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Saturday, 12 September 2009

Saudi Tadawul, Bloomberg Finance in index deal

The Saudi Stock Exchange (Tadawul) has this week signed an agreement with Bloomberg Finance L.P. for developing financial indices, the SPA news agency reported.

'The agreement provides the development of special financial indices comprising information on the Saudi financial market provided by Tadawul,' SPA said.

The deal authorises Bloomberg Finance L.P. to use real-time Tadawul price and other data to create indices, which may measure the performance of the Saudi stock market.

Bloomberg L.P. is the third international company to sign an agreement for establishing indices with Tadawul. Dow Jones Indexes and Standard and Poor’s are already Saudi market index providers.END

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The D. E. Shaw Group opens Office in DIFC

The D. E. Shaw group, a leading global investment firm, today announced that the Dubai Financial Services Authority (DFSA) has granted D. E. Shaw & Co. MENA, Ltd. a license to operate in the Dubai International Financial Centre (DIFC).

Established in 1988, the D. E. Shaw group has more than 1,600 employees and approximately US$29 billion in investment and committed capital as of July 1, 2009.

The firm has been an active participant in the Middle East and North Africa (MENA) region's public securities markets and, through the establishment of D. E. Shaw & Co. MENA, Ltd., aims to build on its public and private investment activities.

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UAE insurance companies' investment total Dhs 21.6b in 2008

The Insurance Authority has launched its annual report on the UAE Insurance sector highlighting the development achieved by the significant sector during last year.

It quoted Minister of Economy and Chairman of the Board Insurance Authority Sultan Saeed Al-Mansouri as saying Dhs 21.6 billion were invested in this sector last year. Shares and bonds account for 45% of these investments while deposits account for 34.2%, according to Al-Mansouri.

The new report asserts the substantial role of insurance sector in the UAE national economy.

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Indian firms looking at Zain stake

India's Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam are undertaking due diligence to buy a stake in Zain, the Indian ambassador to Kuwait said in remarks published on Saturday.

Last week, the two state-run firms said they had not decided on whether to join a consortium that is buying a 46 percent stake in Kuwaiti telecom Zain.

"MTNL and BSNL are always looking for investment opportunities overseas to expand their operations. As for buying a stake in Zain group, the evaluation and due diligence is ongoing," ambassador Ajai Malhotra said, according to al-Qabas newspaper.

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Lebanon charges Ezzedine with embezzlement

The Lebanese authorities on Saturday charged businessman Salah Ezzedine, dubbed the “Lebanese Madoff” in the local media, with embezzlement. Mr Ezzedine’s case involves hundreds of millions of dollars and has been called a Ponzi scheme by several officials.

Mr Ezzedine, a Shia Muslim, was close to senior members of the armed Shia Hizbollah movement, which plays an important political and military role in the country. The party has confirmed to the Financial Times that prominent Hizbollah MP Hussein Haj Hassan was among the investors with Mr Ezzedine.

MP was one of the first people to file a complaint against the businessman, sparking the probe. Hizbollah then “helped” Mr Ezzedine surrender to the authorities.

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Iraq mulling foreign oil tax

Iraq's parliament held an initial discussion on Saturday of a bill that would impose a 35-percent income tax on foreign oil and gas firms working in Iraq, lawmakers said.

"Today we held a first reading of a draft to impose tax on foreign oil companies working in Iraq," Haider al-Ebadi, head of parliament's economic committee.

Ebadi and other lawmakers said the 35 percent tax on oil company income, if approved, would cover all types of oil and gas contracts - exploration, production, processing and other activities.

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Tadawul may be closing windows to open doors

Saudi Arabia likes to play hard to get with foreign investors, restricting ownership of companies on its stock exchange to its own citizens and those of the UAE and other Gulf Cooperation Council states.

The authorities are carrying that diffidence to a new extreme in a dispute with MSCI Barra, a compiler of stock indices followed by professional investors around the world. The subject matter probably will seem trivial to anyone who does not create indices or operate a stock exchange for a living, but the disagreement may have significant implications – possibly bearish, but more likely, if unexpectedly, bullish – across GCC markets and especially in the UAE.

Here are the details: The Saudi exchange, known as Tadawul, has threatened to withhold market information from MSCI unless it promises to seek the exchange’s approval before licensing indices that use the information to third parties that create financial products, such as exchange-traded funds. MSCI has counter-threatened, saying it would drop Saudi stocks from its Middle East indices.

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Al Gosaibi fighting is far from over

There has been a recent lull in hostilities in the war being fought out in Saudi Arabia between the Al Gosaibi business dynasty and its former partner Maan al Sanea, whose Saad Group is alleged to have defrauded Al Gosaibi of US$9.2 billion (Dh33.8bn). But the Ramadan-inspired cessation should not be mistaken for a truce, let alone an armistice, in the bitter struggle being waged both inside the kingdom and in the global financial theatre.

A quick review of the strategic situation: Al Gosaibi’s business empire has been laid low by what the family claims is a systematic, decade-long campaign of fraud and thievery by the Kuwait-born businessman. Mr al Sanea denies those allegations vehemently, but, in a series of surgical strikes by lawyers in New York, London and the Cayman Islands, has seen the assets of his Saad group frozen across the world.

The struggle between these giants of the Saudi business scene is a straightforward bid by the Al Gosaibis to get their money back, but is also a battle for the hearts and minds of the kingdom’s ruling elite, who will ultimately determine the fate of the warring parties.

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Technical Trade: SELL the Kuwait Stock Exchange (KSE) (Re-post)

Now this really contradicts my previous post, but technically speaking the Kuwait Stock Exchange (KSE) index is posed to sell-off in the short-term. Although we are still lagging most indexes around us, there is a strong probability that we might lose another 200 points, i.e 2.5%.

Below is a list of the year-to-date (YTD) performance of relevant indexes:

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Dubai World says Istithmar CEO's job safe

Dubai World said on Friday the chief executive of its Istithmar World unit would continue to lead the company, after reports his position was under review.

"Reports that ... David Jackson had left the company were incorrect," the state-owned conglomerate said in an e-mailed statement.

Earlier on Friday, Bloomberg said Istithmar World is freezing investments as part of a restructuring process that may result in sale of the fund or its assets, citing people familiar with the plan. The sources said Jackson's job was under review.

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Credit crunch signals end of The World for Dubai’s multi-billion dollar property deal

England is deserted, Australia and New Zealand have merged, and the man who bought Ireland has killed himself.

They were designed to make Dubai the envy of the world: a series of paradise islands inhabited by celebrities and the super-rich reclaimed from the azure waters of the Arabian Gulf and shaped like a map of the Earth. It was called The World.

As millions of tonnes of rock were dumped into the sea for the foundations, timely leaks suggested that Brad Pitt and Angelina Jolie were to buy Ethiopia, Sir Richard Branson was tipped to occupy England, while Rod Stewart would border him in Scotland.

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Korea 'Should Be More Like Dubai'

A British financial expert and top adviser to president-elect Lee Myung-bak has suggested that the next government would create a special international financial zone similar to Dubai in a bid to stimulate foreign investment. David Eldon is a co-chairman of the special subcommittee on national competitiveness promotion under Lee's Transition Team.

Eldon's remarks flesh out the incoming president's campaign pledge to establish a global financial center in Jeju Island. "Financial institutes that enter Dubai not only enjoy near zero percent tax privileges but also a stable government and autonomous regulatory authorities," Eldon told reporters Sunday. "Korea's problem is its duplicated financial regulations. This is the biggest difference between Korea and Dubai." He added, "If Korea establishes a special international financial zone as such, success is not impossible."

Lee promised to turn Jeju into an offshore financial hub when he visited the island on the campaign trail on Nov. 30 last year.

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For a Bounced Check in Dubai, the Penalty Can Be Years Behind Bars

For more than a year, prosecutors have been cracking down on the corruption and kickbacks that thrived during the boom years in this Persian Gulf city-state. Dozens of executives have been arrested and charged in a high-profile effort to show that fraud will no longer be tolerated. Investigators say their cases have uncovered $3.58 billion that was stolen or used as bribe money.

But alongside the con artists and crooks, a rising number of businesspeople have been sent to jail for going into debt. Bouncing a check is a criminal offense here. That fact has begun raising questions about the fairness of Dubai’s laws, especially among the foreigners who make up about 90 percent of the population.

Consider the tale of Ali Fariq, a 33-year-old Iraqi real estate agent now serving a three-year jail term. Mr. Fariq says his ordeal in the Dubai legal system began last year when he was kidnapped and beaten by a diplomat who blamed him for an investment deal gone sour.

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