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Saturday, 27 June 2009

RAIL FREIGHT TRAFFIC PLUMMETS 18% (Re-post)

"Start spraying those “green shoots” with some Weed-B-Gone. They are in fact weeds. The most recent rail data confirms the continuing trend that the real economy is seeing no real recovery. Intermodal traffic for the week ending June
24th was down a staggering 17.8% from the same period a year ago.

That’s an astounding decline for an economy that is supposedly in recovery mode. You would think that a huge rebound in commodity prices and economic activity would spur large gains in rail traffic, but it’s not translating into real strength in the data. Buy into the “green shoots” theories at your own risk. It’s just not being seen in the real economy. We are seeing the same results in other economically sensitive industries like trucking and air transports. We are also hearing similar stories from readers in the trenches."


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Iraqi oil contracts to be auctioned in live TV 'game show'

Oil giants will be forced to tussle for contracts worth an estimated $16bn (£9.7bn) live on Iraqi television in a bizarre contest they fear could end up resembling a game show.

More than 30 energy companies, including BP, Shell and ExxonMobil may be forced to make last-minute alliances and reveal their offers in a tense round of bidding due to start early next week.

Iraq, which has the world's third-largest proven oil reserves, plans to conduct the bidding for contracts to develop six major oil and two gas fields publicly over the course of a few hours.

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Abu Dhabi's fortune favors the bold


The longstanding sibling rivalry between the two biggest members of the United Arab Emirates, always complex, has taken a remarkable turn in recent months.

For years, as its neighbor on the Persian Gulf, Dubai, engaged in a frenzy of construction and deal-making, Abu Dhabi -- the capital of the UAE and owner of its deepest petroleum reserves -- was mostly content to keep its ambition in check. Its caution underscored old stereotypes about its role as the wary, wealthy older brother to an aggressively ambitious emirate next door.

Now, as Dubai struggles to recover from the dramatic collapse of its real-estate market, Abu Dhabi is taking advantage of the downturn to savor a moment in the spotlight. The emirate is actively promoting its 2030 Plan, a wide-ranging blueprint for growth unveiled in 2007. It is also moving forward on a number of big-ticket urban initiatives that it has the luxury of financing to a significant degree from its own coffers.

Top Saudi investor fined for insider trading (Delayed publication)

Saudi Arabia has fined a key local investor and shareholder in several listed companies for insider trading, according to the regulator's website.

The Capital Market Authority (CMA) said it has fined Mohammed bin Ibrahim bin Mohammed Al-Issa SR100,000 ($26,667) after an appeal affirmed a ruling that Al-Issa conducted "insider trading in shares of Saudi Hotels Co based on his membership of the company's board".

Reuters was unable to contact Al-Issa directly. A member of his family said Al-Issa declined immediate comment.

"He is the third biggest retail investor in the Saudi stock market after Prince Alwaleed bin Talal and Suleiman Al-Rajhi. Al-Issa is worth some $2 billion," said Abdulhamid Al-Amri, a member of the Saudi Economic Association think tank.

Al-Issa was ordered to pay the watchdog the SR3.37 million that ($898,600) the CMA said he has made in profit from trading in Saudi Hotels' shares. The CMA also banned Al-Issa from working for any listed company for three years.

According to Saudi bourse data, Al-Issa is the top shareholder in both Saudi Hotels and Savola Group and also holds a 10 percent stake in Riyad Bank and a 5 percent stake in Banque Saudi Fransi, Calyon's Saudi affiliate.

Officials contacted at Savola, Fransi and Riyad confirmed that their shareholder was the same one fined by CMA.

Like others in the Gulf region, Saudi Arabia's stock exchange has been dogged by allegations of insider trading and manipulation of stock prices, and CMA has slapped hefty fines on many investors and executives found guilty of manipulation.

"Insider trading is plaguing the Saudi market probably more than any other market in the world.

The CMA action will increase confidence in the market especially with foreign investors," Amri said.

Analysts say the Saudi regulator needs to make adherence to corporate governance regulations compulsory for listed firms instead of voluntary in order to achieve greater progress in boosting transparency in the Arab world's largest stock market.

In remarks published by Okaz newspaper on March 28, CMA's head Abdul-Rahman Al-Tuwaijri said his department was probing 92 cases of suspected violations including price manipulation and improper disclosure.

The cases are among 151 cases registered last year which involve suspected price manipulation, misleading, and irregular disclosures and insider trading, he said.

The Appeal Panel is formed by the Council of Ministers and hears appeals against decisions issued by the Committee for the Resolution of Securities Disputes (CRSD), a sort of first instance court that looks into cases in the stock market.

According to CMA website, a decision by the CRSD may be appealed to the Appeal Panel within 30 days of the notification date.END

Hydra Village buyers consider legal action

Buyers of property in the delayed Hydra Village, a Dh2 billion (US$545m) housing project being developed by Hydra Properties on the outskirts of Abu Dhabi, are considering legal action against the company in an effort to either recover the money they have invested so far or have their contracts rewritten.

If the case goes to court, it would be the first major property dispute to be heard in Abu Dhabi where, unlike Dubai, formal property regulations are yet to be established.

The long-running battle between the Hydra Investors Committee, a group of about 350 members, took a turn for the worse after buyers rejected a revised contract offered by Hydra earlier this month.

Dubai World not just a company but a symbol

Some companies come to symbolise their country of origin in a far more fundamental way than by what they produce, or their place of incorporation, or the size of their workforce.

General Motors in the USA typified America’s dynamic expansion in industrial processes and consumer products in the last century; BP in Britain encapsulated the country’s past as an imperial power and global merchant trader; Sony of Japan was the very essence of the country’s post-war recovery through sophisticated hi-tech exporting. You could probably add Deutsche Bank of Germany, Fiat of Italy, and (no sniggering now) Guinness of Ireland as examples of corporates that became business symbols, almost ambassadors, of their respective nations.

This is why what is happening at Dubai World is so important to the future of the emirate as it grapples to come to terms with the post-crisis world. “Dubai’s flagship in global investments”, according to its website, is the beating corporate heart of the emirate, responsible more than any other single company for the way the world views Dubai.

Porsche, Qatar Investment Talks Are in ‘Final Stage’

Porsche SE said talks with Qatar over a potential investment in the sports-car maker have entered a “final stage” as chances diminish that the German government will extend a loan.

The due diligence process conducted with the Persian Gulf state has led to a “positive” conclusion, Frank Gaube, a spokesman for Porsche, said in a telephone interview today. He declined to predict when an agreement may be reached. Daimler AG, the second-largest maker of luxury cars, denied a German magazine report that it’s seeking a stake in Porsche.

The maker of the 911 sports car may sell a stake for as much as 2.5 billion euros ($3.5 billion) to Qatar to help reduce 9 billion euros in net debt, people familiar with the plan said June 15. Stuttgart, Germany-based Porsche has applied for a 1.75 billion-euro loan from state-owned development bank KfW Group.

Saudi Arabia’s Algosaibi Said to Owe $9.2 Billion

Ahmad Hamad Algosaibi & Brothers Co., the Saudi family holding company whose Bahraini bank has defaulted, owes 34.6 billion Saudi riyals ($9.2 billion) to more than 100 banks, two people familiar with the situation said.

The Algosaibi group held a meeting with creditors in Bahrain June 24 to ask for a grace period of 90 days to investigate the debt, said one person involved in the talks, who declined to be identified because the information is confidential. A spokesman for the company, which bottles Pepsi Cola in Saudi Arabia and holds stakes in lenders including Saudi British Bank, had no immediate comment when contacted by Bloomberg News.

The size of Algosaibi’s liabilities “strikes the markets as a surprise,” said Luis Costa, an emerging-markets debt strategist at Commerzbank AG in London. “This is a problem when it comes to buying anything originated from the Middle East, how to properly measure the leverage of players there.”

Dubai hotel revenues down 40pc

Dubai hotel revenues fell more than 40 percent in May from a year ago as travellers tightened their belts due to the economic crisis, according to a survey.

Hotel occupancies in Dubai, the Gulf's tourism and trade hub, fell 14.5 percent in the same period to 66.5 percent, hospitality research company STR Global said.

Revenue per available room (revPAR), an industry benchmark, stood at around $141, compared with $236 last year.

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Dubai talks on Emaar merger

Emaar PropertiesImage via Wikipedia

Two Dubai government-related groups on Friday said they were in advanced talks to merge Emaar Properties, the Middle East’s largest real estate company, with three developers owned by the emirate’s ruler.

The move appears intended to deliver cost savings by merging Emaar, which is building the world’s tallest tower in Dubai, with Dubai Properties, Sama Dubai and Tatweer, the developer behind the Dubailand theme park, which is yet to be built.

The latter three companies are part of Dubai Holding, which is owned by Sheikh Mohammed bin Rashid al Maktoum, Dubai’s ruler.

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