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Middle East Edition
3rd April 2025
 
THE HOT STORY
Gulf economies avoid harshest Trump tariffs
Gulf Co-operation Council countries have been largely spared Donald Trump's reciprocal tariffs - but analysts say the indirect effects of the tariffs are likely to have the biggest impact on GCC members. The US president announced 10% reciprocal tariffs on the UAE and Saudi Arabia, while other Middle East countries that were hit with reciprocal tariffs included Israel (17%), Jordan (20%), and Egypt (10%). “Given the global nature, the GCC probably got the best outcome they could've got,” observed Rachel Ziemba, founder of Ziemba Insights, who added: “It's not a good outcome that universal tariffs are now part of how the US is financing itself, but [Gulf] leaders may take it as a partial success that they ended up in [the] lowest tier of most friendly countries in this new rubric.” But much more important to the GCC, she said, are the indirect effects of reciprocal tariffs on the US economy and global trade flows.
LEGAL
Minister cracks down on Shabbat work
Israeli labour minister Yoav Ben-Tzur has launched an operation enforcing working hours and rest laws at businesses which employ Jewish workers on their weekly rest day. "Labour laws in the State of Israel are not a recommendation; they are a civic duty to preserve workers' rights," Ben-Tzur posted on social media. The Labor Ministry's Regulation and Enforcement Administration investigated a number of businesses at the BIG Fashion Glilot mall, and found that 21 workers had experienced rights violations, including 13 Jewish workers who were found to be employed on their weekly rest day. "The Working Hours and Rest Law in the State of Israel clearly state that it is strictly forbidden to employ Jewish workers on Shabbat without special permission,” Ben-Tzur said. Opposition politicians have challenged the crackdown as unnecessary.
SUSTAINABILITY
KPMG: ESG targets now driving executive pay decisions
More than three-quarters of companies worldwide link sustainability targets to executive pay, according to a new report from KPMG International. The study, Incentivizing Long-term Value Creation: Linking sustainability metrics to board members’ pay, found that 78% of businesses now link senior execs' compensation to sustainability performance, with the most common targets relating to climate change and internal workforces, often focusing on female leadership and injury rates. While more companies linked sustainability to short-term targets (40%) compared to both short-term and long-term incentives (37%), KPMG said that investors generally expect to see a balance between both short-term and long-term targets to measure board performance. “Despite ongoing economic and geopolitical uncertainty, the findings make clear that linking executive compensation to sustainability performance is becoming increasingly widespread within the world’s largest companies,” said Nadine-Lan Hönighaus, global ESG governance lead at KPMG International. 

TECHNOLOGY
SoftBank teams up with OpenAI
SoftBank has announced a partnership with OpenAI, aiming to develop artificial super intelligence (ASI) that surpasses human intelligence. The Japanese investment group plans to invest $10bn initially, with an additional $30bn contingent on certain conditions by the end of 2025. OpenAI recently raised $40bn, valuing the company at $300bn, marking the largest funding round for a start-up.
INVESTMENT
Wealth management mega-trends in the UAE
Khaleej Times reports on how wealth management (WM) is in transformative mode, particularly in the UAE, which is becoming a hub for affluent investors. According to Bain & Company, global WM assets are expected to grow from $130tn to $230tn by 2030, with the UAE attracting over 70,000 millionaires in 2024 alone. The allure of Dubai, known for its luxury and safety, continues to captivate investors, especially Americans seeking real estate opportunities. The rise of family offices in the UAE, supported by favourable regulatory frameworks, is enabling efficient wealth management. Additionally, the demand for ESG-compliant investments is increasing, driven by the UAE's Vision 2050. As the digital and artificial intelligence revolution unfolds, WM firms are integrating technology to enhance client value. The Islamic wealth management sector is also thriving, with Shariah-compliant solutions gaining prominence. Luxury real estate remains a key asset for UHNW investors, attracting buyers from around the globe.
INTERNATIONAL
Foreign tech workers campaign against new Swedish citizenship law
Eric Peterson, a Spotify software engineer, has launched a petition against Sweden's new law tightening citizenship requirements, which he believes will deter highly skilled foreign workers. The letter argues that extending the residency requirement from five to eight years will diminish Sweden's appeal to skilled workers and that retroactive application of the law could harm trust in Swedish institutions. Peterson hopes to highlight the economic implications of the proposed changes to influence the government's decision-making process. "I've been very surprised and pleased at the volume of signatures that we've received and the feeling behind it," Peterson told The Local. "We're at a little over 130 signatures right now, which is way more than I expected, because I'm not broadcasting this. This is just going through the whisper networks of immigrants in tech in Sweden."
Employers in Taiwan struggle to fill key roles
Taiwan is grappling with a significant talent shortage, with the National Development Council predicting a workforce gap of 480,000 by 2030. A recent survey by Robert Walters reveals that 52% of companies plan to increase hiring in 2025, yet 71% face challenges in filling critical roles. John Winter, country manager of Robert Walters Taiwan, said: "The competition for top talent is intensifying." The Robert Walters Talent Trends 2025 Report highlights that 40% of employers are influenced by competitors' practices in shaping their workplace strategies. Additionally, 94% of employees are more likely to stay with companies that invest in career development, indicating a shift towards dynamic career lattices over traditional ladders. As artificial intelligence tools become more prevalent in recruitment, businesses are advised to balance automation with ethical hiring practices to ensure effective talent acquisition.
France stands firm on DEI policies
France's minister for foreign trade, Laurent Saint-Martin, has said that his country will not compromise on its diversity, equity, and inclusion (DEI) initiatives despite reported demands from the U.S. State Department for French companies to abandon such policies. Speaking on RTL Radio, Saint-Martin expressed his shock at the US interference, emphasising that the DEI initiatives align with French values and laws, including equality and anti-discrimination efforts. He said: “All of this is progress that corresponds first and foremost to our French values, we are proud of this and we don't want to compromise on it.” He did however stress the need to have a “positive agenda” and maintain a dialogue with the US.
Taiwan probes talent poaching
Taiwan's authorities are investigating China's Semiconductor Manufacturing International Corporation (SMIC) for allegedly luring Taiwanese tech workers through a shell company posing as a Samoan firm. The probe by the investigation bureau of Taiwan's justice ministry follows concerns over illegal activities by Chinese companies aimed at stealing expertise and attracting talent in the semiconductor sector. This month, 180 officials raided 11 companies suspected of such practices, including SMIC, as part of a broader effort to protect Taiwan's vital high-tech industry. Since 2020, over 100 cases have been investigated, highlighting the ongoing tensions surrounding semiconductor technology in the region.
 


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