Sunday, 5 June 2011
The IMF praised the government's attempts to stabilise the economy since the uprising that toppled President Hosni Mubarak in February.
The uprising scared away tourists and investors and cut tax revenues, which has left the government short of cash.
The first six months of this year have not been easy for the Egyptian economy. The political unrest that ousted the president and uncertainty over the country’s direction triggered a drop in tourism revenues, low levels of domestic and foreign investments and scarce employment opportunities in the formal private sector. Economic growth is expected to drop from an early forecast of 5.5% to a maximum of 2% for the 2010-11 fiscal year, the country’s lowest growth rate during the past decade.
Meanwhile, government expenditures are steadily rising, following a 15% hike in civil servants’ wages and a budget increase in food subsidies to soften the burden of high prices in global markets. The government’s budget deficit for the 2010-11 fiscal year could exceed 10% of GDP, up from 7.6% projected before the unrest began.
As a result, the Egyptian government is struggling to fund a gap of around $20 billion and to budget confidently for the coming fiscal year, which begins next month. There are ongoing negotiations with international institutions — primarily the International Monetary Fund (IMF) and the World Bank — as well as talks with Egypt’s traditional partners: the United States, the European Union and the Persian Gulf states.
While the survey is now in its sixth year, this is a newly launched institutional edition, which focuses on understanding the perspectives of the top 30 financial institutions investing in regional real estate markets. This latest version highlights two clear trends.
First, the amount of overseas capital allocated to investing in MENA real estate is negligible.
|TASI (Saudi Stock Market)||6626.94||0.03%|
|DFM (Dubai Financial Market)||1566.71||0.02%|
|ADX (Abudhabi Securities Exchange)||2666.16||-0.24%|
|KSE (Kuwait Stock Exchange)||6290.4||-0.76%|
|BSE (Bahrain Stock Exchange)||1337.42||-0.13%|
|MSM (Muscat Securities Market)||6042.57||-0.64%|
|QE (Qatar Exchange)||8156.6||-1.02%|
|LSE (Beirut Stock Exchange)||1365.56||0.26%|
|EGX 30 (Egypt Exchange)||5445.01||1.55%|
|ASE (Amman Stock Exchange)||2161.73||0.45%|
|TUNINDEX (Tunisia Stock Exchange)||4139.38||-0.11%|
|CB (Casablanca Stock Exchange)||12196.5||-0.03%|
|PSE (Palestine Securities Exchange)||498.81||-0.17%|
Orascom Construction Industries (OCIC), Egypt’s biggest publicly traded property builder, jumped 2.5 percent. Commercial International Bank Egypt SAE (COMI) advanced the most in almost a week. The EGX 30 Index (EGX30) gained 1.6 percent, the most since May 29, to 5,447.70 at 1:04 p.m. in Cairo. The measure slumped 2.7 percent on June 2 after the government unveiled the capital gains tax on dividends and higher corporate tax bracket to rein in the budget deficit. In the Persian Gulf, the Bloomberg GCC 200 Index (BGCC200) declined 0.3 percent.
“The negative effect we saw last week from the capital gains tax announcement was very short-lived because the market is still trading at a discount and small investors now see that their trading profits will not be affected,” said Ashraf Akhnoukh, senior equity sales trader at Cairo-based Commercial International Brokerage. "There still remains a growth story here.’’
The three companies secured rights to develop the Mansouriya field in Iraq’s eastern Diyala province, while Turkiye Petrolleri and Kuwait Energy won a license for the Siba field in southern Basra province, Oil Minister Abdul Kareem al- Luaibi said. The government awarded rights to both deposits in October, together with a license to a third field called Akkas.
“Iraq needs to develop these fields in order to provide for the needs of its electricity stations,” Luaibi said today during the signing ceremony in Baghdad and in the presence of Turkish Energy Minister Taner Yildiz. “Iraq also aims to become a major source for gas in the future,” the Iraqi minister said.
The HSBC UAE Purchasing Managers' Index (PMI), which measures the performance of the OPEC member's manufacturing and services sectors, fell to 56.0 points in May.
It stood at 57.5 points in April, which was the highest level since the series began in August 2009, with 50 marking the point separating growth from contraction. Four hundred private sector firms take part in the survey.
Qatar already has the world's largest capacity to ship super-chilled gas, and exported its first cargo from the latest plant to come into operation in February. That plant, Qatargas train seven, was the last in its expansion plan to reach capacity of 77 million tonnes of liquefied natural gas (LNG) exports per year.
Qatargas trains six and seven are still ramping up, Saad Abdullah al-Kuwari, chief executive of Qatar International Petroleum Marketing Co (Tasweeq), told Reuters in an interview.
"The parties have together decided to end negotiations for the proposed combination of businesses after final terms could not be agreed," the statement issued late on Saturday said.
"As a result, the existing governing, operational and financial structures in place at the Banks will remain unchanged."
"The market in Saudi Arabia is down today...With oil prices going down, other major stock markets of the region in Dubai, Abu Dhabi and Qatar may see some more downsides," Mousa Haddad, Head Trader with National Bank of Abu Dhabi Asset Management, told Gulf News.
At 1,520, there's a very strong support level for the Dubai market, while for Abu Dhabi the support level is at 2,620. For the Saudi market the support level is around 6,500," Haddad added.
The American military uses the term to describe the systematic destruction of an opponent's fighting capability, usually by remote warfare weapons such as cruise missiles, drones or "smart" bombs.
In Libya, the damage has been done by Nato attacks using some of those techniques, as well as by more conventional assaults in support of the western-sponsored rebels.
Some 67 per cent of chief financial officers surveyed in the Middle East and North Africa (Mena) region say they are decidedly optimistic about the financial prospects of their company now compared to the prior six months. That is up 21 points from when the question was first posed at the end of 2009 and marks an 18-month high, says a study from the consultancy Deloitte & Touche.
More than 80 per cent of the surveyed chief financial officers, who cover industries such as energy, manufacturing, finance and hospitality, also believe operating cash flow from their company will rise over the next year. That is substantially higher than the 49 per cent who felt this way during the third quarter of last year.
Palm Hills Developments and Egyptian Resorts are slated to release their first-quarter results in the coming days.
Many developers are being investigated for land purchases completed under the administration of the former president Hosni Mubarak, with some transactions nullified because of corruption.
OMV, in which the International Petroleum Investment Company holds a 20 per cent stake, said its Bina Bawi 3 well had encountered hydrocarbons in one of the primary reservoir targets. The company said it planned to investigate further.
"We are very pleased to announce this discovery of oil. It seems good quality oil and it was flowing to the surface following a drawdown test," said Jaap Huijskes, the OMV executive board member responsible for exploration and production. "We are now going to continue drilling but I am confident that the final results will be promising."
The stock benchmark Tadawul All Share Index fell 1.73 percent to close at 6,624.95 points, the biggest loss since March 15. All 15 industry groups dropped.
Saudi Basic Industries Corp. and National Industrialization Co. fell more than 2 percent. Al Rajhi Bank, the kingdoms largest publicly traded lender by market value, declined 1.7 percent.
Mr Joyce and Mr Lee are accused of profiting from the sale of land that had been earmarked for a colossal high-rise development, which was to include the futuristic construction known as the Atrium, but which has never got off the ground. In a very Australian story, the two men are accused of deceiving the buyer of the plot, the Gold Coast developer Sunland, and harming Nakheel, Dubai Waterfront's parent company.
Since their arrest in January 2009, Mr Joyce and Mr Lee have maintained they are innocent. Their passports confiscated, neither allowed to work, they are trapped with their families in a city where food prices are soaring and rent remains expensive despite the property crash. If convicted, the men could face long jail terms in the Middle East.