5 Ways that Financial Crime Compliance will Change in 2020

Financial Crime Compliance

Financial crime is a global problem that may be affecting you and, the environment around you, without you even knowing it. The value of illegal wildlife trade has an estimation of between $5 billion and $20 billion per year, one of the most lucrative illegal businesses, following narcotics, human trafficking and weapons trade. As technology becomes more advanced, financial criminals are becoming more sophisticated and adaptable in their illicit methodologies; therefore, it is important for legislation to stay updated and mirror the flexibility of their illicit counterparts in order to effectively combat financial crime. Anti-Money Laundering (AML) was a strong focal point for 2019, with new directives and legislation becoming adopted by jurisdictions to combat this global rise in financial crime. 2020 is set to follow-on, improve upon and adapt to foundations that financial crime compliance laid in 2019. This article will draw upon 5 key predictions for 2020 in regards to financial crime compliance. We must address the main issues faced today and how companies and countries can overcome them to stamp out or minimise financial crimes.

Financial Crimes & Hefty Fines

The financial system has heavily evolved in the last decade, rapid payments, instant payments, PSD2 and other advancements have acted as vehicles for financial misuse, resulting in money laundering and harmful effects on economies, society and the environment. Since 2015 there has been a steady rise in money laundering fines issued, notably, 2019 saw almost double the amount of fines issued than 2018. In 2019, global money laundering fines exceeded $8 billion, whereas in 2018 the figures were around $4 billion. France, alone, issued fines of over $5 billion and the global average penalty for money laundering was around $145 million.

Money Laundering
Source: https://www.encompasscorporation.com/blog/why-are-aml-fines-increasing-deep-dive-into-encompass-analysis/

 

The above chart symbolises a need for change in regards to fighting financial crime. Governments, regulators and agencies are scrambling to find optimal solutions to reduce this illicit activity and effectively monitor illegal financing. Below is a variety of key areas that 2020 may unveil in an attempt to reduce financial crime and ensure compliance.

  1. Private-to-Private Information Sharing:

    Currently there is a major lack of information sharing across private companies at a global level. Financial crime is a global issue, yet institutions are combatting them at a microscale. 2020 should see an increase in information sharing at a macro-level. Information sharing is currently difficult due to legislative barriers and due to a lack of digitalisation. Only 54% of data and legal documentation, that is needed to carry out effective due diligence, is digitalised. Therefore, before private information can be successfully shared, it must be digitalised for institutions to utilise effectively. However, with an increasing rise in data privacy and security, it is difficult to share data without breaching data protection legislation. Institutions will opt for information digitisation and information and data sharing solutions for the private sector.

  2. Contextualised Financial Crime:

    2020 should see a focus on redefining the context of financial crime. By this, we mean, currently transactions monitored are based upon a fixed set of rules and thresholds. This approach can allow anomalous behaviour that escapes the standard of protection and monitoring, allowing illicit activity to go unnoticed. Monitoring needs to be contextualised and not generalised in order for future success in preventing financial crime. In order to contextualise monitoring, there needs to be more agile and optimised systems in place that can account for anomalous behaviour, systems that can learn, adapt and predict. In order to make more informed decisions you need relevant content that you can analyse. A prediction for the near future of AML is to integrate multiple sources of data into a centralised system; this can ensure a wider scope of information, account for numerous circumstances and allow for an increased contextual monitoring approach. Additionally, enhancing data analysis can aid this approach, by better understanding the context of transactions you can increase your understanding of consumer activity. Taking informed data-driven approaches based off a centralised data system can provide necessary contextualised financial crime compliance.

  3. Real-Time AML Monitoring:

    This approach is perhaps in its early stages, but 2020 will see a trend in focussing on real-time AML monitoring to allow for quicker decision making than the current batch file process. With the increased usage of artificial intelligence (AI), financial institutions are encouraged to take innovative approaches to work in coexistence with current risk-based approaches. This hybrid of AI and current practice can allow for a prioritisation of scenario-based alerts and quickly and automatically adapting to new money laundering schemes. Additionally, 2020 predicts the convergence of AML transaction monitoring and inbound fraud payment monitoring for operation efficient purposes. This implementation may also aid in preventing financial crime by providing more data to be analysed and contextualised to support the above two factors.

  4. Quality over Quantity:

    To only implement technical compliance is not enough, it is important to also provide higher quality of information. 2020 will place a great emphasis on the quality of information provided to the necessary authorities. Quality of information concerning financial crime will also parallel an awareness movement, to make people, companies and institutions aware of the dangers involved with financial crime, the possibilities and the realism of the threat. Illicit wildlife trading, human trafficking, terrorist financing, arms dealing, drug smuggling and more are all activities that bear implications in the reality of financial crime. These very serious social, economic and environmental issues need to be addressed and managed. Therefore, through spreading relevant and informative information and, moreover, being able to provide the quality information to authorities, we can collectively help reduce financial crimes.

Companies have already begun to adopt campaigns to spread financial crime awareness. For example, Barclays campaigned to fight against human trafficking.

“We need to prevent it entering the supply chain, we need to educate other companies, and we need to raise awareness beyond our consumer base.” – Paul Horlick, Director – Head of Barclays’ Financial Intelligence Unit

Barclays, as a bank, understands the importance of preventing money laundering and is part of the process in redefining how big businesses view, and combat, financial crime. The emphasis on a higher quality of information will bring an increase in thorough investigations that can aid relevant authorities in their mission to end illicit financial activities.

5. Conformity – Alignment of Standards:

As previously stated, financial crime has implications at a global level, money laundering doesn’t stop at the border and criminals will take any means and jump through any loophole in the law that presents itself. 2020 calls for an alignment in regulations and standards to combat financial crime, compliance at this level should hold an international standard that companies can abide by. This factor will also aid to the centralisation of information discussed in the first prediction. Importantly, jurisdictions must first issue a consistency of standards for crimes, punishments and all that falls under the umbrella of financial crime compliance. The EU has taken great leaps in bringing about consistency through their 5th AML directive. The EU are working on implementing a 6th AML directive that will include tougher sentencing and additional offences of criminal liability in the form of aiding and abetting. The EU has acknowledged the necessity for an alignment of standards and has worked tirelessly to compile a respectful standard for companies to follow. Yet, what must follow is a global standard for financial crime punishment and regulations that will, hopefully, reduce financial crime and stop individuals from successfully manoeuvring across jurisdictions.

Bright Days Ahead

Financial crime compliance has undergone transformation and 2020 does not see it slowing down. Newer legislation, technology and methodologies will consistently be tested until financial crime is reduced and, hopefully, eradicated. The above predictions each come with their own hurdles and tests, yet they each propose a slightly better future for financial compliance. We shall see across the next decade if the industry takes the necessary routes to successfully combat illegal financial activities.

MENA’s Finest AML

Cedar Rose has understood the issue of financial crime and has embedded, in their culture, a desire to tackle money laundering from the hardest of regions. We have over 23 years’ experience in the Middle East and North Africa, where we have been combatting money laundering through enhanced due diligence investigations using a collection of resources, local networks and expertise to help companies put an end to financial crime. Tackling financial crime throughout the MENA region is especially difficult due to the scarce digitalisation of data, secrecy of free-zone jurisdictions and its particularly volatile political climate. However, our team of expert researchers can help you with your due diligence needs, we have the experience, the resources and the knowledge to help with your AML requirements. It is our duty to help spread the awareness of financial crime and to help companies avoid it at all costs. This is a global problem, which requires a global solution and Cedar Rose are proud to be part of the solution.

Check out our recent article on The China-Pakistan Economic Corridor

Written By Jack Evangelides, Marketing Executive

5th Anti-Money Laundering Directive – Highlights

Anti Money Laundering

On 10th January 2020, EU Member states will have to implement new AML rules into their national legislation. The European Commission presented its proposal for a 5th Anti-Money Laundering Directive on 5 July 2016 which aims at ensuring a significant tightening of the European regulations for the prevention of money laundering and terrorism financing. The 5th Anti-Money laundering directive has been adopted and entered into force on 9 July 2018.

As per the European Commission’s fact sheet on the 5th Anti-Money Laundering Directive, this directive aims at:

  • Setting up centralised bank account registers or retrieval systems
  • Enhancing the powers of EU Financial Intelligence Units and facilitating their cooperation
  • Enhancing cooperation between financial supervisory authorities
  • Lifting the anonymity on electronic money products (prepaid cards) in particular when used online
  • Extending Anti-Money Laundering and Counter Terrorism financing rules to virtual currencies, tax related services, and traders in works of art.
  • Improving transparency on the real owners of companies
  • Improving transparency on the real owners of trusts
  • Interconnection of the beneficial ownership registers at EU level
  • Broadening the criteria for assessing high-risk third countries and improving checks on transactions involving such countries

It is worth highlighting that accessing data related to beneficial owners of trusts is not accessible to the public. This access is understood to be restricted to competent authorities including Financial Intelligence Units, the professional sectors subject to Anti-Money laundering rules (such as banks, lawyers) as well as other persons who can demonstrate a legitimate interest. Additionally, it is important to mention that the national registers on beneficial ownership information will be directly interconnected to facilitate cooperation and exchange of information between Member States.

The above objectives are meant to increase public scrutiny and will contribute to preventing the misuse of legal entities for money laundering and terrorist financing purposes.

Worth noting also that new criteria have been added to assess high-risk third countries, including transparency of beneficial ownership. Member States will have to ensure that the sectors dealing with countries presenting strategic deficiencies in their Anti-Money Laundering and Counter Terrorism financing regimes listed by the European Commission apply systematic enhanced controls on the financial transactions from and to these countries. The list of checks is now harmonised to ensure there are no loopholes in the EU. In addition, the listing of the Commission will include third-countries with low transparency on beneficial ownership information, no appropriate and dissuasive sanctions or which do not cooperate nor exchange information.

Cedar Rose’s investigative due diligence reports, including tracing the source of wealth of persons residing in high risk third countries as well as the UBOs of companies registered in these same countries, tends to directly serve these objectives. Our database, which includes more than 24 million persons’ data and over twelve million companies, provides a solid foundation for tracing UBO’s and for performing link analysis. Fresh investigations to trace the source of wealth of a person through a local reputational report or via understanding his directorship and shareholding structure is also available to facilitate your investigations.

Written By Wassim Antar, Senior Due Diligence Analyst

See our Due Diligence Case Study here.

References

https://ec.europa.eu/info/policies/justice-and-fundamental-rights/criminal-justice/anti-money-laundering-and-counter-terrorist-financing_en

https://paytechlaw.com/en/5-anti-money-laundering-directive-summary/

Citizenship via Investment Schemes: Risks & Solutions

Citizenship

Facts:
A most recent European Commission report to the European parliament, the Council, the European economic and social committee and the committee of the regions tackled the topic of “Investor Citizenship and Residence Schemes in the European Union”. As per the report, recent years have seen a growing trend in investor citizenship (golden passport) and investor residence (“golden visa”) schemes, which aim to attract investment by granting investors citizenship or residence rights of the country concerned. Such schemes have raised concerns about certain risks related to security, money laundering, tax evasion and corruption.  While some investor residence schemes were initiated in the early 2000s, the financial crisis starting in 2007 led more EU Member States to adopt these schemes, or revive previous ones. This trend has continued over the past 10 years and these schemes exist to date in 20 Member States.  For instance, Bulgaria, Cyprus and Malta introduced in 2005, 2007 and 2013 respectively broader schemes aimed at attracting investment from third-country nationals by facilitating access to their citizenship. These schemes are a new form of naturalisation as they systematically grant citizenship of the Member State concerned, provided the required investment is made and certain criteria fulfilled. The report added that investor citizenship schemes aim to attract investment by offering citizenship in return for a defined amount of money. In Bulgaria, an overall investment of EUR 1 million is requested under its fast-track investor citizenship scheme. In Cyprus, a minimum investment of EUR 2 million is necessary, together with ownership of property in Cyprus. In Malta, a contribution of EUR 650,000 must be paid into a national investment fund, together with an investment of EUR 150,000 and a requirement to own or rent property in Malta. In Cyprus and Malta, additional investments for family members are required. Various investment options can be observed among the three Member States operating investor citizenship schemes: capital investment; investment in immovable property; investment in government bonds; and one-off contributions to the State budget. In addition to the investment requirement, applicants must also pay non-refundable administrative fees as part of the application process. Cyprus and Malta have significantly higher fees than Bulgaria.

Areas of Concern and Risks:

Third-country nationals may invest in an EU Member State for legitimate reasons, but may also be pursuing illegitimate ends, such as:

  1. Evading law enforcement investigation and prosecution in their home country;
  2. Protecting their assets from the related freezing and confiscation measures.
  3. Utilizing illicit funds to obtain a passport.

Hence, investor citizenship and residence schemes create a range of risks for Member States and for the Union as a whole in particular:

  1. Risks to security, including the possibility of infiltration of non-EU organised crime groups.
  2. Risks of money laundering and tax evasion.
  3. Risks related to terrorist financing.
  4. Risks related to corruption including previous involvement in fraudulent practices.
  5. Risks of being directly or indirectly politically exposed.
  6. Risks related to lack of Transparency and proper governance:

Controversial case:

A controversial investment for citizenship scheme was reported in Cyprus on October 17 2019 in relation to the acquisition of Cambodia’s long-time prime minister. Investigations revealed that the once prime minister used his wealth to buy foreign citizenship. It was reported that eight family members or allies including the country’s police chief who has been instrumental in clamping down on dissent in Cambodia, and its finance minister, sought and received Cypriot citizenship in 2016 and 2017. The European Commission warned in a January 2019 report that what it called “golden passports” could help organised crime groups infiltrate Europe and raised the risk of money laundering, corruption and tax evasion. While Cyprus authorities say their processes are transparent, and data laws protect he who gets citizenship, it was understood that the Cypriot government did not respond to questions on the Cambodians before publication of the report. After publication, a government spokesman was reported to say that the citizenship program was absolutely credible and transparent while declining to discuss individual cases and that the information on the Cambodians “will be taken into serious consideration”. Further investigations traced that the prime minister was in power for 30 years and has overseen the murder, torture and jailing of his critics. His family members hold key posts in politics, the military, police, media, and charities, and his eldest son is being groomed to succeed him. His family wield significant control across most of Cambodia’s lucrative industries, with links to major global brands. Some of the domestic companies they are affiliated to have been accused of a litany of abuses, including land grabbing, and violence and intimidation against local populations. His daughter was reported to have the largest number of business holdings of any member of the family, with links to or interests in 22 companies, which have registered share capital of more than USD 66 million, according to filings in Cambodia.

The questions remain on how diligent were the authorities or the obliged entities in examining the applications of the Cambodians? Where there any Enhanced due diligence process conducted to trace any red flags issues associated with these applicants? If yes, were these findings factored in when assessing their case? The above case lies at the heart of the need of enhanced due diligence to be put in place. Mitigating risks and adopting risk based approaches throughout the process of the Citizenship via investment schemes is becoming a necessity rather than just an option.

Solutions

Therefore, Cedar Rose has engineered a bouquet of integrity and investigative due diligence products, which aim at:

  1. Identifying, the source of income / wealth as well as any illicit practices associated with the subject under investigation (Fraud, Bribery, Corruption, etc). This type of investigation helps in understanding the reputation of the subject and in establishing a profile, which would trace any possible reasons for this person to transfer funds or benefit from investor citizenship schemes.

  2. Tracing Ultimate Beneficial Owners (UBO’s) as well as the business and political network of an applicant. This type of investigation will help in tracing and identifying possible concealment of the origins of proceeds, which could be, linked to the layering stage a potential Money laundering scheme.

  3. Identifying the directorship and shareholding of the applicant. This type of investigation will also aim to trace possible concealment of the origins of proceeds (Layering stage) as well to identify possible ownership of these shareholders and directors which would possibly be a result of the reintroduction of laundered funds into the system (Integration stage) via the ownership of assets in the country where they applied for the investor citizenship scheme.

  4. Tracing the business relationships and any possible political exposure for the applicant.
  5. Initiating litigation and criminal checks to understand any possible previous illegal practices.

References:

https://www.globalwitness.org/it/blog/we-dont-care-we-are-still-power/

https://ec.europa.eu/info/sites/info/files/com_2019_12_final_report.pdf

https://cyprus-mail.com/2019/10/17/mp-charalambidou-demands-answers-for-passports-to-cambodian-elite/

** Check out our newsroom for more business intelligence insights

Written by Wassim Antar, Senior Due Diligence Analyst

Green Card Initiative: Saudi Arabia opens its Economy

Green Card

Saudi Arabia is continuing its efforts to reach their 2030 vision of diversifying the economy, however not through traditional means. Similar to the United States green card system, Saudi Arabia is implementing a similar initiative, officially known as ‘Privileged Iqama’. This idea has been in the pipeline for over 3 years, hinted by Crown Prince Mohammed bin Salman. The idea is simple yet effective, attracting visitors to reside in the Kingdom that, in turn, would boost the economy. The Kingdom is undergoing mass transformations to reach their vision, to develop robust public service sectors, enhance tourism, and strengthen the economy to create an overall better place to live, financially and socially. However, what is ‘Privileged Iqama’ and how can it really help?

“We are working on a specific program similar to the green card.” – Crown Prince Mohammed bin Salman, in retaliation to a question on non-oil revenue measures.

Privileged Iqama
Privileged Iqama, commonly known as the Saudi ‘green card’ aims to provide permanent residency to foreigners if they meet a certain criteria. It is understood that the individual would need to be wealthy, highly-skilled and without a criminal record. If you meet these three conditions you will be entitled to a residence permit without any need for a sponsor, which is the traditional regulation currently implemented in Saudi Arabia. Your status will be permanent, subject to annual renews, or, possibly, unlimited. Although, you may be screened and required to prove that you meet the conditions, however, there are many other benefits that you will receive if granted a Saudi green card. For example, the benefits include the opportunity to have ownership of property and transport, recruit a workforce, receive private employment, travel without restrictions to and from Saudi Arabia and even sponsor visitor visas for relatives. 

When this initiative was first hinted, in 2016, it was said to take up to 5 years before implementation, so far the Kingdom is right on track with their promises and their 2030 vision. 

The Benefits of the Saudi Green Card
Expatriates have always sought out the Kingdom as a great place to reside in, however, there are a handful of cases where it hasn’t worked to their favour. The burden of having a sponsor and not being given the same rights as a legitimate resident has often unfairly left some individuals who have had to pay huge sums of money to relieve a dispute. Due to the magnitude and success of expatriates in Saudi Arabia, combating this problem and finding a solution to provide them with a necessary pass, or a green card in this case, to healthily instigate business may have positive outcomes. The new system plans on producing an enhanced and robust social cohesion, inviting many to establish businesses and, for those who are already established, to continue positive and robust growth for their enterprises. The success of companies and individuals within the Kingdom will translate into the success of the country. Affluent living will attract more investors and entrepreneurs to the Kingdom, diversifying the country’s economy and keeping on track with the 2030 vision. 

In another light, providing privileged Iqama will also reduce travel barriers, with many residents having to make ‘visa runs’ every few months, eliminating queues at embassies and many other inconveniences that come with having a visa. The current limits on visas will be a thing of the past. Although this initiative is currently in its early stages, the country is making quick ground on transforming in line with their 2030 vision. Is Saudi Arabia on your radar? 

Know the Kingdom
Saudi Arabia may just be your next potential business move, however, every transition comes with a risk. Attaining a privileged Iqama is one thing, but understanding the way a country works, how to do business and any mitigating unwarranted risks is another. It is important to do your due diligence, learn how the country operates, the typical business week, formalities that you need to know, the legal system, what similar types of businesses exist and more. If you are considering engaging in employment or local partnerships, it is useful to have the full background on the individuals and businesses you may be working with.

Cedar Rose can offer in-depth investigations into regions such as Saudi Arabia, which we have been covering for over 20 years. With a due diligence investigation we can provide a safer passage to instigate business. The more you know the better. Avoid harmful surprises with high quality data, research and discreet investigative reports from Cedar Rose. 

While you’re here make sure to check out the importance of company credit reports 

Written By Jack Evangelides, Marketing Assistant

 

*** The sole purpose of the article above is to generate public discussion, it has no intention to constitute legal advice. ***

TAQA Takeover – The Schlumberger Acquisition, Saudi Vision 2030

TAQA Takeover

The Middle East and North Africa (MENA) is undergoing mass transformations in the oil industry. Recent events have seen Saudi Arabia’s Industrialisation and Energy Services Company – TAQA – acquire onshore drilling rigs throughout MENA which were previously owned by Schlumberger. This large operation sees the acquisition of rigs from Kuwait, Oman, Pakistan and Iraq, and amounts to a significant $415 million. TAQA believes this acquisition aligns with the core ethos of Saudi’s 2030 vision, envisaging economic and infrastructural growth. Saudi Arabia have much depended on oil that practically fuels its economy, this acquisition will bring a more robust and stable outlook to the country with hope to generate further income and achieve prosperity.

The Logistics
TAQA’s triumphant acquisition, instigated via their drilling subsidiary Arabian Drilling Company (ADC), will seek to operate a fleet of 58 onshore rigs and 9 offshore rigs across MENA. This investment in growth will generate steady income for the country and provide employment opportunities for an estimate of 6,000 employees across the firm. This acquisition is in respect to TAQA’s 2021 strategy of becoming a leading regional oilfield services and equipment company. This pan-regional drilling powerhouse will unlock value and drive growth in Saudi Arabia. Their growth-driven strategy is reflected in 3 pillars:

  • To create value through expanding into new markets and strengthening their current position,
  • Maintain current value via keeping up-to-date and current with new technologies and by providing optimum services for their clients,
  • Striving for efficiency in relation to safety, reliability and competiveness.

TAQA’s values are aligned with Saudi’s 2030 vision which bolsters the country’s position of achieving their vision.

“This acquisition is fully aligned with Saudi Vision 2030. It unlocks value and drives growth across our entire value chain through a more integrated regional approach, while positioning a leading Saudi company as a global player. The transaction also follows on from ADC’s accelerated expansion activity in 2018 when 16 rigs were commissioned to support the growth of Saudi Aramco. This new combination clearly demonstrates that TAQA and ADC are delivering on their transformation and growth strategies, and further strengthens what is already a long-standing and trusted partnership between TAQA and Schlumberger. We look forward to supporting ADC in the next phase of its expansion and have full confidence that this will benefit all stakeholders, most notably our regional clients.” – Azzam Shalabi, CEO, TAQA and chairman of the ADC board

This much awaited acquisition is set to take place in the second half of 2019, post-regulatory approvals, and will aim to generate revenue, employment opportunities and sustainability. ADC has recently undergone other expansions from as early as 2018 where the company saw an increase in 16 rigs to support the growth of Saudi Aramco. It is evident that ADC, subsidiary to TAQA, is taking an accelerated, progressive and prosperous path. ADC traditionally has a history of innovation, efficiency and safety throughout its 55 years of operations.

Strive for Excellence
Acquisitions and mergers require meticulous due diligence research to make sure you mitigate any potential risks. No matter the size of the merger, if counterparties are not investigated correctly and thoroughly the effects could be costly on your business. Cedar Rose specialises in business intelligence, such as due diligence investigations, especially throughout the MENA region. Know the company and individuals (such as directors and shareholders) you are dealing with beforehand, be aware of their associations to other entities or organisations, ensure all paperwork is in order and remain compliant. Contact our Client Services team on info@cedar-rose.com with your particular requirements.

Head on over to our newsroom for more invigorating articles. 

Written By Jack Evangelides, Marketing Assistant

Sourced Image Freepik

*** The sole purpose of the article above is to generate public discussion, it has no intention to constitute legal advice. ***

Solar Power Controversy: How to Utilise Alternative Energies

Solar Power

It is evident that the 21st century portrays a mission for sustainable, renewable and alternative energies. Solar power is one of the most advanced forms of clean energy that current technologies have to offer, it is a source of energy that is beginning to be used more widely across the globe. Solar power energy, harnessed by technologies such as solar panels, is most optimised in countries that provide the most sun. This gives the continent of Africa a significant outlet to harness renewable energies. Countries such as Egypt, Sudan, Chad and Niger are all witnessing an average of over 10 hours of sun per day. So why hasn’t Africa managed to utilise their ideal climate to produce sustainable energy?

Solar Power Potentials
There are approximately 600 million Africans who live without electricity and those that have access experience power shortages and high prices. If this continent was able to utilise solar power technologies it could transform it in many areas. Socially, more citizens will have access to electricity which will in turn bolster their economy, providing more opportunities for the people of Africa. Additionally, diversifying the economy with solar power energy will provide stability and economic growth for Africa. Having a strong focus on renewable energies also provides a more sustainable environment, a healthier environment that will be organically sustained for the future. Current means of energy through fossil fuels are simply redundant, polluting and inevitably coming to an end, countries need to take the right initiatives for a sustainable future.

Although, as a whole, Africa poses as a continent that lacks availability to constant electricity, there are a few countries that show the possibilities of alternative energies.
For example, Morocco is an iconic country, paving the way forward with solar power technology, not only for other African countries, but for all. The Moroccan government is pushing to generate over 50% of its electricity, through only renewable energy, by 2030. To enforce this, they are pending the completion of the world’s largest solar plant, through the construction of Noor Ouarzazate. This significant solar power station has already undergone many installations and is still growing. Since 2013 this project has grown and achieved incredible results.

The Roadblocks
However, for many parts of Africa, it is not that simple. The production requirements for solar power plantations aren’t something that grows overnight. It requires a substantial amount of funding and investments to ensure the projects can develop in a robust manner. African governments invested a mere $12 billion annually, towards the power sector. In order to enact sustainable methods, much larger investments are required. By 2040, approximately $63 billion will be needed to be invested in the power sector.

Alternatively, weak infrastructure that currently exists in many African countries, including those nations with traditionally stronger economies, plays a part in the scepticism against adapting renewable energy. Businesses are continuously disrupted due to Africa’s power generating capacity, causing rationing, shortages and blackouts. Infrastructural issues in Africa hinder opportunities to diversify their energy.

Steps in the right direction
Although a big proportion of Africa poses as a harsh economic landscape to introduce solar power energy, more nations are becoming aware and making the right movements towards a more sustainable future. North Africa in particular portrays a region that has adopted solar energy and it is setting an example to the rest of the continent.

Moreover, national governments are attempting to tackle the issues with scaling up these initiatives through offering more reasonable payment solutions. Pay-as-you-go solar solutions have become a success throughout the continent, providing a financially healthier framework to build upon.

African Business
Are you considering doing business in Africa? Cedar Rose has an extensive amount of data on companies and individuals within the region; we offer award-winning business credit reports, in-depth due diligence investigations and other services that may assist you in working within Africa.

Visit www.cedar-rose.com today for more information.

For more articles on clean energy make sure you check out our newsroom.

Written By Jack Evangelides, Marketing Assistant

*** The sole purpose of the article above is to generate public discussion, it has no intention to constitute legal advice. ***

Riyadh on the Rise – The Saudi Capital Focal Point for Growth

Riyadh

Riyadh is undergoing a significant transformation with plans for $23 billion dollars of investments being pumped into the capital. It is no surprise that the Middle Eastern region has been booming in recent years, through economic revivals from oil, to diversification of energy commitments and investments, enhancing prosperity in the region. However, the blossoming country of Saudi Arabia is not only promoting green initiatives through this investment, but a healthier lifestyle. From projects such as parks and museums to sports facilities and golf courses, the transformation of Riyadh is setting the bar high. Whilst the capital undergoes such a significant transformation, the country plans to promote and to enhance tourism, investments and bolster their economy as a whole through the project.

What to Expect?
The plan for Riyadh’s growth is not to be under estimated. It is, essentially, a plan to revive the capital and generate a prosperous city of growth and success. The $23 billion investment is, and will be, a significant achievement for Saudi Arabia as a whole. The project aims to enhance tourism, diversifying the economy further and relying on other sources of income as opposed to traditional energy and oil funding. What is to be expected?

New welfare projects include sports facilities and a vast, green, central park that hopes to encourage a healthier lifestyle for all generations. Saudi Arabia is aiming to promote an active lifestyle, while expanding their economic reliance through other outlets that can generate income. Some of the projects launched are as follows: Sports Boulevard, Riyadh Art, King Salman Park and Green Riyadh. Saudi Arabia will witness a lifestyle transformation, a cultural change and an overall expansion of the capital.

Additionally, the investment draws heavily on generating a robust tourist landscape in order to support the Saudi Arabian economy. Thus, the project is not purely for generating a greener, more active and sustainable lifestyle, but to influence tourists to visit the capital. If we look more closely at one of the projects, the King Salman Park, it is set to spread out over a 13.4 square kilometre area, which will include garden areas, open theatres, art sections, up to sixteen hotels, seven museums and even a golf course. Therefore, we can visualise that this portion of the project is, on its own, a significant revival plan, not just to boost the country’s lifestyle but to create a place for all to visit.

Aimed at increasing activity in the capital, the project for a Sports Boulevard is set to include bicycle routes, spanning to 135 kilometres, and horse-riding areas for all citizens to enjoy. Furthermore, to keep the concept of going green and providing sustainability, the capital will also be increasing its per capita green space to 28 square metres (currently at 1.7 square metres).

Although these projects set to begin in the second half of 2019, most are expected to be completed from 2023-2030. Through this timeframe, there are a predicted 70,000 extra jobs generated and huge investment opportunities for the private sector. Through enhancing private sector participation, the Kingdom can expect a fresh barrel of fuel for growth.

The Middle-Eastern Gem
Saudi Arabia’s distinguishable landmass, religious significance and central location have supported the Kingdom in becoming an outstanding country in the Middle East. However, these new initiatives are set to completely and positively transform the country beyond Riyadh and, perhaps, breed potential for further investments throughout the country. Opportunities will be plentiful for savvy exporters, developers and construction companies.

Whether are already conducting business with Saudi Arabian companies or not, it is important that you understand the region, the data and the day-to-day operations before investing, extending credit, trading or engaging in mergers or acquisitions. To properly mitigate risks and take controlled opportunities in the Middle East it would be beneficial and indeed advisable for you to do your due diligence pre-emptively.

Cedar Rose has been active in the Middle East, in countries such as Saudi Arabia for over 20 years, with specialist knowledge of the region. We have qualified researchers who are experts at sourcing information, speak the local language and provide the highest quality, trusted data and due diligence reports for the region in a compliant way. Our due diligence professionals can provide you with the in-depth investigations necessary to draw the correct information to help you and your company. Trained and experienced in the region, they have in-depth knowledge in countries such as Saudi Arabia and are ready to provide you with the necessary information and business intelligence to utilise the opportunities that the Middle East has to offer.

Visit www.cedar-rose.com today to find out more.

While you’re here make sure to check out the importance of company credit reports 

Written By Jack Evangelides, Marketing Assistant

Sourced Image: AlphaCoders

*** The sole purpose of the article above is to generate public discussion, it has no intention to constitute legal advice. ***

Oman Oil & Gas Ministry Sign Funding Agreement with Shell for 2019

Oman Shell Funding - Cedar Rose

Agreements signed and exploration for further gas resources continues as the Ministry for Oil and Gas (MOG), Oman Oil Company (OOC), Shell and Petroleum Development Oman (PDO) sign an interim upstream arrangement. This has been long in the waiting, since the MoU that was pre-emptively signed in May 2018, which was related to the development of an integrated gas project. The excavation will further explore and develop the gas resources of the Greater Barik area. In light of the discovered gas resources Oman poses as a prime country for investment and has already had potential investors. French energy major Total has acknowledged Oman’s prospects and plans to invest to develop their gas resources. 

“Today’s agreement is a significant step forward. We hope that the development of gas resources destined for the integrated projects will play an important role in generating in-country value and diversifying Oman’s economy.” – Chris Breeze, Shell’s country chairman in Oman. 

Planning Ahead

The parties involved in the development of gas resources envisage a long and prosperous future together, one of investments, developments and success. The Oman Oil and Gas Ministry, Shell and other parties involved, such as OOC and Total, will be working closely, diligently and positively to consolidate the energy projects. These aforementioned parties are expected to sign definitive agreements within the second-half of 2019. Oman has been closely linked in a variety of agreements and partnerships, supporting the go-ahead for production/exploration of gas resources. Energy company Eni has signed with MOG and BP a Head of Agreement (HoA), setting up principles for the acquisition of the Exploration and Production rights of Block 77. Eni has been making movements throughout the Blocks, setting up multiple partnerships and reinforcing its presence in The Sultanate of Oman, while strengthening the collaboration with OOCEP.

“We are confident that the project will help diversify the gas sector in Oman and support the economic development of the port of Sohar and its region,” – Stephane Michel, senior vice-president for exploration-production of Total for the Middle East and North Africa (MENA).

 

Oman – Your Next Potential Investment?

It is evident that Oman is potentially a prosperous country for investments. The Middle East relies heavily on gas and oil production and positively benefits from these discoveries. Although big proportions of the economy rely on gas and oil, the Middle East is now utilising and diversifying the economy, using investments to generate other in-country values. Oman is one of many success stories within the region.

Bordering with the UAE, Saudi Arabia and Yemen, it is a prime location for investments. 

In case you decide to invest in the region, Cedar Rose offers KYB or Know your Business checks that offer an instant automated verification of businesses throughout MENA. Via API, you can receive, in real-time, accurate information that can help you instigate business and mitigate risks. However, in many situations it may be vital to investigate further, and we therefore offer investigative due diligence checks, which are a more advanced form of business intelligence. Let our information help steer you in the right direction. 

For information on the very much talked about news in the Middle East surrounding one of the largest expo’s in the world, find out more with our latest 2020 Dubai Expo: Everything we Know article. 

Written ByJack Evangelides, Marketing Assistant

*** The sole purpose of the article above is to generate public discussion, it has no intention to constitute legal advice. **

ClearVue Technologies to make a Positive Statement in the Middle East

ClearVue Energy - Cedar Rose

The Middle East is progressing into a region of clean and renewable energy. The concern for a healthier environment and, consequently, a healthier planet, is refreshing to witness. ClearVue, an Australian public listed company, is one of the companies that is providing a cleaner industry within the region. Through their ground breaking product, photo-voltaic solar panels, ClearVue aspire to provide smart-building-material to the heights of the Middle East. Their patented technology allows visible light to pass through a pane of glass, while the invisible wavelengths of light are deflected to the edges of the glass where they are converted into electricity. This offers a huge market potential for the visionary company and can benefit the region for years to come. Newer technologies and innovations are constantly being developed and ClearVue have perfectly designed their product to suit the sunny landscapes of the Middle East and North Africa (MENA) region.

A Global Turning Point
The world has, arguably, formed a global consensus concerning the issue of the environment. There is a strong desire for cleaner sources of energy, renewable energies and healthier means of industrial operations. ClearVue is one of many companies that have taken the initiative to focus their processes on developing technologies to benefit the environment. What better place to implement these new initiatives than the Middle East, a vast region of scorching heat to fuel their technology.

Currently, ClearVue is expected to formalise a distribution license and have a formal deal in writing within two months. The company has currently signed a memorandum of understanding (MoU) with UAE based Grasfol General Trading in order to attain exclusive distribution rights within the UAE, Kuwait, Bahrain and Qatar. Additionally, the deal also includes non-exclusive distribution rights in Saudi Arabia. ClearVue has portrayed its vision and product effectiveness throughout the US and European markets, now it is taking the Middle East by storm.

“This MoU represents a great opportunity for ClearVue to break into the Middle Eastern region,” – Victor Rosenberg, executive chairman of ClearVue Technologies.

This aesthetically efficient product has paved the way forward for future initiatives concerning cleaner forms of energy. Already planning for the long-term, the companies envisage using the glass to become a virtual power supplier in the region. The room for growth amongst this ideology is potentially limitless.

A Real Niche
ClearVue have hit the nail on the head, so to speak, with the market that they are moving in to. Although exporting to new markets will always involve an element of risk, Cedar Rose can help navigate companies safely through the Middle East. With over 20 years’ experience providing Credit reports, Monitoring and Due Diligence in the region; we know the ins and outs that can save your business time and money.

To find out more, contact orders@cedar-rose.com.

Read up on other companies that are benefiting the environment here.

Written By Jack Evangelides, Marketing Assistant

Sourced Image: Phys

*** The sole purpose of the article above is to generate public discussion, it has no intention to constitute legal advice. ***

African Business – Your Guide to Mitigating Risks (Part 2)

African Business - Mitigating Risks - Cedar Rose

Now that we have covered (in Part 1) why you need to take precautions when investing into the many nations of Africa, we can now assess the treasures that African countries may hold. Each region contains their own positives, for example, East Africa shows promising signs of growth. Kenya, Rwanda and Tanzania are all predicted for a 6% + growth rate [according to Rand Merchant Bank]. Furthermore, while East Africa shows the greatest economic growth rates, it is North Africa that dominates, and has been dominating, contributing an incredible 37% of the African GDP from only 5 countries. Each market that African countries supply contains a multitude of potentials. However, in order to utilise the markets and instigate business while mitigating risks, it is pivotal that you understand the region.

Room for Investments

Despite the technological difficulties that Egypt endures, it would be unwise to overlook the nation as a potential region for investment. Egypt has the largest consumer market throughout the Middle East and North Africa, with a market size of an estimated $1.4 trillion, which accounts for 20% of Africa’s $7 trillion market. The fact that North Africa provides a bulk of the African GDP amounting to a significant 37% from only 5 countries [Egypt, Morocco, Tunisia, Algeria and Libya] indicates that this is a booming region with great potential. Furthermore, the structural and technological deficits that parts of the African continent endure may be a blessing in disguise. The silver lining with every problem is that there is a solution; the difficulties provide a perfect platform for investment in development or financing of infrastructure projects.

Foreign direct investment (FDI) hot spots are prevalent across the African nations, from Egypt’s large consumer market and Ethiopia’s fast growing (deemed the fastest) economy to Côte d’Ivoire’s investments in infrastructure with a focus on transport and energy. There are many potential growth opportunities across Africa, you just need to know how to navigate within the region and be informed enough to mitigate risks. For example, eleven countries are forecasted to grow their economies above 6%, with Ethiopia leading the way with a strong 8% predicted growth rate. Furthermore, the magnitude of natural resources also presents a positive indicator for FDI. Nigeria’s recovering oil prices and Ghana’s concentrated around the oil and gas sector prove that, not only does Africa present investment opportunities, but long-term prosperity is within reach.  

Look before you Leap

However, there are a few fundamental precautions that are needed to be considered before investing or involving yourself and your company within Africa. Thorough and reliable due diligence must be undertaken, whether you are investing abroad, within your own country or even your own city. It is fundamental to know what potential risks may arise with certain actions and weigh them against potential rewards. Thus, when you instigate business in a continent such as Africa, indulging in business intelligence is a must. Becoming informed of a topic or a region will give you the necessary knowledge and know-how to enact business.

Cedar Rose is a business intelligence company which specialises in the Middle East and Africa. Our database contains coverage of African countries that may be of great potential. Our data warehouse holds more than 90% of entities in Algeria and Morocco, with at least 50% of entities in Egypt. Furthermore, our coverage also spreads into entities located in Western Sahara. But we don’t just provide data access, we have teams of experienced and professional investigators who can conduct meticulous additional research, ensuring your due diligence is trustworthy, up-to-date and compliantly obtained.  

Africa is one of the largest continents on this planet and it contains a huge amount of untapped potential. With our data, knowledge, language skills and research expertise, Cedar Rose can help you and your company successfully invest in this vast region.  Our services are focused and dedicated to business intelligence, expertly conducted in order to mitigate risks. Check out our services online and let us know how we can help you.

Written ByJack Evangelides, Marketing Assistant

*** The sole purpose of the article above is to generate public discussion, it has no intention to constitute legal advice. **