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Wednesday, 12 December 2012

Heavy loss results in credit rating cut for Kuwaiti bank - The National

Kuwait's fifth-largest lender by assets had its credit rating cut yesterday after a multimillion-dollar loss in the third quarter.

Commercial Bank of Kuwait's (CBK) local and foreign-currency deposit ratings were lowered to A3 from A2, said Moody's Investors Service. A3 is the fourth-lowest investment grade at the agency.

"[The] rating action is [mainly due to] the ongoing pressure on Commercial Bank of Kuwait's asset quality, primarily driven by its high exposure to the construction and real estate and investment sectors," the Moody's analysts Stathis Kyriakides and Yves Lemay said yesterday.

UAE project spending to increase next year - The National

Three in four industry figures believe that project spending in the Middle East will increase next year, according to a survey, with the UAE tipped to invest the most.

An upgrade to the energy sector, and massive government spending on infrastructure will boost the projects market next year, finds the survey by PricewaterhouseCoopers (PwC).

"In terms of where that growth is coming from, it's predominantly the energy sector, and large government infrastructure programmes," said Jonathan Roe, an author of the report at PwC.

Shuaa in final phase of shutting retail share-trading business - The National

Shuaa Securities has started the process of transferring client accounts to third party brokers, marking the final phase of shutting its retail share-trading business.

Shuaa Capital, the Dubai-based investment bank and parent company, will retain institutional clients and high net worth clients, acting as advisers and executing share-trades through another company.

"We are encouraging clients to go and find someone else to do brokerage with," said Oliver Shutzmann, the spokesman at Shuaa Capital. "We have been in talks with the regulator, there is a process we have to follow. We are in the final stages of closing retail brokerage."

Big two UAE banks not ready for 'chip and pin' debit cards - The National

The UAE's two biggest banks have warned that they are not yet ready for a December 31 deadline to introduce chip and pin debit cards.

National Bank of Abu Dhabi customers who expected to receive cards with the new security features by the new year are likely to be disappointed after the lender confirmed it was still not ready for them.

It wants the Central Bank to postpone an impending deadline to implement the technology on debit cards to next year.

Dynamic duo will work and grow in tandem - The National

The shiny new cranes at Abu Dhabi's Khalifa Port have been in motion since it opened on September 1, establishing itself as the main sea port for Abu Dhabi, taking over from the smaller city-based Port Zayed facility. Equipped with some of the largest sea-to-shore cranes in the world, the port will be capable of handling 2.5 million 20ft equivalent units (TEUs) a year, a figure that could rise to 15 million by 2030.

Women in the Boardroom |

Returning from Qatar after delivering a public speaking programme to an executive women’s team, I can really see that there is a huge amount of untapped talent just waiting outside the boardroom door and yet we see that their actual representation around the table, is very low.
According to Shamsa Saleh, CEO of Dubai Women’s Establishment, the UAE female participation in the public sector is recorded at over 50 per cent with a 22 per cent of women presence in the boards’ positions. But their presence is quite low when it comes to the private sector at 1.5 per cent only.
It doesn’t mean that women are unable or don’t have the skills to compete in a man’s world, particularly in the Middle East, but there are still many challenges along the way.

Abu Dhabi celebrates 50th anniversary of its 1st crude shipment |

Abu Dhabi Marine Operating Company (Adma-Opco) late on Tuesday celebrated the 50th anniversary of the first crude oil shipment from the emirate.
The shipment of crude produced at Abu Dhabi’s Umm Shaif field and exported from Das Isaland on july 4, 1962 is considered a turning point in the history of the UAE as it ushered in a new era of drastic transformation of the country from a barren desert region that relied heavily on fishing and pearl diving to a booming economic hub.
Abu Dhabi produces more than 90 per cent of the UAE’s crude oil output, the bulk of which is exported.

Egypt’s accusations don’t hold |

Economic consequences of the so-called Arab Spring can be summarised in the drastic deterioration in economic conditions and the subsequent decline in economic performance of all sectors with no exception, as well as an increase in unemployment rates and outflow of local and foreign investments.
On the financial level, the Arab Spring countries, except for Libya — the oil-rich country — are on the verge of bankruptcy. The economic hardships can be obviously noticed in the sharp decline in reserves and deterioration in stock markets, thus prompting their immigrant manpower abroad, especially in the GCC countries, to increase remittances back home, which have been badly affected by the Arab Spring. This happened with an aim to contribute to the basic needs of their families due to inflation and high prices — a fact that helped to prevent the full collapse of financial conditions there.

Project Abu Dhabi: Piecing together the emirate's future - The National

Abu Dhabi took a giant step towards its industrial future yesterday with the official launch of the Dh26.5 billion Khalifa Port.

At 12 noon on the 12th day of the 12 month of 2012, the President, Sheikh Khalifa, declared the region's largest automated port open for business.

The port's target of 15 million container units a year in the next 20 years will place it alongside Shanghai, Hong Kong and Singapore as one of the biggest in the world.

View Project: Abu Dhabi in a larger map

JLR and Saudi Arabia: Desert rovers | The Economist

IT HAS been a busy time for Jaguar Land Rover (JLR). In the past three months the British-based but Indian-owned luxury carmaker has launched the all-new Jaguar F-Type sports car, a radically redesigned Range Rover SUV (pictured) and the Jaguar XFR-S, a high-performance sedan. It has started work on a new assembly plant in China with its local partner, Chery. And now it has signed an agreement with Saudi Arabia to look into building factories there to make parts, and perhaps finished cars.

For JLR the main attraction of the desert kingdom is aluminium. The company is a pioneer in using the lightweight metal in place of steel in its cars. With the new Range Rover it has gone all the way, replacing the traditional steel structural parts with an all-aluminium monocoque body, making it 40% lighter than the previous model.

Saudi Arabia to increase dollar-denominated debt sales - The National

Saudi Arabia will probably boost its dollar-denominated debt sales next year amid more than $500 billion of expansion projects in the largest Arab economy, Deutsche Bank AG said.
Less than 30 per cent, or $2.5bn, of the kingdom's record issuance Islamic bond sales this year were denominated in the US currency, data compiled by Bloomberg show. In the UAE, the second-largest Arab economy, the majority of sukuk offerings this year were denominated in dollars as Gulf yields drop to a record, the data show.

SocGen sells Egypt arm to QNB for $2 billion | Reuters

Societe Generale will sell its majority stake in Egypt's National Societe Generale Bank (NSGB.CA) to Qatar National Bank QNBK.QA for $2 billion, as part of the French bank's bid to meet new capital requirements.

The sale, which is expected to be completed in the first half of 2013, promises a net gain of around 350 million euros ($456 million) and will lift SocGen's (SOGN.PA) core Tier 1 capital ratio by close to 0.3 percentage points by the end of next year under Basel III banking rules, the bank said.

"This means there will be no more questions over SocGen's capital base for 2013," said Natixis analyst Alex Koagne.

Strong demand may prompt Qatar Telecom to rethink $1 billion bond cap

Strong global demand for Qatar Telecom’s imminent 10-year bond offering could prompt the company to reconsider its decision to cap the issue at $1 billion, especially if interest from the United States is robust.

Investors are expected to pile into the issue, viewing it as virtually a sovereign issue priced at a small premium to Qatar government bonds and as a rare chance to invest in a corporate bond in the cash-rich state, the world's top liquefied natural gas exporter.

After price guidance was set on Wednesday, the issue from the majority state-owned telecoms operator was bid up +0.375 in grey trading, an indication of strong appetite for the paper, which is backed by Qatar Telecom’s (Qtel) solid A credit rating from Standard & Poor’s.

Qatar considers investing in Greece’s defense sector -

Qatar is considering investing in some areas of Greece's defense sector.

Possible companies of interest include the state-owned Hellenic Defense Systems and Hellenic Vehicle Industry, which the Greek government is considering privatizing.

Other major Greek armament companies include EADS 3 Sigma, Econ group, Elviemek, Hellenic Aerospace Industry, Hellenic Arms Industry, OMI Ordtech Military Industries and Pyrkal.

Gulf states held back by sheer volatility -

For the past four decades, the Gulf Cooperation Council states have shown remarkable economic growth, yet they are still challenged by a volatility they need to eradicate if they are to diversify away from oil and become powerhouse emerging economies.
Between 1992 and 2011, the standard deviation of the GCC, excluding Kuwait, for economic growth – a measure of volatility – ranged from 2.65 per cent in Bahrain to 6.6 per cent in Qatar, compared with 1.67 and 2.1 per cent in high-income OECD countries and China respectively.
The economic volatility is compounded by several factors.

Qtel sets final terms at T+175bp - Yahoo! News Maktoob

Qtel (A2/A/A+) has launched a 10-year USD1bn bond at 175bp over Treasuries, inside initial guidance of 187.5bp area after the book exceeded USD11bn.
The telecoms firm is expected to price the February 2023 note today via Barclays, HSBC, Mitsubishi UFJ, Mizuho, Morgan Stanley and QNB Capital.

MIDEAST MONEY-Iran's stock market rally defies economic slump, raises risk of a bubble - Yahoo! News Maktoob

Iranian share prices have rallied 40 percent in the past four months, at odds with the country's deteriorating economic fundamentals under the weight of sanctions and raising the risk of a stock market bubble, analysts say.
While a weak currency, high unemployment and double-digit inflation are contributing to a contraction in the Iranian economy as Western sanctions crimp the country's energy and banking sectors, some listed companies are benefiting as a sharp currency devaluation has made them much more competitive.
That is boosting the share prices of companies like Sina Chemical Industries, up 145 percent since October, and Abadan Petrochemical Co., up 18 percent in that time.

MENA stock markets close - December 12, 2012

 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)

Nakheel makes $57m sukuk payment - Sukuk -

Nakheel Properties has made a AED210m (US$57m) payment to sukuk holders as part of its debt restructuring deal which repays trade creditors 40 percent in cash and 60 percent via the Islamic bond.
The sum takes the total amount paid to trade creditors to AED9.6bn (US$2.6bn) since November 2009, the developer said.
The Dubai-based real estate firm also said that property prices in Dubai are starting to show signs of stability.

STOCKS NEWS MIDEAST-Egypt rises to 3-wk high; Saudi up - Yahoo! News Maktoob

Foreign buying lifts Egypt's bourse to a three-week high, helping the index recover most of the losses sparked by President Mohamed Mursi's decree last month that expanded his powers and triggered a political crisis.
Cairo's index jumps 2.8 percent to 5,158 points, its highest close since Nov. 22.
Palm Hills Development surges 9.4 percent, the most active stock on the index. Talaat Mostafa Group
follows, with a 6.4 percent gain. Citadel Capital climbs 6 percent.
Arab and non-Arab foreign investors are net buyers on the bourse, according to its website.

UPDATE 3-Iraq-Saudi OPEC standoff over next oil curbs | Reuters

A new rivalry at the top of the OPEC oil group has emerged, pitting up-and-coming Iraq against undisputed cartel heavyweight Saudi Arabia.

Having overtaken Iran as OPEC's second biggest producer, a rejuvenated Iraq is beginning to worry Riyadh.

At Wednesday's meeting of the Organization of the Petroleum Exporting Countries the opening salvos were fired in the struggle over who takes responsibility for cutting output if oil prices, now at a comfortable $108 a barrel, start falling.

UAE's Union National Bank in $250 mln tap of 2016 bond - Yahoo! News Maktoob

Abu Dhabi-listed Union National Bank will sell an additional $250 million in bonds to its existing 2016 maturity, arranging banks said on Wednesday. The bond was launched at 2.65 percent, slightly tighter than guidance indicated earlier in the day, signalling demand for the deal was healthy.
A tap means the new bond is issued at original face value, maturity and coupon but sold at current market price.
Yields on UNB's $400 million 2016 bond, which carries a coupon of 3.875 percent, have tightened this year, thus lowering the issuer's borrowing costs.
The bond was bid at 104.5 cents on the dollar on Wednesday afternoon, to yield 2.64 percent, according to data provided by Deutsche Bank Autobahn.

Dana Gas flares on bond deal -

Dana Gas, the Abu Dhabi-listed energy company, has seen its share price climb since unveiling details of its $1bn Islamic bond restructuring deal on Monday.
Dana Gas, which has had to overcome cash flow issues because of late payments in troubled Egypt and Iraqi Kurdistan, offered a $70m cash payment to the creditor group led by Ashmore and BlackRock.
Dana, the region’s largest private gas producer, will cancel $80m of the sukuk it had bought earlier in the market. The remaining $850m will be rolled into two new sukuk instruments: regular, which pays a profit rate (sharia equivalent of interest) at 9 per cent. The other instrument, a convertible, will pay a profit rate of 7 per cent.

BP back in running for Abu Dhabi contract -

BP is back in the running for Abu Dhabi’s onshore oil concession after its unexpected earlier omission from a bidding round in which diplomatic tensions and the changing geopolitics of oil have loomed large, people familiar with the matter say.
The company was not invited over the summer to pre-qualify for bidding for the renewal in January 2014 of the emirate’s 1.4m barrel a day concession, even though it is one of four western majors that hold stakes under the existing 75-year deal.
Many observers saw the action as a calculated snub, reflecting a political disagreement between Abu Dhabi and London, as well as the emirate’s desire to bring in businesses from Asia and elsewhere.

Dubai Group in talks to sell Omani stake - sources - Banking & Finance -

Dubai Group, an investment vehicle restructuring US$10bn of debt, is in talks to sell its stake in Oman National Investment Corp Holding (ONIC), three sources aware of the matter said on Wednesday.
Dubai Group, part of Dubai Holding, the personal investment firm of the emirate's ruler Sheikh Mohammed bin Rashid al-Maktoum, was hit hard by the global financial crisis and is considering asset sales to cut debt.
Based on the Omani company's current market value, Dubai Group's near-42 percent stake would raise about US$54m. The sources were not aware of the name of the potential buyer.

Iraq to Pay Kuwait $500 Million in Few Days to End Air Dispute - Bloomberg

Iraq will pay Kuwait Airways Co. $500 million compensation in a few days to settle a debt dispute, allowing Iraqi Airways to start flights to Europe for the first time since 1990, an Iraqi airline official said.
Iraqi Airways will operate flights to the U.K. and Frankfurt by the end of January after state-run Kuwait Airways drops its legal claims against the carrier, Saad al-Khafaji, director general of Iraqi Airways, said in an interview today. The Iraqi airline is also negotiating routes to Kuala Lumpur, he said in Baghdad.
Kuwait in October endorsed by decree a deal reached with neighboring Iraq in July to settle the financial dispute “and stop litigations in this regard,” the state-run KUNA news agency reported at the time.

STOCKS NEWS MIDEAST-Kuwait gains for 4th day; UAE mkts slip - Yahoo! News Maktoob

Kuwait's bourse gains in strong trading value, up for a fourth straight session, as investors bet on stronger
fourth-quarter earnings.
The index climbs 0.2 percent to 5,932 points, rising 3.1 percent so far this month.
Large-caps are mixed. National Bank of Kuwait slips 1 percent, National Mobile Telecom gains 0.9 percent and Ahli United Bank climbs 2.5 percent.

UPDATE 1-Qatar Telecom to raise $1 bln from 10-yr bond sale - Yahoo! News Maktoob

Qatar Telecom (Qtel), the majority state-owned telecoms operator, is looking to raise $1 billion from a ten-year bond, lead arrangers said on Wednesday, in its first bond market foray in more than two years.
Final price guidance for the bond, maturing February 2023, has been set at a spread of between 175 - 180 basis points over U. S. Treasuries, a document released by lead arrangers showed, and the bond will price within this range.
Guidance tightened from indications earlier in the day due to strong demand for the bond. Order books were north of $11 billion at 1000 GMT, according to IFR Markets, a Thomson Reuters unit.

Global institutional investors want to invest $550m in Dubai commercial real estate despite 50% vacancy rate « ArabianMoney

Some of the world’s biggest institutional investors and sovereign wealth funds have been looking to invest $550 million in Dubai commercial real estate this year, property agent CBRE told The National newspaper today, despite a Dubai office vacancy rate set to hit 50 per cent.

Why would these ultra professional investors be interested now when they avoided Dubai in the boom years? For one thing commercial real estate is going cheap and for another business prospects are improving rapidly in Dubai as the economy picks up thanks to the Arab Spring inflow of capital and people. Legal issues have also been resolved.

STOCKS NEWS MIDEAST-Saudi flat but petchems gains; Egypt rises - Yahoo! News Maktoob

Saudi Arabia's bourse hovers near flat as gains in petrochemical stocks fail to outweigh declines in other sectors.
The index eases 0.02 percent to 6,761 points, holding on to December's gains of 3.5 percent.
NCB Capital raised its rating on National Petrochemical to 'neutral', and remains 'overweight' on Saudi Basic
Industries Corp (SABIC), Saudi International Petrochemical (SPICHEM) and Sahara Petrochemical.
SABIC gains 0.6 percent, SIPCHEM rises 0.3 percent, while Sahara slips 0.4 percent.

Mena able to handle gas crunch - The National

A looming gas crunch in the Arab world can be offset by tapping unconventional reserves, according to a state-backed financier for regional energy projects.

The Middle East and North Africa (Mena) region is home to proven reserves of 88 trillion cubic metres of natural gas, more than 40 per cent of the world's total, says the Arab Petroleum Investment Corporation.

This alone secures supplies lasting more than 30 years, said Ali Aissaoui, a senior consultant at the development bank.

ADX on par with Dubai as roof is raised on daily share gains - The National

The Abu Dhabi Securities Exchange (ADX) has raised the price ceiling by which a stock can rise to 15 per cent from 10 per cent and kept its floor at 10 per cent, bringing its trading practices in line with Dubai.

The stock market also amended the mechanism by which it determined the closing price for a stock, which it says offers a better reflection of its true value.

"Investors have been asking for these changes for some time," said Rashed Al Baloushi, the ADX chief executive.

'Healthy competition' to lead Opec - The National

Opec ministers face a tough discussion today over the future leader of the organisation.

Abdalla El Badri, a former Libyan oil minister known for his diplomatic skill in shepherding members to consensus, reaches his two-term limit at the end of this year, leaving a choice between three candidates at today's output meeting.

The Saudi Arabian candidate, the oil ministry adviser Majid Al Muneef, is in the running and challenged by a candidate from Iran and Thamer Ghadban, a former Iraqi oil minister seen as a possible compromise between price hawks represented by Tehran and doves led by Riyadh.

Kurdistan oil wrapped in red tape - The National

Bureaucratic red tape is hampering efforts to ramp up oil production in Iraqi Kurdistan, with companies struggling to procure equipment and visas.

"It's a barrier to getting there," said Dave Hanson, a project manager at DNO International, which is looking to double output at one of the autonomous region's largest oilfields. "Unfortunately, we can't find a way to work with it, we have to find a way to work around it."

DNO, which last year merged with the UAE's RAK Petroleum, was granted three licences by the Kurdish Regional Government (KRG), and is producing about 100,000 barrels per day (bpd) at the Tawke field. The company is racing to increase production further, and is targeting a capacity of 200,000 bpd by the end of 2014. Time is money, as it needs to empty the field of its 700 million barrels of reserves before DNO's concession expires in 2030.

Clear logic that comes from within the box - The National

Riad Meliti likes to think inside the box. That is not to say he is conventional or orthodox, but rather it explains the basic business philosophy of Arqaam Capital, the investment bank he founded and of which he is chief executive.

"The box" in this instance is a geographical reference. Mr Meliti illustrates it with a passable drawing on a whiteboard of a map of Europe, Africa and Asia, with the bottom half of the map ruled off in a rectangle extending from Indonesia to Morocco, and from Turkey to South Africa.

"There are too many smart minds focused on the Brics," he says, referring to the acronym for the high-growth markets of Brazil, Russia, India and China. "We are looking instead for the greatest opportunity."

Al Ghurair Investment opens two new hotels in Deira |

Al Ghurair Investment, one of the biggest family-owned conglomerates in the UAE, is opening two new hotels on Wednesday as part of its expansion of Al Ghurair Center, the company vice-chairman said on Tuesday.
Al Ghurair Arjaan by Rotana and Al Ghurair Reyhaan by Rotana in Deira will have a combined total of 621 rooms, said Eisa Al Ghurair, vice-chairman of Al Ghurair Investment. The hotels are attached to Al Ghurair Center, one of the oldest shopping malls in Dubai.
Al Ghurair Investment, owned by Abdul Aziz Al Ghurair, has recently appointed Constantin Salameh as group chief executive officer. It is the first time the company board has decided to appoint a group CEO.

100m jobs need to be created in Mena |

The huge gap between the supply of qualified youth and the market requirements is one of the key reasons behind rising unemployment in the Middle East and North Africa (Mena) region, experts at the Global Entrepreneurship Summit (GES) noted on Tuesday.
At 24 per cent, youth unemployment is the biggest challenge facing the region, with around 100 million jobs required to be created in the next few years and experts feel there is no quick fix to it.
Belaid Rettab, Economic Researcher and expert in the Sustainable Business Development Sector at Dubai Chamber, who was one of the panellists who discussed the issue of unemployment and possible solutions, said that a complete revision of education sector is the key.

What Real Estate Crash? Dubai's Towering Ambitions Return - Arabic Knowledge@Wharton

Where can you build the world's biggest mall? How about digging a canal running from the sea under an already built highway? Would it be possible to construct a giant theme park with five different theme parks inside it? It can happen in Dubai.

In years past, the United Arab Emirates' metropolis made a name for itself by planning projects that seemed to be concocted from sheer flights of fancy -- towers that would revolve, an underwater hotel, a suburb replete with mechanized dinosaurs. Some actually came to fruition, such as the Burj Khalifa, the world's tallest freestanding tower, and the man-made Palm Jumeirah island. But most vanished like desert mirages in 2009, when Dubai's debt standstill announcement caused economic shockwaves worldwide.

Owing much to its newfound status as a regional safe haven from Arab Spring discontent, Dubai's economy has inched back. And seeking to capitalize on this momentum, the Emirate's leadership has in recent weeks announced a series of development megaprojects that brought back memories of the days during its boom when outlandish schemes were announced almost daily.

Batista Said to Pledge Extra EBX Stake to Back Abu Dhabi Deal - Bloomberg

Eike Batista, the Brazilian tycoon who sold a $2 billion interest in his commodities empire to Abu Dhabi’s Mubadala Development Co., pledged an additional stake that shields the fund from the selloff in his publicly traded companies, according to a person familiar with the transaction.
Billionaire Batista, under terms of the sale of 5.63 percent of his EBX Group Co. in March, agreed to turn over an unspecified stake in 2019 if he fails to deliver a 5 percent annual return on the sovereign-wealth fund’s investment, the person said, asking not to be identified because the details are private. The person declined to say how the target is measured.
The deal, which Batista, 56, championed as a sign of investor confidence in his interlinking natural-resource and logistics startups, helps preserve Mubadala’s investment if EBX fails to grow or loses value. It also puts Batista’s holdings at risk after his publicly traded companies lost about half their value this year following delays and missed output goals.