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Sunday, 16 October 2011

Buy Dubai debt - Zawya

 Dubai has come a long way in a short period of time. From being shunned by investors after it infamously requested a debt standstill from creditors in November 2009, the emirate has made a number of painful cuts and significant restructuring of key companies.

The emirate has matured considerably, swallowed its pride, shunned projects that did not add value and brought down debt during the period.

Unrest around the emirate has also made it look better than its peers, such as Bahrain and Egypt, and the support down the road from Abu Dhabi has shored up investor confidence.

MENA stock markets close- October 16, 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)

Qatar Shares Rise to Highest in Three Weeks on Earnings Optimism, Oil Gain - Bloomberg

Qatar’s shares rose to the highest level in more than three weeks on optimism third-quarter earnings will increase following government stimulus programs and after oil gained last week. Israel’s benchmark rallied.

Industries Qatar QSC (IQCD), the Middle East’s second-biggest petrochemicals company, rose 0.8 percent. Masraf Al Rayan, the country’s second-largest Shariah-compliant lender, advanced to the highest this month, lifting the Qatar Exchange Banking Sector Index 0.6 percent. The QE Index (DSM) climbed 0.5 percent to 8,437.61, the highest since Sept. 22, at the 1 p.m. close in Doha. The Bloomberg GCC 200 Index (BGCC200) slipped 0.2 percent at 2:21 p.m. in Riyadh, while Israel’s TA-25 Index surged 4.5 percent, the most since April 2009.

“We are positive on banks and industrial sectors” in Qatar, said Nabil Farhat, a partner at Abu Dhabi-based Al Fajer Securities. “The government has embarked on a spending program to stimulate the economy, and the central bank adopted an expansionary policy which is positive for economic growth and the stock market.”

Kuwait wealth fund aims to boost China investments -

Kuwait Investment Authority (KIA), the Gulf state's sovereign wealth fund, plans to boost its investments in China after opening an office in the world's second largest economy, a KIA official told the state news agency.

"China has huge potential, which presents opportunities that KIA can seize on the back of China's steady economic growth," Fahad al-Shatti, the head of KIA's newly opened office in China, was quoted as saying by KUNA on Sunday.

Kuwait, the world's No. 6 crude exporter is one of the richest countries globally with its sovereign wealth fund, KIA, managing assets in excess of $290bn. It owns stakes in companies such as Citigroup, Daimler and was a cornerstone investor in the initial public offerings of Agricultural Bank of China and insurer AIA Group.

National Bank of Kuwait Denies Exposure to First Investment - Businessweek

National Bank of Kuwait SAK said it didn’t have exposure to First Investment Co., a Kuwaiti Islamic finance company known as Al-Ola, and denied a report that it was part of a debt restructuring accord.

“NBK denies signing any restructuring debt agreement with Al-Ola Investment," the bank said in an e-mailed statement today. ‘‘We did not take part in this agreement and we do not have any relationship with or exposure to Al-Ola Investment.’’

Al-Ola Chief Executive Officer Khalid al-Sanaousi told Bloomberg News on Oct. 13 that the company signed an agreement with its creditors to restructure 92 million dinars ($334 million). He said National Bank of Kuwait, Kuwait Finance House, Burgan Bank SAK, Kuwait International Bank, Commercial Bank of Kuwait SAK and Boubyan Bank were part of the accord signed in February.

IDBI Bank to raise $1 billion via bonds in 12 months - The Economic Times

State-owned IDBI Bank today said it would raise around USD 1 billion (about Rs 5,000 crore) over the next 12 months through bonds from overseas.

"We plan to raise USD 1 billion overseas in tranches over one year," IDBI Bank Chairman and Managing Director R M Malla told PTI.

The raising of funds would be done under Medium-Term Note (MTN) programme and they will be utilised to expand overseas operations through its Dubai branch.

WAM | Trading of Dubai Gold Securities rises 1,280% on NASDAQ Dubai

Trading of Dubai Gold Securities (DGS) on NASDAQ Dubai reached 8,761 securities in the third quarter of 2011, an increase of 1,280% from the first two quarters of the year combined.

DGS closely track the spot price of gold and are structured products that can be traded on NASDAQ Dubai through a broker, just like equities. DGS are backed by gold in a bank vault and can be held without the inconvenience of holding physical gold.

NASDAQ Dubai outsourced the trading of DGS to the trading platform of Dubai Financial Market on October 10, 2011 in order to facilitate access by DFM's retail investors. NASDAQ Dubai's equities have traded successfully on DFM's platform since July 2010.

Exclusive:Saudi central bank not interested in distressed assets | Reuters

Saudi Arabia's central bank is not interested in buying distressed or speculative assets such as troubled European debt and gold and the OPEC member's banks are well positioned to withstand the euro zone crisis, its head said on Saturday.

The world's No. 1 oil exporter like most of its Gulf Arab neighbors is a major holder of dollar assets as its riyal currency is pegged to the greenback and crude accounts for 85 percent of its budget revenue.

Asked if the Saudi Arabian Monetary Agency had considered buying European sovereign bonds such as Italian ones, Governor Muhammad al-Jasser told Reuters: "We do not buy specific bonds at all. We have not done it."

FDI flows decline for 2nd consecutive year in 2010

In 2010 foreign direct investment flows (FDI) to the GCC declined for the second consecutive year since the end of the financial crisis to level at $39.8 billion, according to UNCTAD’s World Investment Report 2011 (Chart 1). The GCC, however, still accounts for more than 60% of all foreign investment flows to the Arab world. In spite of the improved economic conditions in 2010, FDI flows to the region registered a drop of 15.3% compared to 2009. Lingering caution by private investors in the wake of the financial crisis, constrained credit to the private sector, and the suspension, cancellation or completion of a number of mega-projects that had hitherto been responsible for sizeable investment flows, are cited as major contributing factors.

The decline in FDI inflows to Saudi Arabia—the historically pre-eminent destination for FDI in the GCC—by 12.4% to $28.1 billion in 2010, for example (see Chart 2), came in part as a result of certain joint-ventures with foreign partners, such as those petrochemical projects between Saudi Aramco and Conoco Phillips and Dow Chemical being cancelled or suspended.
In Qatar, the completion of the last of the LNG Qatargas trains in 2010 resulted in a significant drop in FDI of almost 32% from the previous year.

Kuwait would certainly not have experienced such a sizeable drop in FDI were it not for the uncharacteristically high FDI inflows of $1.1 billion the country received in 2010 due to the recapitalization of Gulf Investment Corporation (GIC), a Kuwait-based but wholly GCC owned investment company that was especially hard hit by exposure to toxic assets. The country’s basic level of FDI over the last decade—a mere $313 million a year on average—is by far the lowest in the GCC (GCC average is $44 billion per annum) and among the lowest in the wider MENA region.

Arab states can use economics to push Syria - The National

Ibrahim Al Shaibani, a 10-year-old from Damascus, died on Friday after security forces shot him in the chest while he took part in an anti-regime demonstration. He is one of the 187 children killed in the clampdown that began with the uprising seven months ago. The pictures of doctors trying to resuscitate him should be foremost in the minds of Arab foreign ministers who meet in Cairo today.

So far, Arab countries have not taken any really meaningful steps against Damascus. Saudi Arabia, Kuwait and Bahrain have recalled their ambassadors. That is about it. The Arab League called on the Assad regime to embark on reforms, but it has become obvious that President Bashar Al Assad will not be persuaded to end the violence, simply because his regime will crumble if he does.

The spectre of civil war looms, as the United Nations warned on Friday. The country is boiling with anger. Three thousand people are known to have been killed but the real death toll can only be guessed. Tribal, ethnic and religious leaders are all being targeted by the regime.

Lack of regulation leads to a free-for-all in legal practices - The National

For international law firms, setting up a practice abroad usually requires jumping through a number of regulatory hoops. But in the UAE, it can be as simple as just choosing where to set up shop.

This country is one of the few legal markets lacking any real regulations on international legal practices. It is also one of the few environments where a legal practice, at least for lawyers who do not litigate, operates under very few restrictions.

The legal profession has, until now, been as liberal as could be, but there are questions as to whether that needs to change.

Arab states look to diaspora as they rebuild - The National

The World Bank has come up with a novel plan to help rebuild "Arab Spring" economies - people power.

In a move to raise funds to reconstruct nations hit by unrest, the bank is recommending that bonds be issued and financed by nationals of those countries who work abroad.

So-called diaspora bonds could help to generate more than US$1 billion (Dh3.67bn) in each African nation, including those affected by unrest, said Dilip Ratha, a World Bank economist.

Bridging the gulf between GCC laws and the West -

GCC nations have attempted to modernise and standardise their legal frameworks in the past 30 years to encourage foreign investment in this rapidly growing region.

But how much investment can be expected when foreigners can’t own their businesses outright and business debts are secured by a cheque?

The nations that constitute the Gulf Co-operation Council (GCC) - Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE) - have deep-rooted and complex legal traditions.

Investors keen on heavyweight Qatar - The National

Qatar's stock market will take its cue from a stream of quarterly reports this week that could shape investor views on the country's banking sector.

"Investors are expecting good earnings from the banks that haven't reported," said Joe Kawkabani, the chief investment officer for equities at Franklin Templeton Investments. "From the ones that have, loan volumes have been impressive, and non-performing loans have declined after the government raised wages and announced infrastructure projects for the 2022 football World Cup," he said.

Qatar, the biggest exporter of liquefied natural gas, expects economic growth of about 16 per cent and projects a budget surplus of 6.1 billion rials this year. The IMF forecasts growth of about 19 per cent this year, making Qatar's the world's fastest-growing economy for a second year.

Shell's Qatar gas project a winner - The National

GCC countries have woken up to the prospect of adding value to their primary export products, crude oil and natural gas, as the growing petrochemical complexes in Ruwais, Abu Dhabi, and in Saudi Arabia's Jubail and Yanbu testify.

But in terms of scale and ambition, the latest addition to Qatar's Ras Laffan industrial park is unmatched. At a cost of at least US$18 billion (Dh66.11bn), Shell is putting the finishing touches to a gigantic gas-to-liquids (GTL) plant. Once it is fully operational, which is expected to be by early next year, the Pearl GTL project will produce a total of 260,000 barrels per day (bpd) of marketable output, much of which will be products such as gasoil, a form of diesel, and kerosene, to be used as aviation fuel. Pearl is by far the biggest industrial hydrocarbons project to date. Over the life of the plant, it will process 3 billion barrels of oil equivalent of gas.

By entering a production sharing agreement with the state-owned Qatar Petroleum, Shell is funding the entire project but will be able to recover the investment costs as well as receive a share of the profits.

Oman's quieter revolution |

It is generally accepted among regional contractors that the shift in construction activity in the last three years has moved to the three rich states of Abu Dhabi, Qatar and Saudi Arabia.

Their oil and gas wealth has largely insulted them from the wider global shocks, even if the speed of activity in the countries varies.

Though the size and number of new projects in these markets from new economic cities to endless tall towers and complete football world cup masterplanning justifies the resulting shift in companies’ resources, Oman has steadily emerged with some substantial projects and plans.

gulfnews : Oman's economic performance is laudable

Numerous indications point to success of Omani authorities in coping with local challenges on the one hand and benefiting from international developments on the other. Positive news includes growing budgetary spending without sparking inflation as well as a steady rise in oil output.

Oman's oil output amounted to 882,000 barrels per day (bpd) in July, the highest in many years. As such, oil output averaged some 878,000 bpd at the start of 2011, up from 858,000 bpd in the corresponding period in 2010. Yet oil production capacity stood at 760,000 bpd in 2008.

Like other Gulf Cooperation Council (GCC) countries, the petroleum sector accounts for three quarters of Oman's treasury income, divided between 62 per cent for oil and 13 per cent for gas. Still, Oman is not a member of the Organisation of Petroleum Exporting Countries (Opec) and thus is technically free to raise output levels when deemed necessary. However, the country is noted for adopting conservative policies across the board, oil not excluded.

Abu Dhabi inflation slows to 1% as housing prices drop - Arab News

Abu Dhabi's annual inflation rate slowed to 1.0 percent in September as housing and transport prices in the Gulf emirate edged lower, data showed on Saturday.

Inflation had been edging higher over the past year in the emirate, which accounts for roughly 60 percent of the United Arab Emirates economy and invests billions of dollars in industry, tourism and infrastructure to diversify away from oil.

Consumer prices eased on an annual basis in September after a 1.6 percent rise in the previous month, data from the Statistics Centre Abu Dhabi (SCAD) showed.

gulfnews : Dubai-based oil retailer Enoc expects loss of Dh2.7b in 2011

Dubai-based oil retailer Emirates National Oil Company (Enoc) said on Saturday the cost of providing subsidised fuel to its customers is expected to lead to a loss of Dh2.7 billion for the company this year.

"The current scenario, where Enoc has to bear the burden of higher international fuel prices while at the same time distributing fuel at subsidised rates, is clearly not sustainable or viable for the company.

"Enoc looks forward to the support of the concerned authorities in addressing the concern," the company said in a statement.

gulfnews : Gulf nations will spend $45b to expand power generation

Utility demand in the GCC is expected to grow 7 per cent to 8 per cent every year, with Gulf countries expected to spend $45 billion (Dh165.26 billion) before 2015 in order to add 32,000 megawatts of capacity, a report released by the Kuwait Financial Centre (Markaz) says.

It states that there are 361 power projects underway in the GCC at a total value of $277 billion, with 70 per cent of them in Saudi Arabia and the UAE. Saudi Arabia has the highest number at 161, followed by the UAE with 70.

The GCC countries have been trying to increase their power generation capacity for some years, the report points out, in an effort to meet rising demand from growing populations and economies.