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Wednesday, 6 October 2010

FT.com - Foreign revenues bolster Morocco

The launch of Morocco’s first sovereign bond in three years should ease strains on liquidity in an economy weakened by the global crisis and particularly the contraction in Europe, analysts say.

The kingdom’s main sources of foreign currency – exports, tourism, foreign direct investment and remittances – have been affected to varying degrees by the global downturn. More broadly, the economy remains vulnerable to slow growth in Europe and austerity measures adopted by trade partners such as France, Germany and Spain.

Salaheddine Mezouar, the Moroccan finance minister, says the country has returned to the international market to “diversify its sources of finance” and to reduce pressure on domestic financing.

Mideast, North Africa Economies to Expand 5.1% in 2011 on Oil, IMF Says - Bloomberg

The International Monetary Fund said economic growth in the Middle East and North Africa region may accelerate to 5.1 percent next year as oil prices rise.

Growth is forecast at 4.1 percent this year, more than double the 2009 pace, the Washington-based lender said in its World Economic Outlook. It predicted a “robust” expansion in the region’s oil-importing economies, which suffered limited damage from the global financial slump, and “modest” rises in crude prices that will boost exporters. Saudi Arabia’s economy, the region’s biggest, is forecast to grow 4.5 percent next year.

“The recent economic recovery in the MENA region is largely underpinned by the rebound in oil prices from their trough in 2009,” the IMF said in the report published today. “The region has largely been bypassed by the recent surge in capital flows to emerging markets, with the notable exception of Egypt and Lebanon.”

Dubai Credit Default Swaps Drop to Lowest Since Dubai World's Debt Delay - Bloomberg

Credit default swaps linked to Dubai fell to the lowest since state-owned Dubai World sought to delay debt repayments in November as investors gain confidence in the emirate’s economic recovery and global stocks rallied.

Default swaps tied to Dubai government debt narrowed 32 basis points to 385.74 yesterday, the lowest close since Nov. 24, according to data compiled by Bloomberg. The five-year contracts rose to a record 977 basis points in Feb. 17, 2009, before the United Arab Emirates’ central bank bought $10 billion of Dubai bonds.

Dubai World, one of the emirate’s three main state-owned business groups, said Nov. 25 it would seek to delay repaying loans until at least May 30. The announcement sparked a plunge in developing-nation stocks and the largest increase in emerging-market bond yields over U.S. Treasuries in four weeks. The cost to protect against a default by Dubai doubled.

FT.com - Algeria moves to knock Vimpelcom’s plans

Vimpelcom’s plans to combine with most of the telecoms assets of Naguib Sawiris, the Egyptian entrepreneur, have suffered a setback after the Algiers government reiterated its determination to buy his Algerian mobile business.

Vimpelcom, the Russian mobile operator, plans to transform itself into a global telecoms player partly by securing a controlling stake in Orascom Telecom, the company founded by Mr Sawiris.

Orascom’s most valuable asset is Djezzy, its Algerian mobile business, which generates about 50 per cent of the Cairo-listed company’s earnings.

Dubai Shares Gain Most in Two Weeks on Stimulus Speculation, Ruler Comment - Bloomberg

Dubai shares rose the most in almost two weeks after the emirate’s ruler expressed optimism about the economy and as stocks rallied worldwide on speculation central banks will increase efforts to stimulate global economies.

Emaar Properties PJSC, the builder of the world’s tallest tower, gained to the highest in a week and Dubai Financial Market, the only publicly traded Gulf Arab stock market operator, climbed 1.7 percent. The DFM General Index gained 0.9 percent, the biggest advance since Sept. 26, to 1,704.91 at the 2 p.m. close in the emirate.

Global stocks rallied with the MSCI World Index extending yesterday’s 2 percent gain. The Bank of Japan unexpectedly cut interest rates Oct. 5 and said it would buy as much as $60 billion of assets to keep the economy from faltering, increasing speculation that other central banks will take similar steps. Credit-default swaps tied to Dubai government debt dropped 32 basis points to 386 yesterday, the lowest since the beginning of the Dubai World debt crisis. Asian bond risk fell to the lowest in five months.

Book-built IPOs set to be the trend in Oman: Morgan Stanley

Book-building, a novel route for pricing a new equity issue and introduced for the first time on Muscat's bourse through Nawras's Initial Public Offering (IPO), is expected to catch on in the Sultanate, according to a top executive of global financial services firm Morgan Stanley.

Klaus Froehlich (pictured), Executive Director of Morgan Stanley and Head of Global Capital Markets for the Middle East, said the Nawras IPO will set a major precedent for the launch of new issues based on the book-building route -- a process of determining the price at which an IPO will be offered.

Nawras's IPO opened on September 15 with a price range set at 702 baisas to 902 baisas. The final share price will be determined on the basis of the book-building process and is expected to be announced on October 24.

Dana Gas, Crescent Delay Iraq Kurdistan Gas Target By One Year to 2012 - Bloomberg

Dana Gas PJSC, Crescent Petroleum Co., Mol Nyrt and OMV AG will produce 300 million cubic feet a day of gas from its project in Iraq’s Kurdistan region in 2012, a year later than expected.

The production rate is currently 200 million cubic feet a day, Dana Gas said in a statement today.

The production rate was expected to reach its target in the first quarter of 2011, Chief Financial Officer James Dewar said in August, almost two years later than the company had originally expected.

GM Said to Approach Sovereign Wealth Funds to Boost Stock Sale - Bloomberg

Investment bankers for General Motors Co. have met with sovereign wealth funds and private investors in the Middle East and Asia to gauge interest in the automaker’s planned stock sale, said two people familiar with the meetings.

GM’s bankers had planned to approach Riyadh, Saudi Arabia- based Kingdom Holding Co., Abu Dhabi-based Mubadala Development Co., Qatar Holdings LLC and Singapore-based Temasek Holdings Pte. about GM’s initial public offering, said one of the people, who asked not to be named because the discussions are private.

Seeking large international investors is one way for the nation’s largest automaker to generate demand for its stock in preparation for an IPO next month. GM and its bankers are forging ahead with the stock offering in a year when at least 47 companies have postponed or withdrawn U.S. IPOs, two people familiar with the plan said.

WSJ: U.A.E. Banks Cut Ties To Iranian Banks Blacklisted By U.S. - WSJ.com

Banks in the United Arab Emirates have curtailed financial dealings with a handful of Iranian banks blacklisted by the U.S. Treasury, officials here said, drying up one of Iran's financial lifelines as international sanctions continue to aim at curbing Tehran's nuclear ambitions.

Washington has pushed many of Iran's Persian Gulf neighbors to end financial access to Tehran's banks. The U.A.E.'s move is especially significant since Dubai has in recent years been an important re-export hub for Iranian importers, prohibited by previous sanctions from importing goods directly from the U.S. and elsewhere.

Stuart Levey, the U.S. Treasury's point man on sanctions, traveled in late August to the U.A.E., Bahrain and Lebanon to meet with officials and explain Washington's new financial-sanctions law.

Bahrain economy grows by 4.6% - Arab News

Bahrain's economy expanded 4.6 percent in real terms in the second quarter of this year, the island kingdom's statistics office said on Tuesday, slower than the pace of growth in the first quarter.

The gross domestic product of the small non-OPEC oil producer rose by 1.1 percent from the previous three months, the statistics office quoted Prime Minister Sheikh Khalifa bin Salman Al-Khalifa as saying on its website www.cio.gov.bh.

The prime minister said that the second-quarter growth was satisfactory given current economic challenges.