This week, Elon Musk unveiled plans to establish a $1 billion ‘Musk Institute’ in Dubai, aiming to address the global brain drain and foster cutting-edge research. The UAE’s government-owned EV charging network, UAEV, announced new tariffs and a mobile app rollout in January 2025 to support sustainable transportation.
In other developments, the Oman Investment Authority acquired a stake in Elon Musk’s AI company XAI, underscoring its focus on advanced technologies. Meanwhile, the UAE launched the world’s first VAT refund system for tourists’ e-commerce purchases, streamlining tax refunds through a fully automated digital platform. Across the Atlantic, the US Federal Reserve lowered its interest rate to a range of 4.25%-4.50% but signalled a cautious approach to future rate cuts as inflation remains a concern.
These were the top stories this week as selected by Finance Middle East editors.
Elon Musk plans $1 billion ‘Musk Institute’ in Dubai to tackle global brain drain
Elon Musk is planning to invest $1 billion in a science institute in Dubai, according to his father, Errol Musk. Speaking to Arabian Business during a visit to the UAE, Errol revealed that the project, named ‘The Musk Institute,’ will focus on cutting-edge research in areas like gravity and nuclear fusion while addressing the global “brain drain” by retaining top talent in the region.
The idea for the institute has been in discussion between Elon and his father since the launch of SpaceX in 2001, but plans have accelerated in recent years. “When I discussed it with Elon, he said, ‘We must do it now, or somebody else will do it,’” Errol shared. Construction is expected to begin in 2025, and the institute will be fully funded by Elon Musk’s fortune, which currently stands at over $460 billion.
UAE announces new EV charging tariffs
UAEV, the UAE’s first government-owned EV charging network, is rolling out new tariffs and a mobile app in January 2025 to enhance the charging experience and support the country’s shift toward sustainable transportation.
Starting next year, EV drivers will pay standardised fees of Dh1.2/kWh + VAT for DC chargers and Dh0.70/kWh + VAT for AC chargers. This marks a significant step for UAEV, which has kept charging services free since the tariffs were first announced in May 2024. The new pricing is designed to ensure fairness while maintaining the network’s quality and reliability.
Oman Investment Authority acquires stake in Elon Musk’s AI company XAI
The Oman Investment Authority (OIA) has announced its acquisition of a stake in XAI, an American company specialising in artificial intelligence technologies. The investment aligns with OIA’s strategy to focus on advanced technologies across various sectors.
XAI, founded by Elon Musk, is one of the top five companies in the AI sector. It has achieved significant milestones, including establishing a large-scale data centre in the US and launching the advanced AI platform, “Grok 2.”
UAE introduces VAT refund system for tourists’ e-commerce purchases
The Federal Tax Authority (FTA) announced the launch of the world’s first VAT refund system for e-commerce retail purchases made by tourists during their stay in the UAE.
The new system integrates e-commerce platforms and retailers registered with the FTA, enabling tourists to claim VAT refunds on purchases made online while in the UAE. The platform allows tourists to scan their passports, complete transactions digitally, and share purchase details through electronic invoices. The process is fully automated, with tourists able to verify invoices via an online portal. Refunds are processed efficiently, offering a seamless and fast experience for eligible transactions.
Fed lowers rates to 4.25%-4.50%, signals slower cuts ahead
The US Federal Reserve reduced its benchmark interest rate by 25 basis points on Wednesday, marking its third consecutive rate cut since the onset of its easing cycle in September. The decision lowers the federal funds rate to a range of 4.25% to 4.50% but signals caution regarding further reductions, citing slower progress in bringing inflation back to its 2% target.
Fed Chair Jerome Powell highlighted ongoing concerns about persistent inflation, particularly in housing costs, and noted that the central bank would proceed cautiously with future rate cuts. Policymakers now project just two additional quarter-point rate cuts through the end of 2025, a reduction from previous forecasts of four cuts made in September.
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