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Monday, 9 March 2009

The Face of Power in the UAE is a Woman and Her Name is Sheikha Lubna Bint Khalid Al Qasimi.

I first heard about Sheikha Lubna during the Dubai Ports Crisis in February of 2006. The issue was over the sale of port management businesses in six major U.S. seaports to a company based in the United Arab Emirates (UAE). There was concern of whether this sale would compromise port security. I remember how American citizens became very vocal raising serious concerns about how and why the United States would do such a thing since Americans were still suffering from the sting and psychological impact of 9/11 and were also very confused and frankly racist about Arab people. While then President George W. Bush fought hard to keep the sale alive, he did not have the political capital to stop Congress from ultimately delaying the sale.

During the crisis in came IT specialist Sheikha Lubna Bint Khalid Al Qasimi, then Minister of Economy. One of Forbes' 100 most powerful women, she was the first woman to be appointed cabinet Minister for the UAE in 2004, this petite woman with expressive eyes and proudly wearing her signature designer silk scarves, intimidated CNN's Wolf Blitzer during his visit to Dubai to see what he could sniff out about this controversy. Blitzer under estimated her, and he immediately discovered that the Sheikha was nothing to shake -- with quick responses, wit and perfect elocution she was a force to be reckoned with.

More than half of Dubai projects now on hold or cancelled

More than 50% of the announced residential and commercial projects due for completion between 2009 and 2012 have been either put on hold or cancelled, said a report out today from property experts Jones Lang LaSalle. This reflects the lack of available funding and projections of declining population along with continuing job cuts.

Vacancies in the Dubai’s office market have doubled to around 16% over the past six months, the highest rate ever recorded. Meanwhile, the hospitality market is reporting the lowest occupancy rate in five years with an average of 79%. This has been brought about by declining visitor arrivals and the release of new rooms into the market over the past six months.

The office market has been impacted by both deteriorating demand (in line with the global economic downturn) and significant levels of new supply, according to the Dubai City Profile report.

UAE looks to bridge $30 bln loan-deposit gap-cbank

Loans at United Arab Emirates' (UAE) banks exceeded customer deposits by 110 billion dirhams ($29.95 billion) and the government was looking for a way to bridge the gap, the UAE central bank's governor said on Monday. "The current situation requires a stimulus plan for banks and the economy in view of this 'gap' which could be bridged in collaboration with the Ministry of Finance," said Sultan Nasser al-Suweidi, according to state news agency WAM.

He gave no further details of a plan he first mentioned at a bankers' meeting last month.

The finance ministry of the second-largest Arab economy said last year it would invest 70 billion dirhams into long-term deposits at banks struggling to cope with tight global credit conditions.

Global's Jordan Weekly Market Report - March 05, 2009

"In our effort to provide the investment community, economists and researchers with an array of market reviews, we at Global Investment House are proud to present "The Weekly report on Amman Stock Exchange (ASE)". The report views the latest developments in the ASE, trading activity, indices performance and economic and corporate news.

In order to view the full reports kindly click on the headline."

Conspiracy theorists thrive on Russia anxiety

Analysts and politicians in Russia are increasingly frantic about the political fallout from the country’s six-month economic crisis, judging by the number of doomsday scenarios aired recently in the press and in speeches.

Warnings of social unrest, normally limited to small opposition newspapers and liberal commentators, are now aired in the mainstream media – as are comments on the regime of Dmitry Medvedev, the president, and Vladimir Putin, prime minister.

The Kremlin is making the most pessimistic noises. A key adviser wrote last week that the economic crisis threatened to unseat the two leaders, whom, he suggested, might be swept away in an uprising financed by the oligarchs.

Plunging assets cost $50,000bn

Falls in the value of financial assets worldwide might have reached more than $50,000bn, equivalent to a year’s global economic output, the Asian Development Bank will warn on Monday. Asia has been hit disproportionately hard, the bank will say, in a report that warns of many Asian stimulus plans lagging behind those of the leading global economies. Separately, the World Bank said on Sunday that developing countries faced a financing gap of between $270bn and $700bn a year as capital flows dried up, with only a quarter of vulnerable countries able to cushion the blow of the economic downturn.

Hedge funds turn to gold

Hedge fund investors who made money last year by betting against investment banks are now buying gold as a way of betting against central banks. The gold bulls include David Einhorn, founder of hedge fund Greenlight Capital, who last year came under the spotlight for his short selling of shares in Lehman Brothers, after arguing that the bank did not have enough capital to offset its exposure to falling property prices. Other funds looking at gold include Eton Park and TPG-Axon, the FT reported.

Unified GCC sovereign wealth fund is the 'need of the hour'

A unified sovereign wealth fund (SWF) for the Gulf is the need of the hour, as is intervention by Gulf-based funds in their respective economies to save them from the effects of the global financial meltdown, said bankers and economic experts in the region.

The percentage of investment by these SWFs in local markets should be raised to between 20 per cent and 30 per cent from the current five per cent, especially after the funds suffered losses estimated in reports at $450 billion (Dh1.6 trillion), several bankers said. These losses might go up to $600bn should the Gulf SWFs try to liquidate the assets they picked up abroad, which have now turned poisonous.

Dr Ahmed Al Janahi, Deputy Group CEO of Noor Islamic Bank, was among bankers in the region advocating the establishment of a sovereign wealth fund, saying it would have a positive effect on economies in the region.

Abu Dhabi in defence hub talks

Abu Dhabi Ship Building (ADSB) and Raytheon, the US defence contractor, are in talks to set up a joint venture to maintain and recertify Raytheon’s naval missiles in the Gulf.

The initiative would create the region’s first facility to handle the sophisticated re-certification process required to maintain missile systems throughout their lifespan. It joins other efforts to make Abu Dhabi a regional centre for the defence industry covering maintenance, manufacturing and research and development.

Bill Saltzer, the chief executive of ADSB, said the plans involved servicing the Armed Force’s arsenal of naval missiles from Raytheon and later expand to contracting with other regional governments.

Crescent in bid to develop Iranian gas field

Crescent Petroleum, the Sharjah oil and gas company, is seeking to develop part of Iran’s biggest gasfield.

The privately held company, already a partner in a project to import gas to the UAE from another Iranian offshore field, said it was ready to invest extensively in Iran’s South Pars gasfield, according to the Iranian oil ministry’s official Shana news website, citing Hamid Zaheri, the branch manager for Crescent in Tehran.

“If the oil ministry accepts this suggestion, we are ready to begin negotiations over the development of some of the phases of the South Pars field,” Mr Zaheri said.

Changing face of Dubai banking

Less than a year ago, bankers in London were being given a stark choice of either “Dubai or goodbye”. As business declined in the rest of the world, it was thought that Dubai could pick up the slack. For a while that was the case, but the depth of the crisis in western banking, combined with the fall in asset values in the Emirates, has brought upheaval to many financial institutions here too.

Despite growing numbers of departures from Dubai’s financial centre, bankers say no-one should write off the emirate as the Gulf’s banking hub.

“Bankers are leaving here partly due to business drying up and investment firms moving staff to cut operational costs,” says Wadah al Taha, a banking and markets analyst based in Dubai. “Business has reduced significantly from what it was in the first quarter of 2008.”

It’s time to hear the good news from Dubai

Not many businesses are making more money in the present global climate, but for a few lucky professionals, this is clean-up time. Insolvency lawyers, administrators and corporate investigators, for example, are almost turning down jobs, or having to hastily recruit staff to deal with the wrecks that have been left exposed by the falling economic tide.

Add to these one other class – the communications industry. When times are tough, the spin doctors really get going, because even relatively impoverished bankers and financiers need to think about their image, with an eye to the post-recession jobs market. When your reputation is all important, you have to be sure it remains as unsullied as possible by association with the disasters taking place all around you. As the saying goes: “A good reputation is more valuable than money.”

The decision makers of Dubai obviously agree. I hear that a senior delegation of the emirate’s financial and economic elite made a trip to London last week to consult some of the biggest names in the world communications business. Their mission was to find out why Dubai seems to have been getting a rough ride in the international press, and what can be done to put it right.

FNC chief tells Arabs to unite on economy

The Speaker of the Federal National Council appealed to Arab parliamentarians yesterday to get serious about regional economic integration, urging them to draft specific proposals that could be considered by next year.

Abdul Aziz al Ghurair, the FNC Speaker, said in a speech to the 15th Arab Inter-Parliamentary Union conference in Muscat: “We are in dire need of turning the slogan of Arab solidarity into practical programmes and policies. For two decades our Inter-Parliamentary Union has put solidarity on its agenda, but this never leads to any real development or tangible steps.”

He called on participants to prepare suggestions for moving ahead with economic integration that could be presented at their next conference, in 2010.