Wednesday, 1 June 2011
The expansion of any such union is often based less on economic logic than on politics. The accession of many eastern European states to the European Union since 2004, even if economically premature, was essentially a political project.
It is unclear whether the GCC is considering full membership for one or both of Morocco and Jordan, or whether the six existing members want to create a new tier of membership focused on mutual political and military interests.
The company said the bond launched at 330 basis points over midswaps, as reported earlier by Reuters, with a coupon of 5.125 percent.
Final price guidance for the bond had been in the range of 330 basis points to 337.5 bp over midswaps and carried a reoffer price of 99.904.
|TASI (Saudi Stock Market)||6741.83||0.09%|
|DFM (Dubai Financial Market)||1574.4||0.93%|
|ADX (Abudhabi Securities Exchange)||2666.01||1.02%|
|KSE (Kuwait Stock Exchange)||6390.1||0.19%|
|BSE (Bahrain Stock Exchange)||1349.07||0.18%|
|MSM (Muscat Securities Market)||6075.07||1.12%|
|QE (Qatar Exchange)||8326.9||-0.58%|
|LSE (Beirut Stock Exchange)||1363.23||0.43%|
|EGX 30 (Egypt Exchange)||5507.67||-0.28%|
|ASE (Amman Stock Exchange)||2159.28||-0.03%|
|TUNINDEX (Tunisia Stock Exchange)||4142.89||0.53%|
|CB (Casablanca Stock Exchange)||12202.2||0.05%|
|PSE (Palestine Securities Exchange)||496.87||-0.39%|
The head of Germany's soccer federation on Wednesday called for FIFA to re-examine the award of the tournament to Qatar amid allegations it had bought the event. The Gulf state has strenuously denied any wrong-doing. [ID:nLDE7500JC]
But even if the gas exporter ultimately loses the tournament, the impact on infrastructure expansion and on the economy would be limited, analysts said.
All 13 oil analysts and traders surveyed by Reuters predicted the Organization of the Petroleum Exporting Countries (OPEC) would roll over its current output agreement, untouched since the group's record cut in December 2008.
"They will simply sit on the fence with oil back near $100 barrel," said Harry Tchilinguirian, head of commodity markets strategy for BNP Paribas.
Moody's downgrades long-term and short-term issuer ratings of Bahrain Islamic Bank by two notches to Ba1/Non-Prime | AMEinfo.com
Both the Ba1 issuer ratings and BFSR of E+ remain under review for possible further downgrade.
The downgrade of BIsB's ratings reflects a material weakening in the institution's stand-alone financial profile, as shown in the significant losses it posted in the last two years and the erosion of its capital base in the absence of new capital injections. The sharp deterioration of the bank's asset quality since 2008 is at the core of BIsB's financial problem. Results in 2010 show a very high level of non-performing loans, driven for the most part by some high corporate and real estate sector concentrations in the institution's loan book.
The ratings agency said the financial profiles of most of the Gulf banks are expected to remain relatively stable or keep improving, but slowly because of listless loan growth and difficult funding conditions.
S&P noted in its report that most sovereigns and by extension banks in the GCC will continue to remain isolated from the political turmoil in other parts of the Middle East and North Africa.
The private equity firm said it made a consolidated net loss of $241.7 million. It did not give a comparative figure, but last year it reported net profit of $38.6 million.
Earlier in the session the shares rose as high as 7.7 percent.
By Jim O'Neill, Goldman Sachs Asset Management.
I returned from a brief 3-day trip to the Gulf this morning, after visiting Abu Dhabi and Dubai. I spent much of the time highly stressed about the path of the Icelandic ash cloud, in view of a rather important event that I needed to get back to London for Saturday evening. As is often so typical of life these days, it looks as though it was all blown out of proportion, and my own personal black swan event didn’t happen. Mind you, if the bookmaker’s odds are to be believed, then United are merely there to make up the numbers in tomorrow¡¯s Champions League Final. We shall see.
Beyond the ash-induced stress, the trip was very interesting. We hosted a client conference in Dubai and I also met with a number of important clients. In addition to discussing the world and global markets, I had fascinating exchanges with people about the so-called Arab Spring.
THE ARAB UPRISING.
Most people locally were as concerned as many people around the world seem to be about the possible future paths. That said, it was fascinating to hear this as well as comments about all the specific nuances. There were some I chatted with that shared my view that this could be the Middle East and North Africa (MENA) Berlin Wall ‘moment’ but not many. Most see the possible paths as highly uncertain and worrisome. One local fund manager put it to me differently. He said that there is always uncertainty about the future in this part of the world. But these uprisings have eliminated this future uncertainty. Instead, the uncertainty is here now. Linked to what I wrote about recently following my Singapore trip and fund managers’ experience, if you combine uncertainty with lower valuations, this spells opportunity.
Much discussion focused on each of Egypt and Syria, both being seen as key countries for the region. But the more the discussions advanced through a dinner where it became the featured topic, the more uncertain it became. On Egypt, views ranged from the most negative outcomes post the September elections to some thinking that, while Mubarak has gone, not much has really changed, as the Army will remain in charge. Regarding Syria, many see it as even more interesting, since a change in regime could have big consequences for Iran and support for the more extreme terrorist organizations.
DUBAI AND N11 CAPITAL?
This was the first time I had spent a few days there since the bursting of the property bubble. The damage could be seen everywhere, with many half-finished projects. That being said, the main artillery roads seem to function better based on my trip over to Abu Dhabi and back. I can’t help wondering whether it is all really sustainable in Dubai, but as I have found on past trips, the more I found my mind wondering, maybe there is more substance than meets the eye. With the troubles of Bahrain, and the never ending volatility of Beirut, and the clever way its leaders have allowed the local atmosphere to develop, Dubai seems to really benefit from some of the large nations not so far away. Moreover, it seems to benefit from those that are doing well, and possibly also from those that are less stable. Two of the BRIC countries, Russia and India, especially have positive relevance for Dubai, and a number of the Next 11 Group; Egypt, Iran, Pakistan and Turkey, all have differing degrees of relevance.
I would encourage anyone to take a visit to this part of the world. It is quite mind opening.
ABU DHABI AND GOLD BARS.
I had been planning to add a picture to this week’s Viewpoint. Abu Dhabi is the more sober of the major UAE conurbations and has always a more straightforward raison d’etre owing to its oil reserves and revenue. However, not to be completely outdone, as I am sure many of you know, it has a 7-star hotel, yes 7 stars. We managed to slip into the Emirates Palace for a quick (and not so cheap) cup of tea in between meetings, particularly to visit the Gold Bar ATM that is present in the lobby. Yes, there is a Gold Bar machine, and I have a picture on my blackberry to prove it. A shame that my technology skills are sufficiently limited that I can’t upload it for all you Gold bulls to see.
WORLD MARKETS AND THE MAY FACTOR.
Not because of this particular anecdote, but the Middle East being what it is, my meetings involved more discussion about Gold prices than is usually the case in other parts of the world. While the gold bar machine anecdote adds to all the other colourful stories I pick up, the recent remarkable resilience of gold, despite what has happened to silver and other commodities, is rather impressive. This gold price strength may perhaps be just a simple function of both the extremely low level of G7 real interest rates and the prospect that they might not rise anytime soon. I got the impression that there a quite a few bulls of Gold in the Middle East.
The shares were at 830 pence at 8:58 a.m. in the British capital after gaining to as much as 880 pence. The stock rose 1.3 percent to $13.63 on Nasdaq Dubai, reversing a decline of as much as 1.9 percent. They closed at $13.45 yesterday.
DP World, which operates ports from Europe to Asia, cross- listed 830 million ordinary shares to attract investors after low trading volumes in its home market. "The aim is to provide an additional platform to invest in DP World shares to help attract a broader range of investors," it said today.
Lead managers on the issue had said that the Dubai airline was planning a benchmark-sized bond, which is typically at least $500 million.
"They're looking at a minimum of $500 million and a maximum of $750 million," said one of the sources. A second source confirmed the company was eyeing $750 million from the issue.
"When it comes to adequacy and quality of capital, we don't have any difficulty in securing capital adequacy in the short run," he told a financial workshop in the UAE capital.
"As for liquidity, the difficulty lies in the fact that there are no sufficient government debt instruments. It will be important to double efforts locally to create an active market for government bonds as well as high quality corporate bonds," he said.
Any collaboration would focus on the technology sector, Kingdom said in an emailed statement Monday, following a Paris meeting between the pair.
Alwaleed holds significant investments in the US market, through his stakes in Citigroup, News Corp and Time Warner.
It is obviously very good news that liquidity has returned to the UAE's banking system in such abundance that the Central Bank governor "expects the emirates interbank rate to go down further because the liquidity situation has improved". And Sultan Al Suwaidi is right to ask the banks to drop their interest rates, and so reduce the cost of borrowing.
But all this banking liquidity has to trickle through to the business world, which is still coping with the terrible effects of the property slump in which the real estate market's huge 60 per cent share of the country's GDP fell by more than 50 per cent. The government rescues have saved the large developers, but it is now the suppliers and contractors who need the money.
Average daily volumes (ADV) for the DME Oman crude oil futures contract (DME Oman) through the first quarter stood at 3,000 contracts (equivalent to 3 million barrels of oil per day). Sustained liquidity and continued growth enabled the DME to set a new trading record in January, with an ADV of 3,570 contracts, the highest monthly figure since trading began on the DME in 2007.
Although the exchange experienced high volatility and reduced volumes in April, Leaver said DME volumes picked up momentum in May.
The cash injection comes as the airline prepares to accelerate its fleet expansion as it receives more Airbus A380 superjumbos and Boeing 777-300ERs, putting new demands on its financing abilities.
The Dubai airline completed lending terms with three foreign banks for the financing of 10 of the wide-bodied, long-haul jets from Airbus and Boeing, worth US$3 billion (Dh11.01bn) at list prices before standard industry discounts.
"I'd be happy if the government started selling shares today," Mr Hester said yesterday in Abu Dhabi. "We're ready to stand on our own two feet."
The process of privatising the bank would be unlikely to start until regulatory changes to the British banking system were complete, and the timing of any share sale would ultimately be decided by the UK government, he added. But he said he hoped it could get under way next year.
“The strong near-term economic outlook provides an opportunity to address longer-term priorities,’’ Masood Ahmed, the Director of the Middle East and Central Asia Department, said in an e-mailed statement today. “Key steps will be to continue progress in diversifying the economy, building on the positive business environment, and continuing to improve access to finance” for small businesses.
Qatar looks like it has knocked on the head any chance of an upgrading by the index compiler MSCI to "emerging market" status.
The chairman of the country's exchange said ownership limits, a key element in the nation's potential for an upgrading from "frontier market" status, would continue to stand at 25 per cent. There had been talk of lifting the limit to 49 per cent, potentially prompting an influx of foreign direct investment.
As delegates from countries that hold two-thirds of the world’s reserves gather in Cairo tomorrow for a one-day meeting of the Gas Exporting Countries Forum, customers from France’s GDF Suez SA to EON AG of Germany are urging producers to link prices to spot markets instead of insisting on long-term contracts that shadow the fluctuations of oil. Contract prices will rise about 15 percent in the next quarter alone, according to Wood Mackenzie Ltd., an Edinburgh-based energy consultant.
“The European contract price of gas is going up,” said Thierry Bros, a senior analyst at Societe Generale SA in Paris. “Utilities won’t sign new oil-linked contracts.”
Lenders in the world's No.3 crude exporter will be required to comply with qualitative, quantitative and reporting requirements on liquidity risk management, effective from September, according to the circular sent to banks.
"The aim of this liquidity regulation is to reduce the frequency and severity of banks' liquidity problems," the circular said.
Even before the Tohoku earthquake and tsunami reminded the world that nuclear power is not risk-free, the liquefied natural gas (LNG) market was booming in Japan. In fact, the LNG market has been booming throughout Asia for the last several years. That's good news for Australia...and for a variety of companies that serve the LNG industry.
Currently, Japan is the largest buyer of LNG. Japan and South Korea together make up 53% of current global regasification capacity. (That is, the ability to import LNG and turn it back into a gas for consumer and industrial use.)
Pressed against this new demand is an aging supply base in places. For instance, there are old LNG fields in Malaysia and Indonesia coming to the end of their useful lives.