The Gulf’s advantage in the next AI chapter

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The Gulf’s advantage in the next AI chapter

The Gulf’s advantage in the next AI chapter
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The seismic shift in global technology markets carries a message the region already seems to understand. When DeepSeek demonstrated that it could build cutting-edge AI models for just $5.6 million using older hardware, it did not just blow a hole in Nvidia’s stock price — it validated the Gulf’s distinctive path to technological leadership.

Let me explain why investments like the $100 billion AI initiative of Saudi Arabia’s Public Investment Fund might be more prescient than people realize.

The conventional wisdom about AI has always hinged on scale — like a skyscraper reaching ever higher into the clouds, each level demanding more investment, more power, more computing resources. But DeepSeek’s breakthrough reveals a different architectural possibility entirely: AI development is more akin to a suspension bridge, where elegance of design trumps sheer mass of materials.

This paradigm shift mirrors the Gulf’s transformation of its financial sector. Just as Dubai and Abu Dhabi upended traditional notions of wealth management — proving that Wall Street was not the only path to sophisticated investment strategies — the region now stands poised to reimagine AI development. The same strategic thinking that turned hydrocarbon wealth into world-class sovereign wealth funds could now reshape the future of AI.

The whispered conversations in Davos’ hushed hotel lounges tell the same story: The era of computational brute force is ending. Success in AI no longer depends on who can build the biggest data centers or deploy the most powerful chips. Instead, victory will go to those who can execute most skilfully, who can find the smart solution hiding in plain sight.

Here is what is really happening: The Gulf states’ traditional strengths — political stability, capital efficiency and regulatory agility — are suddenly looking like decisive advantages in the AI race. While Western nations grapple with complex AI regulation and China faces export controls, the region can chart a middle path — maintaining high standards while moving quickly to implement new technologies.

Think about how this mirrors patterns in the region’s history. Just as Dubai transformed itself into a global business hub — not by competing head-on with established centers, but by creating unique advantages through regulatory innovation and strategic positioning — Saudi Arabia now has the opportunity to do the same with AI.

The Gulf states’ traditional strengths — political stability, capital efficiency and regulatory agility — are suddenly looking like decisive advantages in the AI race.

Adrian Monck

Consider this: While Silicon Valley was building AI models that required the equivalent of a small country’s power grid to run, DeepSeek proved you could achieve similar results with clever engineering and elegant execution. It is as if someone just proved you could build a Formula 1 car using last year’s parts and still make the podium.

The implications for Saudi Arabia’s strategy are profound. Its $100 billion initiative is not simply replicating Silicon Valley’s infrastructure-heavy model — it is creating innovation ecosystems, where computational efficiency matters more than raw power. It is exactly what South Korea did with semiconductors in the 1990s, focusing on clever design rather than industrial-scale manufacturing.

Three key priorities emerge. First, leverage regulatory flexibility to create AI development zones that attract global talent while maintaining high ethical standards. Success with economic cities provides a proven model.

Second, educate to innovate. In Abu Dhabi they are building the “Stanford of the Middle East,” positioning for global AI research leadership. The Gulf’s traditional role as a bridge between East and West takes on new significance in the AI education age.

Third, think ecosystem, not infrastructure. The most valuable part of AI investment will not be the hardware you buy — it will be the innovation networks you create.

The market’s dramatic reaction to DeepSeek’s breakthrough reveals another advantage: timing. As the industry shifts from a focus on scale to a focus on efficiency, the region can leapfrog the massive sunk costs of earlier infrastructure investments.

We are entering the “Age of AI Arbitrage,” where clever implementation beats computational might. It is a world of quantum innovation where technological advantage can materialize anywhere through sophisticated thinking rather than massive investment.

Sometimes the most important revolutions are not about new capabilities, but about fundamentally new ways of thinking about old problems. The Gulf states have already proven they can transform natural resources into lasting economic advantage. Now they have the chance to do it again — this time with artificial intelligence.

• Adrian Monck writes a weekly newsletter, Seven Things. He is senior adviser to the Mohamed bin Zayed University of Artificial Intelligence and a former managing director of WEF.

Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News' point of view

Myanmar junta extends state of emergency to support election preparations

Myanmar junta extends state of emergency to support election preparations
Updated 6 min 22 sec ago
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Myanmar junta extends state of emergency to support election preparations

Myanmar junta extends state of emergency to support election preparations
  • Myanmar has been locked in a civil war triggered by the military’s overthrow of the elected civilian government of Aung San Suu Kyi
  • Opponents of the military government plan to disrupt the ballot and have urged other countries not to recognize the outcome
Myanmar’s ruling military has extended a state of emergency for another six months, state media reported on Friday, a day ahead of the four-year anniversary of a coup that plunged the country into chaos after a decade of tentative democracy.
Myanmar has been locked in a civil war triggered by the military’s overthrow of the elected civilian government of Nobel Peace Prize winner Aung San Suu Kyi. The junta plans this year to hold an election, which critics have derided as a sham to keep the generals in power through proxies.
“There are still more tasks to be done to hold the general election successfully. Especially for a free and fair election, stability and peace is still needed,” state-
run MRTV said on its Telegram channel in announcing the extension of emergency rule.
No date has been set for the election but the junta is forging ahead with plans, despite struggling to run the country as it tries to fend off on multiple fronts an armed rebellion with its roots in a youth-led uprising that was put down by the military with deadly force.
Fighting has displaced an estimated three million people, with widespread food insecurity and a third of the population in need of humanitarian assistance, according to the United Nations, whose special envoy has urged all sides to seek dialogue and move past their “zero-sum mentality.”
Despite the fighting, an economy in tatters and dozens of political parties banned or refusing to take part, the junta is determined to hold the election.
Opponents of the military government plan to disrupt the ballot and have urged other countries not to recognize the outcome, saying it will be held against the will of the people.

Japan scrambles jets as Russian bombers fly over high seas

Japan scrambles jets as Russian bombers fly over high seas
Updated 18 min 47 sec ago
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Japan scrambles jets as Russian bombers fly over high seas

Japan scrambles jets as Russian bombers fly over high seas
  • ‘We confirmed that Russian military bombers and fighter jets flew over the high seas of the Sea of Okhotsk and the Sea of Japan yesterday’
  • Tokyo has raised the issue with Moscow in the past through diplomatic routes, including regarding a Russian fighter jet’s intrusion into territorial airspace in September

TOKYO: Japan scrambled fighter jets after Russian bombers flew over international waters around the country, Tokyo’s top government spokesman said Friday.
“We confirmed that Russian military bombers and fighter jets flew over the high seas of the Sea of Okhotsk and the Sea of Japan yesterday, and we scrambled Air Self-Defense Force fighter jets” in response, Yoshimasa Hayashi told reporters.
“It is difficult to say clearly what the purpose of the flight was... but the Russian military has been active on an ongoing basis in areas surrounding Japan,” he said.
Tokyo has raised the issue with Moscow in the past through diplomatic routes, including regarding a Russian fighter jet’s intrusion into territorial airspace in September, which Russia denied according to media reports.
“We will continue to monitor (the situation) closely and do our best to take measures in patrolling and responding to airspace incursions,” Hayashi said.
Russia’s defense ministry said on Telegram Thursday that two long-range bombers flew over international waters in the Sea of Japan and the Sea of Okhotsk.
The Russian ministry also released a video of two Tupolev-95 aircraft escorted by Russian fighter jets conducting what it called a regular flight over more than eight hours.
“All flights by Russian Aerospace Forces aircraft are carried out in strict compliance with international rules on the use of airspace,” it said in a statement.


5 years after Britain left the EU, the full impact of Brexit is still emerging

5 years after Britain left the EU, the full impact of Brexit is still emerging
Updated 26 min 58 sec ago
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5 years after Britain left the EU, the full impact of Brexit is still emerging

5 years after Britain left the EU, the full impact of Brexit is still emerging
  • People and businesses are still wrestling with the economic, social and cultural aftershocks of a decision that divided the country
  • British Prime Minister Keir Starmer has promised to “reset” relations with the EU after years of acrimony

LONDON: Five years ago Friday, two crowds of people gathered near Britain’s Parliament — some with Union Jacks and cheers, others European Union flags and tears.
On Jan. 31, 2020 at 11 p.m. London time – midnight at EU headquarters in Brussels — the UK officially left the bloc after almost five decades of membership that had brought free movement and free trade between Britain and 27 other European countries.
For Brexit supporters, the UK was now a sovereign nation in charge of its own destiny. For opponents, it was an isolated and diminished country.
It was, inarguably, a divided nation that had taken a leap into the dark. Five years on, people and businesses are still wrestling with the economic, social and cultural aftershocks.
“The impact has been really quite profound,” said political scientist Anand Menon, who heads the think-tank UK in a Changing Europe. “It’s changed our economy.
“And our politics has been changed quite fundamentally as well,” he added. “We’ve seen a new division around Brexit becoming part of electoral politics.”
A decision that split the nation
An island nation with a robust sense of its historical importance, Britain had long been an uneasy member of the EU when it held a referendum in June 2016 on whether to remain or leave. Decades of deindustrialization, followed by years of public spending cuts and high immigration, made fertile ground for the argument that Brexit would let the UK “take back control” of its borders, laws and economy.
Yet the result — 52 percent to 48 percent in favor of leaving — came as a shock to many. Neither the Conservative government, which campaigned to stay in the EU, nor pro-Brexit campaigners had planned for the messy details of the split.
The referendum was followed by years of wrangling over divorce terms between a wounded EU and a fractious UK that caused gridlock in Parliament and ultimately defeated Prime Minister Theresa May. She resigned in 2019 and was replaced by Boris Johnson, who vowed to “get Brexit done.”
It wasn’t so simple.
A blow to the British economy
The UK left without agreement on its future economic relationship with the EU, which accounted for half the country’s trade. The political departure was followed by 11 months of testy negotiations on divorce terms, culminating in agreement on Christmas Eve in 2020.
The bare-bones trade deal saw the UK leave the bloc’s single market and customs union. It meant goods could move without tariffs or quotas, but brought new red tape, costs and delays for trading businesses.
“It has cost us money. We are definitely slower and it’s more expensive. But we’ve survived,” said Lars Andersen, whose London-based company, My Nametags, ships brightly colored labels for kids’ clothes and school supplies to more than 150 countries.
To keep trading with the EU, Andersen has had to set up a base in Ireland, through which all orders destined for EU countries must pass before being sent on. He says the hassle has been worth it, but some other small businesses he knows have stopped trading with the EU or moved manufacturing out of the UK
Julianne Ponan, founder and CEO of allergen-free food producer Creative Nature, had a growing export business to EU countries that was devastated by Brexit. Since then she has successfully turned to markets in the Middle East and Australia, something she says has been a positive outcome of leaving the EU.
Having mastered the new red tape, she is now gradually building up business with Europe again.
“But we’ve lost four years of growth there,” she said. “And that’s the sad part. We would be a lot further ahead in our journey if Brexit hadn’t happened.”
The government’s Office for Budget Responsibility forecasts that UK exports and imports will both be around 15 percent lower in the long run than if the UK had remained in the EU, and economic productivity 4 percent less than it otherwise would have been.
Brexit supporters argue that short-term pain will be offset by Britain’s new freedom to strike trade deals around the world. Since Brexit. the UK has signed trade agreements with countries including Australia, New Zealand and Canada.
But David Henig, a trade expert at the European Center for International Political Economy, said they have not offset the hit to trade with Britain’s nearest neighbors.
“The big players aren’t so much affected,” Henig said. “We still have Airbus, we still have Scotch whisky. We still do defense, big pharmaceuticals. But the mid-size players are really struggling to keep their exporting position. And nobody new is coming in to set up.”
A lesson in unintended consequences
In some ways, Brexit has not played out as either supporters or opponents anticipated. The COVID-19 pandemic and Russia’s invasion of Ukraine piled on more economic disruption, and made it harder to discern the impact of Britain’s EU exit on the economy.
In one key area, immigration, Brexit’s impact has been the opposite of what many predicted. A desire to reduce immigration was a major reason many people voted to leave the EU, yet immigration today is far higher than before Brexit because the number of visas granted for workers from around the world has soared.
Meanwhile, the rise of protectionist political leaders, especially newly returned US President Donald Trump, has raised the stakes for Britain, now caught between its near neighbors in Europe and its trans-Atlantic “special relationship” with the US
“The world is a far less forgiving place now than it was in 2016 when we voted to leave,” Menon said.
Can Britain and the EU be friends again?
Polls suggest UK public opinion has soured on Brexit, with a majority of people now thinking it was a mistake. But rejoining seems a distant prospect. With memories of arguments and division still raw, few people want to go through all that again.
Labour Party Prime Minister Keir Starmer, elected in July 2024, has promised to “reset” relations with the EU, but has ruled out rejoining the customs union or single market. He’s aiming for relatively modest changes such as a making it easier for artists to tour and for professionals to have their qualifications recognized, as well as on closer cooperation on law enforcement and security.
EU leaders have welcomed the change of tone from Britain, but have problems of their own amid growing populism across the continent. The UK is no longer a top priority.
“I completely understand, it’s difficult to get back together after quite a harsh divorce,” said Andersen, who nonetheless hopes Britain and the EU will draw closer with time. “I suspect it will happen, but it will happen slowly and subtly without politicians particularly shouting about it.”


Oil Updates — prices rise amid US tariff threat but still set for weekly loss

Oil Updates — prices rise amid US tariff threat but still set for weekly loss
Updated 42 min 34 sec ago
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Oil Updates — prices rise amid US tariff threat but still set for weekly loss

Oil Updates — prices rise amid US tariff threat but still set for weekly loss

NEW YORK: Oil prices rose on Friday as markets weighed the threat of tariffs by US President Donald Trump on Mexico and Canada, the two largest crude exporters to the US, that could take effect this weekend.

Brent crude futures for March, which expires on Friday, gained 61 cents at $77.48 a barrel at 7:30 a.m. Saudi time. The more-active April contract was at $76.37 a barrel, up 48 cents.

US West Texas Intermediate crude gained 65 cents to $73.38.

For the week, Brent is set to fall 1.3 percent while WTI has declined 1.69 percent.

However, for the month of January, Brent is set to gain 3.8 percent, its best month since June, and WTI is poised to climb 2.3 percent.

“Crude oil prices declined this week due to increasing fears surrounding Trump’s tariffs, which are expected to hinder global economic growth,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

Investors are contemplating the likelihood of US tariffs alongside a flurry of executive orders and policy announcements, ANZ Bank analyst Daniel Hynes said.

Trump has threatened to impose a 25 percent tariff as early as Saturday on Canadian and Mexican exports to the US if those two countries do not end shipments of fentanyl across US borders.

It is unclear if the tariffs would include crude oil. On Thursday, Trump said he would soon decide whether to exclude Canadian and Mexican oil imports from the tariffs.

In 2023, the last full year of data, Canada exported 3.9 million barrels per day of crude to the US, out of 6.5 million bpd of total imports, while Mexico exported 733,000 bpd, according to the US Energy Information Administration, the statistical arm of the Department of Energy.

The increased risk of supply disruptions from the foreign policies of the new Trump administration has kept prices elevated, Hynes said.

“Sanctions on Russia, stopping purchases of Venezuelan oil and maximum pressure on Iran will increase the geopolitical risk premium on oil,” said Hynes.

“This could be compounded by the refilling of the strategic petroleum reserve, adding to oil demand,” he said.

The market will be watching the upcoming OPEC+ meeting scheduled for Feb. 3 as recent US sanctions on Russian oil have removed over a million barrels from global supplies, possibly prompting the producer group to reconsider its output plans, Phillip Nova’s Sachdeva said.

Kazakhstan’s energy minister said on Wednesday that the group is set to discuss Trump’s plans to raise US oil production and take a joint stance on the matter at next week’s meeting.

On the monetary front, the Federal Reserve’s decision to keep interest rates unchanged signals a cautious approach moving forward amid ongoing inflation challenges in the world’s largest economy, Sachdeva added.

“With the threats of Trump’s tariffs, the path to disinflation is likely to become even more turbulent.”


‘She’d call to say, I love you’: Husband grieves Pakistani woman killed in DC air crash

‘She’d call to say, I love you’: Husband grieves Pakistani woman killed in DC air crash
Updated 52 min 33 sec ago
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‘She’d call to say, I love you’: Husband grieves Pakistani woman killed in DC air crash

‘She’d call to say, I love you’: Husband grieves Pakistani woman killed in DC air crash
  • Asra Hussain Raza sent a text to her husband from the doomed flight, saying she would land in about 20 minutes
  • World champion figure skaters, pilot planning his wedding, teenage skaters seen as “future of the sport” among 67 victims

World champion figure skaters, a pilot planning his wedding, teenage skaters seen as the “future of the sport” and a Pakistani consultant with dreams of improving public health were among the 67 victims of the deadly midair collision between a commercial jet and a US Army helicopter near Washington.

All 64 people aboard the American Eagle flight that took off from Wichita, Kansas, including 60 passengers and four crew members, and all three soldiers aboard the helicopter were killed when the two aircraft slammed into each other on Wednesday night, causing a fiery explosion.

Here is what we know about some of the victims:

ASRA HUSSAIN RAZA

Raza, 26, sent a text to her husband, Hamaad, from the doomed flight as they approached Washington, saying she would land in about 20 minutes.
Hamaad Raza, 25, who was waiting at the airport for her arrival, never received another message, his father, Hashim Raza, told Reuters.
“Asra was everything to us,” Hashim Raza, holding back tears with a quavering voice, said in a telephone interview as he traveled from Missouri to Washington to meet his son. “And now my son is a widower at 25. What do I say to him? They planned to have children, they were so much looking forward to that.”
The couple met at Indiana University Bloomington, where she studied corporate finance and was a straight-A student.
Hashim Raza said when his son first met Asra, he declared, “I’m going to marry her.”
Asra Hussain Raza later earned her master’s degree in public health from Columbia University and got a job with a consulting group in Washington, with the ultimate goal of working for the government to improve public health, her father-in-law said.
“All she wanted to do was help people, and DC, she thought, was the place to achieve her goals,” Raza said. “And she was such a great cook — Indian, Italian, Chinese food. I told her to open a restaurant.”
She traveled to Wichita about once or twice a month to help turn around a hospital, he said.
“She was an extremely caring person,” he said. “She’d call just to say, ‘I love you.’“

SPENCER LANE AND JINNA HAN

In 2022, Spencer watched Nathan Chen, the superstar American figure skater, win a gold medal at the Olympics and decided he wanted to take up skating too, his father, Douglas Lane, told WPRI in Rhode Island.
Three years later, the 16-year-old had proven to be a prodigy, qualifying for an elite national training camp in Wichita reserved for young athletes that his skating club’s executive director, Doug Zeghibe, described as “the future of the sport.”
“He just loved it,” Spencer’s father said. “There wasn’t anyone pushing him. He was just somebody who loved it and had natural talent but also just worked every day.”
“He was all-in on figure skating,” Douglas Lane said.
Shortly before taking off, Spencer posted a photo of the wing of the plane on Instagram, according to media reports. In another post, he said qualifying for the camp had been a longtime goal and that the training was an “amazing experience.”
Jinna, 13, had also qualified for the camp, which followed last week’s US national figure skating championship in Kansas.
Both Spencer and Jinna trained almost every day at the Skating Club of Boston in Norwood, Massachusetts, according to Zeghibe, the club’s director. The Lane family lived in Rhode Island, and the Han family lived in the Boston area.
Jinna was a “wonderful kid,” Zeghibe said.
“Wonderful parents, great athlete, great competitor, loved by all,” he told reporters.
Spencer’s mother, Christine, and Jinna’s mother, Jin, were also on the plane. Both were “role model parents” who made a lot of sacrifices to help their children excel in the sport, Zeghibe said.

THE LIVINGSTON FAMILY

Everly and Alydia Livingston — aged 14 and 11, respectively, and known on social media as the “Ice Skating Sisters” — were among those killed in the crash, according to the Kansas City Star newspaper. Their parents, Peter and Donna, were also on the plane.
Alydia was the youngest of the several skaters on the flight and “was known for her vivacious personality and strong desire to improve on the ice” according to a tribute posted on the Facebook page of The Skating Lesson, a forum aimed at educating athletes and fans about the skating community.
Everly “was shy and reserved compared to her sister, yet came alive on the ice — becoming a sectional champion at the intermediate and juvenile levels,” according to The Skating Lesson post.
The family lived in Ashburn, Virginia, and was among the many skaters on the plane attending the US Figure Skating Championships in Wichita last week.

YEVGENIA SHISHKOVA AND VADIM NAUMOV

Russian-born Shishkova and Naumov, who were married, won the world championship in pairs figure skating in 1994 and had coached at the Skating Club of Boston since 2017.
“They were talented and beautiful people,” said Ludmila Velikova in St. Petersburg, where she trained both skaters when they were children. “Zhenya (Shishkova) trained with me from the age of 11 and Vladik (Naumov) from age 14. They were like my own children.”
The couple’s son, Maxim, also a skater, finished in fourth place in the men’s free skate at the US national championships last week. He left Wichita after the competition and was not on Wednesday’s plane.
Zeghibe described Vadim Naumov as an “old-school” coach who applied the strict “Russian method” to his students.
“You could not see Genia without breaking into a smile,” he said, using a nickname for Shishkova.

SAM LILLEY, IAN EPSTEIN, JONATHON CAMPOS, DANASIA ELDER

Lilley, 28, was one of two pilots on the plane, serving as the first officer, his father, Timothy Lilley, said in a Facebook post.
“I was so proud when Sam became a pilot,” wrote Lilley, himself a pilot, who was in New York at the time of the crash. “Now it hurts so bad I can’t even cry myself to sleep.”
Sam Lilley was engaged to be married later this year, his father said. The Lilley family has ties to Savannah, Georgia, reported FOX 5 Atlanta.
“This is undoubtedly the worst day of my life,” Timothy Lilley told the television station.
Flight attendant Epstein was an outgoing person who loved his job, his ex-wife, Debi Epstein, told the Charlotte Observer.
“He made flying fun for the passengers on the plane so they didn’t get scared,” she said. “He was always the jokester and just doing the announcements with the twist.”
Ian Epstein had two daughters, including one who is getting married in eight weeks, Debi Epstein told the newspaper.
Campos was the captain of the plane, and Elder was the second flight attendant, according to media reports.

WENDY SHAFFER

Shaffer, who lived in Charlotte, devoted her life to her family, including her two small children, ages 1 and 3, friends said on Thursday.
Bill Melugin, a Fox News correspondent and a friend of the family, confirmed her death and posted a statement from Shaffer’s husband, Nate, in an X post.
“Wendy was not just beautiful on the outside, but was a truly amazing woman through and through,” Nate Shaffer said. “She was the best wife, mother, and friend that anyone could ever hope for. Her love, kindness, and strength touched everyone she met.”
A GoFundMe page set up to raise money for her family described her as a “radiant soul.”
“Wendy was the heart of her family — a loving partner to her husband and a nurturing, joyful mother to her children,” the fundraiser’s organizers wrote. “Her boys were her greatest pride and joy, and she dreamed of watching them grow into the amazing individuals she knew they would become.”

RYAN O’HARA

Ryan O’Hara was one of three soldiers on board the Black Hawk helicopter, a US official confirmed.
O’Hara attended Parkview High School in Gwinnett County, Georgia, where he had been a member of the school’s Junior Reserve Officers’ Training Corps, or ROTC, a program that trains high school students for military service.
In a Facebook post that was later removed, the ROTC wrote, “Ryan is fondly remembered as a guy who would fix things around the ROTC gym as well as a vital member of the Rifle Team,” according to local media reports. O’Hara had a wife and 1-year-old son, the post said.

INNA VOLYANSKAYA

Russian-born Volyanskaya, a skating coach in the Washington area, was on board the plane, according to a post on X from US Representative Suhas Subramanyam and a report from the Russian news agency TASS.
Volyanskaya competed as a pairs skater for the Soviet Union in the 1980s. She coached young skaters at the Washington Figure Skating Club, according to the club’s website.
In a statement on Thursday, the club did not confirm whether any member or coach was on the flight but said it was “devastated” by news of the crash.
“More information will be posted when appropriate,” the club said.