LONDON: London will enjoy a very strong year for stock market flotations, analysts say, arguing that both Brexit and coronavirus offer firms a unique opportunity to expand.
Various big-name businesses that have seen booming online demand from home-bound customers during Covid-19 lockdowns have revealed eye-catching plans for initial public offerings (IPOs) in recent weeks.
Clarity over Britain’s final departure from the European Union on January 1 acted as a catalyst for many companies to raise funds, according to specialists, while the rollout of Covid-19 vaccines also soothed investor concerns over the deadly pandemic.
So far this year, the celebrated shoemaker Dr. Martens, app-driven meals delivery service Deliveroo and online greetings card seller Moonpig have all outlined plans.
“Looking to the year ahead, we can expect 2021 to be a very strong year for the UK IPO market,” said Scott McCubbin at London-based financial services giant EY.
“An uptick in IPO activity may well intensify the competition for investment, placing greater emphasis on preparing early for IPO and raising profile with investors.
“Confidence continues to build with the Brexit deal now giving clarity around the future relationship with Europe and the rollout of Covid-19 vaccinations.”
Added to the mix, online money transfer specialist TransferWise has reportedly appointed banks to coordinate a planned float.
British media report that others could include insurer Canopius, EDF-owned electric vehicle charging business Pod Point, and online fashion retailer Very.
The IPO market has also attracted interest in recent years due to the easier availability of financing, alongside ultra-low interest rates.
“Over the past few years we have also seen a strengthening in the financing available for UK and European companies in the early stages of their growth,” said Marcus Stuttard, head of UK primary markets at the London Stock Exchange.
“This means that there are now an increasing number of dynamic businesses at the stage and size of development that are ideal for an IPO.
“These factors coming together have contributed to the strong IPO pipeline we are seeing at the start of 2021,” he told AFP.
At the same time, investors have lots of cash, owing to low borrowing costs and several billion pounds worth of central bank stimulus funds.
London thus hopes to steal a march on rival IPO destinations such as Frankfurt, Hong Kong and New York.
Britain ranked only behind China and the United States in terms of the total amount of cash raised on the stock market last year, according to a recent EY study.
The British capital represented more than 40 percent of the total IPO amounts raised in Europe.
Brexit could deliver a further boost because the government wants to relax certain stock exchange regulations as it seeks to attract more big-name businesses to list.
The Brexit trade deal, which took effect on January 1, did not encompass the finance sector — but Britain and the EU aim to seal a memorandum of understanding about financial services by March.
The City of London Corporation revealed Friday in a study that the British capital still trails the United States and Hong Kong in attracting foreign company listings.
London now wants to compete more effectively against European rivals and EU officials are concerned it could dump highly-prized standards.
Catherine McGuiness, policy chair at the City of London Corporation, said: “The competitive strengths of London and the UK should mean that we are well placed to seize opportunities as we start a new trading chapter outside the European Union.”
London stock market facing blockbuster IPO year
London stock market facing blockbuster IPO year
- So far this year, the shoemaker Dr. Martens, app-driven meals delivery service Deliveroo and online greetings card seller Moonpig have all outlined plans
- The IPO market has also attracted interest in recent years due to the easier availability of financing
Arab region on recovery path with 3.7% growth in 2026, but geopolitical risks persist: ESCWA
RIYADH: The Arab region is on a path of gradual economic recovery this year, according to a UN report that forecast growth reaching 3.7 percent and a gradual decline in inflation.
The UN Economic and Social Commission for Western Asia warned in its Macroeconomic Outlook for the Arab region that the persistence of geopolitical fog and risks to global trade remains a pressure factor on the region’s growth prospects.
ESCWA projected regional gross domestic product to have grown by 2.9 percent in 2025 before accelerating to 3.7 percent in 2026, supported by diversification efforts, fiscal reforms, and investment in non-hydrocarbon sectors.
Inflation across the region is expected to decline from 8.2 percent in 2025 to 5.4 percent by 2027, driven by easing commodity prices and the normalization of supply chains, the report said.
In its latest economic update, the World Bank said that regional GDP in the Middle East, North Africa, Afghanistan, and Pakistan is projected to grow by 3.3 percent in 2026, driven by stronger-than-expected performance in Gulf Cooperation Council countries and developing oil importers.
However, ESCWA warned that “ongoing conflicts, trade disruptions and elevated global tariff uncertainties continue to steer the economic outlook,” citing the spillover effects from the war on Gaza, tensions between Iran and Israel, and the volatile situation in several Arab countries, including Sudan, Yemen, and Syria.
The report highlighted a widening divergence in growth prospects among Arab economies. High-income Gulf countries are driving the regional recovery through diversification into manufacturing, tourism, and digital sectors.
For investors eyeing this shift, a key question is which specific non-oil industries offer the most resilient returns despite the persistent geopolitical risks. Ahmed Moummi, economic affairs officer at ESCWA, told Arab News that beyond the headline sectors, the most sustainable opportunities lie in the real economy.
“In general, real sectors have sustainable returns, particularly industry and agriculture. Investing in the latest technologies in the industrial or the agricultural sectors are likely to enhance returns and ensure sustainability of the business, like agri-business, food processing, fisheries, and tourism,” he said in an interview.
Saudi Arabia’s real GDP is projected to grow by an average of 3.3 percent during 2025-2027, supported by increased investment in manufacturing, real estate, and tourism, while the UAE is expected to achieve 4.5 percent average growth over the same period.
Middle-income countries face more significant challenges, including high debt burdens, inflation, and external shocks.
According to the ESCWA, the situation remains dire for conflict-affected low-income countries, including Somalia, Sudan, Syria, and Yemen. These economies are projected to contract by 0.9 percent in 2025 before modestly recovering to 1.7 percent growth in 2026, assuming conflicts de-escalate and reconstruction efforts begin.
With growth so uneven across high-income, middle-income, and conflict-affected economies, the question arises as to what business models or sectors are best positioned to succeed across this fragmented regional landscape. The answer, according to Moummi, lies in resilience through diversification.
“Diversified economies with diversified sources of income are the best models given the overall geopolitical and global landscape,” he said. “Investing in real sectors generates employment and realizes sustainable and inclusive economic growth. Also investing in knowledge economy and in skills’ development would ensure also that labor force would be agile and would fit for future jobs.”
The analysis warned that elevated tariffs announced by the US in April 2025 have increased trade uncertainty globally. While energy products are currently exempt, textiles, fertilizers, chemicals, aluminum, and electronics now face high US tariffs, affecting several Arab countries.
Jordan stands to be most impacted, with around 25 percent of its total exports directed to the US.
Bahrain, and Egypt, as well as Lebanon, Morocco, and Tunisia will be affected to a lesser extent, as their US exports average around 5 percent.
An indirect impact may emanate from potential slowdowns in the region’s main trading partners, particularly China and the EU, which together account for nearly one-third of Arab exports.
ESCWA has developed machine-learning-based “nowcasting” models piloted for Egypt and Saudi Arabia that integrate conventional and alternative data sources, including Google Trends and satellite imagery, to enable near-real-time GDP estimation.
“Nowcasting integrates conventional and alternative data sources and enables near-real-time GDP estimation, enhances policy responsiveness, and provides a scalable framework for evidence-based economic assessment in the region,” the report stated.
For Egypt, the models point to a 4 percent annual real GDP growth rate for 2025, while Saudi Arabia’s growth is nowcast at 4.3 percent for the same year.
The release concluded that achieving lasting peace and stability is fundamental for recovery and long-term development. It called for sustained aid and concessional financing to support reconstruction and human capital investment in conflict-affected countries.
“Diversification, fiscal consolidation and improved debt management are needed to preserve macroeconomic stability, decrease dependence on hydrocarbon revenues, generate employment, and create fiscal space for productive investment and social spending,” ESCWA said.
