The American oil services firm SPX Flow expanded operations in Abu Dhabi in order to tap new customers in the region.

The facility, which opened in the capital on Wednesday, will meet any service, repair and overhaul requirements across its range of equipment, including pumps, processors and transformers.

“SPX recognises the excellent growth prospects for oil and gas across the region and has opened the service centre in Abu Dhabi to respond to the needs of our customers,” said Jose Larios, president of SPX’s power and energy business. “Lowering the total cost of ownership is crucial in tough market conditions, and we’re committed to delivering this to all of our Gulf-based clients,” Mr Larios said.

The low oil prices which have been a market mainstay for over two years have squeezed the industry, but some consider the region to still be a safe haven for investment. For SPX, it is not only looking to better service existing business, but it also hopes to grab new local clients.

The company said that ongoing investments in the region signaled to a greater potential for the Middle East North Africa region to make up a larger part of its portfolio. SPX saw a total revenue of US$2.5 billion in 2014 with the Mena region making up about 21 per cent of that total, according to Chris Thorburn, SPX service centre manager for the UAE.

“We have strong aspirations for Mena to make up an increased share of SPX’s global business revenues,” Mr Thorburn said. “Specifically for the UAE, we’re targeting double digit percentage growth year over year for the next three years.

Earlier this year the company opened a service centre in Saudi Arabia and it plans to add another facility in the region next year. Mr Thorburn said the “details of which would be shared at a future date”.

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Abraaj sells stake in Pakistan's K-Electric to Chinese utility

Abraaj Group has agreed to sell its stake in Pakistan’s largest power utility for US$1.77 billion to Shanghai Electric Power (SEP) as the Chinese utility moves to increase its overseas assets.

SEP will acquire a 66.4 per cent stake in K-Electric, formerly Karachi Electric Supply Company, marking one of the largest private sector transactions in Pakistan, Abraaj said.

The buyout firm based in Dubai invested in K-Electric seven years ago to increase power generation in Pakistan’s largest city.

The utility added more than 1 gigawatt of installed generation capacity during that time, and recorded its first net profit in 17 years in 2012.

K-Electric reported a 40 per cent increase in net profit for the nine months ending in March compared to the same period last year.

The utility reaches a quarter of the 9.33 million people in Karachi, and is continuing efforts to expand its reach including the 1.32GW Bin Qasim Coal Power Plant, which is expected to be completed in 2018.

“Abraaj fully recognised the outstanding growth opportunity that K-Electric represented for the power sector in Pakistan when we made our investment in 2009,” said Arif Naqvi, founder and group chief executive of Abraaj. He added that the private equity firm would remain focused on other investment opportunities in Pakistan and wider Asia.

For SEP, a unit of Fortune 500 company State Power Investment Corporation, its aim is to increase assets abroad. SEP said on its website that its strategy was to expand in the overseas market gradually.

“The power station service business has initiatively implemented the strategy of ‘going abroad’ on the basis of serving the domestic market,” the company said pointing to operations in Equatorial Guinea, Iraq and Turkey.

“SEP will leverage its own strengths as a strategic investor and further realise K-Electric’s potential to provide better services to the people of Pakistan and the government of Pakistan,” said Wang Yundan, the chairman of SEP.

“The K-Electric transaction only marks the beginning of SEP’s cooperation with Abraaj and we look forward to further collaboration between the two parties in many other areas in the future.”​

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Dubai Gold and Commodities Exchange to list Shanghai gold futures

Chinese gold and coffee will play a larger role for Dubai’s commodities market after several deals were signed in Shanghai last week as the emirate seeks to boost ties with its No 1 trade partner.

The Dubai Gold and Commodities Exchange (DGCX) said on Saturday it will list Shanghai gold futures, marking the first time that a foreign exchange will use the yuan-based gold product.

The futures will be traded according to the Shanghai gold benchmark price, established two years ago to open China’s financial market to global economic integration.

To help facilitate the trades, the Agricultural Bank of China (ABC) will be the first market maker for the product, DGCX said in a statement.

The bank’s DIFC branch will bid and offer prices with a minimum spread and maximum size, maintaining margins and collaterals. Gaurang Desai, the chief executive of DGCX, said that this will help to bring more liquidity to the market.

“This will ensure that we have a strong start to trading,” he said, adding that there was already a strong appetite from investors. “[The Shanghai Gold Futures] to be traded and cleared outside of China allows us to further strengthen our offering, deepening our commitment to the gold market.”

Gold trading volumes for the Shanghai Gold Exchange were up nearly 22 per cent in September compared to the previous year.

China has been Dubai’s biggest trading partner since 2014 and it has been the second-largest trading partner of the UAE as a whole since 2011. China’s investment in the UAE is close to US$2.33 billion, according to Dubai Chamber of Commerce and Industry

In addition Dubai is looking to become a global coffee distributor with the help of beans from Yunnan State Farms. Dubai Multi Commodities Centre (DMCC) signed a deal with Hong Kong-based holding firm Mega Capital Halal that will involve up to 140,000 tonnes of Chinese Arabica beans making their way to Dubai for redistribution to other markets, DMCC said in a statement.

The DMCC will offer storage and warehousing facilities and office space within a 4,500 square metres temperature-controlled facility. DMCC wants to boost the commodities trade along the West -East corridor, according to Gautam Sashittal, the chief executive of DMCC.

Saxo Bank said last month that Arabica coffee was beginning to show signs of life once again after having an 18-month downward trend. Arabica coffee prices rose 5 per cent last month, according to the International Coffee Organisation.

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Dubai adds partnerships to bring in more Chinese visitors

Dubai has stepped up its game to grab more Chinese visitors by partnering with major tourism and financial services companies while adding more Chinese employees to the roster at Dubai Duty Free.

The emirate had more than 14.2 million overnight visitors last year, according to Dubai’s Department of Tourism and Commerce Marketing (DTCM). Chinese tourists only made up 450,000 of that figure, or about 3 per cent of Dubai’s total tourists.

To help attract more, Dubai Duty Free will partner with Ctrip, one of China’s largest online travel agencies with 141 million active members. The agency members will get a 7 per cent discount while shopping at Dubai Duty Free from January to June, subject to terms and conditions.

Dubai Duty Free also made plans with UnionPay International to expand its partnership. The bank card service provider, which is similar to companies such as MasterCard and Visa, was created by China’s central bank, but about 85 per cent of state-owned banks have a stake in the provider.

While Chinese tourists do not make up a large amount of overall tourists, they accounted for 12 per cent of duty free sales last year. Colm McLoughlin, executive vice chairman and chief executive of Dubai Duty Free, said that this growing number was the reason behind making the duty free website available in Mandarin for the first time last week.

“Both the number of Chinese travellers flying through Dubai International and those shopping at Dubai Duty Free has increased substantially in recent times,” he said. “And we believe that by teaming up with Ctrip and UnionPay we can interact directly with travellers before they fly and help them make informed purchasing decisions at Dubai Duty Free.”

Chinese nationals represent 10 per cent of Dubai Duty Free’s total workforce at 591 employees. That figure will increase to nearly 700 workers over the next year, according to , Nic Bruwer, the executive vice president of commercial at Dubai Duty Free.

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Boost for Dubai with increase in cruise numbers

Dubai expects a 20 per cent increase in cruise passengers this season as new ships call on the city.

Dubai Cruise Tourism (DCT) expects 157 ship calls during the 2016-17 season, spanning from October through to July, which will help the emirate to inch closer to its 2020 target of 20 million tourists a year.

This season, DCT expects 600,000 cruise tourists compared with more than 500,000 a year ago.

“Through our cruise tourism strategy, we aim to bring in 1 million tourists to Dubai by 2020 and we’re heading in the right direction,” said Jamal Al Falasi, the director of DCT.

Dubai will have more than 23 cruise operators, including six that will use the emirate as a base. This number goes up with the addition of one of the world’s largest operators, Norwegian Cruise Line, as well as the UK-based Thomson Cruises.

The DCT forecasts for tourists from cruises this year is a far cry from 10,000 in 1998. Part of the reason this segment is growing for the country is the introduction of multi-entry visas two years ago. This has opened the door to potential emerging markets such as China, India, Russia and South America, according to the DCT.

Packages will include a variety of options, including a 7-day trip around several regional destinations from Thomson, and even the extended 21 – or 32-day excursions provided by Norwegian.

Next year, Celestyal Cruise Lines from Greece will be the first in the region to offer a three-night/four-day itinerary for Arabian Gulf tourists, tapping the Mediterranean markets.

Dubai is looking to peg the region as a winter destination for European and Mediterranean travellers. “Celestyal Cruise Lines choosing Dubai as its home port in the region is yet another instance of the collective approach of tourism, airlines and port authority leading to a compelling tourist proposition,” Mr Al Falasi said.

“With such a broad market of visitors choosing the emirate, cruise offers travellers the chance to view the city from a different perspective,” he said.

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Cruises to raise Dubai's tourism goals

Dubai expects a 20 per cent increase in cruise passengers this season as new ships call on the city.

Dubai Cruise Tourism (DCT) expects 157 ship calls during the 2016-17 season, spanning from October through to July, which will help the emirate inch closer to its 2020 target of 20 million tourists a year.

This season, DCT expects 600,000 cruise tourists compared with more than 500,000 a year ago.

“Through our cruise tourism strategy, we aim to bring in 1 million tourists to Dubai by 2020 and we’re heading in the right direction,” said Jamal Al Falasi, the director of DCT.

Dubai will have more than 23 cruise operators, including six that will use the emirate as a base. This number goes up with the addition of one of the world’s largest operators, Norwegian Cruise Line, as well as the UK-based Thomson Cruises.

The DCT forecasts an 18 per cent growth in ship passengers to 600,000 tourists, a far cry from 10,000 in 1998. Part of the reason that this segment is growing for the country is the introduction of multi-entry visas two years ago. This has opened the door to potential emerging markets such as China, India, Russia and South America, according to the DCT.

Packages will include a variety of options, including a 7-day trip around several regional destinations from Thomson, and even the extended 21 or 32-day excursions provided by Norwegian.

Next year, Celestyal Cruise Lines from Greece will be the first in the region to offer a three-night/four-day itinerary, tapping the Mediterranean markets.

Dubai is looking to peg the region as a winter destination for European and Mediterranean travellers. “Celestyal Cruise Lines choosing Dubai as its home port in the region is yet another instance of the collective approach of tourism, airlines and port authority leading to a compelling tourist proposition,” Mr Al Falasi said.

“With such a broad market of visitors choosing the emirate, cruise offers travellers the chance to view the city from a different perspective,” he said.

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UAE banks come together to expand sustainable financing

A group of UAE banks has come together to fund sustainable projects amid a potential Dh10 billion financing gap.

Eight UAE banks signed an agreement yesterday to expand sustainable financing over the next five years as banks pull back on lending across the wider economy.

National Bank of Abu Dhabi (NBAD), Commercial Bank of Dubai, Dunia Finance, Emirates NBD, HSBC, National Bank of Fujairah, RAKBank and Union National Bank signed the Dubai Declaration yesterday.

The deal, at the Unep Finance Initiative Global Roundtable, was struck in partnership with the UAE Government and Unep Finance Initiative.

This is in line with the UAE’s Vision 2021, a set of national targets to be achieved by the country’s 50th anniversary.

“We consider the transition to a global low-carbon economy to be an enduring influence on the business world of the future,” said Nathan Weatherstone, the head of sustainable business at NBAD.

The banks will “lend to, invest in, facilitate financing or provide insurance to the projects, businesses and customers with sustainable purposes as well as support the growth of a successful small and medium-sized enterprise [SME] sector”.

The criteria borrowers will need to meet to tap the funding was not disclosed.

Johann Schoeman, a partner at Dubai-based Oryx Solar, which specialises in the installation and maintenance of solar energy systems, said that it was important that banks create fin­ancial instruments that will provide funding for individual homeowners to install residential solar systems.

“At current interest rates for personal loans, it’s feasible to create products that will allow for monthly savings on utility bills to be more than loan repayments,” he said.

Small-scale initiatives have been overshadowed by larger projects, says Enerwhere, based in Dubai.

One example is the US$10 billion in clean energy financing that NBAD announced it would commit over the next decade.

The bank told The National earlier this year that the funding would be geared towards the wholesale side – meaning projects that are more than $100 million in value. For companies that focus on small to medium-scale deployment, funding options are limited.

Enerwhere provides solar-diesel hybrid generators, which can be offered on a short-term rental basis or through a ­power-purchasing agreement.

Daniel Zywietz, Enerwhere’s chief executive, said he was not aware of any distributed solar projects financed by UAE banks.

He said that with about 1,000 megawatts of diesel generators running in the UAE, there is a fin­ancing requirement of about Dh4bn for the solar equipment alone. That investment would increase to more than Dh10bn if batteries were added to provide power at night. “That’s a big, profitable market that banks are currently missing out on,” he said.

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Banks team up to expand sustainable financing

A group of UAE banks has come together to fund sustainable projects amid a potential Dh10 billion financing gap.

Eight of the country’s banks signed an agreement yesterday to expand sustainable financing over the next five years as banks pull back on lending across the wider economy.

National Bank of Abu Dhabi (NBAD), Commercial Bank of Dubai, Dunia Finance, Emirates NBD, HSBC, National Bank of Fujairah, RAKBank and Union National Bank signed the Dubai Declaration yesterday.

The deal, at the Unep Finance Initiative Global Roundtable, was struck in partnership with the UAE Government and Unep Finance Initiative.

This is in line with the UAE’s Vision 2021, a set of national targets to be achieved by the country’s 50th anniversary.

“We consider the transition to a global low-carbon economy to be an enduring influence on the business world of the future,” said Nathan Weatherstone, the head of sustainable business at NBAD.

The banks will “lend to, invest in, facilitate financing or provide insurance to the projects, businesses and customers with sustainable purposes as well as support the growth of a successful small and medium-sized enterprise [SME] sector”.

The criteria borrowers will need to meet to tap the funding was not disclosed.

Johann Schoeman, a partner at Dubai-based Oryx Solar, which specialises in the installation and maintenance of solar energy systems, said that it was important that banks create fin­ancial instruments that will provide funding for individual homeowners to install residential solar systems.

“At current interest rates for personal loans, it’s feasible to create products that will allow for monthly savings on utility bills to be more than loan repayments,” he said.

Small-scale initiatives have been overshadowed by larger projects, says Enerwhere, based in Dubai.

One example is the US$10 billion in clean energy financing that NBAD announced it would commit over the next decade.

The bank told The National earlier this year that the funding would be geared towards the wholesale side – meaning projects that are more than $100 million in value. For companies that focus on small to medium-scale deployment, funding options are limited.

Enerwhere provides solar-diesel hybrid generators, which can be offered on a short-term rental basis or through a ­power-purchasing agreement.

Daniel Zywietz, Enerwhere’s chief executive, said he was not aware of any distributed solar projects financed by UAE banks.

He said that with about 1,000 megawatts of diesel generators running in the UAE, there is a fin­ancing requirement of about Dh4bn for the solar equipment alone. That investment would increase to more than Dh10bn if batteries were added to provide power at night. “That’s a big, profitable market that banks are currently missing out on,” he said.

lgraves@thenational.ae

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Banks team up to expand sustainable financing

A group of UAE banks has come together to fund sustainable projects amid a potential Dh10 billion financing gap.

Eight of the country’s banks signed an agreement yesterday to expand sustainable financing over the next five years as banks pull back on lending across the wider economy.

National Bank of Abu Dhabi (NBAD), Commercial Bank of Dubai, Dunia Finance, Emirates NBD, HSBC, National Bank of Fujairah, RAKBank and Union National Bank signed the Dubai Declaration yesterday.

The deal, at the Unep Finance Initiative Global Roundtable, was struck in partnership with the UAE Government and Unep Finance Initiative.

This is in line with the UAE’s Vision 2021, a set of national targets to be achieved by the country’s 50th anniversary.

“We consider the transition to a global low-carbon economy to be an enduring influence on the business world of the future,” said Nathan Weatherstone, the head of sustainable business at NBAD.

The banks will “lend to, invest in, facilitate financing or provide insurance to the projects, businesses and customers with sustainable purposes as well as support the growth of a successful small and medium-sized enterprise [SME] sector”.

The criteria borrowers will need to meet to tap the funding was not disclosed.

Johann Schoeman, a partner at Dubai-based Oryx Solar, which specialises in the installation and maintenance of solar energy systems, said that it was important that banks create fin­ancial instruments that will provide funding for individual homeowners to install residential solar systems.

“At current interest rates for personal loans, it’s feasible to create products that will allow for monthly savings on utility bills to be more than loan repayments,” he said.

Small-scale initiatives have been overshadowed by larger projects, says Enerwhere, based in Dubai.

One example is the US$10 billion in clean energy financing that NBAD announced it would commit over the next decade.

The bank told The National earlier this year that the funding would be geared towards the wholesale side – meaning projects that are more than $100 million in value. For companies that focus on small to medium-scale deployment, funding options are limited.

Enerwhere provides solar-diesel hybrid generators, which can be offered on a short-term rental basis or through a ­power-purchasing agreement.

Daniel Zywietz, Enerwhere’s chief executive, said he was not aware of any distributed solar projects financed by UAE banks.

He said that with about 1,000 megawatts of diesel generators running in the UAE, there is a fin­ancing requirement of about Dh4bn for the solar equipment alone. That investment would increase to more than Dh10bn if batteries were added to provide power at night. “That’s a big, profitable market that banks are currently missing out on,” he said.

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UAE to shift focus of energy mix to solar from gas over five years, IEA forecasts

Hundreds of thousands of homes in the UAE could be powered by renewable energy over the next five years as the country steers away from power plants primarily driven by natural gas, according to the International Energy Agency (IEA).

The IEA on Tuesday released its medium-term report on renewable energy. The agency is forecasting that, by 2021, the use of renewables in the Middle East and North Africa will grow by 78 per cent, led by the UAE, Egypt and Morocco.

The UAE is expected to add 1.9 gigawatts (GW) – mostly through solar photovoltaic – bringing the country’s capacity to more than 2GW. However, the IEA said that the figure could reach 5GW, more than twice the current target, by 2021 if electricity subsidies for small consumers were removed. This is enough power for more than 800,000 homes, according to calculations from the US-based Solar Energy Industries Association.

Even so, Moritz Borgmann, a partner at the Berlin advisory Apricum, says the IEA is underestimating the pace of the UAE’s renewables growth.

“The IEA is notorious for operating on hopelessly outdated cost assumptions and for lowballing renewable deployment,” Mr Borgmann said. “Beyond 2021, the low cost of renewables will lead the UAE to further increase its already ambitious targets.”

Mr Borgmann said Apricum expects that by 2021 the UAE will have 2.8GW of renewables installed, if not more.

So far the effect of low oil prices has had little effect on long-term plans for renewable energy in the UAE, even though many believed that the appetite for renewables would wane. Last November, Dubai extended its clean energy targets to reach 75 per cent of its energy mix by 2050.

“These developments suggest that decreasing the reliance on imported fuels for power generation and hedging against fuel price volatility are likely to have more of an impact on renewable deployment over the medium term rather than lower fossil fuel prices,” the IEA said.

The UAE has been an importer of natural gas since 2007, despite having the fifth-largest reserves in the world. While local gas reserves meet half of the demand, a large portion is used to reinject into oilfields to maximise output. This month, the UAE and Qatar signed a deal to secure more natural gas.

Currently, natural gas is used to meet more than 90 per cent of the UAE’s power needs. As the country grows, so does its power demand – more than doubling to 52 gigawatts by 2030 from levels in 2010, according to the UAE State of Energy Report.

Apricum said on Monday that it had opened operations in the UAE as demand increases for financial and commercial advisory services in the renewables sector.

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