approves Tax Hike on Homes Purchased for Investment
1.3  Israel Establishes Technology and Innovation Authority


2.1  BIRD Foundation to Invest $8 Million in 10 New Projects
2.2  Checkmarx Receives $84 Million Investment From Insight Venture Partners
2.3  El Al Inaugurates Boston Route
2.4  Tel Aviv’s Norman Hotel Is Voted World’s Best Boutique Hotel
2.5  Stockton Group Receives $90 million from China’s Hebang Group for 51% Stake
2.6  Emerson Electric Unit Buys Israel’s Spectronix
2.7  CropX Closes $9 Million Series A Funding
2.8  Kingenta Leads Ground-Breaking Sino-Israeli Agricultural Partnership
2.9  GenomeDx Announces Agreement for Decipher Prostate Cancer Classifier in Israel


3.1  Florida Defense Firm to Pay $7.1 Million to Settle Kuwait Bribery Probe
3.2  UAE’s Trussbridge Invests in Canadian Food Producer
3.3  Creative Learning Awards Franchise in Malta and Saudi Arabia
3.4  France’s FigeacAero to Open Production Unit in Morocco
3.5  Furukawa Electric to Open Production Facility in Morocco


4.1  Israeli Facility Will Turn Plastic Waste Into Fuel
4.2  Energix Expanding Golan Heights Wind Energy Activity
4.3  First Solar Modules to Power Landmark 200MW Photovoltaic Project in Dubai


5.1  Jordanian Exports & Imports Decline

♦♦Arabian Gulf

5.2  Kuwait Legalizes Surveillance Cameras in Public Areas
5.3  Qatar’s Secretive Sovereign Fund to Restructure
5.4  UAE & US Sign Agreement to Provide Tax Information
5.5  UAE’s Inflation Rate Rises to 4.3% in May
5.6  UAE Economy Set to Surge 4.4% to Cross $440 Billion
5.7  Dubai’s May Inflation Rate Jumps to Six-Year High
5.8  France & Saudi Arabia Set To Sign Contracts Worth $12 Billion

♦♦North Africa

5.9  Egyptian Cabinet Approves Budget Draft for FY 2015/16
5.10  Egypt Enters Into Initial Deal for 15 Projects Worth $10 Billion with China
5.11  Egypt’s Suez Canal Revenue at $449.6 Million in May
5.12  Tunisia Sees Losses of $515 Million for Tourism This Year After Attack
5.13  Morocco’s Trade Balance Improves 25.3% in Second Quarter of 2015


6.1  Turkey’s Exports Decline by 19% in May
6.2  Turkish Tourism Sector to Lose $2.5 Billion Amid Russian Crisis
6.3  IMF Says Cyprus’ Economic Progress “Impressive”
6.4  Greece in Shock as Banks Shut After Creditor Talks Break Down
6.5  Eurozone Prepares for Greek Default After Tsipras Referendum Call
6.6  Greece & Russia Sign Memorandum on Gas Pipe to Greece



7.1  Fast of 17th of Tammuz to be Observed on 5 July
7.2  NFL Hall of Famers Get All-Star Tech Demo in “Startup Nation”
7.3  New NIS 200 Bill to Be Introduced Soon


8.1  Teva & Microchips Biotech Form Digital Drug Delivery Technology Partnership
8.2  PhysiMax’s Real-Time Movement Assessment Validates Landing Error Scoring System
8.3  Tikun Olam Announces Its First U.S. Partnership
8.4  Biogal-Galed Commercializes Two New PCRun Veterinary Molecular Detection Kits
8.5  Chinese Investors Putting $2 Million Into Hadasit
8.6  Pluristem Granted Australian Patent for 3D Cell Expansion Technology
8.7  BioLight Obtains CE Mark for CellDetect Non-Invasive Test for Bladder Cancer
8.8  Pharma Two B Announces Positive Results in its Parkinson’s Clinical Study


9.1  Mellanox Announces ConnectX-4 Lx Cost-Efficient 25/50 Gigabit Ethernet Network Adapter for Cloud
9.2  Mellanox Introduces the World’s First 25/100 Gigabit Open Ethernet-based Switch
9.3  Yissum and ICL Expand Research Collaboration in the Area of Advanced Materials
9.4  Vexigo’s Visualizr Supports New Mobile Friendly Search Engine Ranking Requirements
9.5  ECI Announces the New Apollo OPT 9900 Series – High Capacity Switching Platforms
9.6  Mellanox Improves Software-Defined Storage Performance
9.7  Optimal+ 6.0 Delivers Big Data Analytics to High-Volume Semiconductor Manufacturing
9.8  Free Wi-Fi on South African Buses Thanks to RADWIN’s Wireless Mobility Solution


10.1  Foreign Investment in Israel Drops by Half in 2014
10.2  Israel’s Agricultural Exports Fall
10.3  Israel’s Unemployment Rate Rises Slightly
10.4  Israel’s Heart Disease Mortality Rate Among Lowest in OECD


11.1  ISRAEL: Concluding Statement of the IMF’s 2015 Article IV Consultation
11.2  ISRAEL: Gas Issue Dominates Cyprus-Israel Agenda
11.3  LEBANON: IMF Executive Board Concludes 2015 Article IV Consultation with Lebanon
11.4  JORDAN: Staff-Level Agreement with Jordan on Final Review Under the SBA
11.5  JORDAN: Jordan’s Economy Surprises
11.6  JORDAN: Jordan Moves to Lay New Tracks
11.7  QATAR: Qatar Remains Central to Global Hydrocarbons
11.8  UAE: Dubai Set For Leaner Tourism Season
11.9  SAUDI ARABIA: Saudi Arabia to Keep Pumping Oil
11.10  GREECE: S&P Long-Term Ratings Lowered To ‘CCC-‘; Outlook Negative


1.1 Netanyahu Defers Knesset Vote on Gas Agreement Powers

Prime Minister Benjamin Netanyahu has decided to defer the Knesset vote on transferring to the full government the minister of the economy’s powers to override Antitrust Commissioner Gilo’s objections to the settlement with the gas companies. This follows Minister of the Economy Deri’s refusal last week to exercise his powers in the matter, after the diplomatic-security cabinet decided that the gas settlement was a matter of national security that justified setting Gilo’s objections aside.

The prime minister ordered that the outline gas settlement should be released for publication within a short time, as soon as the legal drafting of it, which is currently being worked on, is complete, to enable full public discussion of all parts of the agreement. Netanyahu is convinced that when the public is exposed to the details of the agreement and sees its advantages for the economy and for the country’s security, the Knesset will support the government’s proposal. (Globes 30.06)

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1.2 Knesset Approves Tax Hike on Homes Purchased for Investment

On 22 June, the Knesset approved at second and third readings the increase in the purchase tax on dwellings bought for investment to 8-10%. 73 Knesset members voted in favor. The Knesset Finance Committee has approved the advancement of the date for the tax hike to come into force to 24 June. Approval was obtained after Ministry of Finance director-general acceded to an opposition demand that he should examine the widening of the tax exemption for people who inherit homes. The tax hike is the initiative of Minister of Finance Kahlon, part of his strategy for bringing down the price of housing in Israel. (Globes 23.06)

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1.3 Israel Establishes Technology and Innovation Authority

The Israeli government has approved the establishment of a National Authority for Technology and Innovation (NATI). The authority will function as the executive arm of the Office of the Chief Scientist at the Israeli Ministry of Economy. Minister of the Economy Deri was one of the proposers of the authority along with Minister of Finance Kahlon, said. The government’s innovation policy aims at achieving broad national goals in the coming decade, including: encouraging growth of industrial companies, injecting technological innovation into traditional fields which are not traditionally R&D dependent, strengthening research infrastructure as well as capital and labor, harnessing innovation for the improvement of the public sector and increasing the participation of sectors currently underrepresented in the hi-tech work force. (Globes 22.06)

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2.1 BIRD Foundation to Invest $8 Million in 10 New Projects

During its meeting on 18 June, held in Washington D.C., the Board of Governors of the Israel-U.S. Binational Industrial Research and Development (BIRD) Foundation approved $8 million in funding for ten new projects between U.S. and Israeli companies. In addition to the grants from BIRD, the projects will access private sector funding, boosting the total value of all projects to approximately $19 million. Projects submitted to the BIRD Foundation are reviewed by evaluators appointed by the National Institute of Standards and Technology (NIST) and by the Chief Scientist’s Office of the Israeli Ministry of Economy. The projects approved include:

• Compedia (Ramat Gan, Israel) and AllenComm (Salt Lake City, UT): Advanced just-in-time augmented reality for manufacturing
• Fulcrum S.P. Materials (Yavne, Israel) and Graphene Technologies (Novato, CA): Graphene enhanced carbon fiber sizing
• Kando (Hadera, Israel) and Water Analytics (Andover, MA): Smart city organic wastewater management system
• Life-Beam (Tel Aviv, Israel) and Under Armour (Baltimore, MD): Advanced smart fitness earbuds integrated with bio-sensing technology
• mPrest Systems (Petach Tikva, Israel) and New York Power Authority (New York, NY): mPrest-NYPA transformer control system
• OMAT (Jerusalem, Israel) and Fives Machining Systems (Hebron, KY): Multi-objective machining process optimization system
• Remedor Biomed (Nazareth Illit, Israel) and Medline Industries (Mundelein, Illinois): An EPO-releasing dressing for diabetic chronic wounds
• Senecio (Haifa, Israel) and Dynamic Aviation (Bridgewater, VA): Mosquito SIT
• Telesofia (Tel Aviv, Israel) and Tribune Content Agency (Chicago, IL): Personalized Wellness Videos
• WellToDo (Netanya, Israel) and American Water (Mount Laurel, NJ): Novel Water Treatment System Based on Catalytic Reduction.

The BIRD (Binational Industrial Research and Development) Foundation works to encourage and facilitate cooperation between U.S. and Israeli companies in a wide range of technology sectors and offers funding to selected projects. BIRD has approved over 900 projects over its 38 year history. To date, BIRD’s total investment in these projects has been over $300 million and has received approximately $100 million in repayments. BIRD funded projects have generated direct and indirect sales of approximately $10 billion. (The BIRD Foundation 30.06)

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2.2 Checkmarx Receives $84 Million Investment From Insight Venture Partners

Checkmarx announced an $84m investment from New York-based venture capital and private equity firm, Insight Venture Partners. The new round of capital will be primarily used to further accelerate growth through product innovation and global expansion. Founded in 2006, Checkmarx provides comprehensive solutions for application security testing and application layer attack prevention. Its flagship product is its automated static code analysis – scanning for security deficiencies in source code early in the software development lifecycle where it is most cost effective to apply fixes. With offices in both Israel and the US, Checkmarx has grown employee headcount to over 150 in the last 12 months, and is experiencing revenue growth greater than 100% in 2015. The company has an industry-leading customer retention rate and currently serves over 700 customers worldwide including, SAP and the US Army.

Mooreland Partners LLC served as the Company’s exclusive financial advisor in the transaction and HFN served as the Company’s legal counsel. Willkie Farr & Gallagher LLP acted a legal adviser to Insight Venture Partners. (Checkmarx 25.06)

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2.3 El Al Inaugurates Boston Route

Starting on 26 June, El Al Israel Airlines is operating three direct flights from Ben Gurion Airport to Logan International Airport in Boston using Boeing 767-300 planes. The flights take off on Sundays, Tuesdays and Thursdays at 00:30 AM and land at 5:45 AM local time, after a 12-hour flight. Return flights from Boston to Tel Aviv will take off on Sundays, Tuesdays, and Thursdays at 9:00 AM local time, and land on Mondays, Wednesdays, and Fridays at 3:05 PM. The duration of the return flight will be 11 hours. Flights to Boston in tourist class will cost $1,400. (Globes 28.06)

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2.4 Tel Aviv’s Norman Hotel Is Voted World’s Best Boutique Hotel

Luxury American tourism magazine Jetsetter has just named the world’s best boutique hotel – the stunning Norman Tel Aviv. “The term ’boutique hotel’ can be applied to everything from major chains’ brand extensions to indie sleeps one step removed from B&B status, but Tel Aviv’s smart, stylish Norman is the real deal,” Jetsetter explained of its vote, which was based on reviews by 200 international journalists. Overall, the magazine examined 23 hotel categories, such as business hotels and all-inclusive beach resorts. (NoCamels 21.06)

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2.5 Stockton Group Receives $90 million from China’s Hebang Group for 51% Stake

On 29 June, an agreement was signed in Beijing the sale of 51% of the Israeli Stockton Group to the Chinese-based Hebang Group in return for a $90 million investment in the company. The Hebang Group is a public Chinese company, traded on the Shanghai Stock Exchange, and is active in a variety of industrial activities, including the agrochemical industry. This is the Hebang Group’s first investment outside of China. Hebang’s goal with this investment in Stockton is to “support Stockton’s growth as a global leader in environmentally-friendly biofungicides.”

Stockton recently received a license to sell Timorex Gold in the United States. The investment from Hebang will allow Stockton to accelerate its penetration into this and additional markets, as well as to advance the development of other environmentally-friendly products through ongoing cooperation with research and academic institutes in Israel and around the world. According to the agreement, Stockton will continue to operate as an Israeli company with no change to its management, while the controlling shareholder of Hebang will serve as the company’s chairman following the investment. The transaction is expected to close within 90 days, subject to regulatory approvals in China.

Petah Tikva’s Stockton Group is a leading crop protection product supplier offering an extensive product portfolio with almost 100 different registered active ingredients in different formulations and packaging configurations. Among its products, the Stockton Group distributes its own proprietary line of bio pesticides, which it developed in its R&D center in Israel. (Stockton Group 29.06)

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2.6 Emerson Electric Unit Buys Israel’s Spectronix

Sderot’s Spectronix, which develops fire detection systems, will be sold to Emerson Electric for $99 million, proving that old industrial companies can also produce exits. The price consists of $79 million in cash and $20 million to be distributed to the shareholders as a dividend. The share price for the deal is $11.67 ($9.31 without the dividend). Spectronix develops sensors and fire and gas detection systems for the civilian market and systems for detecting and containing explosions in military vehicles. In its 2014 financial statements, the company said that one the characteristics of business in the civilian market was the merging of companies in the sector into major international companies. The structure of the deal with Emerson is a triple reverse merger. Emerson Process Management Asia Pacific, through which Emerson is making the acquisition, will merge into itself Vulcan, a fully owned subsidiary of Spectronix. When the merger is completed, Spectronix will become a private company fully owned by the acquiring company. Emerson Process provides measurement, analysis, and management solutions for energy, chemical, mining, and other companies. It is part of the Emerson group, whose market cap is $37.8 billion. (Globes 29.06)

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2.7 CropX Closes $9 Million Series A Funding

CropX completed the first close of its $9 million Series A financing. Led by Finistere Ventures, Innovation Endeavors and GreenSoil Investments, each investor in the Series A round is dedicated to agriculture technology innovations. OurCrowd also participated in the round given its previous investment in the company. With drought conditions accelerating around the globe, water management has become one of the most critical issues facing the farming sector. Driving a new era in AgAnalytics, CropX uses advances in the Internet of Things (IoT) and big data to transform traditional farming techniques. The investment will be used to aggressively expand the CropX team and scale the company to meet the increasing need among farmers for low-cost and simplified, remote control of their irrigation. It will also fund new product development including controls in nutrition, plant protection, and planting and harvesting prediction.

The CropX system automatically analyzes the exact water needs of different parts of each field based on topography, soil structure and current moisture. Farmers simply download the mobile app and place three wireless sensors in the ground. These sensors continuously send soil readings to the cloud, where the patent-pending CropX software determines how to effectively irrigate different parts of the field based on pattern-recognition analysis and revolutionary algorithms. Farmers can self-install the system without expensive infrastructure or significant consulting input during the installation process. CropX’s product was developed by a team of world-leading scientists and technology experts in Israel, a global leader in water conservation technology and New Zealand, and was validated on-farm over the past five years.

CropX, the world’s most advanced adaptive irrigation software service, delivers dramatic crop yield increase and water and energy cost savings, while conserving the environment. Optimizing irrigation to help farmers around the globe, CropX generates daily, accurate, hassle-free irrigation maps and automatically applies the right amount of water to different parts of the same field. CropX is led by a team of top scientists, technologists, and entrepreneurs with a track record of identifying and commercializing disruptive technologies. (CropX 22.06)

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2.8 Kingenta Leads Ground-Breaking Sino-Israeli Agricultural Partnership

Beijing’s Kingenta Ecological Engineering Group announced the launch of a Kingenta-led major agricultural partnership between Israel and China. This partnership is centered on a set of technologies that provide integrated control and regulation of water and fertilizer and consists of five medium- or long-term interrelated projects that will profoundly affect the future of agricultural development. The projects include constructing 10 Sino-Israeli demonstration farms exploring modern agriculture, establishing 100 agricultural service centers, sending 1,000 Chinese scholars and experts on fact-finding visits to Israel, training and supporting 10,000 model agricultural households, and cultivating 100,000 leaders in modern farming.

The advance of agriculture in Israel has been seen as a miracle from a global perspective. Agricultural development in China needs to deal with both the shortage of fresh water resources, a similar challenge that Israel faced decades ago. Wasteful use of fertilizers and a reduction in soil fertility, problems resulting from inappropriate use of fertilizers are other issues. As a pioneering company in Sino-Israeli agricultural development cooperation, Kingenta has already sent four groups of agricultural experts and scholars, farmer representatives and others in the industry to Israel on fact-finding missions, starting in 2014. (Kingenta 29.06)

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2.9 GenomeDx Announces Agreement for Decipher Prostate Cancer Classifier in Israel

San Diego, California’s GenomeDx Biosciences signed an exclusive agreement with Medison Pharma, a leading marketer of innovative healthcare solutions, to distribute the Decipher Prostate Cancer Classifier in Israel and the Palestinian Authority. GenomeDx Biosciences is focused on transforming cancer patient care by putting usable genomic information in the hands of patients and their physicians. GenomeDx is developing and commercializing Decipher, a highly validated genomic test for predicting metastatic disease in men with prostate cancer.

Medison is Israel’s leading marketing group, representing innovative niche healthcare products from companies such as Biogen Idec, Amgen, Shire and Ipsen. Medison has been building and maintaining long-standing relations with HMOs, local medical centers and physicians. Backed by three generations of experience in the healthcare industry since 1937, Medison is uniquely qualified to provide the complete spectrum of integrated services for international companies looking to enter or expand their presence in the Israeli market. (GenomeDx Biosciences 30.06)

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3.1 Florida Defense Firm to Pay $7.1 Million to Settle Kuwait Bribery Probe

Florida-based defense company IAP Worldwide Services will pay $7.1 million to settle a US investigation into an alleged conspiracy to bribe Kuwaiti officials to win a government contract, the US Justice Department has said. According to prosecutors, in February 2006 senior executives at IAP, including Rama, set up a shell company called Ramaco to compete in the first phase of a bid to provide surveillance capabilities, including closed-circuit television, to Kuwait’s Ministry of the Interior. The aim was to win the first phase of the contract and use the shell company to tailor the requirements for the contract’s implementation stage to IAP without the Kuwaiti government’s knowledge. As part of the scheme, IAP also funneled almost $1.8 million between 2006 and 2008 to a consultant who would pay bribes to Kuwaiti government officials to help IAP retain and win both contracts, the Justice Department said. IAP said the company accepted full responsibility for its actions and was firmly committed to improved ethics and compliance programs. The Justice Department said it entered into a non-prosecution agreement with IAP, which allows it to escape criminal charges, due to the company’s cooperation with federal authorities. (AB 17.06)

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3.2 UAE’s Trussbridge Invests in Canadian Food Producer

UAE-based investment firm Trussbridge has announced that it has arranged and led a consortium of investors from the Middle East to acquire a majority stake in La Maison Cannelle, a Canadian food producer. The company, which operates in the health and wellness food segment, is based in Québec, and as part of the acquisition, the Trussbridge consortium will invest in capacity expansion as well as organic growth. Trussbridge Advisory Holding acted as the exclusive advisor on the transaction, while Trussbridge Investments led the consortium of regional investors participating in the transaction.

Trussbridge is an independent financial services firm focused on providing objective and long-term strategic financial advisory services, capital raising solutions and investment opportunities for companies and investors in the Middle East. Through its presence in North America and the Middle East, Trussbridge said it acts as a bridge between established players in both regions by advising on cross-border investments, business joint ventures. (AB 27.06)

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3.3 Creative Learning Awards Franchise in Malta and Saudi Arabia

St. Augustine, Florida’s Creative Learning Corporation, owner and developer of Bricks 4 Kidz, Challenge Island and Sew Fun Studios, the highly-popular children’s education and enrichment programs, announced that Bricks 4 Kidz has awarded franchises in Malta and Saudi Arabia. Through a unique franchise business model that includes a proprietary curriculum and marketing strategies, plus a proprietary Franchise Marketing Tool (FMT), the company provides a wide variety of programs designed to enhance students’ problem solving and critical thinking skills. Creative Learning Corp is now operating in 40 countries. (Creative Learning 29.06)

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3.4 France’s FigeacAero to Open Production Unit in Morocco

Following in the footsteps of other global heavyweights in aeronautics such as Bombardier and Airbus, a €25 million investment will be injected in the Moroccan aeronautics industry by FigeacAero, a French group specializing in mechanical aerospace. The French company has confirmed plans to open a production unit in Casablanca which is expected to generate 500 jobs and an investment of €25 million over a period of 5 years. FigeacAero is expected to locate their operations in the Casablanca industrial platform, Midparc.

The aeronautics and aviation industry in Morocco generates over a billion euros in turnover and employs 10,000 people. Financial incentive packages and tax exemptions for investors lure several aerospace manufacturers, including Airbus, Dassault Aviation, Safran SA and Bombardier. (MWN 18.06)

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3.5 Furukawa Electric to Open Production Facility in Morocco

Japan’s Furukawa Electric, the world’s third largest fiber-optic manufacturer, will open a fiber-optic cable factory in Morocco. The new factory will be Furukawa Electric’s first factory in Africa. The Japanese company plans to invest $8 million to set up the factory in Tangier, northern Morocco. According to the Nikkei Asian Review, Furukawa Electric seeks to satisfy the growing demand for communications infrastructure in Africa.

The company projects demand for fiber-optic cables in the African continent and the Middle East to grow to 32 million kilometers in 2018, up about 80% from 18 million kilometers in 2014. The facility will assemble optic fibers made at the company’s U.S. and Japanese plants into final products. With the opening of its Morocco factory, Furukawa will be the first major company in the field to produce the cables in Africa. At the initial phase, Furukawa will supply cables to telecom companies in Africa and Europe while aiming at producing connectors and other related parts in the future, the same source added.

The company said that its choice of Morocco to set up its factory stems from the fact that the country offers easy access to the Mediterranean and the Atlantic, as well as the country’s security level and political stability. (MWN 30.6)

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4.1 Israeli Facility Will Turn Plastic Waste Into Fuel

The Environmental Services Company, Ltd., a government body established in 1990 to handle hazardous waste in Israel, will soon begin operating a unique facility designed to recycle plastic and turn it into fuel. According to the company’s assessments, the facility will be able to derive 600 kilograms (1,320 pounds) of an oil-like substance from every ton of plastic waste they treat. This facility will be the first of its kind in the country.

Every day, Israelis dispose of some 1,500 metric tons of plastic waste. Most of it, 75.7%, is buried in landfills. Most of the plastic waste comes from homes (plastic bags, packaging, bottles, toys, furniture), agriculture (irrigation hoses, packaging, plastic sheeting) and industry. In addition, the Environmental Services Company receives about 3,000 metric tons of plastic waste from packaging per year. The recycling process involves melting and depolymerizing the plastic until a fuel resembling oil is derived. The establishment of the facility has cost 10 million shekels ($2.7 million). (Israel Hayom 23.06)

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4.2 Energix Expanding Golan Heights Wind Energy Activity

Energix is trying to take advantage of an opportunity to expand its activity on the Golan Heights. The company has come to an agreement for acquiring a company owning a wind energy project for NIS 30 million. The wind energy company, owned by the Melamed family and Zahal Harel, is current bankrupt and in receivership. In order to carry the deal through, Energix will have to get through several proceedings, including obtaining court approval and coming to an arrangement with the company’s current shareholders. The project to be acquired, located on the Tel Asania ridge (Mt. Bnei-Resen) in the northern Golan Heights, the only place in Israel where electricity is produced from wind power, was built in the 1990s and operates with a limited capacity of only a few megawatts. If Energix obtains the necessary approvals for buying the project, it is expected to make additional investments on a large scale estimated in the tens of millions of shekels for the purpose of upgrading it to an estimated 15 MW capacity, subject to the conditions necessary for hooking it up to the national power grid. The project is located near another substantial project that Energix has been promoting for many months. (Globes 29.06)

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4.3 First Solar Modules to Power Landmark 200MW Photovoltaic Project in Dubai

Tempe, Arizona’s First Solar signed an agreement to supply its high performance photovoltaic (PV) modules to power the 200 megawatt (MW)AC second phase of the Mohammed bin Rashid Al Maktoum Solar Park in Dubai, the United Arab Emirates. Earlier this year, a consortium led by ACWA Power, a leading water and power developer, owner and operator based in Saudi Arabia, and TSK, a Spanish engineering and construction company, was selected by the Dubai Electricity and Water Authority (DEWA) to develop, construct, own and operate the independent power project.

Significantly, the utility scale solar plant will be one of the largest facility of its kind in the Middle East when completed in early 2017. The plant will produce enough energy to power 30,000 average homes in the UAE and will displace over 469,650 metric tons of carbon dioxide per year. The project will be powered by over 2.36 million First Solar modules, compared to the 152,880 that were installed in the 13MWAC first phase of the Mohammed bin Rashid Al Maktoum Solar Park. The plant will be built over an area of almost 4.5 million square meters, sufficient to cover as many as 100 soccer pitches.

First Solar modules already power the 13MWAC first phase of the Mohammed bin Rashid Al Maktoum Solar Park and will be installed at the 52.5MWAC Shams Ma’an solar PV plant, currently under construction in Jordan and scheduled for completion in the second half of 2016. (First Solar 23.06)

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5.1 Jordanian Exports & Imports Decline

Jordan’s total exports during the first four months of 2015 amounted to JD1.7 billion, 12.1% less than the figure during the same period of 2014, according to the Department of Statistics (DoS). Data showed a 13.7% drop in domestic exports to JD1.5 billion, and a 2.2% decline in re-exported items to JD262.3 million, compared to the same period of 2014. Imports, at JD4.5 billion, were lower by 14.3%. The trade deficit in the January-April of 2015, stood at JD2.8 billion, marking a 15.7% drop compared to the same period of 2014. Exports of clothes increased by 11.1%, while the value of fertilizers, fruits and vegetables, and pharmaceutical exports dropped by 45, 37.1 and 19.7% respectively. Imports of machinery and spare parts increased by 18.5%; vehicles, motorbikes and their spare parts went up by 12.3%; and electronics and their spare parts rose by 3.4%, while imports of crude oil and its derivatives, decreased by 44.1% and iron went down by 16.6%. (DoS 21.06)

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►►Arabian Gulf

5.2 Kuwait Legalizes Surveillance Cameras in Public Areas

Surveillance cameras will soon be installed in public places in Kuwait after the parliament legalized them. Under the new legislation, shopping centers and hotels face penalties if they do not install cameras to monitor visitors. Interior Minister Sheikh Mohammad Al Khaled Al Sabah, an ally of the Emir, reportedly said the cameras were needed to allow authorities to monitor security at important locations, including against terrorist threats, and to help in the detection of crimes. He insisted the new legal powers would not be abused or infringe on individual’s privacy. Kuwait has so far avoided any serious public attacks since the Arab Spring, but its rulers have cracked down on public comment, including jailing the former opposition leader, for insulting the Emir. (AB 17.06)

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5.3 Qatar’s Secretive Sovereign Fund to Restructure

Qatar Investment Authority will set asset allocation targets for the first time and restructure internal decision-making, sources say, in response to a drop in oil prices that has crimped available funds as competition for assets grows. Sources, who all either work in Qatar or for foreign institutions which work with the QIA, said the review process was currently ongoing. They spoke on condition of anonymity as they did not want to jeopardize working links with the secretive fund. The QIA, which is estimated by industry tracker the Sovereign Wealth Center to have $304 billion of assets, declined to comment.

QIA, set up in 2005 by the Supreme Council of Economic Affairs was one of few sources of capital available to stressed sellers during the global financial crisis and thus snapped up, at rock bottom prices, many indiscriminate assets like ownership of the Shard skyscraper in London and Harrods department store, and stakes in Credit Suisse and Volkswagen. Now, however, as the global economy recovers, QIA faces competition from other funds again as it seeks to diversify its hydrocarbon-centric economy. On top of that lower oil prices have reduced new investment funds available to it – though they still stand at tens of billions of dollars. It’s also faced criticism for extreme secrecy because the fund doesn’t disclose its performance or total assets under management. (AME 16.06)

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5.4 UAE & US Sign Agreement to Provide Tax Information

The UAE and the US have signed an agreement to implement America’s new Foreign Account Tax Compliance Act (FATCA). The agreement means all US citizens in the UAE will now have the details of all of their finances held in the UAE provided to the American government, potentially making them liable for additional tax. FATCA was enacted by the US Congress in 2010 to target non-compliance by US taxpayers using foreign accounts. The US law requires foreign financial institutions to provide annual reports on account information of customers who are US citizens and provides penalties for institutions that do not comply. US ambassador to the UAE Barbara Leaf said FATCA was becoming the “global standard in the effort to curtail tax evasion”.

Under the agreement, the UAE financial institutions must provide the US Treasury Department a report on information about financial accounts held by US citizens or by certain foreign companies with one or more US shareholders that own more than 10% of the company by 30 September 2015. Certain government institutions, sovereign funds and international organizations are exempt from the reporting requirements. (WAM 23.06)

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5.5 UAE’s Inflation Rate Rises to 4.3% in May

The UAE’s inflation rate edged up towards six year highs in May amid continuing upward pressure from the cost of housing and utilities, according to the UAE National Bureau of Statistics. Inflation rose to 4.3% year-on-year from 4.2% the previous month, and is just 0.2% off January’s rate which was the highest level since May 2009. Housing and utility costs, which account for over 39% of consumer expenses, jumped 9.4% from a year earlier in May.

The emirate of Abu Dhabi, the biggest emirate in the UAE, hiked electricity and water tariffs from 1 January, while the real estate market has been rising. Food and soft drink prices, which account for nearly 14% of the basket, gained 1.4% year-on-year. The latest figures follow a survey published in March in which around half of expats in the UAE are considering leaving the country due to the rising cost of living. (AB 22.06)

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5.6 UAE Economy Set to Surge 4.4% to Cross $440 Billion

Robust non-oil activities, greater public sector spending and huge foreign reserves will propel the UAE’s economic growth by 4.4% to $440.18 billion in 2015 from $416.44 billion in 2014, Frost & Sullivan forecast in a study. In H2/15, the UAE economy is projected to grow by 4.5% to record an annual growth of 4.4% in 2015. In 2014, the gross domestic product of the UAE surged 4.3% to $416.44 billion. Frost & Sullivan’s forecast for the UAE is more bullish than World Bank’s latest projection. In its Mena Economic Indicator report, the World Bank noted that UAE’s real GDP growth would slow from 4.7% in 2014 to 3.1% in 2015 due to a decline in oil prices. Recently, the International Monetary Fund (IMF) has revised the UAE’s growth outlook for this year and the next to 3.2%. However, the Fund forecast in its latest regional outlook report that the UAE’s non-oil GDP to grow at 4.4% in 2015 and 4.5% in 2016. (KT 19.06)

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5.7 Dubai’s May Inflation Rate Jumps to Six-Year High

Dubai’s inflation rate in May rose to its highest level since May 2009, driven by housing and utility costs, according to consumer price data released by Dubai Statistics Centre. Inflation rose to 4.7% year-on-year with housing and utility costs, which account for almost 44% of consumer expenses, jumping 7.8% from a year earlier. The inflation rate was 0.7% higher than the previous month, the data showed.

Food and beverage prices, which account for 11% of the basket, rose by 1.7% on an annual basis. Dubai and Abu Dhabi have been ranked as the 23rd and 33rd most expensive cities to live in, according to Mercer’s 2015 Cost of Living Survey. The two cities have experienced a significant jump compared to 2014, with Dubai soaring 44 places from last year’s position at 67 and Abu Dhabi going up 35 places 68th in 2014. Steep increases for expatriate rental accommodations in both cities partly drove this rise up the list. (GT 21.06)

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5.8 France & Saudi Arabia Set To Sign Contracts Worth $12 Billion

On 24 June, France and Saudi Arabia signed $12 billion of deals, French Foreign Minister Fabius told reporters during a visit by Deputy Crown Prince Mohammed bin Salman in deals highlighting Paris’ growing commercial ties in the Middle East. The contracts include 23 Airbus H145 helicopters worth $500 million. The H145, previously known as the EC145, is a light twin-engined helicopter typically used for emergency services or border patrols. A military version is used by the US Army. Saudi Foreign Minister Adel Al Jubeir said he was still discussing the price for a contract for French naval patrol boats, built by DCNS. Saudi Arabia also plans to sign a feasibility study for two EPR reactors built by Areva. The contracts, the latest to be agreed between Paris and a Gulf Arab state, come after French President Francois Hollande was invited by Gulf Arab leaders in May to address their summit in Saudi Arabia, a rare privilege for a foreign head of state. (AB 24.06)

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►►North Africa

5.9 Egyptian Cabinet Approves Budget Draft for FY 2015/16

Coinciding with the first day of Ramadan and an hour before breaking fast, the Egyptian cabinet announced that it approved the budget draft for the fiscal year (FY) 2015/2016, setting the target for deficit at 9.9% of gross domestic budget. The budget deficit for FY 2014/2015 stands at 10.8%. Last year, the government set a goal of 10% of GDP for the deficit. The government announced that it is expecting a 23% surge in public revenues, which will be utilized to a 12% increase in social programs. The budget targets 22% increase in spending on health and 8.3% increase on education. Public spending is expected to record EGP 872.6b, an 18.5% increase compared to the current fiscal year. About EGP 75b were expected from investment, the cabinet noted. (DNE 18.06)

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5.10 Egypt Enters Into Initial Deal for 15 Projects Worth $10 Billion with China

Egypt has entered into an initial agreement with China over 15 projects worth about $10 billion. Egyptian Trade Minister Abdel Nour signed an initial framework agreement with representatives from the Chinese trade ministry. Financing agreements for the projects will be signed between late June and September. The projects would be mainly focused on the electricity and transport sectors but would also include Chinese direct investment in other projects. The minister did not name any specific companies involved but said that the Export-Import Bank of China would provide financing for six transport projects including building a new railroad and developing several existing ones. The minister said both parties had the right to ask for changes or adjustments to this deal. (AME 19.06)

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5.11 Egypt’s Suez Canal Revenue at $449.6 Million in May

Egypt’s revenue from the Suez Canal rose to $449.6 million in May from $422.1 million in April, a government website said. The canal, the fastest shipping route between Europe and Asia, is one of Egypt’s main sources of foreign currency. (Reuters 18.06)

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5.12 Tunisia Sees Losses of $515 Million for Tourism This Year After Attack

Tunisia expects to lose at least $515 million this year, or about a quarter of its estimated annual tourism earnings, following the 26 June attack on a beach hotel that killed 39 people, mostly British holidaymakers. The attack by a gunman on the Imperial Marhaba beach hotel in the popular resort town of Sousse came just months after militants attacked the Bardo museum in Tunis, killing 21 people, and delivering a blow to the country’s vital tourism industry. Tunisia earned $1.95 billion in revenues from tourism last year. The sector makes up seven% of its gross domestic product and is a major source of foreign currency and employment for Tunisia. The government plans to end a visitors’ tax and also to review debt relief for hotel operators as ways to help sustain the industry. (Reuters 30.06)

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5.13 Morocco’s Trade Balance Improves 25.3% in Second Quarter of 2015

Morocco’s trade deficit was contracted by MAD 21.41 billion by May 2015, that is a 25.3% decrease compared to the same period last year, the Exchange Office said. The trade deficit balance stood at MAD 63.12 billion in May 2015, compared to MAD 84.54 billion the same period last year. The export/import coverage ratio stood at 59.1% compared to 50.4% in May 2014. This improvement is mainly driven by a 5.8% increase in exports, which reached MAD 91.03 billion in the second quarter of 2015 against MAD 86 billion last year, in addition to a 9.6% decrease in imports which totaled MAD 154.15 billion, compared to MAD 170.55 billion the same period a year earlier. (MAP 17.06)

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6.1 Turkey’s Exports Decline by 19% in May

Turkey’s exports declined by 18.8% to $11.1 billion and imports by 14.4% to $17.8 billion in May, compared to the same month of the previous year, according to data from the Turkish Statistical Institute (TUIK). The foreign trade gap contracted by 6.1% to $6.7 billion in May from the same month of 2014 with the continuing positive effect of a decrease in energy prices. The country’s energy imports decreased by 24% to $17.3 billion in the first five months of the year compared to the same period of the previous year. Turkey’s five-month exports fell by 8.4% to $61.6 billion against in the same period of 2014, while imports fell by 10.6% fell to $88.5 billion over the same period. The country’s foreign trade deficit thus decreased by 9.7% to $26.9 billion in the first five months of the year from the same period of 2014. While the share of exports to European Union countries was 43.8% in May 2014, the figure decreased to 42.5% in May this year. The country’s exports to the EU decreased by 21.3% to $4.72 billion in May compared to the same month of 2014.

In May 2015, the main partner country for exports remained Germany with $1 billion, followed by the United Kingdom with $689 million, Iraq with $658 million and Italy with $507 million. In May 2015, the top countries for Turkey’s imports were China, with $1.9 billion, Germany, with $1.85 billion, Russia with $1.8 billion and the U.S. with $1 billion. (TUIK 30.06)

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6.2 Turkish Tourism Sector to Lose $2.5 Billion Amid Russian Crisis

Due to the Russian economic crisis, the number of Russian tourists coming to Turkey has continued to decline, negatively affecting the sector. As the number of Russian visitors has dropped 30%, an economic cost of $2.5 billion has been forecasted, while 20,000 people in the Mediterranean province of Antalya are expected to lose their jobs. According to the president of the Union of Mediterranean Hotel Owners (AKTOB), Antalya has seen 450,000 fewer visitors already this year, with that figure likely to increase to one million by the end of the season. (Zaman 28.06)

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6.3 IMF Says Cyprus’ Economic Progress “Impressive”

The International Monetary Fund (IMF) has released the next batch of aid funds to Cyprus after completing the 5th, 6th and 7th (combined) review of Cyprus’s economic adjustment program, being impressed by the economic progress of the island. IMF’s First Deputy Managing Director and Acting Chair, Mr. David Lipton, stated that “Cyprus’ Fund-supported reform program continues to produce positive results,” and commented that economic and fiscal outcomes have been better-than-expected, with growth turning positive in the first quarter of 2015 and public finances exceeding targets. The Executive Board also approved a revised schedule of future disbursements and reviews, with the next review of Cyprus’s economic adjustment program expected to take place in September 2015.

Liquidity and solvency in the banking system have improved, allowing the elimination of external payment restrictions and, going forward, it will be important to maintain the reform momentum and strong program ownership. Continued efforts are needed to strengthen banking supervision and build the capacity of the banking system to restructure loans in a sustainable manner.

Mr. Lipton concluded his statement by saying that the Cypriot authorities should not forget to advance structural reforms to strengthen public finances and lay the ground for sustained growth. “Fiscal reforms should focus on revenue administration, public financial management, and public administration. Progress in privatization and further efforts to improve the business environment and reduce unemployment are also needed.” (IMF 23.06)

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6.4 Greece in Shock as Banks Shut After Creditor Talks Break Down

On 29 June, Greeks woke up to shuttered banks, closed cash machines and a climate of rumors and conspiracy theories as a breakdown in talks between Athens and its creditors plunged the country deep into crisis. After receiving no extra emergency funding for Greek lenders from the European Central Bank, Prime Minister Alexis Tsipras somberly announced capital controls in a televised address on 28 June to prevent banks from collapsing under the weight of mass withdrawals.

Greece has less than 48 hours to pay back €1.6 billion ($1.77 billion) of IMF loans and a default would set in train events that could lead to the country’s exit from the euro currency bloc. But after Tsipras angered Greece’s international lenders by announcing a snap referendum for 5 July on the terms of a cash-for-reforms deal, hopes of a last-minute breakthrough are fading fast. Greeks reacted with a mixture of disbelief and fear. The Greek government will keep banks shut at least until after the referendum, and withdrawals from automated teller machines will be limited to €60. The stock exchange will also stay shut.

After months of wrangling, Greece’s exasperated European partners have put the blame for the crisis squarely on Tsipras’s shoulders. The creditors wanted Greece to cut pensions and raise taxes in ways that Tsipras has long argued would deepen one of the worst economic crises of modern times in a country where a quarter of the workforce is already unemployed. (Reuters 29.06)

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6.5 Eurozone Prepares for Greek Default After Tsipras Referendum Call

The Eurozone got ready to deal with a Greek debt default this week after refusing to extend credit following Prime Minister Tsipras’s surprise announcement of a referendum on an offer from creditors that his leftist government rejected. Athens asked for an extension of Greece’s bailout program beyond Tuesday, the day it must pay €1.6 billion to the IMF or go bust. But the other 18 members of the Eurozone unanimously rejected the request, freezing Greece out of further discussions with the European Central Bank (ECB) and IMF on how to deal with the fallout from a historic breach in the European Union’s (EU) 16-year-old currency.

The swift rejection was a startling demonstration of the degree to which Tsipras had alienated the rest of the currency bloc with a final-hour announcement that upended five months of intense talks. The Eurogroup of finance members shut Greece’s Varoufakis from a meeting in Brussels and issued a statement without him, accusing Athens of breaking off negotiations unilaterally. Varoufakis said the refusal to provide an extension “will certainly damage the credibility of the Eurogroup as a democratic union of partner member states”.

The offer from creditors requires Greece to cut pensions and raise taxes in ways that Tsipras has long argued would deepen one of the worst economic crises of modern times in a country where a quarter of the workforce is already unemployed.

But voters in other Eurozone states, including economic powerhouse, other southern states which have suffered harsh austerity in return for EU cash and poor eastern countries with living standards much lower than Greece, have lost patience. Worried the country could default and even leave the Eurozone, some Greeks queued up at cash machines to withdraw funds, though there were no signs of panic in Athens. Many sounded defiant, saying Tsipras had offered them an important chance to determine their own fate.

But after they were blindsided by Tsipras’ surprise middle-of-the-night announcement that he rejected their offer and would put it to voters only after Tuesday’s deadline, one after another said all that remained to discuss was “Plan B” — how to limit the damage of default.

After months of wrangling with the lenders, Tsipras announced that he would put the terms of the creditors’ “humiliating” offer to a popular vote on 5 July. Tsipras said he would respect the outcome of the vote, but he argued the lenders demands “clearly violate European social rules and fundamental rights”, would asphyxiate Greece’s flailing economy and aimed at the “humiliation of the entire Greek people”. Greece’s stricken banks depend on emergency liquidity from the ECB to stay open, and the banking system faces at the very least a further flood of withdrawals after billions have left in recent weeks. (Reuters 27.06)

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6.6 Greece & Russia Sign Memorandum on Gas Pipe to Greece

Russia and Greece on 19 June signed a preliminary agreement to set up a joint venture to build a pipeline through Greece. The two countries will jointly own the venture. Russian gas giant Gazprom had earlier proposed footing the bill for building a Greek pipeline extension of the Russia-Turkish energy venture TurkStream, which aims to deliver gas to Europe while bypassing Ukraine. (AFP 19.06)

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7.1 Fast of the 17th of Tammuz to be Observed on 5 July

The Jewish fast day of the 17th of Tammuz will be observed this year from sunup to evening on Sunday, 5 July. The fast day itself commemorates five historical tragedies: 1. Moses descended from meeting God and receiving the Torah on Mount Sinai, saw the Jews celebrating with the Golden Calf and broke the two tablets God had given him. 2. The daily offering, which had been brought regularly in the Temple in Jerusalem, was halted during the Babylonian siege before the Temple was destroyed. 3. The Romans breached the walls of Jerusalem, prior to destroying the second Temple, in 70 CE. 4. A Greek or Roman official named Apostimos held a public burning of the Torah. 5. Idols were set up in the Temple itself; although it is not clear what year this happened. The 17th of Tammuz is the second of the four fasts commemorating the destruction of the Temple and the Jewish exile.

In later years this day continued to be a dark one for Jews. In 1391, more than 4,000 Jews were killed in Toledo and Jaen, Spain and in 1559 the Jewish Quarter of Prague was burned and looted. The Kovno ghetto was liquidated on this day in 1944 and in 1970 Libya ordered the confiscation of Jewish property.

The 17th of Tammuz also marks the beginning of the “Three Weeks,” which ends with the fast of the 9th of Av. Some customs of mourning, which commemorate the destruction of Jerusalem, are observed from the start of the Three Weeks. Jewish mourning customs restricts the extent to which one may take a haircut, shave or listen to music, though communities and individuals vary their levels of observance of these customs. No Jewish marriages or other major celebrations are allowed during the Three Weeks, since the joy of such an event would conflict with the expected mood of mourning during this time. The Three Weeks can be thought of as having a variety of increasing levels of mourning. Some restrictions begin on the 17th of Tammuz, some from the beginning of the month of Av, and some only come into effect the week in which the 9th of Av occurs.

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7.2 NFL Hall of Famers Get All-Star Tech Demo in “Startup Nation”

OurCrowd, the world’s leading equity crowdfunding platform and investor in Israeli startups, together with Jnext – the Jerusalem Development Authority program supporting and promoting tech-entrepreneurship in the city, hosted 19 members of the U.S. Pro Football Hall of Fame for an exhibit of the latest technologies coming out of the “Startup Nation.” The goodwill trip to Israel, coined “Touchdown in Israel: Mission of Excellence,” was organized by New England Patriots Chairman and CEO Robert Kraft, in coordination with Israel’s Ambassador to the United States, Ron Dermer. The week-long visit kicked off with the technology expo in Jerusalem’s Old City. Members of the delegation received an up close look at the best of Israeli high-tech innovation via ten hand-picked companies, seven of which are funded on the OurCrowd equity crowdfunding platform. The NFL legends were greeted with a demo of ReWalk, a wearable bionic skeleton that allows individuals with spinal cord injuries to walk again.

Other companies on display included OrCam, an intuitive portable device with a smart camera designed to assist the visually impaired; Glide, the world’s first and only messaging application with streaming video technology; Inpris, technology that recognizes the individual movements of each fingertip anywhere on a touch-screen; MUV Interactive, a state-of-the-art solution for interacting with multiple screens and media sources through touch, remote and voice interaction; BriefCam, the video analysis software keeping our city streets safe; Consumer Physics, makers of SCiO, an advanced optical spectrometer that allows users to identify the chemical makeup of anything around them; Cimagine, the most visually advanced and user-friendly way for consumers to envision and interact with physical products in virtual reality and Highcon, which manufactures the Euclid, a machine that automates packaging production by bringing it into the digital age. (OurCrowd 22.06)

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7.3 New NIS 200 Bill to Be Introduced Soon

The Bank of Israel has provided manufacturers, suppliers and operators of vending, counting and sorting machines with initial examples of the new NIS 200 bills for the purpose of calibrating their machines to handle them. The new bills will enter circulation in the next few months. The bank is expected to later publish the final design of the bill, as well as comprehensive explanatory material about the security marks on it. The existing bills will continue in circulation for a number of years. The new bill will be colored blue, and will bear a portrait of legendary Israeli poet Natan Alterman. (Globes 18.06)

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8.1 Teva & Microchips Biotech Form Digital Drug Delivery Technology Partnership

Teva Pharmaceutical Industries and Lexington, Massachusetts’ Microchips Biotech entered into a partnership under which the companies will explore innovative ways to apply Microchips Biotech’s implantable drug delivery device to Teva’s portfolio of products with the goal of enhancing clinical outcomes for patients on chronic drug therapies. Microchips Biotech’s electronic device is made up of microchip arrays that can store hundreds of therapeutic doses of drug for periods ranging from months to years and releases each dose at precise times. The device can be programmed to release drug on a pre-determined schedule and will have wireless control features.

Under the terms of the agreement Teva will make a $35 million upfront payment to Microchips Biotech in the form of an equity investment and technology access fee. The partnership has an initial focus on one selected disease area, but will provide Teva with the option to later expand the program into several additional therapeutic areas and sensing applications that are proprietary to Teva. As programs advance, Microchips Biotech will receive development and commercial milestone payments and royalties on future product sales. Microchips Biotech will also receive funding to develop products for any future additional indications Teva may develop, and Teva will be responsible for Phase II and Phase III clinical development and regulatory filings.

The microchip-based implant is a self-contained hermetically-sealed drug delivery device that is easy to implant and remove in a physician’s office setting that can store hundreds of therapeutic doses over months and years, and releases each dose at precise times. The implant has been clinically-validated in human studies delivering parathyroid hormone in osteoporosis patients and the system is fully programmable via wireless communications to adjust dosing by physician and/or patient.

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 18.06)

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8.2 PhysiMax’s Real-Time Movement Assessment Validates Landing Error Scoring System

PhysiMax announced a breakthrough study, validating automated scoring of the Landing Error Scoring System (LESS) box-jump protocol. The study evaluated dozens of healthy West Point freshmen cadets with no pre-existing injuries or limitations, predicting injury risk and evaluating biomechanical efficiency according to the latest standard Landing Error Scoring System protocol, using a 3D video camera (Kinect). Phase two of the study, currently underway, involves evaluating over 1,000 freshmen using the PhysiMax solution, essentially addressing the issue of drop-out due to injury by identifying high-risk enlistees and implementing proactive sports injury prevention measures through athletic movement assessment.

Tel Aviv’s PhysiMax is the first cloud-based real-time athletic movement assessment service provider, reliably scoring athletes’ risk of injury and athletic performance. The solution empowers sports staff to improve performance and facilitate sports injury prevention. PhysiMax already serves prominent healthcare providers, Division I colleges and top international sports clubs. (PhysiMax 17.06)

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8.3 Tikun Olam Announces Its First U.S. Partnership

Tikun Olam announced a joint partnership in New York State with Compassionate Care Center of New York, a leading privately held New York-based biopharmaceutical company applying to be a Registered Organization under New York’s Compassionate Care Act, and MedReleaf Corp., a privately held federally-licensed producer and distributor of medical-grade cannabis in Canada, which has set the gold standard for the industrial production of medical-grade cannabis in North America.

The partnership grants CCCNY an exclusive perpetual license in New York State to Tikun Olam’s globally recognized patient treatment database and its proprietary medical cannabis strains developed during nearly a decade of rigorous testing in Israel. Tikun Olam’s Israeli team of master growers, horticulture and quality assurance experts, will be on the ground with its Canadian counterparts at CCCNY’s manufacturing facility, Newark Greenhouse, a turnkey currently operating 10-acre greenhouse in Newark, NY, to ensure that CCCNY will be the first Registered Organization in New York State to have pharmaceutical-grade products available to qualifying patients.

Tzfat’s Tikun Olam is the first, largest and foremost supplier of medical Cannabis in Israel and is one of leading medical cannabis companies in the world. The company is the flag bearer and pioneer of the treatment of patients with medical cannabis in Israel. It is privately held and has been operating under license from the Israel Ministry of Health for nearly a decade providing unparalleled treatment alternatives through the development of industry-leading professional standards for treating patients with the highest quality pharmaceutical-grade medical cannabis available. The company currently has over 20 on-going clinical trials in Israel. (Tikun Olam 18.06)

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8.4 Biogal-Galed Commercializes Two New PCRun Veterinary Molecular Detection Kits

Biogal Galed Labs announced the commercialization of two new PCRun Veterinary Molecular Detection Kits. Biogal has announced the launch of the Canine Babesia canis and Canine Parvovirus PCRun molecular detection test kits. This is now in addition to the five previously commercialized PCRun molecular detection test kits for canine Leptospira, Ehrlichia canis, Anaplasma platys, Leishmania and Feline Mycoplasma haemofelis. The paradigm of a PCR test being performed in a specialized veterinary lab with prolonged turnaround times has now been broken.

With Biogal’s PCRun, vets can now receive a PCR result within 75 minutes. Conventional PCR testing procedure requires multiple steps, via expensive, time consuming and complicated devices called thermocyclers. For a veterinary lab to even set up a PCR lab, they need to spend tens of thousands of dollars. With PCRun, there is no need for a thermocycler. PCRun is flexible, meaning it can be used in a small animal veterinary lab and/or clinic. You simply purchase the kits only.

Biogal was established in 1986. Biogal’s various veterinary diagnostic products are available in over 35 countries. Biogal developed the patented ImmunoComb technology for detecting antibody levels in blood or serum. (Biogal 17.06)

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8.5 Chinese Investors Putting $2 Million Into Hadasit

Hadasit Bio Holdings announced a $2 million investment from Chinese investors. The investors will receive one quarter of the company’s shares in the placement, which reflected a company value of $6 million, after money.

Hadasit Bio-Holdings (HBL) was founded to allow public participation in the highly promising field of biotechnology. It serves as a precedent in biotech financing – for the first time, public investment is allowed to participate in a holding entity including companies based on IP generated by Israel’s foremost medical research center – Hadassah University Hospital. HBL is a publicly traded subsidiary of Hadasit, Ltd., the technology transfer company of the Hadassah University Hospital in Jerusalem, Israel. Hadasit was established for the purpose of promoting and commercializing the intellectual property (IP) and R&D capabilities generated by Hadassah, aimed at finding solutions to problems faced by modern medicine.

Hadasit Bio has holdings in a number of companies, most of which are at various stages of clinical trials. Hadasit Bio’s most prominent investments are in Cell Cure Neurosciences, which is in Phase I/IIa clinical trials for the use of stem cells in the treatment of age-related blindness; Enlivex, which is preparing for a Phase IIb or Phase III trial of its treatment for Graft Versus Host Disease (GVHD), a disease that attacks bone marrow implants, and which recently received an investment from a group led by Shai Novick; D-Pharm, which is developing drugs for treatment of stroke; and KAHR Medical, whose product treats autoimmune diseases and cancer, and which has obtained an investment from Sanofi. KAHR is also at the pre-clinical trials phase. (Globes 28.06)

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8.6 Pluristem Granted Australian Patent for 3D Cell Expansion Technology

Pluristem Therapeutics has been granted an Australian patent titled “Adherent Cells From Placenta Tissue and Use Thereof in Therapy”. Patent #2009288781 covers Pluristem’s proprietary, three-dimensional method of growing cells from placental or adipose tissue, cells produced by the process, and the use of such cells in the potential treatment of a broad range of conditions. These include peripheral artery disease, other ischemic and cardiovascular diseases, graft-versus-host disease, organ transplantation, cancer, and autoimmune diseases. The patent term will extend until 2027. The newly granted patent is Pluristem’s fifth in Australia, with six more patent applications pending there. Australia has one of the longest life expectancies in the world and healthcare spending in 2013 totaled $172 billion. It is an important market for therapies that target chronic diseases that occur more commonly in ageing populations, such as critical limb ischemia, intermittent claudication and muscle injury or wasting, all of which figure prominently in Pluristem’s clinical pipeline.

Pluristem’s out-licensing partner, United Therapeutics, is currently conducting a Phase I study in Australia of Pluristem’s cells in the treatment of pulmonary arterial hypertension, and is recruiting patients for the second cohort in the study. Pluristem has been issued over 40 patents, and has approximately 150 more patents pending worldwide.

Haifa’s Pluristem Therapeutics is a leading developer of placenta-based cell therapy products. The Company has reported robust clinical trial data in multiple indications for its patented PLX (PLacental eXpanded) cells. The cells release a cocktail of therapeutic proteins in response to inflammation, ischemia, hematological disorders, and radiation damage. PLX cell products are grown using the company’s proprietary three-dimensional expansion technology. (Pluristem Therapeutics 24.06)

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8.7 BioLight Obtains CE Mark for CellDetect Non-Invasive Test for Bladder Cancer

BioLight Life Sciences Investments announced that its CellDetect non-invasive test for detecting bladder cancer in urine has obtained CE Marking, enabling the product to be marketed and sold in Europe and other territories. The CE marking recognizes the conformity of the CellDetect non-invasive test for detecting recurrence of bladder cancer in urine with the relevant directive of the European Community. BioLight also announced that the European Patent Office has issued a patent related to the core of the CellDetect technology. The patent will be in effect until March 2027. The CellDetect technology is being developed by Micromedic Technologies, BioLight’s cancer diagnostics subsidiary, and allows an accurate diagnosis of cancerous and precancerous cells, based on a unique combination of color and morphology, by utilizing a proprietary kit containing unique extract and dyes.

Micromedic plans to submit a Pre-IDE for the Product to the U.S. FDA in H1/2016. Micromedic’s CellDetect technology allows an accurate diagnosis of cancerous and precancerous cells, based on unique combination of color and morphology. The technology may be implemented in screening tests and monitoring tests of disease recurrence in cancer patients after being treated. Micromedic has proven the product’s efficacy in diagnosing cervical cancer and bladder cancer in the framework of clinical trials, and estimates that the technology underlying the products may be implemented for use in additional cancer indications.

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 controlled release drug-delivery insert platform and a new technology a drug-delivery platform 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 others. (BioLight 30.06)

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8.8 Pharma Two B Announces Positive Results in its Parkinson’s Clinical Study

Pharma Two B announced the successful results of the company’s Phase IIb pivotal study of P2B001 for the treatment of early stage Parkinson’s Disease (PD). P2B001 is a combination of low dose pramipexole and low dose rasagiline administered as a proprietary sustained release formulation. The study, titled A Phase IIb, Twelve Week, Multi-Center, Randomized, Double-Blind, Placebo-Controlled, Parallel Group Study, To Determine the Safety, Tolerability and Efficacy of Two Doses of Once Daily P2B001 in Subjects with Early Parkinson’s Disease, met primary and secondary clinical endpoints for both dose combinations.

Pharma Two B’s P2B001 combines two non-Levodopa drugs that have been individually approved for the treatment of early stage Parkinson’s disease, in a sustained release profile. Given as low dose monotherapies, the anti-Parkinsonian effect of these drugs given individually is limited, while in higher doses they can be associated with potentially serious side effects. In preclinical studies, we observed that a low dose combination of these two drugs administered in a sustained release formulation has synergistic effects leading to notable efficacy and a very good safety profile.

Rehovot’s Pharma Two B is a drug development company, developing innovative products, with clinical and commercial added value, based on previously approved drugs. The company develops synergistic combinations of two drugs, acting in complementary biological mechanisms that enable the use of unique low doses, while maintaining high therapeutic benefit. The company also has a line of select generic products in new formulations. (Pharma Two B 30.06)

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9.1 Mellanox Announces ConnectX-4 Lx Cost-Efficient 25/50 Gigabit Ethernet Network Adapter for Cloud

Mellanox Technologies announced its ConnectX-4 Lx 10/25/40/50 Gigabit Ethernet adapter, delivering optimal cost-performance and scalable connectivity for Cloud, Web 2.0 and storage platforms. The first adapter designed to serve as a direct replacement for commonly deployed 10 Gigabit Ethernet adapters, the ConnectX-4 Lx allows businesses to migrate to higher-performance technology as their bandwidth requirements increase without demanding an infrastructure overhaul or added operating expense. ConnectX-4 Lx supports Multi-Host technology which enables multiple compute and storage hosts to connect to a single adapter, while maintaining high-performance levels and reducing overall data center CAPEX and OPEX. ConnectX-4 Lx also includes native hardware support for RDMA over Converged Ethernet (RoCE), stateless offload engines and GPUDirect. Together with Mellanox’s Spectrum 10/25/40/50 and 100 Gigabit Ethernet switches, Mellanox now enables a complete and world-leading end-to-end Ethernet solution for cloud, Web 2.0, data analytics, artificial intelligence and enterprise data centers. With Mellanox Ethernet solutions, data center users and managers can upgrade from 10 to 25 or from 40 to 50 or 100Gb/s performance.

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 18.06)

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9.2 Mellanox Introduces the World’s First 25/100 Gigabit Open Ethernet-based Switch

Mellanox Technologies announced the industry’s first 100 Gigabit Ethernet, Open Ethernet-based, non-blocking switch. Spectrum, the next generation of its Open Ethernet-based switch IC, overcomes current data center challenges by providing a highly flexible and scalable solution that allows businesses to deploy the hardware-software combinations best suited to meet their unique needs. With Spectrum, Mellanox is the first to offer end-to-end 10/25/40/50 and 100 Gigabit Ethernet connectivity. Computing and storage infrastructures have reached a critical point due to the convergence of dozens of industry trends pushing them to the brink as data sets grow exponentially and threatening the unique competitive differentiator of many businesses. Commonly deployed closed-solutions, those that require the use of proprietary hardware-software combinations, leave many organizations unable to optimize their data centers to meet their business needs, making it difficult to garner actionable insights from expanding data sets. Based on the Open Ethernet architecture, Spectrum offers Mellanox’s customers the choice of Application Programming Interface (API) for faster time-to-market and greater flexibility, while also providing industry-leading 25, 50 and 100 Gigabit Ethernet performance, ensuring the data centers can drive their business forward.

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 18.06)

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9.3 Yissum and ICL Expand Research Collaboration in the Area of Advanced Materials

Yissum Research Development Company, the Technology Transfer Company of the Hebrew University of Jerusalem, signed multiple research and licensing agreements in the area of advanced materials with ICL, a global manufacturer of products based on specialty minerals that fulfill essential needs of the world’s growing population in the agriculture, processed food and engineered materials markets.

The expanded collaboration includes a research agreement involving work in the field of materials and 3D printing. These inventions join the on-going research collaboration between Yissum and ICL Innovation, ICL’s technology incubator and ICL Industrial Products (ICL IP).

Yissum Research Development Company of the Hebrew University of Jerusalem was founded in 1964 to protect and commercialize the Hebrew University’s intellectual property. Products based on Hebrew University technologies that have been commercialized by Yissum currently generate $2 billion in annual sales. Ranked among the top technology transfer companies in the world, Yissum has registered over 8,500 patents covering 2,500 inventions; has licensed out 750 technologies and has spun out 96 companies.

Tel Aviv’s ICL is a global manufacturer of products based on specialty minerals that fulfill humanity’s essential needs primarily in three markets: agriculture, food and engineered materials. The agricultural products that ICL produces help to feed the world’s growing population. The potash and phosphates that it mines and manufactures are used as ingredients in fertilizers and serve as an essential component in the pharmaceutical and food additives industries. The food additives that ICL produces enable people to have greater access to more varied and higher quality food. ICL’s water treatment products supply clean water to millions of people, as well as to industry around the world. (Yissum 18.06)

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9.4 Vexigo’s Visualizr Supports New Mobile Friendly Search Engine Ranking Requirements

Tel Aviv’s Vexigo, a global provider of online video advertising and content monetization solutions and a wholly- owned subsidiary of Mer Telemanagement Solutions, announced that its Visualizr mobile publishing platform, which transforms sites so they are mobile friendly thus increasing targeted ad exposure and generating higher ad revenue; now fully supports and leverages the recent changes to search engine ranking algorithms that favor mobile friendly websites. The Vexigo Visualizr mobile publishing platform enables website owners and publishers to promote and monetize their content as a personalized magazine optimized for all types of devices, including mobile and wearable devices. Vexigo’s patented contextual analysis engine performs real-time analysis of a website visitors’ navigation behavior and automatically pushes relevant website elements and content for each unique visitor to their device creating a stunning, personalized mobile website.

Content publishers and advertisers can quickly take advantage of Visualizr’s full suite of mobile online advertising options, including native ads, interstitials, video, rich media and sponsored content that enables them to target their audience with pinpoint accuracy. In addition, the solution provides website visitors with personalized content, based on their unique reading preferences and usage increasing visitor stickiness and time spent on the site. The Visualizr platform also includes a management dashboard for full visibility into engagement statics and ROI measurements allowing publishers to quickly optimize their content and monetization efforts. (Vexigo 18.06)

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9.5 ECI Announces the New Apollo OPT 9900 Series – High Capacity Switching Platforms

ECI introduced the Apollo OPT 9900 series, the newest addition to its industry-leading Apollo optical product line. The Apollo OPT 9900 series, which consists of high capacity, multi-layer switching platforms, is the densest, most energy efficient, hybrid OTN/packet switch on the market today. Designed for core networks and submarine cable landing stations, the Apollo OPT 9900 series is available in two versions: the OPT 9932 with a 16T hybrid OTN/packet switching fabric and the OPT 9914 with a 5.6T fabric for lower capacity requirements. To hold up to the tests of time, the 9900 supports 100/200/400G coherent interfaces and is ready for 1T line rates, which extends the systems’ lifecycle well into the next decade. Multiservice client ports up to 100G are supported and high service reliability is provided via ASON/WSON GMPLS restoration. Boasting the lowest power consumption per bit in the industry, the 9900 series is also extremely energy efficient. Additional benefits include the integral OSNR-based calibration for alien wavelength support, the LightSoft network management suite and the LightApps software defined networking (SDN) network and service automation suite. In the following release, capabilities will be extended even further with the addition of packet switching to address the need for converged solutions in core networks. All IO cards are software upgradable to support packet thus protecting investment.

Petah Tikva’s ECI is a global provider of ELASTIC network solutions to CSPs, utilities as well as data center operators. Along with its long-standing, industry-proven packet-optical transport, ECI offers a variety of SDN/NFV applications, end-to-end network management, a comprehensive cyber security solution, and a range of professional services. (ECI 18.06)

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9.6 Mellanox Improves Software-Defined Storage Performance

Mellanox Technologies has produced a set of storage performance benchmark results working with partners and customers that demonstrate an increase in performance for Red Hat Ceph Storage and Red Hat Gluster Storage with network connections at speeds up to 100Gb/s. Mellanox partnered with Red Hat and its partners, including SanDisk, Scalable Informatics, Supermicro and Storage Foundry, to show the benefits of using fast, low-latency 10, 40, 56, and 100Gb Ethernet networks for Red Hat Ceph Storage clusters. These solutions allow larger and faster Red Hat Ceph Storage daemon (OSD) servers when using all-flash configurations or large numbers of hard drives in each server to perform beyond standard 10Gb networking, making Red Hat Ceph Storage deployments high performing and cost effective.

Red Hat Ceph Storage is well suited for archival and rich media and cloud infrastructure workloads, such as OpenStack. As enterprise and cloud customers evaluate and deploy Red Hat Ceph Storage on faster servers, with more flash, and for more demanding users, they are looking to faster networking solutions to increase performance. Scalable Informatics has been collaborating with Mellanox and Red Hat using 100GbE networking on an all-flash based Unison Red Hat Ceph Storage appliance. They have demonstrated 8GB/s+ reads from disk between a single appliance and client using Red Hat Ceph Storage. This combination provides an incredibly dense, high performance Red Hat Ceph Storage SSD solution with simplified networking.

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 25.06)

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9.7 Optimal+ 6.0 Delivers Big Data Analytics to High-Volume Semiconductor Manufacturing

Optimal+ announced the availability of Release 6.0 of its Semiconductor Operations Platform. This latest release debuts a new solution, EXACT (EXtreme Analytics and CharacTerization), to the Optimal+ family of products. Based on the growing demand for greater data collection and analytic performance, EXACT delivers an unprecedented level of big data performance to semiconductor manufacturing operations, leveraging the power of the HP Vertica Analytics Platform to enable customers to take advantage of all of the data that is generated across their global, distributed supply chain, from new product introductions (NPI) to high-volume manufacturing (HVM).

EXACT addresses two major trends that are currently changing the environment of semiconductor manufacturing operations: the enormous growth in manufacturing data being created due to increasing device volumes and product complexity; and the desire to utilize all of that data to improve operational performance, whether it be measured as a function of product yield, quality or productivity. EXACT takes a major step toward enabling customers to collect and manage all of their production data in a single database that can scale to meet the needs of any size semiconductor company, combined with the real-time performance necessary to analyze the most complex data queries.

Holon’s Optimal+ is a global provider of Manufacturing Intelligence software solutions, enabling any semiconductor company to seamlessly aggregate, organize and act upon the global manufacturing and test data generated across their internal and external supply chains to measurably improve yield, quality and productivity. The company’s real-time, Big Data analytics solutions are deployed in virtually every major foundry and OSAT currently serving the semiconductor ecosystem, processing over 20 billion chips every year on behalf of its customers and ushering in an era of unprecedented supply chain visibility that translates into strong and measurable ROI. (Optimal+ 26.06)

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9.8 Free Wi-Fi on South African Buses Thanks to RADWIN’s Wireless Mobility Solution

RADWIN announced that the city of Tshwane in South Africa is using RADWIN’s FiberinMotion wireless mobility solution to provide free Wi-Fi onboard city buses – up to 100 Mbps throughput per bus. Since the project was launched in December 2014, over 200,000 unique users have used the Tshwane Free WiFi service onboard buses, with total data usage of 30 Terabytes. Project Isizwe – a non-profit organization which brings Internet to low income communities across South Africa – spearheaded the project. In the first phase of project deployment, RADWIN’s FiberinMotion base stations were deployed along the A Re Yeng line from Pretoria Central to Hatfield and over 30 buses were equipped with FiberinMotion Vehicular Mobile Units (VMUs). Tel Aviv’s RADWIN is a leading provider of wireless Point-to-Point, Point-to-Multipoint and FiberinMotion solutions that deliver voice, video and data with unmatched high-capacity for long ranges. (RADWIN 30.06)

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10.1 Foreign Investment in Israel Drops by Half in 2014

Foreign direct investment (FDI) in Israel dropped by nearly 50% in 2014 compared to 2013 according to a report by the United Nations Conference on Trade and Development (UNCTAD), which tracks changes in global foreign direct investment worldwide. The report claims that in 2014 $6.4 billion was invested in Israel, whereas in 2013, $11.8 billion were invested – a decline of about 46%. Moreover, Israeli FDI investments abroad also decreased from $4.67 billion in 2013 to $3.97 billion, a decrease of 15%. These figures are significantly lower than the corresponding figures from 2007 to 2005, before the outbreak of the financial crisis in 2008.

But the decline is not just in Israel. According to the UN report, world FDI investments during the past year amounted to only $1.23 trillion, a 16% drop compared to 2013 ($1.47 trillion). However, when one considers the forecast given in 2014, the decline is much sharper. The UN’s World Investment Report (WIR) estimated last year that the FDI would total $1.6 trillion, in other words, with respect to the 2014 forecasts, FDI fell by 23%. (Ynet 24.06)

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10.2 Israel’s Agricultural Exports Fall

Israel’s fresh produce exports totaled $1.37 billion in 2014, down 8%, compared with 2013. Agricultural exports accounted for 3.5% of all Israeli exports last year, according to figures published by the Ministry of Agriculture and Rural Development Research, Economy and Strategy Division. The fall in agricultural exports last year is attributable to the crisis in Russia during the second half of the year. At the same time, the Ministry of Agriculture and Rural Development made it clear that because the ruble crisis began only in mid-2014, its effect on export figures for the year was limited. The continuation of this situation is detracting from export proceeds, and will also affect this year’s agricultural exports. Israel exported 633,000 tons of fresh vegetables, 128,000 tons of fresh fruit, and 156,000 tons of citrus in 2014. The Ministry of Agriculture and Rural Development figures for the agricultural produce prices show that prices dipped 0.8% in 2014, a decline that was particularly prominent, given the 0.5% rise in fresh agricultural produce prices in 2013. (Globes 22.06)

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10.3 Israel’s Unemployment Rate Rises Slightly

Israel’s unemployment rate was 5% in May, 0.2% higher than April’s 4.8% rate, the Central Bureau of Statistics announced. The number of participants in the labor force among those aged fifteen and over reached 3.833 million in May, of whom 3.643 million were employed and 190,000 unemployed. There were 1.925 million employed men, compared with 1.921 million in April, and 1.717 million employed women, compared with 1.718 million in April. The rate of participation in the labor force among those aged fifteen and over in May was 64.1%, compared with 64.0% in April. The percentage among men aged fifteen and over rose from 69.3% in April to 69.4% in May, while the percentage among women remained the same at 59.0%. The Central Bureau of Statistics also reported that the number of those employed full-time (35 hours a week or more) was 5.9% higher than in April (136,000 more employees), while the number of part-time employees (less than 35 weekly hours) declined by 3.5% in comparison to April (34,000 fewer employees). (CBS 22.06)

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10.4 Israel’s Heart Disease Mortality Rate Among Lowest in OECD

A report by the Organization for Economic Co-operation and Development has ranked Israel’s mortality rate for cardiovascular disease the fourth-lowest among OECD nations. Japan was ranked first, with the lowest rate of mortality from heart disease.

The average mortality rate from heart disease in Israel stands at fewer than 200 deaths per 100,000 population; 161 among women and 220 among men. Israel came after Japan (171 deaths per 100,000), France (182) and South Korea (185). The countries with the highest mortality rate for cardiovascular diseases are Hungary, Estonia and the Czech Republic, with more than 500 deaths per 100,000 people.

However, when it comes to diabetes, Israel takes a worrying third place in diabetes incidence. According to the OECD report data, 27% of people in Israel aged 60 to 79 suffer from diabetes, as do 9% of people aged 40 to 59. Only Mexico and Portugal had higher incidences of diabetes among the OECD nations. An estimated 85 million people ages 20 to 79, or 7% of the population in OECD nations, suffer from diabetes and the number is expected to rise to about 27% (108 million people) by 2030. (Various 23.06)

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11.1 ISRAEL: Concluding Statement of the IMF’s 2015 Article IV Consultation

A Concluding Statement describes the preliminary findings of IMF staff at the end of an official staff visit to a member country. Missions are undertaken as part of regular (usually annual) consultations under Article IV of the IMF’s Articles of Agreement, in the context of a request to use IMF resources (borrow from the IMF), as part of discussions of staff monitored programs, or as part of other staff monitoring of economic developments.

1. Israel’s economy is performing well. This is visible in GDP growth—Israel has not had the sharp post-crisis slowdown that many other countries have experienced. It is also visible in employment creation – since 2007, employment has grown from 59% of the working age population ratio to 68%.

2. Nevertheless, policy makers are confronted with a number of challenges. The fiscal deficit remains stubbornly high, leaving limited buffers to respond to shocks. Inflation is negative – well below the Bank of Israel’s (BOI) target—but housing prices continue to rise. Labor productivity is low and the gap with the United States is widening. Income inequality is among the highest in advanced countries.


3. The economic outlook is positive. Growth this year is expected to rebound to 3% (from 2.8% in 2014), the result of strong private consumption growth, driven by rapid employment growth, near-zero interest rates, falling import prices and the rebound from the impact of military operations last year. Inflation will turn positive, reaching ¾% at the end of the year and the target band next year. There is not much slack in the economy: staff judges that the output gap is near zero. In the medium term, output will grow around 3-3 ¼%—in line with our current estimate of potential output growth.

4. Risks to the outlook are balanced. Growth could disappoint if growth in Israel’s trading partners were weaker, geopolitical tensions in the region heightened, or the shekel appreciation continued. A sharp correction in housing prices could also slow growth. Growth could also be stronger than expected, for example, if trading partner economies recover faster or investment in the natural gas sector increases. Monetary tightening in the United States would likely help Israel, as it would exert downward pressure on the shekel, which would boost growth and inflation.

Rebuilding fiscal space

5. By international standards, Israel has a high, structural, and persistent fiscal deficit.

• If we use international accounting standards and include the inflation compensation of indexed bonds above instead of below the line as is currently done, the deficit is almost 1% higher than the 2½-3% reported in Israel.
• Israel’s deficit is structural. The current deficit originates from tax cuts between 2003 and 2010, which were not offset by sufficient expenditure reductions. It is not the result of cyclical weakness: compared with 2007 – when Israel had a balanced budget – the unemployment rate has fallen from 7.3 to 5.4%, even though the labor force participation rate has increased sharply.
• Efforts to reduce the deficit have repeatedly been deferred. In theory, Israel has an expenditure rule and a deficit rule underpinned by a debt target, but they have been revised so often that in practice there is no effective fiscal anchor.

6. The fiscal deficit needs to be reduced. Current levels leave few buffers to deal with shocks, such as housing price correction, renewed conflicts, or a sharp recession. The decline in debt – from 94% in 2003 to 67% in 2014 – has already almost come to a halt, and if deficits are not reduced, public debt will start to edge up again. If deficits stay around 3% (4% on international standards) and with real GDP growth around 3 and inflation around 2%, the debt ratio will converge to 80% of GDP over the longer term. Sticking to the current deficit law that reduces the deficit to 1½% of GDP by 2019 is critical. If adhered to, the debt ratio would converge to 50% of GDP over the longer term.

7. Reducing the deficit will be a challenge.

• Measures will be needed to stick to the current expenditure ceiling. This is because the plans in the coalition agreement would raise spending above the current ceiling.
• The expenditure ceiling is not tight enough to bring about the desired deficit reduction. The real growth rate of the expenditure ceiling (around 2.6%) is barely below the growth rate of real GDP (3%).

8. This challenge should be addressed immediately and not put off to the future. Policy makers need to decide how to reduce the deficit. If civilian expenditure is considered too low to be reduced, then measures on the revenue front should be identified. In this context, the mission advocates an explicit revenue and expenditure fiscal framework to meet the 1½% of GDP deficit target. This framework should explicitly identify the policies in the next 4 years to bring down expenditure and raise revenue to meet the medium-term deficit targets. Adjustment efforts should seek to minimize the impact on growth. This favors raising revenues from indirect rather than direct taxes and finding savings from current rather than capital spending.

9. Next year’s budget should take an important first step in reducing the deficit. The 2015 budget will likely be passed only in the fall—too late to introduce new measures. As the fiscal deficit for this year is likely to exceed the deficit target in the current law (2¾% of GDP rather than 2.5%), the deficit in 2016 should be brought down by at least half a% relative to 2015, equivalent to the drop envisaged under the current deficit law.

Bringing Inflation Back To Target

10. Low inflation does not reflect domestic weaknesses, but is largely imported. Our analysis suggests that low inflation is mostly the result of the fall in oil prices and the lagged impact of the shekel appreciation in the first half of 2014, while increased competition in the telecommunication industry and one-off reductions of electricity and water rates have also contributed. The temporary nature of low inflation is also evident in inflation expectations, which remain well anchored within the target band.

11. Inflation is expected to return to the target band in 2016 – the result of the shekel depreciation in the second half of the 2014, the tapering of energy price declines, robust domestic growth, and tightening labor markets which are expected to exert upward pressure on wages. Indeed, since February, a strong rebound in consumer prices has been visible.

12. This suggests that monetary policy can be put on hold. With little slack and unemployment at historic lows, further stimulus is not needed. The overall policy mix (with broadly neutral fiscal policy and near zero interest rates) is already very accommodative

Managing Risks From Rising Housing Prices

13. Boosting the supply of housing is critical to contain housing price increases. Housing prices have increased sharply in recent years, as demand—further boosted by low interest rates—has increased and supply has not kept up. In this context, the mission welcomes the intentions of the new government to boost supply through various measures and to concentrate several housing-related authorities into one ministry to shorten the planning process.

14. Macroprudential measures remain vital to containing risks to financial stability emanating from the housing sector. So far, measures have been effective in containing household leverage. However, further tightening may be needed in the future.

Safeguarding Financial Stability

15. The financial sector is stable but exposure to the housing/real estate/construction sector has risen. Banking sector credit to the housing/real estate/construction sector accounts for around 44% of loans. The real estate/construction sector has also been active in the corporate bond market, where spreads have been low even for issuances with low ratings and weak collateral. In this context, risk diagnoses and assessments should be done on an ongoing basis. Stress tests – ideally covering not only credit and market but also liquidity risks – should take into account the interconnectedness of various institutions and instruments as well as macro-financial feedback loops.

16. Efforts to increase banking sector competition should ensure that financial stability remains paramount. Increasing competition could lead to reduced fees, improved services, and increased access to credit, but it could also raise risks to financial stability – particularly if it would lead to weak new banks or rapid credit growth and an erosion of credit standards. It will thus be important to keep prudential policies strong.

17. The adoption of remaining key recommendations from the 2012 FSAP should be completed. Pending legislative initiatives to reduce systemic risk (amendment to the Mutual Funds Law and an amendment to the Banking Ordinance to strengthen the crisis resolution framework) should be finalized. A formal Financial Stability Committee, focused on macro-prudential policies in normal times, should be established with the BOI Governor taking the leading role.

Addressing Low Productivity and Income Inequality

18. Labor productivity in Israel is relatively low, and the gap with the United States has been widening. Productivity is partly low for benign reasons: sharp increases in the working age population (fueled by high birthrates and immigration) and an increase in the labor force participation rate have kept production labor-intensive and thus labor productivity growth low. However, TFP growth has also been very low. Productivity will come under further pressure from the rapidly rising share in the population of the ultra-Orthodox and Arab Israelis – groups that have generally lower education, productivity and participation levels.

19. Without an increase in labor productivity growth, GDP growth will slow in the future. In the past two decades, much of Israel’s growth has come from the use of additional labor. With the increase in the labor force participation rate likely to level off and unemployment already at record lows, future employment growth will likely slow to the rate of working age population—some 1½%. If productivity does not pick up, GDP growth will slow accordingly.

20. Raising productivity should become a priority. Israel has a lot of macro-flexibility—it has managed to absorb an incredible increase in the labor force. But what Israel needs is more micro-flexibility, that is, more competition at the micro level. According to OECD product market restrictions indicators, Israel has too much regulation and restriction, and not enough competition.

21. We therefore welcome the intentions of the new government to boost competition in several sectors, including transportation, food, the financial sector, and commodity imports. Efforts should also continue to address infrastructure gaps and improve education.

22. Income inequality is high. This reflects both high inequality of labor-income, with a high share of both high-paying and low-paying jobs relative to other countries; as well as less redistribution through the tax/transfer system than in other countries. Poverty is concentrated among the Israeli-Arab and Haredi populations, which have lower labor force participation rates, less education, and larger families, but even among non-Haredi Jews income inequality is higher than in almost all advanced countries.

23. Reducing inequality requires concerted efforts from across government agencies, stakeholders and communities. A comprehensive poverty reduction strategy could be formulated to address critical structural problems hindering the effective inclusion of the Haredi and Israeli-Arab populations in society and the labor market, including poor rural infrastructure and transportation and low quality of education. (IMF 24.06)

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11.2 ISRAEL: Gas Issue Dominates Cyprus-Israel Agenda

Simon Henderson wrote for the Washington Institute on 15 June that as Israeli and Cypriot officials meet in Jerusalem, energy-thirsty Egypt remains the obvious market for their offshore gas exports, but such deals risk Turkish ire.

On 15 June, President Nicos Anastasiades of Cyprus held a working lunch with Israeli prime minister Binyamin Netanyahu in Jerusalem. The meeting followed an audience with President Reuven Rivlin and a Sunday visit with the Greek Orthodox Patriarch. Although mutual security was on the agenda after last month’s discovery of a Hezbollah explosives cache in Cyprus, much of the discussion between Israeli officials, Anastasiades and his accompanying foreign and energy ministers has no doubt focused on the future of the two countries’ newfound natural gas resources.

In terms of offshore reserves, Cyprus has been the poor relation of Israel — the lone gas field it has discovered (Aphrodite) contains an estimated 5 trillion cubic feet, compared to Israel’s several fields and total reserves around eight times the size. Yet domestic gas demand in Cyprus is small, making the export option an obvious first step.

Moreover, Israel’s gas development efforts have been set back by a row that erupted at the end of 2014, when Houston-based Noble Energy and its Israeli consortium partners (led by Delek) were deemed to be a monopoly. The new Netanyahu government formed after the March elections has declared gas development to be a national security priority and the antitrust commissioner who had stalled the Noble-led project was sidelined to the point that he announced his resignation last month. Yet getting development of the giant Leviathan field back on track will apparently take several months.

In the meantime, Noble and Delek have turned their attention to Aphrodite, where they also own a license. In March, on the sidelines of the Sharm al-Sheikh economic summit, the Cyprus Hydrocarbons Company (CHC) signed a memorandum of understanding with the Egyptian Natural Gas Holding Company (EGAS) to develop the field. Then, on 7 June, the Cyprus Energy Ministry declared the field to be commercial, prompting Noble and Delek to submit a development plan on 11 June. Their plan calls for a floating production storage and offloading (FPSO) vessel to be located over the field, which lies in deep water more than 100 miles south of the island, close to its maritime border with Israel.

While the plan does not mention where the gas would be exported, the obvious destination is Egypt, which is struggling to cope with growing domestic energy demand and is having difficulty fulfilling contracts to export liquefied natural gas (LNG). Israel has also considered exporting gas to Egypt from its Tamar field, which is already producing for domestic demand and will soon supply two Jordanian industrial plants near the Dead Sea. One plan for exporting this gas to Egypt would involve reversing the pipeline that previously brought Egyptian gas to Israel. That pipeline has been plagued by sabotage, so there is also a proposal to run a new pipeline offshore. Egypt hopes, perhaps optimistically, to be independent of gas imports by 2020, but Cyprus or Israel could still use the existing Egyptian LNG plants on the Nile Delta coast to process gas for export.

Apart from the commercial, financial, and technical hurdles, Turkey’s reaction could pose a further problem. Although Ankara seems distracted by its recent parliamentary elections, it has been vocal in the past about offshore gas exploration around Cyprus, even to the extent of deploying naval ships and military aircraft. Turkey regards itself as the natural market for Cypriot and Israeli gas exports. It also objects that Nicosia is exploring for gas offshore without the involvement of Turkish Cypriots, who live in the northern part of the island that has been occupied by Turkish troops since 1974. A further tension is that President Abdul Fattah al-Sisi of Egypt and President Erdogan of Turkey increasingly see themselves as competitors for regional leadership.

The meetings in Jerusalem, including a formal banquet at President Rivlin’s residence, underline the growing importance of Israeli-Cypriot ties. The plans for development of the Aphrodite field should also remind Israel of the imperative not to delay the utilization of its offshore gas riches.

Simon Henderson is the Baker Fellow and director of the Gulf and Energy Policy Program at The Washington Institute. (TWI 15.06)

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11.3 LEBANON: IMF Executive Board Concludes 2015 Article IV Consultation with Lebanon

On June 26, 2015, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation1 with Lebanon.

The conflict in Syria, now in its fifth year, dominates Lebanon’s outlook, with refugees now comprising over one-quarter of the population. The refugee crisis is straining local communities, adding to poverty and unemployment, and placing further pressure on the economy’s already-weak public finances and infrastructure. Moreover, Lebanon faces a difficult domestic political situation. The presidency has been vacant since May 2014 and a lack of consensus between the major parties is hindering passage of key legislation.

In the face of this uncertainty, growth remains subdued. Following a sharp drop in 2011, growth has crawled upward to about 2–3% but remains well short of potential. IMF staff estimate that GDP increased by only 2% in 2014 and project a similarly modest growth rate in 2015. Lebanon’s traditional growth drivers – tourism, real estate and construction – have received a significant blow and a strong rebound is unlikely soon. Lebanon’s return to potential growth (4%) before 2019 is now doubtful. Inflation also declined sharply in 2014 on the back of lower oil prices and other one-off factors, but should return to about 3% by end-2015.

On the fiscal side, exceptional factors allowed for a primary surplus in 2014, but without decisive action fiscal deterioration will continue in 2015. The 2014 primary surplus of about 2.5% of GDP largely resulted from exceptional telecom transfers and, to some extent, from withheld and delayed payments. But the primary balance is expected to return to a deficit of almost 1.25% of GDP in 2015, with public debt remaining high at 132% of GDP. Foreign-exchange and financial markets continue to be resilient, despite Lebanon’s sizable external financial requirements. Inflows remain large, particularly from non-resident deposits; and in the context of Lebanon’s currency peg to the U.S. dollar, the Banque du Liban (BdL) has maintained an adequate level of gross foreign exchange reserves.

Executive Board Assessment

Executive Directors commended the authorities for preserving macroeconomic stability and market confidence despite the unprecedented humanitarian and economic spillovers from the conflict in Syria, including a daunting inflow of refugees which has taken a toll on public finances, infrastructures, and the social fabric. Against this background, they called on the international community to provide greater humanitarian and development assistance to Lebanon. While acknowledging that a very difficult economic and political context limits feasible policy choices, Directors encouraged the authorities to further strengthen confidence and secure more inclusive growth by implementing priority fiscal and structural reforms promptly.

Directors stressed that a sustained fiscal adjustment is essential. They welcomed the primary surplus in 2014, but noted that it mostly reflected one-off factors. They cautioned that, without further adjustment, the public debt ratio will continue to rise and add to existing vulnerabilities, crowding out essential public investment and social spending. As a first step, Directors encouraged the authorities to pass an appropriately ambitious budget for 2015. They also stressed the urgent need to reform the electricity sector to remove a large drain on the public finances.

More broadly, Directors underscored the need to place public indebtedness on a sustainable downward path. In this context, they advised caution in implementing a salary-scale adjustment for public-sector employees. They pointed to significant scope to increase revenue equitably, including by improving compliance and broadening the tax base, starting with fuel taxation. Further, Directors observed that changing the spending mix toward capital and social spending would help mitigate the pro-cyclical impact of fiscal adjustment. They also considered that strengthening the safety nets and reforming the pension system could improve equity and fiscal sustainability.

Directors commended the central bank for supporting macroeconomic stability and maintaining adequate international reserves. They agreed that monetary policy should remain geared to supporting the U.S. dollar peg, which has served Lebanon well. Looking ahead, they underscored that fiscal adjustment would help reduce the financial and institutional burden on the central bank related to quasi-fiscal activities.

Directors noted the critical role played by Lebanon’s banking system in securing sustained, broad-based economic growth. They commended the authorities’ close oversight of the financial system and stressed the need for continued vigilance and efforts to strengthen the regulatory framework. They highlighted the importance of increasing capital buffers, improving loan classification and restructuring rules, and further enhancing the framework to counter money laundering and terrorism financing. Directors welcomed the authorities’ recent request for an update assessment under the Financial Sector Assessment Program.

Directors underscored the need to advance structural reforms to promote job creation and improve competitiveness. In addition to electricity reform, which is a critical priority, Directors highlighted the need for labor reforms, improvements in public service provision, and legislation to reinvigorate private investment, including in the oil and gas sector. Directors also encouraged the authorities to improve Lebanon’s statistical system, building on ongoing progress. (IMF 30.06)

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11.4 JORDAN: Staff-Level Agreement with Jordan on Final Review Under the SBA

An International Monetary Fund (IMF) team visited Amman from 9 – 241 June 2015 to review Jordan’s economic program, supported by a Stand-By Arrangement (SBA). The 36-month SBA in the amount of SDR 1.364 billion (about $2 billion, or 800% of Jordan’s quota at the IMF) was approved by the Executive Board on August 3, 2012.

“(The IMF welcomes) the authorities’ commitment and progress in implementing their economic program despite a difficult regional environment, stemming from the conflicts in Syria and Iraq. Building on strong program performance through end-April this year, we reached a staff–level agreement on the seventh and final review under the SBA. This agreement is subject to approval of the IMF’s Executive Board, which is scheduled to consider the review at the end of July. Board approval would make available to Jordan SDR 284.167 million (about $400 million).

“Since the program started three years ago, the authorities have implemented macroeconomic policies that have contributed to stabilizing the economy and help it weather a series of severe external shocks. Growth is gradually picking up, inflation is contained, and the current account deficit is narrowing. Budgetary measures – including a bold fuel subsidy reform – as well as energy and water sector reforms, contributed to a substantial decline in fiscal imbalances, ensuring that public debt will stabilize this year and start declining in 2016. Monetary policy complemented these efforts, helping to restore confidence and rebuild international reserves to an adequate level, which in turn has helped the central bank to reduce interest rates to stimulate growth.

“This year, intensified regional conflicts have affected exports, tourism, and investor sentiment and could slow economic growth. Headline inflation remains low, while core inflation has continued its gradual descent. The current account deficit continues to narrow, reflecting primarily a decline in oil imports. The banking sector remains robust, and financial markets are stable.

“Program performance has been strong. All end-April performance criteria were met by comfortable margins and policies are also on track to meet their 2015 targets. The central government deficit was in line with projections from January-April and, aided by lower oil prices, the electricity company NEPCO significantly reduced its losses. International reserves continued to over-perform. The combined public deficit is projected at 3.5% of GDP for 2015, the current account (including grants) at 7.6% of GDP, and reserves at 7 months of imports. Fiscal structural reform is moving forward with the government improving its budget preparation and execution.

“The economy is expected to further strengthen over the medium term, but there are downside risks. Growth is projected to increase to about 3.5% in 2015 as confidence gradually returns, and to 4.5% over the medium term. Inflation would stay low at about 2%. The current account deficit (excluding grants) would continue to decline, to about 11% of GDP in 2015 and about 9% of GDP by 2020, on the back of fiscal consolidation, further savings from the energy import bill, and a pickup in tourism and exports. Reserves would remain at adequate levels. That said, uncertainties to this outlook remain considerable, mostly related to the Syria and Iraq conflicts, which could adversely affect growth and the current account. In particular, growth could be closer to 3% this year if the recovery in confidence and tourism takes more time than anticipated.

“Discussions focused on sustaining the program’s achievements. Fiscal and monetary policies are on track to meet the 2015 objectives. Looking beyond 2015, the authorities reiterated their commitment to gradual fiscal consolidation. They aim at reducing debt to about 70% of GDP by 2020, a level that would markedly reduce vulnerability to shocks. To this end, continued implementation of the energy strategy – to return the electricity company to cost recovery at the latest by 2018 – will be critical. It will also be important for the central government to further improve its balance, and the focus should be on measures which distribute the adjustment burden equitably, including further progress with income tax reform.

“There is a need to accelerate structural reforms to strengthen growth and address chronically high unemployment and low labor force participation. Of particular importance are policy changes to: help the young and unemployed to acquire skills that match the private sector’s needs; increase the participation of women in the labor force; re-examine public sector hiring and compensation; improve the business environment; and strengthen public institutions, including through better tax administration and public financial management. Vision 2025 – the recently adopted 10-year plan for economic and social policies – provides a roadmap for such reforms but needs to be anchored in a medium-term macroeconomic and fiscal framework. Strong implementation of Vision 2025 could build the basis for high, sustained, and inclusive growth and eventually reduce the need for donor support. In the meantime, Jordan needs continued assistance from donors, in particular to help cover the cost of hosting Syrian refugees. (IMF 24.06)

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11.5 JORDAN: Jordan’s Economy Surprises

On 29 June, David Schenker wrote in the Washington Institute that solid economic growth, low inflation, and comfortable international reserves offer a hopeful story line in a war-torn region, but continued chaos in Syria and Iraq will continue to threaten Jordan’s stability.

Jordan featured prominently in the 20 June commemoration of World Refugee Day — and for good reason. According to Jordanian authorities, Syrian refugees now constitute 21% of the kingdom’s population. While refugees are a big concern for Jordan, though, lately the kingdom has been preoccupied with economics. On 21 – 23 June, Jordan hosted its annual meeting of the World Economic Forum (WEF) at the Dead Sea. The meeting came close on the heels of two surprisingly upbeat reports on the kingdom’s economic prospects published by the World Bank and the International Monetary Fund (IMF), respectively. To be sure, the refugees and the threat posed by the Islamic State of Iraq and al-Sham (ISIS) remain significant challenges, but the kingdom nonetheless appears to be making modest progress toward improving its perennially weak economy, a welcome story in a region bereft of positive developments.


Jordan’s economy has never been particularly robust, but the 2011 regional uprisings and their aftermath had a profound impact on the kingdom. Particularly detrimental were the multiple disruptions of the natural gas pipeline between Egypt and Jordan, which compelled Amman to purchase expensive crude oil on the open market. In 2013, this resulted in a $3 billion — or 30% — budget deficit. Wars in Iraq and Syria also curtailed Jordanian exports, stymied expatriate remittances and undermined the state’s transport industry. Meanwhile, the arrival of nearly a million Syrian refugees has strained the kingdom’s infrastructure, driving up real estate prices and tightening an already stressed job market. Regional instability has also significantly hampered tourism in Jordan. In November 2010, 142,000 tourists visited the kingdom; just 78,000 came in April 2015. Last year, tourists visiting Petra were a quarter of what they were in 2010.

Optimistic Appraisals

Average Jordanians are not upbeat about their economy. According to a poll released in June conducted by the Amman-based Phenix (sic) Center for Economics and Informatics Studies, 57% of Jordanians see the economy as “bad” or “very bad.” While the negative sentiment is prevalent and apparent on the ground, the assessment of global financial institutions — which take a view from 30,000 feet — is significantly more positive.

In its April 2015 review of the Stand-By Arrangement with Jordan, the IMF reported that the kingdom was “persevering in a difficult regional environment.” Despite the impact of events in Syria and Iraq, the report noted that “growth is holding up, inflation is low, the current account deficit is narrowing, international reserves are at a comfortable level, and the banking system is robust.” The World Bank’s spring 2015 report “Persisting Forward Despite Challenges” was equally effusive in its outlook. Jordan’s economy, the World Bank predicted, “is expected to steadily continue to gather pace as reforms continue,” although it warned that “security and oil prices present key downside risks.”

Several other bullish assessments of Jordan’s economy were delivered during WEF panels. Lebanese businessman Bahaa Hariri, a leading investor in the public-private partnership in developing the Abdali city center in Amman — a project valued at $5.5 billion — hailed the palace’s economic “vision.” During his talk, Hariri highlighted the kingdom’s ambitious new plan to attract $20 billion in foreign direct investment in the energy, water, transport, infrastructure, urban development, and information technology sectors. Another Jordan booster at the WEF was Mohamed Alabbar, the Emirati chairman of the real estate company Emaar, who advised would-be financiers to put their money into the kingdom. “The numbers are working,” he said. “I think it’s the right time now to make that investment.” By the end of the two-day WEF meeting, Jordan reportedly had secured $6.9 billion in investment.

Challenges Still Abound

In a region wracked by instability, the relative calm in Jordan – as well as the seemingly enduring U.S. security commitment – provides undeniable appeal for investors. Given the regional turmoil, Jordan’s 2015 growth rate of 3.1%, up from 2.8% in 2014, is no doubt impressive. Yet the kingdom nevertheless faces several persistent economic challenges.

Job creation is one big problem. Officially, unemployment in Jordan is about 12%, although many believe the actual figure to be significantly higher. Youth unemployment alone is a staggering 30%. Worse, according to the World Bank, labor market participation in the kingdom is only about 36%, a figure that has been decreasing, some speculate, due to competition for jobs by Syrian refugees. The job market is also crowded by the more than 300,000 permitted foreigners currently working in Jordan, nearly two-thirds of whom are Egyptian.

Compounding the problem is the country’s relatively high enrollment in higher education. More than 90,000 students register for university every year, leaving 16% of graduates unemployed and presumably disgruntled. In 2013, for example, 200,000 college graduates applied for 6,400 civil service jobs. Recognizing the problem, Amman has announced plans to help create 180,000 new jobs by 2025. While this represents a good start, the stated figure may not be adequate. In 2013, the IMF estimated that 400,000 new jobs would be needed by 2020.

Energy is another perennial Achilles’ heel. In 2014, the kingdom spent $5.9 billion, or 18.5% of its GDP, on energy. While the commodity remains subsidized, in 2012 Amman (consistent with its IMF commitments) started a process of targeting fuel subsidies and rationalizing electricity prices. The kingdom has made progress in this endeavor, but has a way to go, particularly regarding electricity. At the same time, Jordan is trying to diversify its energy sources, moving ahead with building two nuclear facilities, renewable-energy projects, and pursuing a natural gas deal with Israel. For the near future, even as the kingdom benefits from low oil prices, energy is expected to remain a significant government expenditure.

Other economic concerns include the kingdom’s growing public debt, most of which is domestically held, which has now reached $32 billion, or nearly 90% of GDP, considered a high proportion for developing countries. The Amman Stock Exchange’s performance also remains anemic. Total market capitalization in 2014 was $25 billion, down 30% from 2005. Jordan’s largest private financial institution, the Arab Bank – which holds 23% of bourse investments – was just struck with an enormous financial judgment against it in a U.S. court for supporting Hamas terrorism. At the same time, Jordan remains highly dependent on foreign assistance to fund domestic infrastructure projects, which create many jobs. In 2015, $736 million of the Jordanian government’s $1.4 billion capital expenditures will be underwritten by the Gulf, a region experiencing financial hardship due to low oil prices.


Four years of regional volatility have made Jordan’s stability an even higher priority for Washington and the administration has acted to demonstrate its commitment. In February, the United States signed a three-year memorandum of understanding with the kingdom pledging to increase its economic and military assistance baseline from $700 million to $1 billion per year. In late May, the administration provided its third loan guarantee to Jordan, this one for $1.5 billion, bringing the total to $4 billion over the last three years.

Even as Washington has taken appropriate financial steps to help insulate the kingdom from regional reverberations, Jordan remains vulnerable to violent spillover from Syria and Iraq. Recently, for example, mortars from Syria rained on the Jordanian border town of Ramtha, killing one and injuring four. Just before that, Jordanian warplanes destroyed a vehicle attempting to infiltrate across the border. Meanwhile, an estimated 2,500 Jordanians are participating in the jihad in Syria, many affiliated with ISIS and the al-Qaeda affiliate Jabhat al-Nusra.

No doubt, U.S. and Gulf financial assistance is helping the kingdom weather the regional storm. But this aid is only a stopgap measure. Should the chaos continue in Syria and Iraq, as is likely, the threats to Jordan will surely increase. Over time, the kingdom will be ever more susceptible to domestic radicalization, terrorist attacks as occurred in Amman in 2005, and, perhaps, a deluge of additional Syrians pushed south by a regime offensive or an exodus spurred by fears of ISIS.

Despite developments in Syria and Iraq, Jordan is “persevering,” as the World Bank and IMF noted. Yet the kingdom’s remarkable resilience and continued stability are by no means guaranteed, and are likely to become more tenuous as regional security deteriorates. At this critical time, ongoing substantial U.S. and Gulf economic support is necessary. If the current trajectory persists in Syria and Iraq, however, it is unclear whether this assistance will be sufficient.

David Schenker is the Aufzien Fellow and director of the Program on Arab Politics at The Washington Institute. (TWI 29.06)

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11.6 JORDAN: Jordan Moves to Lay New Tracks

The arrival of the first liquefied natural gas (LNG) shipment from Qatar at Aqaba Port last month signaled a major step forward for Jordan’s energy sector, according to the Oxford Business Group, while also putting the country’s plans for developing transport infrastructure firmly in the spotlight.

Jordan received its first cargo of LNG at the purpose-built Sheikh Sabah Al Ahmad Al Sabah Terminal, named after Kuwait’s emir, on 25 May. The gas supplies are set to play a major role in the country’s efforts to meet its pressing energy needs. However, the heightened activity at Aqaba has underscored the need for Jordan to improve connectivity between the country’s only port and the north, where the capital and many businesses are located, and reduce the strain on its roads.

Driving the Distance

Aqaba Port was responsible for around 55% of Jordan’s entire export trade in 2013, while handling some 73% of total imports during the year, according to the Department of Statistics. The area is also home to the Aqaba Special Economic Zone, an industrial site including airport and maritime facilities, factories, workshops and businesses in and around the Red Sea city.

However, given the instability in neighboring Syria and Iraq, pressure is likely to increase at Aqaba due to the fact that overland trade has been largely paralyzed by border attacks from insurgents.

In April, Jordan closed its only working border crossing with Syria at Jaber, with the loss of trade routes hurting both importers and exporters. This has forced Jordanian traders with commitments in Syria or Iraq to rely on sea routes either via Haifa in Israel or on the long journey through the Suez Canal to Aqaba.

While the port itself is facing greater traffic, the two overstretched highways which link the port to the north of the country – where most of Jordan’s population is located in or around the capital Amman – are also under strain, leading to calls for alternative solutions.

Rail has emerged as the front-runner in discussions aimed at exploring alternative forms of transport. Jordan already possesses two rail networks, both of which are managed by government-owned entities. The Hejaz Railway Corporation (HRC) operates 217 km. of track, while the second 293 km. line falls under the responsibility of Aqaba Railway Corporation (ARC).

HRC’s main route runs from the Syrian border to the Modawara crossing on the Saudi border, although the conflict in Syria has severely restricted the service. The ARC, meanwhile, transports cargos of phosphates from mines in the southern interior to loading bays at Aqaba.

Making Connections

The government is now looking to develop the network further, with the aim of connecting the port with the capital. “The first phase of the railway network would be to connect Aqaba and Amman,” the transport minister, Lina Shbeeb, told OBG recently. “This would include a connection to Ma’an, where we would like to have a dry port.”

The rail link would speed up the process of getting goods from Aqaba to Amman, the minister said. In another move aimed at reducing delays, the planned dry port at Ma’an is set to be a designated hub for clearing goods, away from the main site. The minister also told OBG that the government was “eager to engage the private sector for projects regarding the railway network.”

The Aqaba-Ma’an-Amman project is the cornerstone of a JD2b ($2.8b) plan for the network announced by Shbeeb back in April. The rollout for the three-part scheme is set to begin with the construction of the Aqaba-Ma’an stretch and the Ma’an dry port, followed by the Ma’an – Amman phase of the project. Phase three will link the capital to Mafraq, where another dry port is to be built.

The railway project has widespread backing among transport and logistics firms. Aside from improving connectivity, the service is expected to reduce transport costs, making Jordanian exports more competitive and imports cheaper. The dry ports will also go some way towards cutting clearance times, while also bringing new investment and jobs to Ma’an and Mafraq.

Despite the positives, Jordan’s network plan faces some uncertainty. Established road haulers, particularly those in Ma’an, may see rail as unwelcome competition. In addition, the authorities’ success in securing private investment for such a large infrastructure project could be determined in part by what is offered in terms and conditions, with much hanging on the shape of the contracts the ministry will be drawing up.

Yet the need for the railway is widely acknowledged, furthermore the government’s commitment to pushing it through is an encouraging sign for both investors and future transport users. (OBG 25.06)

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11.7 QATAR: Qatar Remains Central to Global Hydrocarbons

BQ Doha reported that Qatar remains central to the global hydrocarbon sector based on new data for 2014 released in BP’s Statistical Review of World Energy last week.

Qatar remains the third largest producer of natural gas in the world after the US and Russia with 5.1% of global production. The country is also the world’s top exporter of liquefied natural gas (LNG) with 31% of total global exports in 2014. This central role is a result of its large endowment of hydrocarbon reserves.

In terms of oil and gas reserves per capita, Qatar remains well ahead of the other major oil and gas producers with 83.6k barrels of oil equivalent (boe) in 2014. The revenue generated from Qatar’s hydrocarbon exports provides a stable source of financing for major infrastructure investments that are driving the growth and diversification of the domestic economy.

The report from BP indicated that reserves of oil and other liquids had risen 2.6% to 25.7b barrels in 2014. Recent studies and oilfield exploration and development projects are likely to have led to an increase in the level of proven oil reserves. Meanwhile, gas reserves in Qatar fell 0.6% in 2014 as a result of the extraction of gas and in the absence of exploration and development of new reserves due to the moratorium on further gas development and exploration in the North Field where almost all of Qatar’s gas reserves are situated.


In terms of production, Qatar’s total hydrocarbon output was virtually unchanged in 2014 at 5.2m barrels of oil equivalent per day (boe/d) – 3.2m from gas and 2.0m from oil. This was largely due to the above mentioned moratorium on further gas development projects. As a result, gas production only crept up in 2014 by 0.4%. The increase in gas production was offset by a decline in oil production in 2014 (-0.8%) as Qatar’s oil fields are maturing.

The implementation of large investment projects should help to stabilize oil production, such as the $4.0b Bul Hanine in 2017. Meanwhile, we expect the non-hydrocarbon sector to grow at around 10.8% in 2015-17, driven by investment in major infrastructure projects. This should lead to overall growth of 7.0% in 2015, 7.5% in 2016 plans to update facilities and increase production from 40k barrels per day (b/d) to 95k b/d.

Most of Qatar’s gas production is exported as LNG (58% in 2014). Heavy investment in LNG facilities over the last 20 years and a vast ramp up in production has made Qatar the world’s largest LNG exporter, driving the establishment of a global LNG market. Gas is a clean and relatively low cost source of energy in comparison to other hydrocarbons, such as coal and oil. The rise of LNG exporters has made it possible to move natural gas around the globe. This has opened up a new source of clean energy for many countries and encouraged them to invest in the necessary infrastructure to import and regasify LNG.

The switch to a cleaner source of energy as well as strong economic growth have made the Asia Pacific region the largest market for Qatar’s LNG exports, taking 72.0% of Qatar’s exports in 2014. But Qatar’s LNG exports are not confined to Asia. Cheaper LNG prices relative to pipeline gas prices in Europe has prompted the UK to switch to LNG. As a result, the UK increased its imports of LNG from Qatar by 20.5% in 2014.

What’s Next

Looking forward, Qatar is expected to maintain its dominant role in the global hydrocarbon sector. Global demand for clean energy is expected to continue rising and Qatar is a leader in the LNG market. Moreover, domestic energy demand is expected to rise strongly as the population grows rapidly due to the influx of expatriates being called in to work on the country’s large infrastructure program. To meet this rising domestic demand, the Barzan project – a $ 10.3b North Field gas development to increase production for domestic use – is coming online and is expected to drive growth in the hydrocarbon sector.

First production from Barzan is expected during the second half of this year. At the same time, oil production is expected to stabilize, leading to an increase in real GDP growth in the hydrocarbon sector to 0.8% in 2015, 1.8% in 2016 and 1.9% and 7.9% in 2017.

Qatar has enough gas reserves to maintain production at current rates for 138 years and is therefore likely to remain central to global hydrocarbon markets for a number of years to come. (BQ Doha 21.06)

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11.8 UAE: Dubai Set For Leaner Tourism Season

The Oxford Business Group observed that a tapering of demand will lower earnings in Dubai’s tourism and hospitality industry this year, though an expected rise in arrivals from emerging markets, in particular Asia, may offset weaker traffic from more established sources of visitors.

The fall in the price of oil is being seen as a key factor in weakening demand, with the Russian market one of the hardest hit. The continued weakness of many Eurozone countries has also affected Dubai’s arrival figures, though it is expected some of this may be offset by increases from developing markets, such as China.

Growth Rate Slowing

Sentiment within the industry remains positive, despite the slowdown in growth, according to a recent survey. The Dubai Economy Tracker – a new study of economic conditions within the emirate – showed that business activity dropped in April to its lowest point since October 2013, with the travel and tourism sector the largest drag on growth. The survey, conducted by banking group Emirates NBD and financial information services firm Markit, indicated that the travel and tourism sector index dropped to 52.3 in April, from 55.5 in March.

Khatija Haque, head of MENA research at Emirates NBD, said sectors such as construction and retail showed relatively robust growth, but the tourism sector was negatively impacted by a number of factors such as a stronger US dollar hurting key emerging markets.

A weakening in markets such as Russia has added to the sector’s woes. Lower oil prices and the impact of sanctions imposed over its involvement in the Ukraine conflict have seen the value of the ruble tumble, meaning fewer Russians can afford to travel and those that do may have less to spend. Last year saw a 23.5% year-on-year decline in Russian visitors and the ongoing easing in arrivals from that country and other members of the Commonwealth of Independent States will continue to eat into booking levels.

Offsetting this though has been a steady rise in arrivals from new markets, such as China, which Dubai has been working to develop in recent years, both through promotional activities and by providing services catering to Chinese visitors. “We have dedicated Chinese websites and dedicated Chinese content … it’s a market that’s going to continue to grow in importance and we take it very seriously” said the Director General of Dubai’s Department of Tourism and Commerce Marketing (DTCM), Helal Saeed Almarri.

The strategy is paying off, with a 25% jump in arrivals from China in 2014, with inbound visitors topping the 340,000 mark, according to local media reports. This increase compares to an overall rise of 8.2% in arrivals last year, with the DTCM forecasting expansion of 7-9% this year, with India, China and South-east Asia among identified growth markets.

Rev Below PAR

The expected fall in arrivals from key markets is also set to impact hotel earnings, compounded by new offerings coming to the market. A PwC report issued in May forecasts a 2.4% fall in revenue per available room (RevPAR) to $184.6 this year, as occupancy and average daily rates ease (ADR). RevPAR edged up 0.5% year-on-year in 2014, which missed the consultancy’s forecast of a 6.5% increase. Other estimates put last year’s RevPAR figure down 2.3% year-on-year, from a record high in 2013, according to real estate consultancy JLL.

The PwC report added that many of the factors affecting Dubai’s tourism sector in 2014 such as lower visitor numbers from Russia and the CIS, high levels of room stocks and concerns over the euro, would continue this year. “In the interim it will mean that supply – or more accurately oversupply – could become an issue in some parts of the region, especially at the increasingly crowded luxury end of the market,” the report concluded.

According to JLL, the average increase in hotel rooms was 5% per year from 2009-2014, with this rate set to increase to 12.5% annually until 2017 based on existing project pipeline and forecasts. Having opened 2015 with 65,000 graded rooms, Dubai could see another 21,000 new rooms added to the existing stocks by the end of 2017.

However, the picture is looking brighter with PwC forecasting a 6.6% rise in RevPAR to $196.8 in 2016 thanks to improved occupancy and ADR driven by infrastructure spend, moderate supply increases and higher tourist numbers. A rebound in the global tourism trade will also help absorb additional accommodation supply over the coming years. (OBG 17.06)

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11.9 SAUDI ARABIA: Saudi Arabia to Keep Pumping Oil

The Oxford Business Group said that production from Saudi Arabia’s oil fields will remain at near record levels for the next few months, with Riyadh looking to maintain above-average output despite low prices. In its June meeting, OPEC decided to keep the bloc’s production at 30m barrels per day (bpd), the level agreed in November. According to the International Energy Agency (IEA), combined output by the 12 member states for May was 31.3m bpd, with Saudi Arabia being the largest single contributor to production.

Saudi Arabia pumped a record 10.3m bpd in May and flagged the possibility in June of raising output even further. Ahmed Al Subaey, executive director for marketing at Saudi Aramco, said any increase in global demand could trigger a further rise in production. “We have plenty of crude,” he told Reuters. “You are not going to see any cuts from Saudi Arabia.”

The Kingdom has a production capacity of around 12.5m bpd, which means it has a comfortable margin should it need to raise output.

Global Repercussions

OPEC’s decision to keep production levels high and Saudi Arabia’s suggestion it could further raise output are seen by some analysts as putting additional pressure on North American oil production and exploration. In mid-June, the Canadian Association of Petroleum Producers forecast that shale and conventional light oil production in western Canada would be scaled back to 730,000 bpd by 2019, down from 770,000 bpd this year, a result it said of OPEC’s lower pricing and higher output policy.

However, Saudi Arabia’s decision to step up production is also in part a response to rising domestic demand, especially during peak periods. Estimates from sector consultancy Energy Aspects, based in Vienna, and Boston-based ESAI Energy project a 20% increase in domestic Saudi oil consumption this summer, with the Kingdom’s power stations set to burn 420,000-430,000 bpd, up from 300,000-410,000 bpd in the summer of 2014.

Saudi Aramco Products Trading Company (an arm of Saudi Aramco) reached out to external markets in early June due to the expected seasonal surge in electricity demand. Tapping suppliers in both India and the Middle East, the company bought 1.1m barrels of gasoil for delivery in July, just ahead of the peak consumption period. Due to soaring temperatures, Saudi Arabia has been a top importer of gasoil during the summer months, but imports are set to fall as it adds capacity from new refineries.

Oil Price Drop

While the IEA has forecast an increase in global oil demand for the rest of the year, the rise is expected to be more muted than in the first half of 2015 due to the “temporary nature” of many of the factors that contributed to expansion in the first two quarters.

Global demand could also be hit by headwinds from Europe, with concerns over a Greek default and an escalation of the conflict in Ukraine potentially dampening prospects for economic recovery. Furthermore, ongoing instability in parts of the Middle East, in particular Iraq, could affect pricing as well.

The fall in global oil prices means that the energy sector’s contribution to Saudi Arabia’s economic growth in 2015 will be limited. A recent report by National Commercial Bank forecast the Kingdom’s GDP will expand by 3.4% this year, roughly in line with the 2014 rate of 3.6%. As was the case last year, growth will be driven by the non-oil sector, which the bank said would increase by around 5%. Growth from the oil sector can be expected to be modest this year after a rise of 1.72% in 2014, even with any increase in production. (OBG 25.06)

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11.10 GREECE: S&P Long-Term Ratings Lowered To ‘CCC-‘; Outlook Negative


• S&P interprets Greece’s decision to hold a referendum on official creditors’ loan proposals as a further indication that the Tsipras government will prioritize domestic politics over financial and economic stability, commercial debt payments and Eurozone membership.

• In our view, the probability of Greece exiting the Eurozone is now about 50%.

• Also, we believe that, absent unanticipated favorable changes in Greece’s circumstances, a commercial default is inevitable within the next six months.

• We are therefore lowering our long-term ratings on Greece to ‘CCC-‘ from ‘CCC’ and affirming the ‘C’ short-term ratings.

• The negative outlook indicates that we could lower the long-term ratings to ‘SD’ within the next six months in the event of a distressed exchange or nonpayment of Greece’s commercial debt, including treasury bills.

Rating Action

On 29 June, Standard & Poor’s Ratings Services lowered its foreign and local currency long-term sovereign credit ratings on Greece (Hellenic Republic) to ‘CCC-‘ from ‘CCC’. The ‘C’ short-term ratings were affirmed. The outlook is negative.

In Greece’s case, the deviation was prompted by the central government’s decision to reject official creditors’ loan proposals and instead schedule a national referendum on whether to accept the terms of the proposals. The deviation also reflects further deterioration since June 10 of liquidity conditions in Greece’s banking system, which depends heavily on official financing from the Eurosystem, the Eurozone’s monetary authority. This led to the imposition of emergency capital controls in Greece as of 28 June.


The downgrade reflects our assessment that, in the absence of unanticipated favorable changes in circumstances, Greece will likely default on its commercial debt during the next six months.

In our view, the Greek government’s decision to hold a national referendum on official creditors’ loan proposals indicates that Prime Minister Tsipras will prioritize domestic politics over the country’s financial and economic stability, commercial debt service, and membership of the Eurozone. We interpret the government’s inability to agree with official creditors on a loan program as a sign that it will likely miss payment obligations due on 30 June, including the €1.5 billion owed to the International Monetary Fund (IMF).

Given that the government appears willing to accept the consequences on its banking sector and economy from the failure to reach an agreement, we now see a 50% likelihood of Greece eventually exiting the Eurozone. Should this occur, Greece would permanently lose access to financing from the European Central Bank (ECB), which, in our opinion, would create a serious foreign currency shortage for the private and public sectors, potentially leading to the rationing of key imports such as fuel. Under our methodology, exit from the Eurozone would lead us to revise our transfer and convertibility assessment on Greece to ‘CCC’ from ‘AAA’ to reflect the loss of a reserve currency and the foreign currency shortage this would create.

At present, the Eurosystem’s support to Greek banks – directly through the ECB’s main refinancing operations and indirectly via the Bank of Greece’s Emergency Liquidity Assistance (ELA) – exceeds 70% of GDP, according to our estimates. Without it, Greece’s payment system would shut down and its banks would not be able to operate. Despite further deposit withdrawals from Greek banks over the weekend, the ECB has decided not to increase the ceiling on the ELA to Greek banks from the €89 billion agreed on 26 June.

The Greek Financial Stability Council has declared a bank holiday from 29 June until 7 July 2015. It has also introduced deposit withdrawal limits and controls on transfers abroad. An extended bank holiday involving capital controls will, in our view, further weigh on Greece’s economy, which we expect will contract by 3% this year, although the margin of error on this figure is substantial. While failure to make tomorrow’s IMF payment would not constitute a commercial default as defined by our criteria, it is a legal event of default under the December 2012 Master Financial Assistance Facility Agreement between Greece and the European Financial Stability Facility (EFSF). Our base-case expectation remains that, over the next several months, the EFSF is unlikely to demand accelerated payment on the €130.9 billion (equivalent to 75.1% of GDP) that it lent Greece.

We would not lower our long-term ratings on Greece to ‘SD’ should the government miss payments on bonds held by the ECB totaling €6.7 billion due in July and August. This is because our sovereign ratings pertain to the central government’s ability and willingness to service financial obligations to commercial (that is, nonofficial) creditors and we consider the ECB to be an official creditor.

Greece’s upcoming commercial debt payments include €2.0 billion in treasury bills due on 10 July; €83 million on a Japanese yen obligation, due on 14 July; and €71 million in interest, due on 17 July on a three-year commercial bond the government issued in July 2014. About €39 billion of Greece’s total medium- and long-term debt is commercial, representing 22% of GDP. All of the remaining €261 billion in debt (excluding €15 billion in treasury bills) is owed to official creditors.


The negative outlook indicates that we could lower the long-term ratings to ‘SD’ within the next six months in the event of a distressed exchange or nonpayment of Greece’s commercial debt, including treasury bills. We could revise the outlook to stable if we believe that a new financial support program will be agreed, with policy conditions that satisfy both Greece and its official creditors. (S&P 29.06)

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