Press Reviews CW 34-35 (Gulf edition)
1) Expansion of Jebel Ali refinery, Dubai
ENOC will expand the Jebel Ali refinery in Dubai, according to the final contract in the amount of $1bn to Overseas-AST. Overseas-AST will build interconnecting pipelines, that will carry jet fuel, isomerate and light and heavy naphtha between the refinery’s processing units, storage tanks and berth facilities. This project will enhance the production about 50 % from 140,000 bpd (barrel per day) to 210,000 bpd. Commercial production is scheduled to start in the fourth quarter of 2019.
2) Kuwait informs that OPEC will discuss ending oil production cuts
Oil production cuts were introduced to stop the global oil glut and costs. According to Bloomberg calculations, in OPEC nations only 86 % of the planned cuts taking place in July and in June only 84 % of the planned cuts taking place. In non-OPEC countries that signed up for cuts, only 73 % of the planned cuts in July taking place and only 81 % in June. Kuwait oil minister Essam al-Marzouq informs on August 21, 2017 that OPEC would look whether to “extend or terminate” its oil production cuts. IMF estimate that the average oil prices in 2017 will be about $51.9 a barrel, up from $47.8 a barrel in 2016. It is forecasting $52 a barrel in 2018. Also several commodities analysts have decreased their short-term forecasts for oil prices.
3) Value Added Tax (VAT) is coming into effect by a presidential decree
Sheikh Khalifa Bin Zayed Al Nahyan announced the new value added tax (VAT) in his decree, published on August 28, 2017. This new tax will be introduced on January 1, 2018. All supplies of good and services have a standard rate of 5 % with the exception of specific supplies subject to the zero rate. These zero rates will be used for transport, metal, oil & gas, educational services and related goods, basic health care services and certain financial services. Every resident in the UAE or in a VAT implementing GCC state must register and will get a tax registration number (TRN). Two or more person can apply for a tax registration as a tax group, if a person has a place of establishment or fixed establishment in the UAE, the relevant persons are related parties, and one or more Persons are conducting business in a partnership that controls the others. A Tax Return at the end of a tax period will become an obligation. Non-residents are entitled to apply for tax registration if the charging of tax for such goods or services is the duty of the importer. Full details will be announced in the law’s regulatory framework, which is expected to be released by the fourth quarter of this year.
4) Dubai Chamber explores markets in Asia, Latin America, Africa and the CIS
The Dubai Chamber of Commerce and Industry explores new markets, known as “untapped business potential”. Dubai is interested in the trade and investment opportunities and also in vast business potential. Key areas are India with their fast-growing economy and Latin America with their trade and investment opportunities. Non-oil trade between India and Dubai reached $26 billion in 2016; India’s GPD grew 7,1 % in 2016. In Asia, Dubai is also interested in China’s One Belt initiative, that will provide trade and investment opportunities as well. Based on the evaluation of the IMF, emerging and developing economies are going to see growth rates of 4,6 % in 2017 (US: 2,1 %; EURO: 1,9 %). According to Hamad Bu Amin, president and chief executive officer of Dubai Chamber, “Dubai is well-positioned to benefit from an expected recovery in global trade this year, while China and India will likely remain key drivers of global growth in the near term”.