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Thursday, 8 October 2009

Dubai Shares Rise to November High on Global Rally; DSI Climbs - Bloomberg.com

Dubai Shares Rise to November High on Global Rally; DSI Climbs - Bloomberg.com

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Cityscape ends with no deals, few visitors , UAE Sales, Real Estate - Maktoob Business

Cityscape ends with no deals, few visitors , UAE Sales, Real Estate - Maktoob Business

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QatarGas Postpones Shutdown of LNG Train 4 Until 2010 (Update1) - Bloomberg.com

QatarGas Postpones Shutdown of LNG Train 4 Until 2010 (Update1) - Bloomberg.com

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Dubai’s $80 Billion State Debt Is Reasonable, HSBC’s Nasr Says - Bloomberg.com

Dubai’s $80 Billion State Debt Is Reasonable, HSBC’s Nasr Says - Bloomberg.com

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Global's MENA, International Markets & Oil – Technical Overview - October 01, 2009 (PDF)

Global has published its “MENA, International Markets & Oil – Technical Overview”. This report includes all seven GCC Stock Market Indices, Levant, North Africa, NYMEX Crude Oil, and major International Indices with a brief technical overview up till the month ending in September 2009. The report highlights: Trend Status, Resistance, Support, Highest and Lowest level expected for the coming month for each Index & Product.

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GCC to become a global hub for aluminium

The GCC is to become a global hub for aluminium production with 25 per cent global smelting capacity going online in five years, according to a business research and consultancy firm.

Talking to Emirates Business on the sidelines of the first Middle East Growth, Innovation and Leadership Summit (GIL 2009), Aditya Sapru, a partner at Frost and Sullivan, the organisers of the summit, said the GCC is fast diversifying with mega investments in cluster industries, particularly in metal and petrochemical byproducts.

"This region is full of potential for growth. There is potential today as the region is turning around with a huge interest in diversifying. There is also rise in the strength of sovereign wealth funds in the region. This region in five years will have 25 per cent global aluminium smelter capacity," he said.

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Emirates Business 24/7 suspends weekend edition

Emirates Business 24/7, the daily newspaper published by Dubai’s Arab Media Group (AMG), will stop printing weekend editions from this week to prepare for its relaunch in January as a more lifestyle-focused paper.

Abdullatif al Sayegh, the chief executive of AMG, said the move was designed to give the editorial staff time to create new sections devoted to local news, lifestyle, culture and listings, which recent market research indicated its readers were hungry for.

“The business environment in the UAE is not like the business environment anywhere else you go in the world,” Mr al Sayegh said. “When you look at the business papers like the Financial Times and The Wall Street Journal, they are purely business oriented, while business here is more of a lifestyle.

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Reform of cheque system long overdue

To understand the country’s problem with bounced cheques, it is helpful to imagine two cases.

In the first scenario, a man obtains a loan from the bank to pay his rent for the year. He then loses his job and is unable to keep up with his monthly payments.

In the second, a man obtains a loan from the same bank and transfers all the money out of the country in an attempt to defraud the bank and stops making payments.

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Cost of borrowing has dropped, but interest is limited

One of the best pieces of news this region has had in recent months is that the price borrowers here have to pay international investors has been falling. This is a sign that confidence in the region’s prospects are rising, but also that confidence is rising globally, and so the cost of borrowing is going down almost everywhere. That’s good news for those struggling to repay debts they racked up when times were good and repayment seemed easy, such as Dubai and the companies it controls. Now times are tough, money is tight and servicing Dubai Inc’s US$85 billion (Dh312.21bn) debt has become a Sisyphean task. Falling borrowing costs can only help.

But the easing interest rates on foreign borrowing are also the result of a more pernicious trend, one that appears to afflict this region, the UAE in particular.

Since the global credit crisis erupted just over a year ago, many economists and policymakers have warned that recovery would depend on deleveraging, whereby banks, companies and consumers try to wriggle out of the credit binge they indulged in. The economy is terrible, unemployment is up and business prospects dim. Few banks want to lend. Few companies or consumers want to borrow. It’s a nightmare for policymakers because no matter what they try, the players in the economy insist on sitting on their hands, waiting for the other guy to blink. So deleveraging is a necessary evil, one that in the process makes the recession seem longer and more painful.

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Qatar Relies on Natural Gas Reserves While Dubai Leans on Trade and Finance (Re-post)

Qatar is a red-hot economy. Last year it grew around 18% and this year it ought to grow another 16%. We saw the headlines in the Gulf Times in the lounge while waiting for our transfer to Dubai.

Qatar's greatest asset is its natural gas reserves. In fact, the largest gas field in the world is here. Its discoverers were disappointed when they found it in 1971. They were looking for oil.

The boom Qatar now enjoys is the result of some daring investments in liquefied natural gas (LNG) back when people thought doing such a thing was a little batty. Faisal Al Suwaidi, the head of Qatargas, deserves the props for his wager, which have paid off handsomely. Today, Qatar produces about one-quarter of the world's natural gas.......

Chris Mayer
for The Daily Reckoning Australia

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Qatar stock market flags as economy soars

Despite multiple bank bail-outs, an economy in rude health and glowing analyst recommendations, Qatar’s stock market remains one of the region’s underperformers this year.

MSCI Barra’s Qatar index has gained only 9.5 per cent in 2009, compared to a 26 per cent gain in the MSCI GCC index and a near 60 per cent jump in the MSCI Emerging Markets index. Only Bahrain’s stock market has done worse in the Gulf.

One explanation is that the Qatari stock market fell less than its regional counterparts last year. Over the past 12 months it has shed nearly a fifth of its capitalisation, marginally better than the GCC Index’s 25 per cent drop. The Doha index has climbed further from its trough than most other markets.

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Islamic bank expands in a western way

Close your eyes, and Majid al-Refai sounds like a typical businessman from the Deep South. The US-born banker has a habit of punctuating his sentences with “You get it?” and phrases such as “Isn’t that the damndest thing?”

But his appearance tells another story. Dressed in a white thobe and sandals and sporting a luxuriant chest-length beard, Mr Refai is every inch the Islamic banker.

“I’m a Muslim brought up in a Christian world, and my aim is to put that western thinking to good use in this market,” says the founder and chief executive of Unicorn Investment Bank, an Islamic finance house based in Bahrain. “Everyone in the Gulf is focused on trading and real estate. Our task is institution-building.”

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New dawn signalled for debt-ridden Dubai

If the Cityscape property conference and trade show sets the tone for the year ahead, then the future for real estate in Dubai and beyond can only be described as flat – but that is in itself an improvement after a year of precipitous declines.

Empty, subdued exhibition halls contrasted sharply with the exuberance of last year’s event. Then Cityscape was infused with a buzzy, if unrealistic, optimism, despite being held in the aftermath of the Lehman Brothers collapse.

That moment of hubris has come to define Dubai’s difficult year as developers announced multibillion dollar projects just as the bubble burst. Since then, real estate values have halved and rents collapsed amid stalled projects and insolvent developers.

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