Turkiye’s Erdogan offers to host UN climate talks in 2026

Turkish President Tayyip Erdogan delivers a national statement at the World Climate Action Summit during COP28 in Dubai on Dec. 1, 2023. (Reuters)
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Updated 01 December 2023
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Turkiye’s Erdogan offers to host UN climate talks in 2026

  • “We have announced our candidacy to host the 31st United Nations Climate Change Conference, to be held in 2026,” Erdogan said
  • “We intend to increase the proportion of renewable energy to 69 percent by 2053”

DUBAI: Turkish President Recep Tayyip offered Friday to host the United Nations COP31 climate conference in 2026.
Erdogan’s announcement at this year’s gathering in Dubai puts Turkiye in the race against Australia, which announced its candidacy earlier this year.
“We have announced our candidacy to host the 31st United Nations Climate Change Conference, to be held in 2026,” Erdogan said.
“I am certain that you, esteemed friends, will provide the essential support in this regard.”
Turkiye in 2021 became the last country among the Group of 20 major economies to ratify the Paris Climate Accords, committing itself to meet the net-zero emissions target by 2053.
The importance of environmental issues soared in Turkiye in the wake of deadly wildfires in 2021 that ravaged large parts of the country’s Aegean and Mediterranean coasts.
“In pursuit of the net-zero emission target, our decarbonization roadmaps for the steel, aluminum, cement, and fertilizer industries have been finalized,” Erdogan said.
“We intend to increase the proportion of renewable energy to 69 percent by 2053.”
Reeling from a massive earthquake that killed more than 50,000 people in February, Turkiye withdrew from hosting a key UN biodiversity meeting in 2024 in order to focus its resources on reconstruction efforts.


Saudi Arabia ahead of US, EU and UK when it comes to Basel IV compliance

Updated 59 sec ago
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Saudi Arabia ahead of US, EU and UK when it comes to Basel IV compliance

  • Basel IV regulations mandate that banks maintain specific leverage ratios and designated reserve capital

RIYADH: Saudi Arabia’s dedication to financial stability has been underlined by figures from the Kingdom’s central bank showing its capital adequacy ratio stands at 19.5 percent – far above the 8 percent minimum requirement introduced in the wake of the 2008 economic crisis.

This position comes as Saudi Arabia is one of the few countries to be fully compliant with Basel IV regulations, which mandate that banks maintain specific leverage ratios and designated reserve capital.
This adherence to global standards contrasts with the varied timelines seen worldwide for Basel IV implementation.
While the EU, the UK, and Switzerland are navigating finalization processes, the US is yet to commence consultations on these critical reforms, which remain a top priority for regulatory bodies amidst recent bank failures.
Although Saudi Arabia’s ratio falls slightly below the 20 percent recorded in the same period in 2023, it still comfortably exceeds the Basel III minimum requirement of 8 percent, encompassing both Tier 1 and Tier 2 capital.
Basel III is a set of international banking regulations developed by the Bank for International Settlements to promote stability in the international financial system. It was introduced following the 2008 global financial crisis to improve the banks’ ability to handle any shocks from financial stress and strengthen both their transparency and their disclosure.
Basel III builds on the previous accords, Basel I and Basel II, and is part of a process to improve regulation in the banking industry. Basel IV, or 3.1, was introduced in 2017 and is the final reform of Basel III. It focuses on strengthening the banking sector for increased resilience against future crises. The target timelines for implementation of the final reforms vary significantly worldwide.
Originally scheduled to take effect on Jan. 1, 2022, the implementation of Basel IV was postponed by 12 months due to the COVID-19 pandemic, with transitional dates being revised and varies among countries.
The Basel IV proposals seek to restore credibility in the calculation of risk-weighted assets and improve the comparability of banks’ capital ratios.
One of the most significant risks faced by traditional banks is credit risk, which involves the uncertainty that loans, the primary assets of a bank, may not be repaid, leading to unexpected losses.
To mitigate this risk, regulators impose a regulatory capital intended to absorb losses in times of credit default. The absence of sufficient capital can lead to a bank collapse, posing not only a threat to the individual bank but also to the broader financial system.
In a February 2023 report, Fitch Ratings highlighted that Saudi Arabia, along with Australia, Canada, Indonesia, and South Korea, was among the few jurisdictions that successfully met
the globally agreed official Basel IV implementation date in
January 2023. The report also emphasized Saudi Arabia’s status as one of the most sophisticated and conservative regulators in the Middle East and Africa.
Under these regulations, banks are required to measure their risk-weighted assets in a calculation that involves assigning different risk weights to various categories of assets based on their perceived riskiness. The goal is to reflect the varying degrees of credit risk associated with different types of assets in a bank’s portfolio.
Banks are then required to assign regulatory capital to ensure they have a sufficient buffer to absorb potential losses, particularly during economic downturns or financial crises. The capital requirements are usually expressed as a percentage of a bank’s risk-weighted assets.

The key capital types that are allowed under Basel III are divided into two main tiers: Tier 1 which is the highest quality capital and includes common equity, retained earnings and other comprehensive income, in addition to Tier 2, other instruments with specific loss-absorption features.
Within the banks’ capital adequacy calculations under the Basel III framework, another significant ratio that banks need to comply with is the regulatory Tier 1 capital, which should be maintained at a minimum 6 percent of RWA to safeguard their financial strength.
In the context of Saudi banks, this regulatory Tier 1 capital reached 16 percent of their RWA, indicating a robust position that comfortably surpasses the Basel III requirement for a minimum Tier 1 capital of 6 percent.
Furthermore, this capital encompasses the capital conservation buffer – a supplementary measure under Basel III intended to absorb losses during economic stress, fixed at 2.5 percent of total risk-weighted assets.
The primary purpose of the capital conservation buffer is to build an additional layer of capital that banks can draw upon in times of financial difficulty.
It aims to promote the conservation of capital and prevent banks from depleting their capital levels to a point where they may be at risk of financial distress.
Importantly, this buffer must be fulfilled using Common Equity Tier 1 exclusively, and it is positioned above the regulatory minimum capital requirement of 8 percent. This elevates the overall required minimum ratio to 10.5 percent.
If the minimum buffer requirements are breached, capital distribution constraints will be imposed on the bank.
Tier 1 capital is categorized as going concern, signifying its immediate capacity to absorb losses as soon as they arise. On the other hand, Tier 2, the second type of capital considered in calculating the bank’s capital adequacy ratio, encompasses supplementary capital and operates as a gone concern, absorbing losses before affecting depositors and general creditors.
Total available regulatory capital is the sum of these two elements - Tier 1 and Tier 2. Both categories have distinct criteria that capital instruments must meet before being considered. Banks must adhere to specified minimum levels of Common Equity Tier 1, Tier 1, and total capital, with each level expressed as a percentage of risk-weighted assets.
The Basel IV proposals seek to restore credibility in the calculation of risk-weighted assets and improve the comparability of banks’ capital ratios.
Fitch Ratings said this move is expected to benefit banks with significant exposures to residential and commercial mortgage loans, as well as high-quality project finance in Saudi Arabia. The capital ratios of these banks are expected to improve, thanks to more detailed risk-weightings that are generally lower than those observed under the previous regime.
However, according to the agency, banks involved in land acquisition, construction, development, financial guarantees and equities will face increased capital requirements.
Retail-focused banks are set to benefit from improved capital ratios with lower risk-weightings, particularly in residential mortgage loans. SAMA’s cap on the loan-to-value ratio at 90 percent will lead to reduced risk-weights, ranging from 20 percent to 40 percent, from 50 percent previously.
The overall capital ratio for the Saudi banking sector will remain mostly unchanged as indicated by a parallel run conducted by SAMA in 2022.


FII Priority: Leaders in Miami and the Kingdom are fostering environments for growth and talent

Updated 23 February 2024
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FII Priority: Leaders in Miami and the Kingdom are fostering environments for growth and talent

  • Diversity, inclusivity are key ingredients to make a place attractive, panelist said
  • Kingdom has made great improvements to rebrand itself as global talent hub

MIAMI: Leaders in Saudi Arabia and Miami share common ground in their efforts to foster environments conducive to growth and talent, experts highlighted at the FII Priority conference in Miami on Friday.

Over the past few years, both have prioritized initiatives aimed at improving living standards for their residents, focusing on socio-economic policies that promote diversity and inclusivity.

“There are so many parallels between what’s going on here (in Miami) and what’s going on there (Saudi Arabia),” said Jeff Zalaznick, restaurateur and managing partner of hospitality company Major Food Group.

During a session titled “The special sauce: what is the recipe for a vibrant city?” he added: “Both are fostering environments where people can grow (and) excel in their fields. They want to attract talent.”

Zalaznick noted that both regions strike a balance between cultivating diversity and talent locally while also attracting the best from around the world, fostering their potential across various domains such as sports, music, and culinary arts.

Aligned with its Vision 2030, Saudi Arabia has undertaken significant policy reforms, placing diversity and inclusion at the forefront of its development agenda.

This shift has been especially pivotal for the Kingdom’s youthful demographic, as they aspire to leverage this momentum and carve out their niches in various industries.

“(When you make) young people feel optimistic about what they can do, you basically are writing the future,” said Steve Stoute, CEO of marketing agency Translation and music label UnitedMasters.

“I do believe that this idea of multiculturalism, of embracing emerging subcultures and helping enforce that, are (fundamental) ingredients that this city gets and (only) a couple other cities get really well.”

He emphasised that places lacking diversity and inclusive support systems miss out on attracting the brightest young talent, as they fail to cultivate the dynamic and vibrant environments necessary for growth and innovation.

Renowned as a haven for retirees, Miami has undergone a transformation in recent years, enticing a younger demographic with a blend of job prospects and reduced tax obligations.

Similarly, Saudi Arabia has embarked on a campaign to redefine itself as not just a regional hub, but a global magnet for young talent.

With its population surpassing 32 million, as per a 2022 census by the General Authority for Statistics, Saudi Arabia boasts a youthful majority, with those under the age of 30 constituting 63 percent of the total.

Drawing parallels between these two “renaissances,” Zalaznick noted the evolving criteria for vibrant cities and the changing preferences of city dwellers.

He highlighted the growing importance of cultural dynamism and multiculturalism in city selection, particularly for companies seeking diverse talent pools and innovative environments.

“It’s about young people,” said Tom Garfinkel, vice chairman, president and CEO of the Miami Dolphins and Hard Rock Stadium and managing partner of the Formula One Miami Grand Prix.

“We have to attract young people, we have to have cultural dynamics where young people can afford to live, where business opportunities exist, where it’s easy to start businesses and to create.

“The talent goes to the city that attracts, that has the culture that attracts young talent, and the companies go there and not the other way around,” he concluded.


UAE and Kenya finalize terms of Comprehensive Economic Partnership Agreement

Updated 23 February 2024
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UAE and Kenya finalize terms of Comprehensive Economic Partnership Agreement

RIYADH: The UAE and Kenya have concluded negotiations on a trade deal that will boost investment flows in logistics, healthcare, and travel and tourism between the two countries. 

The Comprehensive Economic Partnership Agreement will enhance market access for businesses on both sides, according to a press release.

Investments in the infrastructure and ICT sectors are also set to benefit, and the deal will also see a platform for small and medium enterprise cooperation and expansion on both sides.

Kenya's economy experienced real annual GDP growth of 5 percent in 2023, up from 4.8 percent in the previous 12 months. 

Its services sector, which accounts for 53.6 percent of Kenya’s economy, and agriculture sector, comprising around a quarter of national GDP, offer vast potential for UAE businesses looking to expand into the region, the release added.

The UAE’s Minister of Foreign Trade Thani bin Ahmed Al-Zeyoudi described the new agreement as marking a “significant milestone” in the country’s trade deal program.

He added: “It is a testament to our commitment to strengthening economic ties with the African continent and to creating new opportunities for businesses and investors in both of our countries. 

“The UAE-Kenya CEPA will not only boost trade and investment, but also foster innovation and sustainable growth in key sectors such as agriculture, technology and tourism. 

“We look forward to deepening our relationship with Kenya and to further expanding our presence in Africa as a trusted partner and investor.”

Kenya’s Cabinet Secretary for Investments, Trade and Industry Rebecca Miano said the agreement was testament to her government’s drive to use international commerce as “a key lever of economic growth and transformation.”

She added: “The Comprehensive Economic Partnership Agreement with the United Arab Emirates will play a key role in these efforts, enabling our exports to reach important markets in Asia and the Middle East, and also in stimulating the investment inflows that will further develop our national capabilities. We look forward to its implementation and the mutual benefits it will deliver.”

In 2023, the UAE’s non-oil trade in goods reached an all-time high of $710 billion, a 12.6 percent increase on 2022 – and 34.7 percent more than 2021. 

The UAE has already concluded 10 CEPAs, including with India, Israel, and Indonesia, as well as Türkiye, Georgia, and South Korea.


Oil Updates – crude falls after US Fed governor says no rush to cut interest rates

Updated 23 February 2024
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Oil Updates – crude falls after US Fed governor says no rush to cut interest rates

SINGAPORE: Oil prices fell on Friday after a US Federal Reserve official said interest rate cuts should be delayed at least two more months, but indications of healthy demand and concerns over supplies could boost prices in the coming days, according to Reuters.

Brent crude futures were down 38 cents, or 0.5 percent, at $83.29 a barrel at 8:24 a.m. Saudi time, while US West Texas Intermediate crude futures were 40 cents, or 0.5 percent, lower at $78.21.

US Fed policymakers should delay interest rate cuts by at least another couple of months to see if a recent uptick in inflation signals stalling progress toward price stability or is just a bump in the road, Fed Gov. Christopher Waller said on Thursday.

Higher interest rates for longer slow economic growth, which could curb oil demand in the world’s largest oil consumer. But some analysts say demand has remained largely healthy, including in the US.

Analysts at ANZ research said US crude oil inventories rose at a less-than-expected rate last week, while run rates at refineries ended a streak of declines and may increase in coming weeks.

JPMorgan’s high frequency demand indicators are showing oil demand rising 1.7 million barrels per day month-over-month through Feb. 21, its analysts said in a note on Friday.

“This compares to 1.6 mbd increase observed during the prior week, likely benefitting from increased travel demand in China and Europe,” the analysts said.

Oil benchmarks pared some of their Thursday gains after Waller’s comments.

The US central bank has held its policy rate steady in the 5.25 percent-5.5 percent range since last July, and minutes of its policy meeting last month show most central bankers were worried about moving too quickly to ease policy.

Waller also pushed back on the idea that the Fed risks sending the economy into recession if it waits too long to cut rates, saying the Fed can afford to “wait a little longer.”

Oil futures had settled higher on Thursday as hostilities continued in the Red Sea, with Houthis stepping up attacks near Yemen to show support for Palestinians in the Gaza war.

Israel Prime Minister Benjamin Netanyahu’s war cabinet has approved sending negotiators to truce talks taking place in Paris on Friday as pressure mounts in the Middle East, according to a source briefed on the matter and Israeli media. 


AI can bridge North-South divides, Accenture CEO tells FII summit

Updated 23 February 2024
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AI can bridge North-South divides, Accenture CEO tells FII summit

  • Julie Sweet: ‘One of the things that’s been great to see is Saudi Arabia taking the lead in many places’
  • ‘It’s really important to always stay focused on what are the opportunities with AI to solve the world’s problems’

MIAMI: Artificial intelligence has the potential to bridge North-South divides, Accenture’s CEO told the Future Investment Initiative Priority summit in Miami on Thursday.

Julie Sweet explored the far-reaching impact of AI on addressing global challenges in a panel discussion titled “FII Priority Compass: What matters most to citizens?”

She said: “The question is how much AI can actually help the Global South and the countries that need help through precision farming, through telemedicine and better healthcare.”

Highlighting Saudi Arabia’s proactive stance in leveraging AI for societal advancement, Sweet stressed the importance of global collaboration in harnessing AI’s potential to tackle complex issues.

“One of the things that’s been great to see is Saudi Arabia taking the lead in many places to think through how can AI help and how can they be a leader.

“So I think it’s really important to always stay focused on what are the opportunities with AI to solve the world’s problems.”

However, Sweet acknowledged that the definitive solution to utilizing AI to close existing divides is not currently available.

Highlighting the vital efforts of organizations such as the UN, she emphasized the urgency of understanding how technology can be harnessed to avoid widening disparities.

Since the increased accessibility of AI in the public market and its “democratization,” experts have emphasized the need to regulate the technology.

“Regulation needs to be the outcome of a very strong public-private partnership, because most governments in the world don’t have the access or the talent inside to know it,” Sweet said, adding that there have been a few successful examples of governments balancing innovation and safety.

“That’s one of the most important things that governments need to do, particularly because the technology is changing rapidly. And I think the good news is that everyone has agreed that some regulation is needed.”

Regarding AI-related risks in the upcoming US election, Sweet cautioned against relying solely on government regulation. Instead, she advocated for increased collaboration among private entities.

“That’s as important as government regulation,” she said. “It’s responsible companies coming together in an agile fashion to solve the risks.”

Addressing concerns about job displacement due to AI, Sweet said while her role as a lawyer would persist, the nature of the job would evolve. She emphasized the need to reskill workforces and prepare the new generation to use AI.

Sweet highlighted Accenture’s annual investment of $1.1 billion in staff training, and stressed the importance of adapting school curricula to future-proof the younger generation through enhanced communication skills and basic technology education.

“All of us will have to continue to adapt and learn … because our skills have to constantly be improved and there’s so much change,” she concluded.