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Wednesday, 26 June 2013

Nakheel sukuk yields jump with concern over debt refinancing - The National

"Nakheel's sukuk yields spiked yesterday, as the developer discusses its options on how to refinance its upcoming debt repayments.

Yields for the developer of Dubai's man-made islands on its Islamic bonds maturing in 2016 hit their highest level since November last year. They had spiked 272.3 basis points to 10.2 per cent since May 22, when the US central bank chairman Ben Bernanke first discussed the possibility of rolling back the country's quantitative easing policy.

Bond yields move in the opposite direction from prices. Nakheel disclosed in February that it was in talks to extend a Dh8 billion loan which falls due in 2015, but reports published yesterday suggested it was talking to banks about a potential bond sale."

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HSBC tells small firms in UAE to find new lender - The National

"HSBC is putting many small business owners on notice that they have two months to find a new lender after conducting an internal review.

One 14-year customer of the bank being forced to close his account said the bank had an "obligation to service the community" and not just use them to make profits.

"HSBC has been conducting a review of all its businesses since May 2011, to meet its goal of streamlining the business and improving the return on capital. As part of this, the bank is reviewing its portfolio of small business customers in the UAE," the bank said."

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Poland: 3 options to reduce the pension-debt problem | beyondbrics

"Poland plans to reduce the role private pension funds play in the country’s hybrid pension system in order to reduce public debt as it battles an economic slowdown.

Polish stocks on the main WIG20 index rebounded from a 10-month low after the opening of trading on Wednesday once the market realised the government was not intendig to nationalise pension fund assets, the biggest investor in the local equity market.

Individual defined-contributions to private pension funds to supplement the pay-as-you-go contributions made to the social security system, ZUS, were introduced in reforms made in the late ’90s."

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Bin Nasser to Be Qatar’s Prime Minister, Al Jazeera Says - Bloomberg

"Qatar’s Sheikh Abdullah bin Nasser bin Khalifa Al Thani, minister of state for internal affairs, will be named the country’s prime minister after the emir abdicated yesterday and handed power to his son, Al Jazeera reported, citing people it didn’t identify.
The new premier will replace Hamad Bin Jassim Al Thani, who led Qatar’s government since 2007 as both premier and foreign minister. Qatar’s Emir Sheikh Hamad Bin Khalifa Al Thani yesterday handed authority to the Crown Prince Sheikh Tamim bin Hamad Al Thani after 18 years in power, saying the moment for new leadership had arrived. The new emir is due to address the nation at 6 p.m. local time today, according to the Qatar News Agency."

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Romance Wearing Thin but Not Over for Arctic Resource Exploitation | Business | The Moscow Times

"The high Arctic, once the irresistible frontier for oil and gas exploration, is quickly losing its appeal as energy firms grow fearful of the financial and public relations risk of working in the pristine icy wilderness.

The Arctic holds 13 percent of the world's undiscovered oil and 30 percent of its gas, and Russia's continuing passion for the precarious zone has been demonstrated by recent deals like the Total and Novatek LNG facility on Yamal, and the Exxon-Rosneft plan to expand their zone of exploration of the country's north coast.

But a series of blunders and failures there are making executives shy of such a sensitive area and turn their attention back to more conventional resources and the shale revolution."

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MIDEAST STOCKS-Qatari bourse rises after smooth leadership transition | Reuters

"Qatar's benchmark rose on Wednesday as trading resumed after a one-day holiday during which the emir handed over power to his son in a smooth transition, calming investor nerves.

Doha's index climbed 0.9 percent; its biggest one-day gain in two weeks that extended 2013 gains to 10.8 percent.

Emir Sheikh Hamad bin Khalifa al-Thani said on Tuesday he was abdicating in favour of his son, Crown Prince Sheikh Tamim."

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Gazprom to Pay $1Bln to Ukraine for Gas Transit in Advance | Business | The Moscow Times

"Gazprom said Wednesday that it would pay $1 billion up front to Ukraine for gas transit to finance Kiev's purchases of gas for storage and to secure shipments to Europe in the winter of 2013-14.

Gazprom ships more than half of its gas to Europe via Ukraine. This year it aims to increase exports to Europe, where it provides a quarter of gas needs, to 150 billion cubic meters from 138 bcm last year.

The company also said its upfront payments to Ukraine's Naftogaz state energy company totaled $5.15 billion, enough to cover the transit fees until the beginning of 2015. The company's statement did not make clear whether this included the $1 billion for the coming winter."

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Egypt: markets turmoil ahead of Morsi’s address | beyondbrics

"Egypt’s Mohamed Morsi is set to make a key televised address on Wednesday ahead of planned political protests against his presidency. But the markets have already voted – and it looks grim.

The 5-year CDS rose another 13 points to hit an all time high of 821.255, suggesting that investors are braced for protests, unrest and uncertainty.

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TAP set to clinch huge Azeri gas deal -

"One of the most keenly fought battles in European energy politics has drawn to a close, after a key shareholder in the Nabucco West pipeline said the project had not been chosen to supply gas to Europe.
For the best part of a decade, Nabucco has been vying with a rival project, known as the Trans Adriatic Pipeline (TAP), for the right to transport Azeri gas from the Caspian Sea to European consumers, in a crucial project designed to improve the security of Europe’s energy supplies.
The BP-led consortium that is developing the huge Shah Deniz II gasfield off the coast of Azerbaijan, which will supply the gas, had been due to announce on Friday which of the two projects it had chosen."

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Investors welcome news of Qatar transition -

"Qatar’s stock market lifted almost 1 per cent on the news of a power transition that replaced the country’s top leadership with a younger generation, signalling investor comfort with the move.
The Qatar Exchange rose 0.9 per cent at the close on Wednesday, outperforming other Gulf markets, most of which declined, according to Zawya, the regional data provider. The Dow Jones MENA Markets index slipped 0.3 per cent."

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Times of Oman | News :: U.A.E. Bank Cash Jumps as Deposits Outpace Lending

"United Arab Emirates banks are holding the most liquid assets in more than three years as government deposits surge and companies increasingly rely on the bond market for funding.

The combined loans-to-deposits ratio of the 51 banks operating in the second-biggest Arab economy fell to 90.4 percent in April, the lowest since at least March 2010 when it was 105.7 percent and Bloomberg began collecting the data. Increased liquidity has helped reduce the three-month interest rate by 38 basis points, to below the level of neighboring Saudi Arabia, the largest Arab economy, central bank data show.

Swelling liquidity at U.A.E. banks reflects a gradual recovery of the industry from the impact of the global credit crisis and contrasts with 2008, when the emirates government pledged $33 billion to ease funding after credit markets froze. Abundant cash at banks amid low interest rates may place them under pressure to boost lending or face a decline in profit margins, according Shabbir Malik, an analyst at EFG-Hermes Holding SAE in Dubai."

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New Emirates NBD CEO Faces Dual Challenges - Middle East Real Time - WSJ

"Shayne Nelson, the newly-appointed chief executive of Emirates NBD, takes the reins of Dubai’s largest bank at a tricky time. The lender is gearing up to play a more prominent international role through acquisitions, but is still grappling with high levels of toxic debt on its books.

One of Mr. Nelson’s most pressing tasks will be seek new pockets of revenue outside the bank’s domestic market, which many consider overbanked with around 50 local and international institutions. Currently, ENBD derives some 8% of its revenues from outside the United Arab Emirates, which it hopes to boost to 20% in the next three to five years.

And while the bank’s 31% rise in first-quarter net profit mirrors to a large degree Dubai’s own economic rebound, the lender’s non-performing loan ratio (the percentage of loans in default compared with total lending) remains perched at a lofty 14.2%. Emirates NBD expects this level to peak at between 15%-16% this year."

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EU interested in developing gas hub in Ukraine, says Ukrainian premier » Interfax News Wire :: Russia, Ukraine, Kazakhstan and Central Asia

"The European Union is interested in the development of a gas hub in Ukraine, Ukrainian Premier Mykola Azarov said at a cabinet meeting in Kyiv on Wednesday.

“At the meeting of the Ukraine-EU Council in Luxemburg, the concept of Ukraine’s role in the energy strategy was first formulated at the highest level and officially announced. The EU is interested in Ukraine being the European gas-energy hub, that is strategic gas stocks for the European market are stored in our territory and maneuvering energy facilities are located here,” he said.

Azarov stressed that the Ukrainian gas transport system (GTS) jointly with the underground storage facilities has unique and irreplaceable possibilities."

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Ukranian News - Average Monthly Wage 0.6% Up To UAH 3,300 In May

"The average monthly wage in May 2013 increased by UAH 20 or 0.6% over April to UAH 3,253, the State Statistics Service said.
The highest average monthly wage of UAH 5,013 was registered in Kyiv.
The lowest average wage of UAH 2,326 per month was recorded in Ternopil Region.
As Ukrainian News earlier reported, in April 2013 increased by UAH 21 or 0.6% over March to UAH 3,233."

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Azarov: Ukraine has to protect investors' funds - ForUm

"Ukrainian government should reliably protect the funds of investors, Prime Minister Mykola Azarov said, opening a meeting of the Cabinet of Ministers, ForUm correspondent reports.

"Investors are waiting for forecasted stable policy and reliable investment protection. Our task is to ensure this. Therefore, I instruct the Finance Ministry to accelerate the development of the agreement on avoidance of double taxation with Luxembourg. This work has been continuing for 10 years," Azarov said.

In addition, he instructed first deputy Prime Minister Serhiy Arbuzov to control the work on preparation of this agreement.

According to the Premier, investors want to learn the Ukrainian market, and such opportunity has to be provided."

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India: can foreign loans lift housebuilding? | beyondbrics

"The Indian authorities, as part of its effort to ease a chronic shortage of affordable housing, this week boosted a scheme that allows developers and housing finance companies to use overseas commercial loans to fund low-cost homes.

The central bank changed its regulations to make it easier for borrowers to qualify for such lending. But does external finance policy actually work?

The RBI has made amendments that reduce the minimum experience developers require in residential work from five to three years. And it is eliminating a requirement that housing finance companies have minimum paid-up capital over Rs500m ($8.39m) to use the external loans. And the $1bn overall ceiling on borrowing under the scheme has been extended until April 2015."

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StanChart: good news from the front | beyondbrics

"Perhaps all this turmoil in EM financial markets won’t have as much impact on their real economies as many investors seem to fear.

That’s certainly a conclusion that could be drawn from Standard Chartered Bank’s half-year trading statement on Wednesday, in which the group predicted a sharp improvement in the second quarter over the first three months of 2013 despite the “backdrop of ongoing turbulence in the global economy”. While the actual results won’t be out for a while, investors took the hint and marked the shares up 3 per cent.

Peter Sands, chief executive, said in the statement:"

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Online retailers develop the Russian market | Russia Beyond The Headlines

"Foreign online retailers have been actively developing the Russian market. Notably, the world's leading online auction,, made its website available in Russian in April 2013, in time to coincide with an advertising campaign on TV. According to an eBay source, the moves were all a part of a carefully weighed campaign to capture the Russian market.

Foreign online stores have surged in popularity on the back of appealing prices and a wide choice of goods, information available to Data Insight suggests. According to the agency, in 2012, Russians put through 5–8 million cross-border purchases for their personal use; these sales were worth roughly $1.3 billion, corresponding to 16 percent of total tangible product sales and up approximately 50 percent from the previous year."

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Dubai, Marcus Lee, Julia Gillard

"Julia Gillard has appealed directly to Dubai’s ruler to end the 4 1/2 year ordeal of Australian man Marcus Lee and his wife, in the hope the emirate’s prosecutors will drop an appeal against his acquittal on property fraud charges.

It is understood the Prime Minister’s letter to Sheikh Mohammed bin Rashid Al Maktoum was hand-delivered by a minister, Warren Snowden, and the Ambassador to the United Arab Emirates, Pablo Kang.

Mr Lee and his wife Julie told Fairfax Media in a statement on Wednesday: “After being in the Dubai court system for so long, and following the extreme disappointment on learning of the decision by the prosecutor to appeal against my full acquittal, we are encouraged by our situation now being raised at such senior levels.’’"

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Ukranian News - Ukraine's Foreign Debt 2.4% Down To USD 26.9 Billion, Domestic Debt 3.0% Up To UAH 227.6 Billion In May

"In May, Ukraine's direct foreign debt fell by 2.4% or USD 0.67 billion to USD 26.877 billion as of May 31 (against the USD 27.547 billion as of April 30), reads a statement made by the Finance Ministry.
In May, direct domestic debt rose by 3.0% or UAH 6.631 billion from UAH 220.953 billion (USD 27.643 billion) to UAH 227.584 billion (USD 28.473 billion).
In May, total direct public-sector debt increased by 0.3% or UAH 1.274 billion, from UAH 441.137 billion (USD 55.190 billion) to UAH 442.411 billion (USD 55.350 billion)."

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Ukraine eyeing 25-bln-USD shale gas investment from Chevron : Ukraine News by UNIAN

"Ukraine is hoping Chevron Corp. will invest 25 billion U.S. dollars to develop the potentially large Olesska shale gas deposit in its west, a senior energy official said Tuesday, according to Xinhua.
"This sum exceeds the amount of foreign investment that Lvov and Ivano-Frankovsk regions have attracted over the 20 years of Ukraine's independence," Volodymyr Ignashchenko, adviser to Ukraine's minister of ecology and natural resources, said during a visit to Ivano-Frankovsk city.
The Olesska deposit stretches across Lvov and Ivano-Frankovsk regions."

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Oil below $100 highlights widening gap in OPEC pain thresholds | Reuters

"Oil's fall below the $100 a barrel favoured by OPEC exposes the deepening divide between countries in the group better able to cope with a lower price and those most hurt by it, making collective action to halt any further price slide harder.

The price of oil dropped below $100 this week from a 2013 high of $119.17 in February, pressured by lacklustre demand and ample supply. While a sustained sub-$100 Brent is bearable for Saudi Arabia, it puts a strain on others such as Iran.

There is no immediate prospect of the Organization of the Petroleum Exporting Countries cutting supply to boost the price, not least because top producer Saudi Arabia - which would lead any cutback - has financial reserves that will help it endure oil at $80 or $90."

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The ending of the golden era for Qatar? « ArabianMoney

"If ever there was a hard act to follow among the Gulf leaders then it would be Sheikh Hamad bin Khalifa Al Thani, the Emir of Qatar who bowed out gracefully yesterday in a peaceful transition of power to his son.

In his 18 years of rule the GDP of Qatar surged from $30 to $200 billion, and the nation flourished, investing in everything from Islamic art to football clubs and Harrods. Sheikh Hamad was the gas man who really delivered."

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EM capital flows: after the party | beyondbrics

"The US Federal Reserve signalled the coming end of QE only a month ago, but forecasters are already producing long-term forecasts of the possible impact on emerging markets of the expected cut in easy money.

That’s brave, given the amount of noise in the market. On Wednesday, the Institute of International Finance, the banker’s club, pitched in with a report predicting a drop in net private capital flows to EMs over the next 18 months to the lowest level since 2009. That sounds bad, given that 2009 was a grim year. But the IIF’s numbers are a bit less gloomy than its top line.

The IIF says private capital flows into EMs are forecast to fall from $1,212bn in 2012 to $1,145bn this year with a further drop to $1,112bn in 2014. That will indeed be the lowest figure since 2009, but DM-to-EM capital flows then totalled only $649bn. Since then they have been rolling along in the $1,100bn-$1,200bn range."

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Abu Dhabi stock market revives derivatives plan - The National

"Stock market officials are reviving plans for a Gulf Derivatives Exchange capable of trading the most sophisticated financial products.

The Abu Dhabi Securities Exchange is dusting off plans first mooted in 2005 but shelved after the eruption of the financial crisis, itself brought about by derivative bets gone wrong.

"What stopped us was the crisis. Immediately we said 'let's reprioritise', and we put it on the shelf," Rashed Al Baloushi, the ADX's chief executive, told The National."

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China State Construction Plans to Invest in Dubai Island Project - Bloomberg

"A China State Construction Engineering Corp. unit agreed to invest in a $1 billion hotel and luxury-residential project on Dubai’s man-made island.
The state-owned developer, based in Beijing, formed a venture with SKAI Holdings, the project’s owner, the companies said today in a statement. The resort will include a 481-room hotel and 221 suites as well as 250 serviced apartments on the trunk of the palm-tree-shaped island known as the Palm Jumeirah.
“We can’t disclose the size of the investment,” SKAI Holdings Chief Executive Officer Kabir Mulchandani said by phone today. “It’s large enough to give the Chinese company joint management control of the project.”"

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UPDATE 1-Dubai hires C.Suisse for Tunisia telco stake sale-sources | Reuters

"Dubai Holding's telecoms unit has hired Credit Suisse as a financial adviser to sell its 35-percent stake in state-owned Tunisie Telecom, three banking sources aware of the matter said.

The unit - Emirates International Telecommunications (EIT) - is stepping up sales from its telecoms portfolio as part of a wider strategy by the emirate's state-linked firms to sell assets to repay its debt pile.

EIT has already put its 26-percent stake in mobile telephone retailer Axiom Telecom on the block and has hired Citigroup Inc as an adviser, sources told Reuters earlier in the week."

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Qatar shows how to manage a modern monarchy -

"The Emir of Qatar’s decision to abdicate voluntarily in favour of his 33-year-old son may well be a first in Arab dynastic politics. Although unlikely to presage a bicycling monarchy for the fabulously gas-rich Gulf emirate, Sheikh Hamad bin Khalifa al-Thani’s infusion of new blood contrasts with the hardened arteries next door in Saudi Arabia – not to mention the republican dynasties that went down like skittles in the Arab spring.
He seems to have prepared the ground carefully. The new emir – Sandhurst-educated Sheikh Tamim bin Hamad al-Khalifa – has had a solid 10-year apprenticeship, grounded in the army and security services, the institutional teat of Arab rulers."

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