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Monday, 31 August 2009

The Sharia Principle : Charts

The Sharia Principle : Charts & Numbers

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Songbird poised to swoop after cash injection

The Canary Wharf Group is poised to return to the property market looking for new acquisitions and development opportunities, following an £836m recapitalisation of its majority owner.

Songbird Estates’ fundraising, agreed on Friday, was backed by a consortium led by the Qatari sovereign wealth fund. Qatar Holding headed a group of investors that will underwrite the £836m equity raising to pay back a Citigroup loan, freeing Songbird from a potential debt crisis.

The group of investors, including the China Investment Corporation, was keen to see the recapitalised company re-enter the property market and look for new investments in London, a person close to Qatar Holding said on Sunday.

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Ahab unlikely to share 'personal affairs'

Family offices of the troubled Saudi groups Ahmad Hamad Algosaibi and Brothers (Ahab) and Saad Group should not be expected to share details of their "personal affairs", said a senior executive of Deloitte. The consultancy firm is advising the Algosaibi group.

Terming it "completely wrong" to blame the family offices of the Saudi groups for the crisis, Neven Hendricks, Chief Operating Officer for Mena, Deloitte, told Emirates Business: "I saw media tearing the family offices apart and blaming them for the crisis and unfairly so. There is no compulsion for a family to tell the world about its personal affairs. It is like asking me to show my personal tax returns. I think that is unfair for the public to expect private families to behave like that."

Recently, S&P had said that the gross exposure of GCC banks to the Saad and Algosaibi groups is about $9.6bn (Dh35.2bn) while Standard Chartered said Saudi banks have almost $5bn exposure. According to analysts, it may take banks at least another quarter to completely write off these provisions. The exposure of banks to the Saad and Al Gosaibi brought forth the issue of lending to conglomerates that had "family names" attached to them.

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Iran-India gas pipeline put on the back burner

India is focused on exploiting its own reserves and has placed the Iran-India gas pipeline project on the back burner, former Indian minister of petroleum and natural gas Mani Shankar Aiyar told Emirates Business.

Aiyar headed the Indian oil and gas ministry for two years from May 2004 to June 2006 when the deal was extensively discussed.

"The deal is now on the back burner. India is now focusing on its own reserves, especially the Krishna-Godavari basin gas," Aiyar said. Asked whether the Indian reserves will be enough to meet the country's consumption, Aiyar said: "That's what everyone is believing."

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UAE has all to gain from Dubai-Abu Dhabi alliance

In this challenging economic climate, I, among others, have talked about the need for greater transparency, financial reforms, increased support by governments and adopting a 'time to act' approach.

All of these actions require a collective effort, be it from individuals, employers, banks or even governments. When I stop to think about how all these elements need to support each other in times of crisis, I think of a great example right in front of me, which shows how strategic alliances and long-term complementary partnerships can overcome the toughest of challenges.

I am, of course, talking of the combination of Dubai and Abu Dhabi.

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Gulf states adopt caution with offshore farmland deals

Gulf states seeking farmland for food security are going underground as the deals, seen by many as land grabs, risk tarnishing their reputation, an independent consultant advising the region on the deals said on Sunday.

Gulf Arab countries, heavily reliant on food imports, have been buying farmland in developing nations to ensure food security, following spikes in basic commodity prices.

“The media has really managed to put a negative spin on these farmland deals, that’s why we are seeing many Gulf countries being less open about them,” said Huma Fakhar, chairman of Market Access Promotion, an international consultancy advising Gulf states on agricultural issues.

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Amlak tumbles into red as writedowns weigh

Amlak Finance, the home finance company in merger talks with its rival Tamweel, lost Dh67 million (US$18.2m) in the second quarter as it took provisions on mortgages made on incomplete properties.

The sharia-compliant finance firm based in Dubai had reported a net profit of Dh145m for the same period a year earlier, it said.

“The loss in the second quarter was inevitable, as Amlak had to make higher general provisions for the financing portfolio,” Ali Ibrahim Mohammed, the vice chairman of the firm, said in the statement.

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Saudi banks see life after scandal

Saudi Arabia’s banks have had little reason to celebrate since May, when the central bank froze the accounts of Maan al Sanea, the chairman of Saad Group and one of the kingdom’s most influential businessmen.

That event triggered what has become the Middle East’s biggest financial scandal, while the intervening three months have shaken confidence in Saudi Arabia’s banking system as wary investors keep a tally of debt defaults from the Saad Group and Ahmad Hamad Al Gosaibi and Brothers.

The two family conglomerates are estimated to owe as much as US$20 billion (Dh73.46bn) to about 100 regional and international lenders.

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Al Sanea kept secret ledger, says court filing

Maan al Sanea, a prominent Saudi businessman, kept records of a multibillion-dollar fraud in a secret set of books referred to as “Ledger 3”, according to documents filed in a New York court last week.

Mr al Sanea, the chairman and founder of the Saad Group, a large Saudi conglomerate, is accused of siphoning an estimated US$10 billion (Dh36.73bn) from Ahmad Hamad Al Gosaibi and Brothers (AHAB), another Saudi conglomerate.

The court documents claim he committed the fraud when he headed AHAB’s financial services arm, Money Exchange, and used ledger 3 to hide the transfers for decades. Mr al Sanea was unavailable for comment.

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Dubai Property through the "rear view mirror" (Re-post)

With every piece of news telling a good or not so good story about the boom and burst of Abu Dhabi and Dubai property markets, each one is as nearly absolute as the “black swan” phenomenae. And with each one as convincingly uncertain as the next one, one thing is for certain: we are uncertain about the future of UAE real estate. Or perharps this is described best by what Emmanual Kant once wrote: that “we are unsure about being sure”.

Market consultants are forced into a seductive “rear view mirror” analysis of what’s happening, that is, writing descriptive tales of events only after the fact of their taking place. The stories are all as less predictive as the confluence of many opinions of other experts that will follow to typically tell the same story.

Can one really predict where Dubai property or Abu Dhabi property prices will be tomorrow or the next quarter or another two quarters from now? Much like predicting the weather forecast, none can tell. But, its all more entertaining to be captivated with the latest happenings of Dubai real estate, the obvious and the non-linear, unpredictable.

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Dubai's vow of silence over stalled developments seems to be working

Along the coast, hoardings display advertisements for The Waterfront, a city twice the size of Hong Kong island, designed to house 1.5m people. Inland, in the middle of the desert, the entrance is the most visible presence of Dubailand, a collection of theme parks twice as big as Disney World that, for the most part, exists on websites only.

The Tiger Woods golf course, to be irrigated by 4m gallons of water a day and surrounded by multi-million dollar mansions, has just three holes completed.

But perhaps even more remarkable than Dubai's ambitions, is the approach the city has taken to the crisis that has brought these latest projects shuddering to a stop. Weighed down by debts officially put at $80bn (£49.1bn), both the Dubai authorities and the companies responsible have taken a vow of silence.

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Qatar, U.A.E. Shares Gain as Oil Holds Above $70; Shuaa Soars

United Arab Emirates and Qatari shares advanced to their highest levels in almost three weeks as oil held above $70 a barrel and evidence builds that the global recession is ending.

Qatar’s DSM 20 Index climbed 2.4 percent to 7,088.17, the highest level since Aug. 11. The Dubai Financial Market General Index added 1.9 percent and Abu Dhabi’s measure gained 0.9 percent.

“The backdrop to international markets remains encouraging and the recent U.S. and European corporate results remain good as well,” Ali Khan, head of cash-equity trading at Dubai-based Arqaam Capital Ltd., wrote in an e-mail. “This is positive for commodities and commodity-based economies.”

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Sunday, 30 August 2009

Dubai Holding annouces key appointments at Dubai International Capital

Dubai Holding announces two internal appointments at Dubai International Capital following the appointment today of Sameer Al Ansari as Chief Executive Officer of SHUAA Capital.

Sameer Al Ansari will continue as the Executive Chairman of DIC, a post he has held since October 2004 when he founded DIC.

Anand Krishnan is appointed Chief Executive Officer of DIC with immediate effect from his existing role as Chief Operating Officer. Anand joined DIC in January 2006 as CFO and was appointed COO one year later. Previously he was a Managing Director at JP Morgan Chase New York/Asia in various senior roles for a total of 19 years.

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Global's GCC Weekly Market Report – August 27, 2009 (PDF)

S&P signs Index Licensing Agreement with Saudi Stock Exchange

Standard & Poor’s, the world’s leading index provider, announced it has signed an Index Creation Agreement (ICA) with the Saudi Stock Exchange (Tadawul).

The new agreement authorises Standard & Poor’s to use Tadawul securities data to maintain current and launch new indices for the Saudi equity market.

It reaffirms Standard & Poor’s commitment to the development of Middle Eastern capital markets and to satisfying the wide array of investment, portfolio benchmarking and trading needs of local and international investors seeking to develop innovative financial solutions.

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Iran to invite bids for 14 oil and gas fields

Iran is preparing to offer 14 oil and gas fields for development, the Oil Ministry's official Shana news website reported on Saturday.

Iran, the Organization of the Petroleum Exporting Countries' second-biggest crude producer, will tender six new gas fields that will require a total investment of $4.1 billion through the Iran Central Oil Fields Co, Shana reported.

Once developed, the Mohktar, Asalooyeh, Gordan, Salkh, Kabir-Kooh and Koohmond fields will have a combined production capacity of 67 million cubic meters a day, Shana added.

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DP World to build and operate Embraport in Brazil

Global marine terminal operator DP World and Brazilian company Odebrecht announce they have entered into a partnership to acquire a majority stake at Empresa Brasileira de Terminais Portuários (Embraport), one of the largest Brazilian private multi-modal port terminals in the city of Santos.

It is the first time that DP World and Odebrecht Investiments in Infrastructure have formed such a partnership. The investment fund FI-FGTS of Caixa Econômica Federal will maintain its shareholding acquired earlier. Coimex Group, leader of the project since its inception, reduces its shareholding, but remains a key member of the partnership.

Embraport (Brazilian Port Terminals Company) is being built adjacent to Porto de Santos, an existing port facility in the city of Santos, São Paulo State.
Porto de Santos is the largest Brazilian container port, with 90% of its cargo destined for the local São Paulo market. There is an excellent road and rail connectivity to the project site.

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Qatari firm in Tajikistan real estate deal

State-owned investment firm Qatari Diar has launched a luxury real estate project in Tajikistan worth at least $150 million, the Qatari News Agency said on Saturday.

The Dushanbe Diar project in the Tajik capital Dushanbe will include residential towers, a five-star hotel, shopping malls, conference centres and gardens when finished in 2012 at a cost of between $150 million and $180 million, the agency said.

The project is Qatari Diar's first in Central Asia. The unit of the Gulf Arab country's sovereign wealth fund the Qatar Investment Authority has said it might delay plans to invest in Asian countries such as China, Vietnam and Cambodia because of the global financial crisis.

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Banks will resume normal lending by Q2 of next year (Interview)

Liquidity is improving but the UAE and regional banks will remain reluctant to lend until a clear picture of the global economy emerges, says Abdul Kadir Hussain, CEO of Mashreq Capital, the GCC's leading investment and brokerage firm.

Hussain told Emirates Business that debt defaults in the region would continue to rise, particularly on the bank loan, syndicated loan and bilateral loan side.

"It's going to take pretty big and deep pockets to buy the $10 billion (Dh36.7bn) second tranche of the Dubai Government bonds. The main subscribers will be UAE and regional financial institutions, which are more liquid now compared with earlier this year.

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Junior oil explores seek paydirt

Like the explorers of old, independent oil and gas producers have left the beaten track in their quest for new sources of the commodities to develop. Their explorations in remote corners of Asia and Africa are beginning to yield some major results. Tamsin Carlisle reports

While many oil companies have cut back investment during the downturn, a band of feisty, independent producers have persevered with efforts to find and develop oil and gas in corners of the globe that “Big Oil” has shunned.

Several are poised for success in parts of Asia and Africa that have yet to make their marks as major producing regions. But the companies’ exploits have not been free of trouble.

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Tadawul trade closes mostly flat

Saudi Arabian stocks closed flat Saturdayafter markets mostly shrugged off a failed attempt to assassinate Saudi Arabia’s security chief, who is also a prominent member of the royal family.

“I am surprised at the markets’ reaction, but they seemed to shake it [the failed attempt] off,” said Ali Khan, the managing director and head of brokerage at Arqaam Capital in Dubai.

“Initially it did cross my mind, whether this would be conceived as a real threat, and we would see a real meltdown. But apparently it was taken off as a one-off.”

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Markaz eyes sinking Reem developers

The Kuwait Financial Centre, also known as Markaz, plans to invest US$50m (Dh183.6m) in distressed property projects in Abu Dhabi, a senior executive said last week.

The arrival of Markaz in Abu Dhabi appears to mark the first time a major investment firm has targeted distressed property in the emirate. Several similar funds have already formed in Dubai, where the property downturn has been more severe.

“Prices have corrected to attractive levels now in Abu Dhabi,” said Bassam al Othman, senior vice president of property development at Markaz, one of Kuwait’s largest investment firms. “We are looking at distressed developers who have spread themselves too thin with their equity.”

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Iraq digs in to rebuild agricultural sector

Iraq, once known as the “breadbasket of the Middle East” for the vast tracts of fertile land between the Tigris and Euphrates rivers, is expected to import 80 per cent of its wheat this year at a cost of more than US$1.4 billion (Dh5.14bn).

Devastated by decades of wars, sanctions and neglect, Iraq’s once abundant farms, pastures and date palm groves produce just a fraction of the needs of the country’s more than 28 million people. Billions of dollars are spent each year on tomatoes, milk and other products from the neighbouring countries of Iran, Turkey and Syria.

But as the country’s security situation begins to stabilise, government officials and private investors are beginning to focus on rebuilding Iraq into a major agricultural producer.

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Banks join global money laundering battle

Banks in the UAE have until Sunday to disclose details of accounts held by foreign officials and politicians as the Central Bank tightens regulations on money laundering.

The move, which brings the UAE into line with standards in other international financial centres, follows recent high-profile cases involving alleged fraud in the region and internationally.

International regulators are increasing pressure on banks to reduce their exposure to the risk of money laundering.

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The Sand, the Sea, the America’s Cup

No one will mistake this for Newport.

To reach the site picked for the next America’s Cup, swing past the camel racetrack near the airport.

Then pass by South Asian groceries and dusty rows of villas under construction. Finally, turn toward a stretch of the Persian Gulf where the ruling sheiks are building an island shaped a bit like a plant inspired by Dr. Seuss.

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Dubai International Capital seeks £150m boost for Alliance Medical

Alliance Medical, which is majority owned by Dubai International Capital (DIC), the investment firm controlled by Sheikh Mohammed bin Rashid Al Maktoum, is seeking up to £150m in fresh funds.

The business has hired Close Brothers Corporate Finance – now owned by Daiwa Securities – to advise the company on securing the extra capital.

DIC bought Alliance Medical at the top of the credit boom in November 2007 for £600m from British private equity firm Bridgepoint. Bridgepoint, which paid £111m in a secondary deal for the business in 2001, is thought still to have a stake in the company.

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Saturday, 29 August 2009

Dubai's Shuaa to issue 515 mln shares to DBG

Dubai-based Shuaa Capital said on Saturday it would issue 515 million shares to Dubai Banking Group (DBG), implementing an agreement to resolve a long-running bond dispute.

Shuaa said in June it had settled the dispute after months of negotiations and the threat of a lawsuit by DBG, by allowing DBG to take a 48.4 percent stake in the investment bank.

On Saturday, Shuaa said it had asked the Dubai Financial Market to issue DBG with 515 million shares in Shuaa, more than twice the amount agreed back in 2007 and making DBG the biggest shareholder in Shuaa.

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China invests in Canary Wharf with £880m bail-out of Songbird

In a sign of the increasing influence of the East, Qatar has joined the Chinese sovereign wealth fund, China Investment Corporation, in supporting a substantial equity raising that will help Songbird pay off an £880m loan from Citigroup that is due next May and threatens the company's future.

The value of Canary Wharf, home to some of the world's largest financial services groups, has tumbled since 2007 as a result of the turmoil in the global economy. Songbird, which owns 60.8pc of Canary Wharf Group (CWG), risked breaching loan-to-value covenants in a November test on the Citi loan, its only debt.

The value of the Songbird portfolio fell almost 30pc to £4.9bn in 2008 and David Pritchard, the chairman, said the company "could have gone down the path of a liquidation or administration" if the new deal had not been struck, echoing the problems the original developer of Canary Wharf faced in the early 1990s.

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Arab bourses gain $144bn in eight months

Arab equity investors ended nearly eight months of 2009 richer by around $144 billion (Dh528bn) to partly offset a loss of more than $400bn during 2008, official figures revealed yesterday.

From $751bn at the start of 2009, the combined market capitalisation of 13 official Arab stock exchanges surged to $895.6bn on August 27, showed the figures by the joint Arab stocks data base at the Abu Dhabi-based Arab Monetary Fund (AMF).

The bulk of the increase was in the capitalisation of the bourses of Abu Dhabi, Saudi Arabia, Kuwait, Qatar and Egypt, while there was a slight decline in the capitalisation of Bahrain, Jordan and Palestine.

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Arab business has its very own global scandal

The increasingly bitter row between the Al Gosaibi family of Saudi Arabia and their erstwhile business partner, Kuwaiti-born Maan al Sanea, is setting new standards for cross-border corporate intrigue. It is difficult to recall another Arab corporate scandal that has achieved such a level of global significance.

The Al Yamama defence contract scandal resonated around the world for years; the fall-out from Dubai World’s 2006 bid to buy the P&O ports business flared briefly from Los Angeles to Shanghai. But these events had geopolitical significance, and security implications, which meant they were bound to attract the attention of the politicians, and therefore the world’s serious business media.

Al Gosaibi versus al Sanea is the first purely business event to grab the world’s attention in such a way. With some US$22 billion (Dh80.8bn) of bank funding at risk, and assets ranging from Airbuses in the Cayman Islands to Coleraine in Northern Ireland (where Mr al Sanea funds some of the activities of the local university), the recriminations between the two sides have gone truly global.

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Friday, 28 August 2009

Lawsuits against Al-Gosaibi, Saad mount in UK

Pressure is building in the UK on Saudi business conglomerate Ahmad Hamad Al-Gosaibi & Bros (AHAB), with a series of lawsuits totaling at least $450 million filed against it in London’s High Court, according to documents seen by Dow Jones Newswires.

The high-profile, family-run group began to face scrutiny in May after it failed to repay some debts. It is now locked in a sour feud with fellow Saudi conglomerate Saad Group, which is also facing a London legal suit. International creditors are estimated to have some $16 billion in exposure to the two firms.

Both groups are working with their creditors for resolution, while the Al-Gosaibi group is already facing legal challenges from creditors in New York.

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Heavy weather for ports operator DP World

The slowdown in global shipping this year has dragged down Dubai-based DP World’s first half net profits, which slumped 34 per cent to US$188 million (Dh689.9m).
Volumes for the port operator declined by 10 per cent between January through June worldwide and by 7 per cent at its flagship Jebel Ali terminal in Dubai amid a “very challenging operating environment”, said Mohammed Sharaf, the chief executive of DP World, the fourth-largest terminal operator with 49 terminals worldwide. The results were better than the global average decline of 15 per cent, according to Drewry Shipping Consultants in London.

Mr Sharaf said the “unpredictable trends in global trade” are expected to continue in the second half of the year, but pockets of growth in its emerging markets businesses should help counter the wider decline in trade.

The company is dealing with the sharpest fall in global seaborne trade since containerised shipping was introduced in the 1950s, with global trade volumes expected to decline by 9 per cent this year, according to the World Trade Organisation. The company has responded by reviewing and postponing nearly all of its expansion plans, although it has begun operating new terminals in Djibouti and Algeria, and renewed terminal concessions in Australia.

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Islamic finance institutions add $580bn in assets

Total assets at the world’s 100 largest Islamic banks climbed by 66 per cent to more than US$580 billion (Dh2.13 trillion) last year, according to a report by Asian Banker.

The dramatic jump reflects the rapid growth of the Islamic finance industry as a whole, analysts say. While little reliable data exists on Islamic assets globally, the overall industry is by some estimates worth about $1 trillion and growing.

“Overall, 2008 was a relatively good year for the Middle East and Asian financial sector, with banks including Islamic financial institutions posting stellar performance in the first half of the year,” said Khalid Howladar, a senior credit officer for Islamic finance at Moody’s in Dubai. “The slowdown fully took effect only in the third and fourth quarter.”

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Yahoo buy spawns e-commerce giant

One of the Middle East’s largest e-commerce companies has been created as a by-product of Yahoo’s acquisition of Maktoob, the region’s biggest internet portal.

While the US technology giant has bought the core Maktoob web portal, a number of businesses previously under the umbrella of the Maktoob Group have been spun off into a new company, to be managed by its co-founder, Samih Toukan.

“We will operate in a similar way to the old Maktoob group but the focus will be different, looking more at e-commerce, transactional businesses, things that nobody is doing enough of in the region,” Mr Toukan said.

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Bank investment chief testifies in fraud trial

The chief executive officer of investment banking at Dubai Islamic Bank told a court yesterday that two defendants in a US$501 million (Dh1.8 billion) fraud trial were the bank executives responsible for facilitating credit allowances for a company that defaulted on its loans.

Saad Zaman, 42, told the Dubai Criminal Court of First Instance that in 2007 he was informed that CCH, a Turkish company, had defaulted on its loan instalments.

He told the court the bank was owed $170m by the company. “We found out that CCH had not used the funds provided according to the investment agreements set between us,” he said.

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UAE-Qatar 'facing negative inflation'

Qatar and the UAE are likely to see negative inflation this year due to falling house prices, while inflation rates will slow sharply in Saudi Arabia and Kuwait, EFG-Hermes said in a note yesterday.

Inflationary pressures have dropped off rapidly across the oil-exporting region as crude prices fell from peaks of $147 a barrel in July last year and the dollar strengthened, easing import costs for states that peg their currencies to the US currency.

"The UAE and Qatar will see the greatest reversal in inflation trends," EFG-Hermes said in the research note.

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Oil and trade lure Berlusconi to Libyan talks

Libya is the biggest provider of crude oil to Italy by far and its sovereign wealth fund may yet prop up some large Italian companies, but Silvio Berlusconi is discovering - like Gordon Brown of the UK - that to deal with Muammer Gaddafi can be a double-edged sword.

When he flies to Tripoli on Sunday, the Italian prime minister will be the first western head of government to greet the Libyan leader since the homecoming of the convicted Lockerbie bomber which has sparked a furore in the US and the UK.

Oil and business ties are expected to top the agenda when Mr Berlusconi joins Colonel Gaddafi to celebrate the accord they forged a year ago under which Italy said it would pay $5bn (€3.5bn, £3bn) during 25 years as reparations for its colonial rule, which lasted from 1911 to 1943.

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Thursday, 27 August 2009

Dubai Is Unlikely to Restructure Nakheel Bond, Ashmore Says

Dubai will choose to repay a government-guaranteed $3.52 billion bond sold by state-owned real-estate developer Nakheel PJSC rather than change its terms, according to Ashmore Investment Management Ltd.

Blackrock Global Funds and Ashmore are the two largest holders of the Nakheel issue, according to data compiled by Bloomberg. Ashmore Investment Management owns 1.09 percent of the bond, the data show. Ashmore, which started its first fund in 1992, invests in currencies, debt and special situations.

Rating firms have downgraded Dubai state-owned companies on concerns the emirate may not have sufficient funds to support its struggling entities. The credit crisis ended a four-year real-estate boom in Dubai and forced the United Arab Emirates government to bail out the two biggest mortgage lenders. The crisis wiped 50 percent off real-estate prices from their October peak, according to Deutsche Bank AG.

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Al-Gosaibi plans to avoid liability -Mashreq

The UAE's Mashreq bank, which is suing the Al-Gosaibi family conglomerate in a New York court, said on Thursday that a counterclaim filed by the Saudi group is part of an attempt to avoid liabilities owed to many banks.

According to documents filed in New York on Wednesday, Ahmad Hamad Al-Gosaibi and Bros (AHAB) accused Mashreq of aiding and abetting fraud, conversion and breach of fiduciary duty, as well as unjust enrichment and bad faith.

Al-Gosaibi is seeking more than $1 billion from Mashreq, in a counterclaim to Mashreq's own $150 million lawsuit against the Saudi operation.

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DP World denies stake sale talks

Port operator DP World has never been approached to sell a stake to a private equity firm and any decision would be up to the company's board, Chief Executive Mohammed Sharaf said on Thursday.

"There is no update ... we haven't been approached by anybody," he said in a conference call.

Parent company Dubai World said in May it was in talks to sell a stake in the port operator after it was approached by a regional private equity firm to sell a minority stake.

Well hush my blog, what did I find in the archives?

Sunday, May 10, 2009
DP World Sukuk Limited - Statement

In light of the suspension of trading in its shares, the Board of DP World has been informed by its ultimate majority shareholder Dubai World that Dubai World has received an approach from, and is engaged in discussions with a regional private equity firm which may or may not result in a transaction regarding a minority stake in DP World, coming largely from the free float.

Consequently shareholders of the company may wish to exercise caution in dealing in their shares.


© Press Release 2009

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Dubai's DP World H1 profit falls 34 percent

Port operator DP World's first-half profit from continuing operations after tax fell 34percent to $188 million, the company said on Thursday, amid a decline in container volumes.

"The first six months of 2009 have continued to present a very challenging operating environment across the portfolio," the Dubai-based firm said in a filing on the Nasdaq Dubai.

DP World said it had 2008 first half profit of $287 million.

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Iraq approves controversial Sinopec oil rights deal

Iraq has approved a deal that would see China's Sinopec Group acquire controversial oil rights in northern Iraq through its purchase of Swiss oil giant Addax Petroleum, Chinese media said Wednesday.

Iraq has now recognised Addax's development of the Taq Taq oilfield in its northern Kurdish region, after first threatening to blacklist Sinopec for pursuing rights there without consulting Baghdad, the China Business News reported, citing an unnamed Sinopec executive.

Sinopec, Asia's largest refiner, agreed to purchase Addax in June for 7.2 billion dollars in China's largest-ever overseas acquisition.

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Moody's downgrades three Kuwait banks for weak credit

Moody's Investors Service yesterday downgraded three Kuwaiti banks, citing weakening credit conditions, as the Gulf state's banking sector grapples with the fallout from the financial crisis.

The three lenders are Gulf Bank of Kuwait, National Bank of Kuwait (NBK) and Burgan Bank.

Moody's said it had downgraded Gulf Bank of Kuwait due to pressure of large losses arising from derivative investments. The bank's financial strength rating (BFSR) was downgraded to D+ from C-. Consequently, Gulf Bank's long-term global local currency (GLC) and long-term foreign currency deposit ratings were also downgraded to A3/Prime-2 from A1/Prime-1, respectively. All ratings remain on review for further possible downgrade.

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Saudi foreign assets cut by SR27bn in July

Saudi Arabia had cut its foreign assets by SR27 billion (Dh26.7bn) in July to fund its massive 2009 budget, official data showed yesterday.

The move was intended to mitigate the impact of the global financial turmoil and keep growth in its non-oil economy, it added.

The funds brought to about SR217bn the total assets withdrawn by the Saudi Arabian Monetary Agency (Sama) since the end of 2008 to bridge the gap between surging spending and relatively low oil revenue.

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Qatar seeks gas pipeline to Turkey

Qatar has proposed a gas pipeline from the Gulf to Turkey in a sign the emirate is considering a further expansion of exports from the world’s biggest gasfield after it finishes an ambitious programme to more than double its capacity to produce liquefied natural gas (LNG).

“We are eager to have a gas pipeline from Qatar to Turkey,” Sheikh Hamad bin Khalifa Al Thani, the ruler of Qatar, said last week, following talks with the Turkish president Abdullah Gul and the prime minister Recep Tayyip Erdogan in the western Turkish resort town of Bodrum.

“We discussed this matter in the framework of co-operation in the field of energy. In this regard, a working group will be set up that will come up with concrete results in the shortest possible time,” he said, according to Turkey’s Anatolia news agency.

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Gulf still waiting for US Fed chief to make right move

Let us now praise famous Ben, the Federal Reserve chairman who, in a nation where nearly one in 10 people is out of a job, has managed to keep his despite failing as banking tsar to prevent a financial crisis so severe that it plunged the US and the global economy into the worst recession since the Great Depression.

This week Barack Obama announced that he would reappoint Ben Bernanke, who was originally installed in 2006 by the US president’s predecessor and political rival, George W Bush, when Mr Bernanke’s term ends next January.

This might seem like a quintessential example of what some call “failing up”. Perhaps what it really underscores, though, is the tendency of investors, in this case the US government, to react to a losing trade by doubling down. Why, indeed, switch horses halfway through the race?

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UAE rejigs interbank rate panel to spur lending

The United Arab Emirates central bank will set up a new panel for the interbank offered rate, an official said on Wednesday, in the hope that the change will lower the rates and spur lending.

The central bank expressed dismay earlier this month at persistently high interbank rates, saying they did not reflect the market. It announced a new mechanism to determine the rates, prompting speculation it may overhaul the panel of providers.

The new 11-bank panel will include four new local banks and drop two international lenders, and will get to work by mid-September, the official in the central bank's treasury department told Reuters, requesting anonymity.

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Algosaibi seeks $2 bln in NY from Mashreq,al-Sanea

The Algosaibi family conglomerate has filed separate lawsuits in New York against Dubai-based Mashreqbank psc MASB.DU and Maan al-Sanea, the billionaire head of Saad Group [SAADG.UL], seeking combined damages of more than $2 billion.

Documents filed on Wednesday in a New York State court escalate a battle among several big Middle Eastern companies over alleged fraud.

Regulators and bankers are trying to address up to $22 billion of debt restructurings at Algosaibi and Saad, in what some Middle East experts view as the biggest financial shake-up in that region in the global credit crisis.

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Sukuk attracts cash-rich banks

With debt markets gingerly reopening, Gulf companies eager to raise cash through issuing bonds have to make a decision: should they issue conventional or Islamic bonds, known as sukuk?

The SR7bn ($1.9bn) sukuk issued by Saudi Electricity Company, the kingdom’s state power utility, this summer could be a useful indicator.

Investors flocked to it, rewarding the company with a price of 160 basis points above the Saudi interbank offered rate.

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KHI earnings plunge 83%

Kingdom Hotel Investments, in which Prince Al-Walid bin Talal, the Saudi investor, holds a 56 per cent stake, said on Wednesday first-half profit plunged 83 per cent to $4.2m. KHI, which is listed on the Nasdaq Dubai and London stock exchanges, blamed poor results at its Four Seasons hotels in Paris and Cairo and reduced real estate sales.

The profit excludes non-recurring items such as divestments and sales. Including divestments, profits fell 61 per cent to $8m from $20.6m in the same period last year, the company said in a statement.

Revenue dropped 11 per cent to $103.3m, but earnings before interest, tax, depreciation and amortisation, rose 9 per cent to $21.6m.

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Manager made ‘hostage in Qatar’

Philippe Bogaert, a Belgian television producer, goes by the Twitter handle “Hostage in Qatar”.

Utilising social media and the internet, the father-of-two is trying to draw attention to a legal battle as he tries to leave the gas-rich emirate after a company he managed was declared insolvent last September.

Since December, Mr Bogaert has been stranded with limited funds at the Belgian embassy, a plight that he says is rooted in Qatar’s “medieval” sponsorship system, which generally allows local partners to block the exit of employees.

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Nakheel cuts customers a deal

Billed as a development twice the size of Hong Kong Island, the billboard announcing Dubai’s mammoth Waterfront project now sags from its frame beside the Sheikh Zayed highway.

Waterfront and its parent company Nakheel are among the most high-profile victims of Dubai’s property crash. Local and international investors, bankers and real estate agents have been fretting how Nakheel, the property developer, will meet a series of loan payments due this year and next.

But now a mechanism has taken root allowing the Dubai government-owned company to unwind contracts in certain developments, such as Waterfront, that are unlikely to see the light of day.

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