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Monday, 4 November 2013

Bahrain parliament moves to take back Gulf Air bailout | GulfNews.com

Bahrain parliament moves to take back Gulf Air bailout | GulfNews.com:

"Bahrain’s struggling national carrier, Gulf Air, could be forced to hand back a BD185 million (Dh1,802,257,) bailout to the government, according to reports out of Bahrain.
A Bahraini English language newspaper — Gulf Daily News reported that the Bahraini parliament has urged members of parliament to veto a royal decree that handed Gulf Air the bailout more than year ago.
Last year Bahrain’s parliament and Shura Council rejected a request from Gulf Air to be handed BD664.3 million cash injection. The government instead proposed heavy cost cutting measure including significant layouts and a BD185 million bailout."

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Ukraine to continue talks with IMF, premature to talk about outcome, says source

Ukraine to continue talks with IMF, premature to talk about outcome, says source:

"Ukraine will continue its negotiations with the International Monetary Fund (IMF) for the restoration of a Stand-By Arrangement and it is premature to talk about their outcome until they are finished, a source in the government has told Interfax-Ukraine.

"The work on a set of measures to reduce economic risks and fiscal imbalance is continuing. The complexity of this work lies in the fact that it is necessary to not only develop effective instruments but also give reason for the proposals in such a way that their realism is considered by the IMF. The negotiations with the IMF will continue," said the source.

"If the negotiations are not finished, it's not proper to talk about their results or adopt specific economic decisions. Ukrainians will learn about the decisions made in the context of cooperation with the IMF as soon as they are agreed and approved. Now any statements on this issue are premature," the source said."

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MIDEAST STOCKS-Egypt gains in cautious trade as Mursi trial begins; Gulf muted | Reuters

MIDEAST STOCKS-Egypt gains in cautious trade as Mursi trial begins; Gulf muted | Reuters:

"Egypt's bourse gained in cautious trading on Monday as ousted President Mohamed Mursi's trial began, while most Gulf markets edged up with investors hungry for fresh catalysts after strong early-year rallies.

Mursi's trial on charges of inciting violence was adjourned to January 8 on Monday after he interrupted the session repeatedly. His now-banned Muslim Brotherhood movement has said it would continue staging street protests to pressure the army to reinstate Mursi.

Cairo's benchmark index climbed 0.6 percent, trading sideways since it hit a near three-year high last week.

"People are being cautious to avoid (losses due to) any tensions," said Islam Batrawy, a Cairo-based trader. "The market volumes are improving and there can be a more sustained upward trend going forward but we need to see what might develop from the court case.""

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Frosty Reception: Rouhani's thaw doing little to rid skepticism of US - YouTube

Frosty Reception: Rouhani's thaw doing little to rid skepticism of US - YouTube:

"Iran's supreme leader is warning the country's hardliners against undermining the nuclear negotiations, defending the President's course of action. Within Iran, there's deep skepticism of any good intentions from Washington, when it comes to the country asserting its right to atomic energy. One former adviser to Iran's nuclear negotiating team told us that's because people see the US is engaged in constant double-speak. The worsening economic situation inside Iran means the country's finding other ways to make ends meet. China has reportedly agreed to finance various projects by unblocking 22-billion-euros of oil assets. Beijing and Tehran deal in the Yuan, not the dollar, so the sanctions don't affect China's business with its third-biggest crude oil supplier. Political analyst Seyed Mohammad Marandi says the US agenda is splintering.


"

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Guest post: Egypt’s economy, propped up but struggling | beyondbrics

Guest post: Egypt’s economy, propped up but struggling | beyondbrics:

"The Egyptian economy is being propped up by loans, grants, direct deposits and fuel shipments worth billions of dollars from Saudi Arabia, Kuwait and the United Arab Emirates following the toppling of former president Mohamed Morsi and removal from power of the Muslim Brotherhood (MB) in July this year.

Although such aid has allowed Egypt’s authorities to launch ambitious spending on infrastructure to jump start the economy, it also allows them to postpone painful but necessary structural reforms.

Cairo’s investment programme for the fiscal year to June 2014 will help achieve real GDP growth projected at 2 per cent in 2013 and 3.5 per cent in 2014, according to a Bloomberg survey of market economists."

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Doing business in Russia: Tricks of the trade | Russia Beyond The Headlines

Doing business in Russia: Tricks of the trade | Russia Beyond The Headlines:

"If Hollywood movies are to be believed, foreigners are scared witless of doing business in Russia. Russian businessmen look more like hardened criminals, and any attempts to work honestly in the country crash against an impenetrable wall of bureaucracy — or so it is said.
But those foreign businessmen who have actually come to Russia don't seem to be in any great hurry to leave.
"It is not at all like the stereotype portrayed in Western media,” says Simon Fentham-Fletcher, a financier from Manchester."

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UPDATE 1-Dubai developer DAMAC plans $500 mln London share listing | Reuters

UPDATE 1-Dubai developer DAMAC plans $500 mln London share listing | Reuters:

"* DAMAC to sell GDR receipts on London exchange

* Citigroup and Deutsche Bank appointed joint bookrunners

* DAMAC would be first property firm to IPO after Dubai crash

DUBAI, Nov 4 (Reuters) - Dubai developer DAMAC Properties said on Monday it plans to raise around $500 million from a sale of global depositary receipts on the London Stock Exchange as it seeks to take advantage of a recovery in the emirate's property market.

A London listing would make DAMAC the first major property firm in Dubai to conduct an initial public offering since the emirate's property market imploded in 2009.

Each GDR will be worth 3 ordinary shares in DAMAC, the regulatory filing said. A GDR is a certificate that represents a block of shares in a company. GDRs are often issued by firms in emerging market states to allow foreign investors to buy the stock more easily."

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Should I stay or should I go? Ukraine’s EU gamble — RT Business

Should I stay or should I go? Ukraine’s EU gamble — RT Business:

"Tough admission standards could keep Ukraine’s trade integration with the European Union on hold, and if the process is dragged out long enough, it may be forced back into the arms of its ex-Soviet ally, Russia.

European Union ministers will meet on November 18 ahead of the Vilnius summit and decide if Kiev has met enough criteria to sign the dotted line on its trade association agreement.

The Ukrainian government approved their draft resolution on September 18 and the agreement will either get a ‘yes’ or ‘no’ at the Eastern Partnership Summit in Lithuania on November 28-29.

If European Union officials reject Ukraine from their trade association, Kiev will need to reconsider Moscow's proposal to join the Russia-led Eurasian Customs Union.
"

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New UAE mortgage cap pushes out end-users | GulfNews.com

New UAE mortgage cap pushes out end-users | GulfNews.com:

"There is broad agreement that the new mortgage rules announced by the UAE central bank would help prevent a re-run of 2008 in Dubai’s property sector. But a corollary of the new situation is that a large segment of potential buyers has been priced out of the market.
After much deliberations and controversies, the central bank capped the loan-to-value (LTV) limit at 80 per cent for UAE nationals and 75 per cent for expatriates for the purchase of the first house, with a limit on the multiples of annual income eligible for mortgage finance. The rules came closely on the heels of a doubling of property registration fees, from 2 per cent to 4 per cent, in a clear move to discourage flipping, which was the genesis of Dubai’s property crash that ended the unprecedented boom.
There is nothing unusual about these measures as property markets around the world have adopted similar steps to prevent overheating. In fact, Dubai’s moves are less stringent than the clampdown by the Singapore and Hong Kong authorities, faced with a threat to the stability of their respective markets."

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Project bonds could be the next frontier of long-term financing in GCC | GulfNews.com

Project bonds could be the next frontier of long-term financing in GCC | GulfNews.com:

"Project bonds could become a reliable and cheaper source of funding for long term projects such as utilities and infrastructure projects in the context of economic diversification and a new wave of infrastructure spending happening in the Gulf countries, said Karim Nassif, Associate Director, Infrastructure Finance at Standard &Poor’s.
Speaking to Gulf News in an interview, Nassif said infrastructure spending in the GCC is estimated at a total $2 trillion over the next 20 years, largely driven by Qatar’s spending for World Cup in 2022 and growing demands on utility companies. An estimated $100 billion of investment is required in the Saudi power and water market alone through to 2030. The region is also diversifying away from upstream oil and gas revenues through large industrial and energy-related projects. Additionally a number of corporate and infrastructure financings obtained through shorter term funding routes are coming up for refinancing, which could boost the bond issuance in the region."

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Gulf states must create jobs to avoid unemployment due to decreases in oil reserves | The National

Gulf states must create jobs to avoid unemployment due to decreases in oil reserves | The National:

"At least 51 million jobs are needed by 2020 to avoid a rise in unemployment among Arabian Gulf nationals, experts have warned.

With regional oil reserves decreasing, a major challenge will be to move towards wealth creation by the private sector.

“We can see, based on projections by the International Monetary Fund, that between now and 2017, there are structural changes happening in the world,” said Dr Hatem Al Shanfari, a professor in economics and finance at Sultan Qaboos University and a member of the board of governors at the Central Bank of Oman."

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IDB $10bn sukuk plan to lift Dubai’s global Islamic finance ambitions | The National

IDB $10bn sukuk plan to lift Dubai’s global Islamic finance ambitions | The National:

"A planned US$10 billion rolling programme of sukuk issues by the Islamic Development Bank (IDB) will be a major boost for Dubai’s ambitions to be a global hub of the Islamic economy, financial experts predict.

The IDB announced it had sought the approval of regulators at the Nasdaq Dubai stock exchange for the series of Sharia-compliant bond issues, which could begin trading over the next year. It would more than double the value of sukuk listed on Nasdaq Dubai so far this year.

The IDB announced the programme after the World Islamic Economic Forum in London last week, where it was also decided that the next forum would be held in Dubai in 2014."

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Oil company Cepsa plans $10bn expansion in next five years | The National

Oil company Cepsa plans $10bn expansion in next five years | The National:

"Compania Espanola de Petroleos (Cepsa), the Spanish oil company owned by Abu Dhabi’s International Petroleum Investment Company (Ipic), plans to spend US$10 billion in the next five years to expand its exploration and petrochemical businesses in North Africa, South America and South East Asia, its chief executive said yesterday.

“Since Ipic became the single shareholder of Cepsa in the summer of 2011, the emphasis is on becoming more international through expansion,” said Pedro Miro, who was in Abu Dhabi for yesterday’s Formula One race.

“Expansion into two areas – upstream and concessions, and the second area is petrochemicals.”"

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Iran Burning Gas Worth Billions to Lead Exporters Amid Sanctions - Bloomberg

Iran Burning Gas Worth Billions to Lead Exporters Amid Sanctions - Bloomberg:

"Iran will lead a club of the world’s biggest natural gas exporters as its own shipments abroad are hampered by U.S. and European Union sanctions that force the country to burn off billions of dollars worth of the fuel.
Mohammad Hossein Adeli, the country’s former deputy foreign minister, was elected secretary-general of the Gas Exporting Countries Forum, whose 13 member countries hold of 60 percent of the world’s reserves, the group said yesterday in a statement. Adeli, who will replace Leonid Bokhanovsky of Russia next year, vowed to turn the Persian nation into a “major player among the gas exporting countries,” he told reporters after a group meeting in Tehran.
U.S. and EU trade sanctions over Iran’s nuclear program have cut the Persian nation’s crude exports, its largest revenue source, by half since 2011 and are stifling projects to export some of its gas reserves, the world’s largest. Iran is one of three GECF members that are net importers as the group faces increased competition from liquefied natural gas projects from the U.S. to Australia."

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Agreement with IMF is best response to question on Ukraine's solvency, says expert

Agreement with IMF is best response to question on Ukraine's solvency, says expert:

"Ukraine as a sovereign borrower should agree with the International Monetary Fund (IMF) as soon as possible, and if the agreement is reached and the new cooperation program is approved, this will allow unfreezing almost ready projects with the World Bank and the European Commission, Morgan Stanley Ukraine Director Ihor Mitiukov said.

"And with the reference to this [the country] will give a clear signal to the market that we know how to cope with the debt burden and the deficit of the balance of payment next year, as this is the main question, on which there is no answer now," he told Interfax-Ukraine.

He said that as for the macro-financial aid of other international financial organizations, apart from IMF, this is several billions of U.S. dollars."

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Saudi Gazette - Gulf becomes magnet for global portfolio investors

Saudi Gazette - Gulf becomes magnet for global portfolio investors:

"Foreign money is flowing into the parts of the Middle East which need it least as the Gulf becomes a major destination for global portfolio investors and political instability deters investment elsewhere in the region.

When uprisings swept across Egypt, Tunisia and other Arab countries more than two years ago, the Arab Spring looked as if it might have a very different impact.

By clearing out corrupt rulers and installing democratic governments focused on raising living standards, the uprisings promised to open markets to more competition and attract fresh foreign investment in much of North Africa and the Levant.

The Gulf, which escaped major political change, seemed to offer less exciting opportunities as conservative monarchies girded themselves to resist the threat of unrest, backing away from politically sensitive reforms of their economies."

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Saudi Gazette - Tadawul share value plunges 26.8% in Oct

Saudi Gazette - Tadawul share value plunges 26.8% in Oct:

"The value of shares traded on Tadawul stock market reached SR83.75 billion 1.50 million transactions executed during October 2013.

At the end of October 2013, Tadawul All Share Index (TASI) closed at a level of 8,044.47, gained 79.56 points (1 percent) over the close of the previous month.

On an YTD basis, TASI registered a positive increase of 18.28  percent (1,243.25 points). Highest close level for the index during the month was 8,170.75 as on Oct. 24.

Total equity market capitalization at the end of October 2013 reached SR1,620.37 billion ($432.09 billion), increased by 2.18 percent over the close of the previous month."

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