Gulf

1. A Gulf rail network
2. Saudi tourism grows…
3. … and debt market allures
4. Qatar investment reforms
5. Dubai property’s record year

Saudi drone championship sets a world record.

Gulf railway project gains momentum

The long-awaited Gulf railway project is finally picking up steam. Kuwait awarded a contract to build the first phase of its 111-kilometer (70-mile) section of the railway to a Turkish engineering firm. The project, set to be completed by 2030, will connect Kuwait to Saudi Arabia and, eventually, to a line linking Manama, Doha, Abu Dhabi, Dubai, and Muscat. Projected to transport eight million passengers and 95 million tons of cargo annually by 2045, the 2,117-kilometer (1,300-mile) Gulf Cooperation Council network is seeing contracts awarded across most Gulf countries, according to AGBI.

One of the busiest routes — the Abu Dhabi-Dubai corridor — will feature a high-speed train capable of transporting passengers between the two cities in just 30 minutes at speeds of up to 350 kilometers (215 miles) per hour. Senior UAE royals inspected a train cabin last week and unveiled designs for stations in Abu Dhabi, Dubai, Fujairah, and Sharjah. The high-speed train is expected to contribute 145 billion dirhams ($39.5 billion) to the UAE’s economy over the next 50 years.

Saudi tourism hits its targets

More than 30 million foreigners flew into Saudi Arabia last year, a new record that edges the country a little closer to its target of 70 million visitors by 2030. The government is spending around $500 billion on hotels, resorts, and tourist attractions to lure more holiday-makers. Billions more are being poured into aviation and events designed to capture the world’s attention, like the 2029 Asian Winter Games and the 2030 men’s soccer World Cup.

One question is whether there’s room for Saudi to compete with established Gulf carriers in the UAE and Qatar. Saudi’s General Authority of Civil Aviation’s head said at Davos that the competition isn’t direct: The kingdom wants people to leave the airport and see the country, rather than just wait for a connecting flight. The middle classes of India and China are key targets, he said.

Hassana, State Street eye Saudi bond ETFs

Saudi Arabia’s government pension firm Hassana Investment Co. and New York-based State Street Global Advisors are considering starting a bond fund in the kingdom. The Saudi fixed-income exchange-traded fund will be anchored by the two big investors — Hassana manages $319 billion, and State Street oversees $4.7 trillion — and aims to deepen the kingdom’s debt markets and attract global investors. Hassana is an active partner of global managers looking to expand in the region: In October, Brookfield Asset Management said it would raise at least $2 billion for a new Middle East-focused private equity fund, with Hassana contributing up to $500 million.

Qatar’s plan to reverse FDI outflows

Qatar is planning sweeping reforms to make it more attractive to investors, as the race for foreign capital among Gulf countries heats up. The country’s commerce and economy minister said the government was looking at 27 laws and regulations and was drafting new legislation covering bankruptcy, public-private partnerships, and commercial registrations, Reuters reported. Under its National Development Strategy, Qatar aims to host a total of $100 billion of foreign direct investment by 2030, up from $27 billion in 2023. But in recent years, divestments have outweighed new inflows. In contrast, Saudi Arabia and the UAE have often been drawing in $20-30 billion a year.

Dubai property booms

Dubai’s property sales surged nearly 20% in 2024, with transactions hitting a record as the city attracts ever-more residents and investors. Almost $207 billion in real estate was traded last year, according to Dubai Land Department data. Dubai — home to around 4 million people — has benefited from the introduction of new resident visas and reforms that have made it more appealing to live and work. The city also remains a bargain compared to London and New York. Prices and transactions are expected to rise again this year, but at a slower pace: The central bank has become stricter in allowing certain fees to be included in mortgage financing, which will force buyers to come up with more cash as down payments, potentially slowing price gains.

Drones buzzed through Riyadh’s skies and in an elaborate indoor race course over the weekend, looking to capture a share of a $350,000 prize pool. The Drone Racing World Cup was recognized by Guinness World Records as the largest edition in terms of participating countries, with 140 pilots from over 50 nations. The winner, South Korea’s Minchan Kim, took home $100,000. Organized by the Saudi Federation for Cybersecurity, Programming, and Drones — an entity not usually associated with frivolous events — the competition shows how central drones have become to all facets of modern life, from family fun to military applications.

Google has found a cheaper way to run AI models, one of the tricks up its sleeve that could give it a long-term edge in the high-stakes race between the largest tech companies, DeepMind co-founder Demis Hassabis told Semafor’s Reed Albergotti in an interview.

Hassabis said new processors — known as “light chips” — are in the works that could make it more cost-effective to run the models, as the question of the processing power of AI chips is front and center in both Silicon Valley and Washington.