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Sunday, 23 June 2013

Kuwait sheikh sues UBS for $21.4 million in Dubai court | Reuters

"A Kuwaiti sheikh is suing UBS AG (UBSN.VX) for $21.4 million, alleging the Swiss bank failed to pay him for helping it become lead arranger on a $9 billion asset sale by the Kuwaiti telecommunications operator Zain, a Dubai court heard on Sunday.

The case highlights the complexity of doing business in the Gulf, where personal connections to high-ranking officials or executives are often valued in deal-making.

Sheikh Meshal Jarah al-Sabah, a member of Kuwait's ruling family, says UBS recruited him with a verbal contract in July 2009 to help scupper the French media conglomerate Vivendi's (VIV.PA) bid to acquire Zain's (ZAIN.KW) operations in about 15 African countries. UBS denies the allegation."

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Iranian currency gains on change in presidency - Your Middle East

"The Iranian rial has strengthened by more than 15 percent against the dollar since the victory of moderate Hassan Rowhani who was elected president more than a week ago, reports said on Sunday.

The Iranian currency was trading at under 30,000 to the dollar on Sunday morning compared to 35,000 a week ago, media and dealers said.

The rial had lost more than two-thirds of its value against the dollar since early 2012 when the United States and the European Union announced new sanctions against Iran's oil exports and access to the global banking system."

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MIDEAST STOCKS-Dubai in largest drop for 15 months; Gulf mixed | Reuters

"Dubai's bourse suffered its largest one-day drop in 15 months on Sunday, while other Gulf markets were mixed as a lack of positive catalysts spurred investors to cash in early-year gains. Trading volumes thinned in a typical summer lull.

The main Dubai index fell 2.6 percent to 2,300 points, a four-week low, in its biggest one-day loss since March 2012. The drop triggered a bearish right triangle formed by the highs and lows since early June, and pointing down to near the 2,100-point area.

However, traders generally blamed profit-taking after this year's gains of more than 40 percent, rather than any fundamental worsening of Dubai's outlook, and did not think the drop indicated Dubai would become dominated by the bearishness engulfing many other emerging markets."

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UPDATE 1-Dubai's Arabtec extends $650 mln share offer period | Reuters

"Dubai builder Arabtec, part-owned by Abu Dhabi state fund Aabar, has extended the subscription period for its $650 million rights share issue, the company said in a statement on Sunday.

The closing date for subscriptions has been extended to July 4 from Sunday, two weeks after its launch on June 9.

Arabtec, builder of Dubai's famous palm islands, has been on an aggressive push for growth after it replaced its chief executive earlier this year in a shake-up led by Aabar, its largest shareholder, which has been tightening its grip on the group."

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France and Qatar end suburbs dispute with new fund | Reuters

"France and Qatar launched a mixed Franco-Qatari fund on Sunday to invest 300 million euros in small and medium-sized French companies, in a bid to quash concerns raised by a previous Qatari plan to invest specifically in depressed French suburbs.

Business ties between cash-strapped France and gas-rich Qatar have deepened in the past five years as the euro zone's second biggest economy behind Germany has overcome instincts for economic patriotism to welcome inward investment in areas ranging from sports to real estate and infrastructure.

But a plan for Qatar to pump 50 million euros into businesses in the suburbs had proved divisive, when they were first floated, with critics concerned that the Gulf state might exercise too much influence and prompting former president Nicolas Sarkozy to put them on hold until after the May 2012 election."

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IMF predicts 3.6% growth in UAE this year |

"A delegation of the International Monetary Fund (IMF) to the UAE has projected a 3.6 per cent growth in the country’s gross domestic product (GDP) this year, the Ministry of Finance said in a statement on Sunday.
The UAE’s economic growth will be driven by investments, trade, tourism and logistics support, the ministry said, citing the IMF delegation’s report. The delegation’s meetings with the UAE government were held from April 30 to May 15.
“This growth is expected to rise to 3.7 per cent in 2014 and 3.8 per cent in 2015,” the report predicted."

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Dubai Inc. Walks the Asset Sale Tightrope - Middle East Real Time - WSJ

"It’s no secret that Dubai’s indebted state-owned firms, part of an amalgam of local companies collectively known as Dubai Inc., have been mulling the sale of numerous investments since striking debt repayment deals with their creditors.

But against a wobbly economic backdrop, the value of most of these assets held by the likes of Dubai World and Dubai Group has plunged dramatically. After all, many were acquired at the top of the market in the mid-2000s when the emirate was engaged in a global, credit-fueled shopping spree.

Dubai Inc. wisely chose not to engage in so-called fire sales. As time went by, however, some lenders have been fretting that the agreed debt repayment deadlines wouldn’t be met unless more asset sales materialized."

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Dubai Holding unit hires Citi for Axiom stake sale -sources | Reuters

"Dubai Holding, the conglomerate owned by the ruler of Dubai, has hired Citigroup to advise on a potential sale of its remaining 26 percent stake in mobile telephone retailer Axiom Telecom, three sources aware of the plan said.

The stake is held by Dubai Holding unit Emirates International Telecommunications LLC (EIT), but the U.S. lender was hired by the holding company, which is taking the lead in the process, the sources said, speaking on condition of anonymity as the matter is not public.

An EIT spokesperson said: "Like any investment company, EIT is always evaluating exit options that are in line with its investment strategy.""

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Abu Dhabi's merged property firms to begin trading on June 30 | Reuters

"Abu Dhabi developers Aldar Properties and Sorouh Real Estate will trade as a merged entity from June 30 with a capital of 7.86 billion dirhams ($2.1 billion), the Abu Dhabi exchange said in a statement on Sunday.

The opening base price of the merged entity will be the closing price of Aldar on the final trading day of June 27, the statement added. Aldar shares fell 4.4 percent on Sunday but have risen nearly 77 percent year-to-date.

Sorouh, the smaller among the two property firms, would be delisted from the Abu Dhabi bourse on June 30."

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Saudi Arabia Shifts Weekend to Friday-Saturday — Riyadh Bureau

"Saudi Arabia has officially changed its weekend to Friday and Saturday, the state news agency reported today. The change will take effect as of this weekend.

King Abdullah has issued a royal decree on Sunday ordering the change of the country’s weekend from Thursday-Friday to Friday-Saturday “for the sake of putting an end to the negative effects and the lost economic opportunities” due to the difference in workdays between Saudi Arabia and the rest of the world.

The change will align banking and business days with most other countries in the region, as well as being closer to the workweek of international financial markets and businesses. Oman was the latest GCC country to shift its weekend to a Friday start last May.

Saudi Arabia’s Shoura Council last April recommended a study to shift the country’s weekend after reviewing a report by the Ministry of Civil Service. The change was first proposed back in 2007, but the Shoura Council failed to pass the proposal then for religious reasons."

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How Ukraine Can Survive 2013 Without the IMF | Opinion | The Moscow Times

"The global bond market rescued Ukraine from budget revenue shortages during the first half of this year allowing it to meet its foreign debt obligations. The Ukrainian government issued successfully a number of sovereign and domestic bonds that were fully subscribed. While this financial influx helped government cover state budget gaps without an IMF program, Ukraine's luck so far does not guarantee a repeat in the near-term.

Ukrainian authorities will concurrently move along two paths: continue talks with the IMF in hopes of a new stand-by agreement and simultaneously search for alternative financial instruments to meet debt obligations. Among them are domestic investors, Russian banks and Chinese loans. These alternatives may be financially less attractive than IMF loans; however, they are much cheaper politically than the potential public fall out from unpopular reforms."

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Dubai Stocks Set for Worst Drop Since March 2012 Amid Fed Rout - Bloomberg

"Dubai’s benchmark stock index headed for the biggest drop in more than a year, led by Emaar Properties PJSC, as concern the U.S. may reduce fiscal stimulus prompted a selloff in emerging markets.
Emaar, builder of the world’s tallest skyscraper, declined to the lowest in two months and Dubai Financial Market, the Persian Gulf’s only publicly traded stock market, slumped 6.3 percent. The DFM General Index retreated 2.7 percent, the most since March 2012 on a closing basis, to 2,295.85 at 1:16 p.m. in Dubai. Abu Dhabi’s ADX General Index lost 1.5 percent.
Emerging markets stocks last week tumbled 5.6 percent, the most in 13 months, as Federal Reserve Chairmen Ben S. Bernanke said June 19 that the U.S. may halt bond purchases by mid-2014. China’s manufacturing is shrinking at a faster pace this month, adding to stresses in the economy and financial system after interbank borrowing costs surged."

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UK to work closely with Deauville transition countries | - @RDavisFCO

"The Deauville Partnership with Arab Countries in Transition will help open economies, open governments and open societies to support free trade and encourage greater accountability ad transparency, regional experts said at a conference hosted by Rotary Club of Dubai to assess the outcome of the Group of Eight (G8) nations Summit 2013 held recently in Northern Ireland.
“UK, which holds the Presidency of the G8 for 2013 and takes a lead role in the Deauville Partnership, is supporting the Transition countries – Egypt, Tunisia, Libya, Jordan, Morocco and Yemen — to build more of the open economies and inclusive societies their citizens aspire to,” said Rosemary Davis, official spokesperson of UK Government in the Arab World.
The Deauville Partnership, which is formed in the aftermath of the Arab Spring by the 2011 French G8 Presidency, includes G8 members, the European Union, the Organisation for Economic Cooperation and Development (OECD), regional partners comprising the governments of the UAE, Kuwait, Qatar, Saudi Arabia and Turkey, and international financial institutions."

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UAE's Gulftainer acquires 51 percent stake in Saudi Gulf Stevedoring | Reuters

"Gulftainer Co Ltd, the United Arab Emirates' second-largest port operator, said on Sunday it had acquired a 51 percent stake in Saudi Arabia's Gulf Stevedoring Contracting Company.

The acquisition allowed Gulftainer to assume full management of three Saudi terminals, located in Jeddah and Jubail, making it the largest port operator in the Middle East by number of terminals, it said in an e-mailed statement.

At the Jeddah Islamic Port, Gulftainer will operate the Northern Container Terminal (NCT) on the west coast of Saudi Arabia, Jubail Commercial Port (JCP) and Jubail Industrial Port (JIP) on the east coast."

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Gulf can profit from improved governance - The National

Badr Jafar is an advocate of the Pearl Initiative, which advances the cause 
of good corporate governance in the Arab world. Salah Malkawi for The National
"Watching Badr Jafar at the World Economic Forum for the Middle East in Jordan last month was an object lesson in the art of networking.

The Sharjah-born executive was shaking hands with important executives one minute, chatting with senior political figures the next and then heading off to speak at opinion-forming sessions at the WEF.

He spoke of entrepreneurship and youth employment, but also found time to get involved in the WEF's initiative to restart Israel-Palestinian Territories peace talks via the business community, as well as handle the inevitable media calls."

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Abu Dhabi lender FGB buys Dubai Group's credit card firm for $164 mln | Reuters

"First Gulf Bank (FGB), UAE's second largest bank by market capitalisation, has acquired a consumer financial services firm from debt-laden investment firm Dubai Group for 601 million dirhams ($163.6 million), it said on Sunday.

The acqusiition of Dubai First, which specialises in liability and credit card products, helps FGB expand its customer base in the United Arab Emirates, the lender said in a statement.

The sale is part of Dubai Group's efforts to address its debt as it restructures $10 billion of laibilities with creditors, Fadel al-Ali, the firm's chief executive said in the statement.

A unit of Dubai Holding, the investment arm of Dubai's ruler Sheikh Mohammed bin Rashid al-Maktoum, Dubai Group has a portfolio of mainly financial services assets bought during the boom years of the mid-2000s, but which have plunged in value since the 2008 global financial crisis."

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Qatar leads GCC money supply growth on pvt sector deposits

"Driven by private sector deposits, Qatar recorded the highest money supply growth rate (37.4%) in the region during the first quarter of 2013, QNB has said in a report.

Last year, the country’s money supply growth rate was due to foreign currency deposits.

According to QNB, this reflects a significant shift in trend, compared with the traditional source of money supply growth in Qatar, which may indicate a higher growth contribution from the non-oil sector."

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Times of Oman | News :: Oman upbeat over Portugal ties

"In the midst of its financial crisis, Portugal is reaching out to Arab businesses, including Oman, for potential investors and business partners.

The Arab-Portuguese Chamber of Commerce and Industry held its first Arab-Portuguese Economic Forum in Lisbon last week in hopes of diversifying its options and attracting investment from North Africa and the Middle East.

Delegations from a dozen Arab and GCC countries attended the two-day event, in which participants discussed cooperation in infrastructure sectors, as well as energy and tourism."

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Right moment to merge DFM and ADX into one UAE bourse « ArabianMoney

"Amid the sea of red on global financial markets last week news of a concrete plan to merge the Dubai Financial Market and Abu Dhabi Securities Exchange into one national bourse barely made the headlines.

That’s a shame because this state-backed proposal makes a lot of sense. The twin UAE bourses have enjoyed an excellent year, with Dubai amongst the highest rising stock markets of the world and capped by the winning of inclusion in the MSCI emerging markets index this summer."

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