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Monday, 8 August 2011

Dubai’s Emirates airline says EU emissions rules could cost it $1 billion over a decade - The Washington Post

Emirates airline says planned European Union emissions requirements could cost the carrier — the Mideast’s biggest — as much as $1 billion over a decade.

Andrew Parker, a senior vice president for the Dubai-based airline, said Monday the EU’s plan would have a “significant financial impact.” He says Europe accounts for nearly a quarter of the carrier’s operations.

EU requirements will eventually force airlines — including foreign carriers — to pay for their emissions as part of its cap-and-trade scheme. U.S. airlines took the EU to court over the proposal last month, arguing it breaches international law.

MENA stock markets close - August 8, 2011

ExchangeStatus IndexChange
TASI (Saudi Stock Market)
DFM (Dubai Financial Market)
ADX (Abudhabi Securities Exchange)
KSE (Kuwait Stock Exchange)
BSE (Bahrain Stock Exchange)
MSM (Muscat Securities Market)
QE (Qatar Exchange)
LSE (Beirut Stock Exchange)
EGX 30 (Egypt Exchange)
ASE (Amman Stock Exchange)
TUNINDEX (Tunisia Stock Exchange)
CB (Casablanca Stock Exchange)
PSE (Palestine Securities Exchange)

Abu Dhabi stocks get lift - The National

Telecommunications and banking lifted Abu Dhabi stocks yesterday as valuations were considered cheaper compared with Saudi Arabia and Qatari markets amid global market turmoil.

Etisalat, the largest telecoms operator in the country, was up 0.3 per cent to Dh2.98 a share. Union National Bank was up 1.2 per cent to Dh3.34, while Abu Dhabi Commercial Bank was up 0.3 per cent to Dh2.98. The Abu Dhabi Securities Exchange General Index was up 0.3 per cent to 2,612.80 points.

'Valuations are good so investors are rotating out of Saudi Arabia and Qatar, whose markets have more exposure to oil, and following the global economic environment,' said Saleem Khokhar, the head of equities at National Bank of Abu Dhabi. 'The UAE never really rallied in the first place, so during a time of turbulence, I would rather be in the UAE than Saudi Arabia or Qatar. That's what it all comes down to.'

Al Gosaibis seek to lift court order - The National

The Al Gosaibi business family of Saudi Arabia has asked a court in the Cayman Islands to lift a freezing order on billions of dollars of assets belonging to the Saudi Arabian entrepreneur Maan Al Sanea.

A statement from the Al Gosaibi's New York law firm, Baach Robinson & Lewis, said the family had 'moved for voluntary dismissal of its worldwide freezing order against Mr Al Sanea and his companies'.

When the order was granted more than two years ago, it was regarded as a significant success for the Al Gosaibi family in their battle against Mr Al Sanea, whom they have accused of fraud. He has consistently denied the allegation. In June the Al Gosaibi family lost a court case in London brought by financial creditors.

Steep fall in oil a threat to Gulf state spending - The National

Falling oil prices and rising fears of another global downturn could put pressure on government spending plans in the Gulf.

Regional governments have poured billions of dollars into everything from new schools to better roads and job creation schemes made possible by an unexpected two-year boom in oil markets.

Earlier this year, Saudi Arabia unveiled US$155 billion (Dh569.34bn) of spending on schools, hospitals and other social infrastructure in the next decade.

Saudi Arabia grapples with gas conundrum -

As the summer sun burns and the air-conditioning units run round the clock, attention in Saudi Arabia focuses on energy demand – and in particular the kingdom’s gas conundrum.

According to the annual report of Aramco, the national oil company, the intention is that production of raw gas – unprocessed natural gas – should reach 15.5bn cu ft a day (bcf/d) by 2015 from 10.2 bcf/d last year.

Progress towards this goal took place last month when the offshore Karan field began production. It is set to produce on average about 0.45 bcf/d through the rest of this year.

Persian Gulf Stocks: Kuwait’s Wataniya Telecom and Qatar Cinema - Bloomberg

Dubai’s DFM General Index (DFMGI) declined 0.8 percent to the lowest since March 17 at the 2 p.m. close in the emirate. Kuwait Stock Exchange Unweighted Index fell 0.2 percent and Qatar’s QE Index (DSM) decreased 0.8 percent.

» In denial—Buying property in Dubai “a dream come true” –

With the US being downgraded by S&P earlier this week, Kipp will be the first to say the future is looking ambiguous. We are not sure what the next few weeks will bring for the US economy, and by extension, the economy of the rest of the world. For one thing, many speculate that the UAE, with its dollar-peg and firm US-backing ways, is in for a tough time ahead.

And though Mohamed al-Tamimi, deputy executive director at the UAE central bank’s treasury department will tell you with much confidence: “We are pegged to the dollar and will keep it. We don’t see the dollar collapse. Because the problem is not in the US only, but also in the European markets. (…) But if the yields go higher to a justified level, there is no reason why we will not invest in US treasuries,” not everyone shares his confidence about the future of the UAE economy.

What with the rollercoaster ride of debt Dubai has been through, there is very little that can be said about Dubai with absolute certainty: except of course that it has one of the most volatile property sectors in the world. Not only do investors lack protection and representation here and the construction projects have been on a perennial pause but so too is the value of the property dropping. Kipp’s written countless articles upon articles highlighting this trend, which is why we were absolutely tickled when we read this article by Gulf News titled “We bought our homes, so can you.”

Oil Continues Big Drop, Moves Closer to $80 on WTI | Arabianomics

When Goldman is right, commodities market pundits line up to praise the investment bank. We’ve praised Goldman for each right call they’ve made regarding oil’s price, and all in all, they’ve had a great year.

But in their latest prediction, they were dead wrong.

As we noted in late May, Goldman, in a significant shift, saw oil at $130 within twelve months. This was an about-face from previous, and certainly more bearish, estimates from the brokerage firm. The bank saw oil at $120 by the end of 2012.

Norton Rose loses four partners in Middle East after "challenging" trading conditions | The Lawyer

Norton Rose has lost four partners and made a new hire from Clifford Chance as part of a major reshuffle of its Middle East practice.

Abu Dhabi-based projects partners Dominic Harvey and Jonathan Brufal are defecting to rival Vinson & Elkins, Dubai-based banking partner Anthony Pallett is leaving for Latham & Watkins and Dubai corporate partner Campbell Steedman will move to White & Case.

As part of the shake-up Norton Rose has also hired debt capital markets of counsel Alex Roussos for its Dubai office from Clifford Chance and will relocate the firm’s Bahrain-based co-head of Islamic finance Mohammed Paracha and Singapore-based conventional banking of counsel Matthew Escritt to Dubai in September.

Dubai investment firm vows to repay $4B in debt - Maktoob News

An investment company run by Dubai's government says it plans to repay in full $4 billion worth of debt coming due later this month.

Monday's announcement by the Investment Corporation of Dubai appears intended to reassure investors amid fresh concerns about the strength of the global economy. Severe debt problems tied to another of the emirate's government-run companies sent world markets reeling in late 2009.

ICD says it plans to cover the $4 billion by the due date of August 21. It has another $2 billion from the same pile of loans that matures in 2013.

Kuwait investors become largest GCC buyers of Dubai real estate | Al Bawaba

Investors from Kuwait now account for nearly 60% of all properties purchased by GCC nationals in the emirate of Dubai, according to new figures from the UAE Ministry of Finance.

Luxury Dubai-based developer DAMAC Properties responded to the figures, by confirming it has observed an increase in inquiries from Gulf investors, particularly Kuwaiti nationals, over the past six months.

“Dubai is only an hour and a half flight from Kuwait, which makes it an ideal location for a second home, or even a primary home for some Kuwaitis. Dubai has always been popular with Kuwaiti investors, but given the price and the quality of properties now available on the market, Dubai offers phenomenal value for money” said Niall Mc Loughlin, Senior Vice President of DAMAC Properties.

Kuwait Hopes Oil Price Rebounds in Few Weeks, Minister Says - Bloomberg

Kuwait hopes oil prices will rebound in the next two or three weeks and “settle” at a level favorable to producers and consumers, Oil Minister Mohammad al- Busairy said.

“It’s very difficult to discuss the price in this situation. We hope the price will recover within two or three weeks from now, but we don’t know,” al-Busairy said in a phone interview today from Kuwait City. “There’s no guarantee about the situation in the States and Europe, and debt in Italy or Spain.”

Oil fell in New York after Standard & Poor’s lowered the U.S. credit rating from the highest level, stoking concern an economic slowdown will worsen and cut fuel demand in the world’s biggest crude consumer. Crude for September delivery fell as much as $3.70 to $83.18 a barrel on the New York Mercantile Exchange and was at $84.44 at 9:39 a.m. London time. The contract slipped to $82.87 on Aug. 25, the lowest intraday price since Nov. 26. Prices declined 9.2 percent last week, the most in three months, and are down 7.6 percent so far this year.

FT Alphaville » What happens when you lose a global oil benchmark…

Another one, somewhere in the world, flourishes…

From the Dubai Mercantile Exchange — the keeper of the world’s only possible alternative to the ailing WTI and Brent crude contracts (for now) — on Monday:

DUBAI, UAE, 8 August 2011: The Dubai Mercantile Exchange Limited (DME) announced today that it set two new trading records during the month of July 2011. The exchange not only achieved the highest average daily volumes, but also saw record physical delivery for its benchmark Oman Crude Oil Futures Contract (DME Oman)since the commencement of trading on the Exchange in June 2007.

Average daily volumes (ADV) for DME Oman Crude Oil Futures Contract (DME Oman) in July stood at 4,427 contracts (equivalent to 4.4 million barrels of oil per day), with a record total of 88,539 contracts traded for the month. This represents a 35% year-on-year increase in trading levels on the exchange. The month also saw DME Oman achieve a new record for physical delivery, with 15.4 million barrels of oil to be delivered in September 2011 through the Exchange, surpassing the previous high of 15.1 million barrels set for delivery in September 2010.

This confirms the status of DME Oman as the largest physically delivered crude oil contract in the world, underscoring to market participants the benefit of robust price discovery through direct linkage to true market supply and demand fundamentals.

StanChart PE arm in first Saudi deal with $75 mln buy - Maktoob News

Standard Chartered's private equity arm is scouting for more deals in Saudi Arabia after buying a minority stake in a Saudi Binladin Group unit for $75 million, its regional private equity head said on Monday.

The investment in Construction Products Holding Co (CPC), the lender's first private equity deal in the Saudi market, will give it a board seat on CPC, the kingdom's largest manufacturer and provider of building materials.

OPEC member Saudi Arabia is seen as an attractive market by large international private equity firms. Carlyle said in April it expects to complete a deal in the kingdom by the end of the year. Another U.S. firm KKR received a license from the regulator to conduct business in Saudi Arabia in June.

gulfnews : Iran oil minister sees big future for Revolutionary Guards' firm

An engineering conglomerate belonging to the Revolutionary Guards, Iran's elite military force, should further expand its role in the economy sector, Oil Minister Rostam Qasemi said yesterday, days after leaving the company to join the government.

Qasemi, who has already said Iran has no need for the foreign companies that have pulled out due to sanctions, told the official Irna news agency that his former employer, Khatam Al Anbia, should be used to fill their place.

'This construction base (Khatam Al Anbia) should become the replacement for big foreign companies,' he said.

gulfnews : New law to allow varied foreign ownership

The UAE government is drafting a federal law for investment in the emirates.

Mohammad Saleh Shelwah, assistant undersecretary for economic policies affairs at the Ministry of Economy, told Gulf News that it would be up to the federal cabinet to set the percentage for foreign investors in projects in the UAE, the second largest Arab economy and foreign investment destination after Saudi Arabia.

'The UAE has completed the drafting of a long-awaited law that could allow foreign investors to have a varied percentage of ownership in some projects, depending on the type of investment and size of the project. [The law] is awaiting final approval before it is enforced this year,' Shelwah said.

With economies in turmoil, oil prices must come down - The National

This does not seem like a global economy that justifies oil prices above US$100 a barrel.

Last week, stock markets around the world were routed and American investors lost $700 billion (Dh2.57 trillion) in a single day.

The US left it to the last moment to avoid default, causing its total public debt to jump above 100 per cent of GDP and the loss of its 'triple-A' credit rating.

US downgrade threat to Gulf borrowing costs - The National

Financial companies in the Gulf face the risk of rising borrowing costs after Standard & Poor's downgrading of the US's credit rating.

The move is raising fresh concern about regional institutions' large holdings of the country's debt.

While no official figures exist on how much US debt Gulf players hold, businesses and governments in the region are thought to have many billions of dollars of US treasuries in their coffers.

Kuwait's Wataniya Telecom Q2 up 18.7 pct to 23 mln dinars | Reuters

Kuwait's National Mobile Telecommunications Co (Wataniya) , the Gulf state's second-largest mobile phone operator, posted an 18.7 percent rise in second-quarter net profit, the firm said in a statement.

The company made a net profit of 23.3 million dinars ($85.2 million) in the second quarter, up from 19.6 million dinars a year earlier, the statement said.

Wataniya, a unit of Qatar Telecommunications Co , said consolidated revenue rose 35.2 percent in the quarter to 182.3 million dinars from a year earlier.

gulfnews : Non-performing loans still an issue for banks in the UAE

The second quarter results of the UAE banks suggest that even after going through 12 consecutive quarters of balance sheet repair many are still struggling with their non-performing loans (NPLs) and mounting impairment provisions.

Thanks to the aggressive deleveraging and cautious lending practices, a number of banks have seen a decline in their provisions in the second quarter of 2011, but at slower pace.

Margins faced an additional squeeze from new central bank regulations on retail loans and fees charged on banking services from May 1 this year.

gulfnews : GCC states to stick with US dollar

The Gulf Cooperation Council (GCC) states, except for Kuwait, which keep their currencies pegged to the US dollar and are major buyers of US government debt will likely maintain the status quo for the foreseeable future despite a downgrade of the world's largest economy by credit ratings agency Standard & Poor's (S&P) on Friday.

Officials from the UAE and Oman spoke in support of the US dollar yesterday.

A senior UAE Central Bank official reaffirmed the country's stance on keeping the dirham's peg to the dollar intact.